Gaming and Leisure Properties, Inc.

Greetings and welcome to the Gaming and Leisure Properties fourth quarter 2025 earnings conference call and webcast. At this time, all participants are in a listen-only mode. A question and answer session will follow a formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce Joe Giaffone, Investor Relations. Please go ahead.

Thank you, Paul, and good morning, everyone, and thank you for joining Gaming and Leisure Properties' fourth quarter 2025 earnings call-in webcast. The press release distributed yesterday afternoon is available in the Investor Relations section on our website at www.glpropinc.com. In addition to the fourth quarter press release, GLPI also posted a supplemental earnings presentation, which highlights the events of the quarter, recent developments, and future considerations in That can also be accessed at www.glpropinc.com. On today's call, management's prepared remarks and answers to your questions may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements address matters that are subject to risks and uncertainties that may cause actual results to differ materially from those discussed today. Forward-looking statements may include those related to revenue, operating income, and financial guidance, as well as non-GAAP financial measures such as FFO and AFFO. As a reminder, forward-looking statements represent management's current estimates, and the company assumes no obligation to update any forward-looking statements in the future. We encourage listeners to review the more detailed discussions related to risk factors and forward-looking statements contained in the company's filings with the SEC, including its 10Q and and in the earnings release, as well as the definitions and reconciliations of non-GAAP financial measures contained in the company's earnings release. On this morning's call, we are joined by Brandon Moore, President and Chief Operating Officer, Desiree Burke, Chief Financial Officer and Treasurer, Steve Ladney, Senior Vice President and Chief Development Officer, and Carlos Santorelli, Senior Vice President, Corporate Strategy and Investor Relations. With that, it's my pleasure to turn the call over to Brandon Moore. Brandon, please go ahead. Thanks, Joe.

Good morning, everyone. We appreciate you being on the call today. And before we dive into the quarter, I'll address the obvious absence of Peter on our call this morning. For those of you that have been dialing into these calls at GLPI and prior to that Penn for the last three decades, Peter's voice is the one you'd expect to hear. But unfortunately, he's unable to join us this morning due to some lingering back issues he's been having, and he's having a procedure this morning ahead of some upcoming travel to get him back on his feet. So we'll miss him this morning. But he asked us to share some prepared remarks, which I will do, and then turn over to Desiree, and then we'll move to your questions. So moving on to Peter's remarks, we enter 2026 in an enviable position with what I would consider to be the most visible line of sight towards healthy multi-year AFFCO growth that I can recall. Our pipeline entering 2026 is deep, with $2.6 billion of future capital commitments poised for deployment over the next 24 months. Our balance sheet is well positioned to support our growth without the need for incremental capital, and our tenants, as evidenced by our robust rent coverage metrics, remain healthy. We recently completed the acquisition of Valley's Lincoln, an asset we have long coveted, for $700 million at an accretive 8% cap rate. while also closing on the real estate related to Cordish Live Virginia project, to which we have committed an incremental $440 million towards the development. In addition, funding remains ongoing in Bally, Chicago with roughly $740 million left to spend towards the development as of 12-31. The project remains on schedule for the first half of 2027 opening with the hotel tower surpassing the 20th floor. On the tribal front, we eagerly anticipate the grand opening of the IOWN Bands Acorn Ridge Casino next week, while development activity at Caesars Republic Sonoma remains ongoing. Overall, we believe the strength of our tenants, the strength of our leases, the depth of our pipeline, and the condition of our balance sheet position us well to continue to execute and grow the business in 2026 and beyond. With that, I'll turn it over to Desiree, and then we'll move to questions.

Thanks, Brandon. Good morning. For the 4th quarter of 25, our total income from real estate exceeded the 4th quarter of 24 by over 17Million dollars. This growth was driven by cash rent increases of over 23Million resulting from acquisitions and escalations. For Bally's, the acquisition of Bally's Kansas City and Shreveport real estate increased their cash rent 6.6Million. The Chicago leased increased cash income by 2.6Million and the Bell Development increased cash rent by 1.9Million. For Penn, the Joliet funding and M-Resort funding increased cash income by 4.4 million. The Sunland Park and strategic acquisition increased cash income by 3.2 million, and then the recognition of escalators and percentage rent adjustments on all of our leases added approximately 4.3 million of cash income. The combination of non-cash revenue gross-ups, investment and lease adjustments, and straight-line rent adjustments partially offset these increases, resulting in a collective year-over-year decrease of $6.2 million. Our operating expenses decreased by $37.8 million, mainly due to a non-cash adjustment in the provision for credit loss. Included in today's release is our guidance for 2026 AFFO between $1,207,000,000 and $1,222,000,000 or between $4.06 and $4.11 per diluted share in OP units. The guidance does not include the impact of future transactions. However, it does include our anticipated development fundings of approximately $575 to $650 million related to current development projects such as Chicago, ION, Marquette, Dry Creek, and Virginia. These will be funded relatively evenly by quarter throughout 2026. In addition, the acquisition of Penn's Aurora facility for 225 million is expected late in the second quarter of 26. And the completion of the 700 million Lincoln acquisition, which is now complete, was also anticipated in our guidance. Lastly, the anticipated settlement of 363 million of our forward equity is expected on June 1st, 2026 in our guidance. From a balance sheet perspective, our leverage ratio is at 4.6, well below our targeted and historic levels. Given our current balance sheet position, the several-year one-way to fund our development projects and our annual free cash flow over that timeframe, we have optionality to fund our future accretive commitments. As a reminder, our significant development projects pay us cash rent upon funding. And our rent coverage ratios on our master leases are now ranging from 1.69 times covered to 2.6 times covered as of the prior quarter end.

With that, operator, please open up the line for questions.

Thank you. We'll now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys. One moment, please, while we poll for questions.

Thank you.

Our first question is from Ronald Candom with Morgan Stanley.

Great. Just two quick ones. If we could just start on Valley Chicago. that development project and so forth. If you could just give an update on sort of the milestones, how that's sort of going. I saw they, you funded some of that in 4Q with some left to go. Thanks.

Sure. There was a report actually, I think, I don't know which publication put it out this morning about the crane movement over the weekend. But the project's going well. We would estimate that it's over 20% complete at this point. There's over 300 employees or average daily crew on the site. Hotel structure, as was mentioned in the opening remarks, we're currently on level 21 of what will be 34 floors total. The curtain wall glass is started on the sixth floor. It's currently on the eighth floor on the hotel. And on the casino podium, we're nearing completion of the phase two structural steel. and the decking. So the project is moving along nicely. I think that you've probably noticed they put out a request to extend the length on the temporary facility. We expect that the project should conclude and open sometime in the first half of 2027. And so I think from that perspective, I don't know if anyone else has anything to add.

The only thing I would add to that, Ron, is the development timeline that we have contemplated here internally at GLPI is consistent with the message that Steve just delivered. First half 27 opening, our development financing has kind of stretched out that long. So despite the request that many of you saw a couple of weeks ago, there's been no change from our perspective.

Great. And then, you know, my second question was just, you know, on the pipeline, you know, obviously Lincoln is through and you got that done. Sort of any comments on, you know, I remember there was sort of a lender consent that I needed to go through and so forth, how that sort of progressed along. And then any broader comments on the pipeline in general between tribal and non-tribal would be helpful.

I'll talk a little bit about the 1st part. I think I think with the Aries refinancing that they announced that the lender consent was solved. So that that was the impediment on Lincoln. They solve that with the refinancing that opened up Lincoln for us to acquire. So that that 1's pretty easy. I'll address a bit of the pipeline. I think obviously there's a lot of stuff we can't talk about here internally at the company on the tribal side. We continue to have gain traction with various tribes with different uses, potential uses. For our capital structure, we obviously announced dry creek recently. Um, you know, I wouldn't say anything is eminent there, but but there are a lot of really productive conversations going on with tribes that would involve our new financing structure. So we'll see. Anybody I don't know if you guys have anything down on the pipeline.

Yeah, I think the supplemental has a great slide on page 8 with the pipeline. Right? So we have the 2.6Billion, which 700Million has now been completed. So we're down to 1.9Million and all of the projects are listed there. And as I said, the guidance does include between 575 and 650Million of the development funding. So those projects that I mentioned that are development. And then, in addition, we have the Aurora project for $225 million left to occur.

Great. That's it for me. Thanks so much.

Our next question is from John Kilichowski with Wells Fargo.

Hi. Good morning. Thanks for taking my question. The first one for me is just both on Vegas and New York. I don't know if you can give us updates on either of those projects, whether there's an idea of what commitments will look like. I know that we have a number on Vegas, but there's room for expansion. Then New York, if we can start to talk about sizing of opportunity there.

Yeah, I'll take the first part of it with Vegas, and then I'll turn it over to Steve to talk a little bit about New York. I'm in Las Vegas. What I can tell you is Peter and I were out there together last month to visit with the A's team and to walk the site and their experience center. The stadium is progressing at a pretty rapid rate. I think they're actually a little bit ahead of schedule on the stadium now. And all I can say is I think they're building a spectacular product. I think the site will see a first-class stadium product that's not just a baseball stadium but also an entertainment venue. which I think is really important for this site. You know, they, they bring fans very close to the field with this new stadium and it opens itself up quite nicely for, uh, you know, 25 to 30,000 seat entertainment venue. So I think both we and folks in Vegas are very excited about the potential that that attraction brings to the site with respect to the integrated resort. You know, we're really looking to valleys to finalize their plans. They've released a lot of renderings and some preliminary permit applications for the site. They've indicated that they intend to phase the site, which is not any surprise to us. And at the present time, we're sitting on our remaining commitment of 125Million. We'll consider investing more in the property as the details of the property become more available. I think. The key for us is to ensure that whatever investment we have in the property, that the revenues that will be generated there can support our rent. We've been hyper-focused on coverage since the day we spun out. We'll continue to do that, and Vegas is no exception. So I think it's a great opportunity. It's a great amenity that the A's are bringing to that site, and we'll see how Valleys looks to take advantage of that.

I can, I can speak to New York. I mean, with, with respect to New York, we continue to view valleys development as an attractive opportunity in New York. And we would certainly like to be a participant. That said, we recognize that there's likely no sort shortage of capital providers for that project. And there's continued interest that we continue to hear about. So. Um, you know, we, we remain in constant discussion with them. We're monitoring the process. I'm not sure that they'll need our capital. Um, so I guess the, the, to put it Frank, I think to dispel any notions that may exist, we do it very unlikely that we would end up providing the majority of the capital for a 4Billion dollar project there. We're going to continue to evaluate the process and the project, and we'll look to try to be as as, uh, you know, strategic as possible with respect to any involvement.

Got it. That's helpful. And then for my second question, maybe, could you provide a timeline on the Virginia Live project?

Timeline.

Well, they opened the temporary in January, and they're beginning the preparation and groundwork on the permanent site. I don't think we have a timeline from Cordish, a definitive timeline from Cordish for opening at this point in time. You may recall from our previous discussion, their capital goes in first. So our funding on that will be after the equity portion of the Cordish Group's capital is in. So we don't expect to be funding that until the latter half of... of 2026 into 2027. I don't really have any other updates on.

John, I think for your purposes, the lion's share of our spend related to the remaining $440 million will occur in 2027. There is likely to be some spend modest relative to the $575 to $650 million that we guided in development. Some modest element of that will likely relate to Virginia later in the year.

Got it. Thank you. Thanks, Tom. Our next question is from Mitch Germain with Citizens Bank. Mitch, are you there? Mitch, is your line up?

Sorry about that. Yeah, sorry about that. When did the economics of the Lincoln transaction change? I mean, obviously, I know the cap rate was the same, but I think I had seen $735 as a purchase price.

Yeah, I think, Mitch, when we came time to exercise that option, we had done some new underwriting on the project. There was a little bit of competitive pressure from the tribe and some other things. And in working with Bally's and focusing on the rent coverage, we decided to lower the rent a little bit, which lowered the purchase price. So I would look at it as finding the right level of rent to put into Master Lease 2 that would come out with a pro forma coverage we were comfortable with. and the rent just yielded that purchase price. So we didn't change the cap rate. We just changed the rent.

Got you. And then with the live project, is it just a traditional lease, or will you guys also have a percentage rent option on any of the food and beverage options?

Traditional lease. Great. Thank you. Thanks, Mitch.

Our next question is from Barry Jonas with Truist Securities.

Hey, guys. Good morning. First off, hope Peter gets better soon. Discussions around iGaming and skill-based games in Virginia are back again this legislative session. How would you guys handicap these things actually getting passed, and how could that impact the Cordish project and your underwriting? Thank you.

Hey, thanks, Barry. So, look, the skill-based stuff is a little bit harder to answer. I think with respect to the iGaming, obviously, there's been a lot of headlines recently. Some of the, I think, thinking maybe a little bit ahead, some of the stuff that's getting passed is more of a passage for the purposes of being able to continue discussion. There's still some reconciliation between the two bills that need to occur. I think with respect to the Cordish project, what's important to remember, and you could kind of evidence this from looking at the leases in Pennsylvania and Maryland, the underwriting of these leases has always been strong. They're written to be strong. They've done nothing but produce great resorts that cover our rent very thoroughly. I don't see there being any reason to believe this project will be any different than the others out there. Obviously, iGaming will be interesting and how it ultimately gets done, if it gets done a couple years down the road, could benefit some of the land-based operators in this instance.

Great. Thanks for that, Carlo.

Just as a follow-up on Acorn Ridge, has all the funding been completed as of today, or does any bleed over into future quarters? I know it's opening in four days. And then is the expectation still that the tribe decides in 5 years, whether to convert this to a Sally stack, or could something happen sooner?

Thanks. So, all of the funding has not been completed. We expect it to being completed over the next few months. There is always a lag between doing the construction and us actually making sure the construction is complete and is thorough before we will fund. So there is a lag and on the. second part of your question.

It's certainly possible that they could convert that to a long-term lease at the end of the five years, but we don't have any indication at the present time that they've made a decision to do that in five years, let alone to do that sooner. But if they came to us and wanted to convert the loan sooner, I think we'd be amenable to that.

Perfect. Thanks a lot, guys. Our next question is from Smedes Rose with Citi. Hi, thank you.

I just wanted to add to this a little bit about sort of the pipeline and willingness to continue to commit capital. You know, you mentioned 2.6 billion over the next 24 months, a very robust pipeline now. But given sort of I think somewhat challenged cost of equity capital, and you've already talked about, you know, having to move leverage up a little bit, I realize well within your, you know, the comfort ranges. But, you know, how do you think about adding new projects at this point? And I guess in general, what's sort of the tenor of sort of conversations like with folks who might be interested in, you know, coming to you for capital?

So, I'll start on the leverage piece and then turn it over to Steve to talk to you about, you know, our expectations for projects, new projects. So, we are at 4.6 times levered and if you layer in what we just did with Lincoln, that would get us to just below 4.9 times. We do have the $363 million forward equity outstanding towards the projects. We also have quite a bit of free cash flow. In 2026 towards the projects, we certainly don't have to hit the debt or equity markets at any near term for these projects. And we do believe we have them all funded. You know, theoretically on our balance sheet, we know where the money is coming from for the projects.

Yeah, with respect to the pipeline, look, I think we, we continue to be active. Um, we're, we're not, uh, turning away a creative transactions underwritten based on, you know, our current, uh, equity cost of capital associated with our and then our cost capital with the debt respects. We're ongoing discussions. Because of where we sit from a leverage profile, it gives us some flexibility. The development transactions that we might discuss with any parties, obviously, there's a timing component. So, I think that we give ourselves an added amount of time to raise the capital and decide what form it's going to come in. I think with respect to regular way sale leasebacks, we would obviously look to fund those at the time in which they were completed. And I think those, you know, we would welcome those discussions and have welcomed those discussions. And so I think we continue to be as thoughtful as possible. But I don't see any interest here to turn away business just because there's a bunch of business already underwritten and signed up.

Thank you.

I appreciate it. We do have quite a bit of availability on our ATM program as well. So, if in the future we want to raise equity, it's still there. And so, we leave a penny of optionality for future commitments.

Great. Thank you. Our next question is from Brad Heffern with RBC Capital Markets.

Yeah. Hey, everybody. Thanks. Best wishes to Peter. Hope the procedure goes well. GOP obviously has one of the highest growth profiles in net lease, great visibility over the next few years. Bally seems to have gotten better. At the same time, the stock continues to trade at a discount. Why do you think that is? And is there anything that you guys can do about it?

Hey, Brad, it's Carlo. Yeah, everything you said is accurate. Obviously, you guys could do the math and see what the growth trajectory looks like. The balance sheet's in really good position to fund it. And the stock does trade where it trades. You know, I think in our conversations, certainly there's a lot of things people can point to. Obviously, the stock performance amongst our tenants is one. There are certainly some issues within the industry as it relates to lease coverages and things of that nature that I think have unnerved some folks. We feel very good about where our leases stand from a coverage perspective, but there's certainly some bigger picture items out there. The equity trading of our tenants certainly being one that you know, does come up quite frequently. And I think those things have harnessed our valuation to a certain extent.

Okay. Got it. Thanks. And then on the funding for Twin River, I know you have a revolver balance that's there for tax reasons related to prior Bally's acquisitions. Is there something similar for Twin River, and how much of the revolver might that represent?

Yes.

So, we did use the revolver for that. As we told you, we would have to to get the Valley's tax benefits, and we did borrow on the revolver for that transaction.

Okay. Is it all of it, or is it a subset of the total?

It's the majority of it, $679 million of it, and there were some units also associated with that transaction.

Okay. Thank you. Our next question is from Chad Baynon with Macquarie.

Hi, good morning. Thanks for taking my question. You guys have made a lot of progress and really broken the mold just in terms of activity with tribes. The recent debate or new input is around prediction markets in markets where tribes might have a little bit more exclusivity. on the land-based side. So given the CFTC's view or maybe even support of this new potential competitor, how are you seeing that in your conversations or maybe future pipeline with tribes in these markets? Do you think that will affect your activity? Thank you.

I guess the long and short of it is I don't think that'll have an impact on our activity with the tribes. I can tell you that the tribes in California, for example, are very focused on being able to offer sports betting exclusively, and the prediction markets obviously threaten that. So they're very active on the legislative front, but I don't see that impacting any of the things we're working on in tribal country, at least not today. If predictive markets become A genuine threat to the it's obviously an underwriting concern and things we'll have to take a look at. But as we sit here today, it's currently not something that I think will impact our tribal investments at the present time.

Based on based on the conversations we've had with tribes and underwriting we've done with respect to the properties that we're. We've currently entered into agreements with and others we've even diligence. No one's making the predominance of cash flow from sports betting. So I think from from that aspect, there are many different areas that they are producing adequate cash to support any type of long term financing structure. But it hasn't been a it hasn't been a predominance from a sports betting angle.

You know, it could certainly be an upside to some of these properties and add revenue, which would be good to the extent that it's a downside on the predictive markets or iGaming side. We're underwriting these deals with such a wide level of coverage that I think that the incremental downside threat to those currently is not something that would impact the durability of our cash flow coming off these. But certainly cognizant of it, and we keep an eye on it. And if things change, then our underwriting will change.

Great. Thank you for that. And then just in terms of interest in the Las Vegas locals market, you know, the S4 was out on one of the deals that was announced, I think, between now and the last time you guys reported. So we have a little bit more insight into that. You know, that market continues to do really well just in terms of, you know, people from California moving there and just the overall wealth effect and retirement effect. Is that still a market that you're interested in? And do you think there could be additional opportunities, maybe even at, unfortunately, a slightly higher cap rate than what you're used to doing? Or I'm sorry, lower cap rate. Thank you.

Yeah, I think I think the short answer is yes, of course, we were interested in Las Vegas locals market. We're very pleased with the performance at the M resort, which we own and we, we get, we get inbound calls around that asset with interest. So I think we continue to have interest. Obviously, Boyd and Red Rock have large presence there, but there are many smaller operators that own individual or or a handful of assets. And we've looked at those in the past and we'll continue to look. So we definitely have an interest. It's a good market. You're right about the demographic shift and some of the movement from California. And we'll continue to try to be active there where it fits.

Thanks.

Our next question is from Anthony Paolone with JP Morgan.

Great. Thank you. With regards to the pipeline beyond what's teed up right now, can you talk about how much of it is perhaps development transactions versus straight-up acquisitions? How much might be more just straight-up gaming versus something more adjacent? Just a little bit more colors to what that pipeline looks like and maybe what the impediments have been to get anything else done there.

Sure, I'll give it a shot and then anybody can add what other thoughts they may have. So. I think I think that the, the reality is there's, there's probably, I'd say half of the pipeline and things we're looking at. It probably would fall in the development part, but it's not because they're greenfield. I would tell you, I think that large gaming operators today. are spending plenty of time looking at their own assets and their own portfolios that they currently hold and figuring out where can they make strategic capital investments to better their performance and increase their cash flow. So Many of the things that I would put in that 50% bucket are existing assets that people are reinvesting in. Whether it's things like Boyd did at Treasure Chest or Penn's done at their Columbus property and resort and a few of their Illinois properties. So we've seen a number of instances of people redeveloping properties, adding to properties, expanding properties, and I think that will continue. I think with respect to some of the smaller or private gaming operators, some of those are new jurisdiction, new opportunity things where, of course, those would fall in the development pipeline. But I think stepping away from that, there are plenty of discussions that we're having around what I would consider to be more traditional sale leaseback. The reality is, though, most of those are portfolio type of projects, and therefore M&A is not a quick discussion, right? So these things take months to talk about, work through details and effectuate. So I think the pipeline, honestly, if I'm being frank, is probably 50-50. And in the 50 in the development, it's not all greenfield. I'd say a large portion of it, two-thirds of that even, is probably existing properties looking to reinvest in their own assets. With respect to non-gaming, I wouldn't consider anything to be in our pipeline on that front. I think there are plenty of discussions we have and plenty of things we look at, but I wouldn't consider anything to be so close to being effectuated soon that we would consider it to be actually actionable in the pipeline.

Okay. Thanks for all that. And then just my follow-up relates to the spending guidance for 2026. And as I look across the pipeline and what you have teed up, I mean, where are the – I mean, I guess Chicago is the obvious one, but where do you think the big swing factors are that can get you, you know, either at the low or high end or above the range there? Because it seems like there's enough teed up where, you know, money could get spent maybe perhaps above the range, but I'd love to hear from you all what you think.

I mean – you know the range was developed by you know looking at our development projects and it's all of them but the largest one clearly is chicago with the most spend in 2026 but you know there could be movement and timing of when it's funded or what gets completed and when it is completed that is outside of glpi's control so that's the reason for the you know spread between 575 and 650 and to be honest with you it's not a very large spread Um, I agree with you, it could be higher, it could be lower, right? It depends on how the construction is progressing at all of those projects. And there are 5 development projects currently going on. So it could. You know, we, we really in our best estimate of what we think will happen in 2026.

And then, Anthony, just to add to that, two of the projects, including Live Virginia and the Caesars Republic project, our capital doesn't turn on until other capital is spent. So you're looking at kind of the time in which that capital is deployed prior to us going in. So there is some ambiguity as to when we'll eventually get started there.

Okay. Great. Thank you. Our next question is from Jay Kornreich with Cantor Fitzgerald.

Hey, thanks. Good morning. I just wanted to ask on just the overall gaming transaction marketplace. As interest rates have come down a bit to start the year, is that opening up new conversations where whole co-owners are coming to the table and starting to more seriously think about selling the real estate? Or is it maybe too soon to have a read on that?

I don't think too soon is the right answer, but I don't think those a lot of these conversations don't pivot on the Treasury rate. Right? So, it's not like someone wakes up 1 morning and decides that 10 basis points change their lives. And now they're interested in the sale lease back. So, most of these conversations are long lived. I think that comps that happen in the marketplace dictate more how people feel. So when people see a deal get cut at 7.5 cap rate, all of a sudden sellers decide that, oh, maybe I'm more like a 7.5 cap rate. And then if they see things like the Lincoln transaction we did at 8%, hopefully they're paying more attention to that and decide that the marketplace is more at 8%. But I say it in jest. But I think the reality is that those conversations don't just, it's not spur of the moment. It's not totally driven by debt. I think that the, if the credit markets were to gap higher, not really lower, but higher, I think that's when people maybe start to look at alternative financing sources as a sale lease backs possibly that solution. But just because rates get a little better, I don't know that it really changes a lot of the dynamic in the marketplace.

Okay, I appreciate that. That's all for me.

Our next question is from Greg McGinnis with Scotiabank.

Hey, good morning.

Tony, I was just looking at the kind of the rent resets to the percent rent resets on a couple of the leases on the amendment pin call and Boyd master. Are you giving any sort of guidance on that front?

No, we're not. I mean, we are not including the pinnacle escalation in our guidance. I can tell you that. But the amount of the percentage run adjustment, since it's going to happen in the middle of the year, is fairly insignificant for the year. So, we have not provided detailed guidance on that.

Okay, thanks.

And follow up with, you know, this intensifying relationship with valleys. if we do kind of some back of napkin math, it does seem like that they're on the casino business, at least given the debt structure, even with the new term loan in place, which is all massively kind of improved the company. Casinos are still generating negative cashflow. I mean, do you guys view that differently or do you think that it's kind of once Chicago delivers and Vegas opportunity in New York, they just kind of have to get through these, this next couple of years and then everything's clean again. Yeah.

Yeah, I mean, look, I'm not going to bless the math, but what I would say is, I mean, Bally's is in a, right now, a development period where they're in the process of three, you know, large-scale casino developments. And it's been a long time, but when you look at, you know, a lot of the companies in the gaming space today, I mean, a lot of them went through these eras where there was a lot of development and not a lot of in-place EBITDA to support it. And I think Bally's continues down this path. It's clearly... Chicago, New York, and Las Vegas. And it's a lot of, you know, incremental EBITDA associated with that stuff and a lot of spend to get there. But, you know, I don't think your math is necessarily wrong, but it's temporary.

Okay. Thank you. Our next question is from Dan Guglielmo with Capital One Securities.

Hi, everyone. Thank you for taking my questions. On your call a few quarters ago, I asked if investors are too focused on what could go wrong kind of versus what could go right. And it feels like the 26 Guide is a testament to what is going right. So are you all starting to feel more supported on the equity side of things, or is there still kind of a ways to go?

I think there's still probably a ways to go on the equity side. I will say, you know, we've been steadfast in our messaging on this. You know, we have not been confused about what 2026 and 2027 would deliver. I think there are a number of different factors that Carlo highlighted near the beginning of the call that could be weighing on the stock. But if the question is, you know, are we happy with a $46, $47 stock price? The answer is clearly no. We did our equity forward around the $48 price. We'll give you a better indication of where we think equity might be actionable. But no, I think we have some room to run in the stock. And I agree that what we're showing you for 26 and into 27 is exactly what we anticipated. And we believe it should be reflected in the price.

Daniel, I'll add to that. Brandon mentioned the $48 level. We used the ATM previously. A lot's gone right since then. Numbers have moved in the right direction. You look at the stock, we're trading at kind of a two-turn discount. Our dividend yield is close to 7%. Our balance sheet is levered at a much more conservative rate than most of our peers, and our FFO growth over the next two years is at a premium to most of our peers. So you put all that together, and I wouldn't say that the stock where it is today is something that makes us incredibly happy.

The cap rate has definitely crept up, and that's you know, not where we want to be.

Great. Yeah, I appreciate all that color. And then kind of a follow up on the price. We generally think that property portfolios should trade at a premium to kind of single properties, but it doesn't seem like you guys are getting that benefit. Am I wrong in thinking that the portfolio premium just doesn't seem to be there right now?

means for us.

I wouldn't say that's wrong.

I think whether that's the reason or not, I don't know. And I would agree with your premise that obviously the portfolio provides a level of safety that the single asset doesn't necessarily provide, and hence a premium should be associated with that. But I think that could be one of several things that maybe our valuation right now is not fully incorporating.

I definitely think the cross-collateralization in our leases is a very important value point. And I certainly hope it's not at not getting a premium, right, because it does give quite a bit of credibility to our leases.

Appreciate it. Thank you. Our next question is from John Decree with CBRE.

Hey, everyone. Thanks for taking my question. I think you guys kind of highlighted our note on just how valuable your stock is right now. So I appreciate all that, Carlo. Maybe one question back on New York, maybe a nuanced one, but are you guys exclusive to ballet, Steve? I think you said... We shouldn't expect you to be kind of the majority of the financing structure for Bally's, but if there were opportunities to partner or invest in the other projects, is that something you could or would look at?

Yeah, we, we are not, we are not exclusive to valleys. We, we would look at, I think I said this on the prior quarterly calls when we, when they hadn't yet won the licensing. I mean, we were, we were open for business and happy to discuss other projects. I think I think the 1 things were 1 thing that is worth noting, though, with respect to us being involved or having discussions like, we, we do value ownership of real estate. And therefore, we've yet to do a loan that didn't have a linkage to either a future right to acquire real estate or some type of real estate ownership accompanying with it from the start. So I would think that any discussions we have with any of the other parties involved would be under the same type of guise, that we have to have a path to owning real estate or a piece of ownership of real estate to start with. That would be the premise, but yeah, no, we're not exclusive and we're happy to have conversations. Please give me a call.

Thanks, Steve. One more on Canada. So there's, there's some discussion of possibly expanding in Niagara to, you know, the Vegas of the North, I think was the comment made. Have you guys spent much time studying candidates at a market that GLPI would look to invest in or, Own real estate and if the right opportunity were to come up and what are your considerations there?

Yeah, we spent a lot of time looking at various projects in Canada. I think if you're familiar with Canada, you recognize that it's different province to province. So the economic drivers in each 1 are a little different. But but if we can find the right project in Canada, we certainly be interested in that. And part of the problem is there is, you know, some tax leakage in getting the dollars from Canada back to the U.S. So that weighs on the underwriting, but we've looked at a lot of different projects there and just haven't found the one that was accretive enough for us to take the dive.

Thanks, Brian. That's helpful. I appreciate you guys fielding all the questions and give Peter our best for a quick recovery. Hope he's back on his feet soon.

Yeah, we'll certainly do that. Thank you.

Our next question is from Rich Hightower with Barclays.

Yeah, hey, good morning, guys. Most of my questions have been answered, but I'll go back to, I guess, a little bit of the background on how the Lincoln purchase price was revised based on sort of shifting coverages. For me, it brings up a larger question. If 2X coverage was kind of the gold standard previously, I think given all of the different factors affecting land-based gaming as we see them before us in the context of 30-plus year leases? I mean, is the higher going in coverage maybe the superior way to underwrite these projects going forward? How do you feel about that?

Well, I'll start and then others can weigh in. I mean, I think a two times coverage is still a nice standard to look at to start. I think each market and property is different. So you got to look at what the factors weighing on the different markets in the property in order to and the help, you know, the credit level of the parent company, whether we have master leases or other properties that we can look to. There are a lot of different factors that go into the coverage. But I think as a starting point, looking at two times is still probably the right place to start. But I'll Steve or Carlo might have a view on that as well.

I mean, to state the obvious, we would love every lease to be struck at three times coverage, but there's obviously a market dynamic and there's a negotiation that will take place. But I agree with everything Brandon said. I just think the reality is, of course, if all of our leases were covered the way the Cordish leases were covered and we were entering into each new lease at three times, I think we'd be totally comfortable with that and would be very happy with that.

I think each of these transactions, you know, we're entering into partnerships for the most point and there's a necessity for the tenant and the landlord to succeed in these. And so the tenant also has. It has an incentive to balance getting the most dollars versus protection and coverage and flexibility in the least moving forward. So, so these are all active discussions and negotiations and would a seller take a coverage level lower than we would pay? Absolutely. What would a seller want a coverage level higher? And would that may knock us out of the box could be, but I think it's a dynamic conversation you have with with sellers between sellers and buyers right now in the market.

And, Rich, just the level set on that specific transaction, you know, as we pointed out, the 4-wall coverage was north of 1.9 times, and that was put into a lease that was robustly covered and obviously could have taken on more rent, and that mass release now is north of 2.2 times. So, I think that one there is not necessarily entirely indicative of kind of a single asset standalone, given where it was going. Yeah, I think you've heard from us in the past.

We very much value four-wall coverage. And so when we look at these leases, we're not depending on corporate credit to support the leases. So we're looking at four-wall coverage. Corporate credit's nice to have. Parent guarantees are nice to have. They're valuable. But we're underwriting these to stand on their own. And so I think what you saw with Lincoln and our discussions with Bally's was taking a little bit less rent up front creates a little bit stronger coverage in that lease, and we were happy with that.

Great. Thanks for the call, guys. Our next question is from Todd Thomas with KeyBank Capital Markets.

Hi, thanks. Good morning. Just sticking with Lincoln, I guess. Brandon, was the competitive pressure that you cited, was that specifically at Lincoln or was it around some of the other assets in that Bally's master lease and And then do you see those competitive pressures abating in the near term, or do you think that some of those headwinds persist for a period of time?

So my comment was unique to Lincoln. The Mashpee tribe at first light has expanded their facility, but I think it's stabilized. So I don't think it's getting better. I don't think it's getting worse. I think we're comfortable where that is. A lot of their funding is coming from Genting, and Genting obviously has a very large project in New York now that they need to fund And so we're less concerned about future expansion of that project. That being said, planning for the future and underwriting a little bit more rent coverage there seemed to be the prudent path, and that's what we did.

Okay, helpful. And then, Desiree, the use of the revolver to fund the majority of the $700 million acquisition, so that capacity or, I guess, amendment was completed back in December of 2004. I think specifically for Lincoln and post-closing, can you just remind us now how that works, the bridge component to that credit facility, whether you're considering any interest rate hedges and also when that can be sort of permanently financed? I guess, what are the mechanisms around that now and that funding with the revolver?

Yeah, so we definitely did plan for this in 24. it wasn't just for the Lincoln transaction. We could actually use that bridge revolver for any transaction that we had that had a guarantee. We knew Lincoln was on the horizon at the time. So that was the primary 1. we've also used it for the other transaction that we did earlier in the year. Last year for valleys. So. we don't like no we have two billion dollars so that takes a billion off that leaves us with over a billion dollars of a line of credit still so we will you know consider what to do in the markets when the time is right okay but that's all that's all floating today on the revolver are there any

Any plans to hedge some of that? And then how long does that need to be outstanding on the revolver specifically?

I think, Todd, we are actively looking at managing our balance sheet, and we understand a Lincoln transaction just came in. So I think you can assume we're cognizant of the fact that that debt is sitting there and it's variable rate debt, and we're taking a look at that. And I think, unfortunately, that's all we can say at the present time.

Okay. All right. Thank you. Our next question is from David Katz with Jefferies.

Morning. Thanks for taking my question. I know that this has been discussed from a few different angles, but, you know, with respect to Bally, who is, you know, as Carlo pointed out, you know, in a very high development mode with a little bit, you know, with EBITDA coming later on. You know, particularly with Las Vegas and then New York behind it, you know, do you think about sort of putting, you know, any limitations or boundaries around, you know, exposure to a singular tenant during that kind of a ramp-up? Or, you know, is that something you're comfortable just compensating for, you know, with cap rates and terms and coverage? Or... you know, is there an amount with a, any singular tenant that you would sort of put some boundaries around?

I mean, as you know, Penn, we have a very large exposure to Penn, you know, Valley's exposure has been growing. So it's not that we have a limit on the exposure to a tenant. We really look at the opportunity that we're funding and the four wall coverage at that property and making sure that it's a good investment option for GLPI. I wouldn't say that we're going to put a limit on some tenants

You know, how much of our balance sheet they are and the reality, the reality is that we, we, we did put a limit on them from the start in Las Vegas. Right? So we, we, we said, 175Million dollars total exposure.

That's a limit on the project.

Correct. Correct. That's yes. So that's what I'm saying. If your questions about New York and Las Vegas are, we're going to look at each project and make a determination based on our underwriting of the project, the situation, what other capital is coming in. To the project so I would say there's no hard and fast ruled as Desiree was pointing out But I think that you can rest assure we're also not we're also not diving headfirst into every opportunity just because of the name on the building understood and so the You you haven't said this but you know, it's fair of us to infer that, you know come New York You know, there may be some some limitations around that too. I

Depending again, depending on what the circumstances are and how it evolves.

I think New York is somewhat unique in this sense. We would have to look at the total project, which we haven't seen. We don't fully understand and think about how much exposure we would want. And the tenant may lean in. It may influence how much exposure we'd be willing to take in a project like New York. But I think overall, we have to sit and look about how much exposure we want in any project. And that's effectively what we did in Chicago. We took a look at the Chicago underwriting and the project and decided that we wanted to cap our exposure at roughly 1.1 1Billion. And that's what we did. And I think we take a similar approach to New York and valleys as our tenant may or may not weigh into how much exposure we'd be willing to take based on where they are when that project funding is needed. If it's needed. I know that's kind of a non answer, but the reality is, I think this depends on the project and the tenant and a lot of the factors going going into it.

And I think in New York, as you're probably aware that there's going to be no shortage of funding for them. And if there's an opportunity for us to play a role, as Steve said earlier. Great, we welcome it, but I do believe that project in particular has quite a few suitors.

Yeah, I appreciate all the commentary. Thanks.

We have time for one further question.

Our last question is from Robin Farley with UBS.

Great. Thanks for squeezing me in here. Just going back to the New York project, you mentioned that there's a lot of interest in financing it, but you've also, you know, previously, I think on the last earnings call, you talked about how you would want to see something, I forget your exact word, but it was, you know, significantly more than two times rent coverage kind of suggesting that maybe it wasn't as attractive to GLPI to fund it. So I guess if you could, I don't know if you could shed any light on that, and given what you're describing as interest in funding that project, would you say the likelihood is that GLPI is not participating in that, given that you're, and maybe your feelings have changed since last quarter, but just on your thought about, you know, the risk factor there. Thanks.

Yeah, I'll have to go back and look at the comment on significantly more than 2 times covered. I suspect that it had to do with our indication that we would like to own the land. And if we were to only own the land in that project, we'd be significantly more than 2 times covered. Would we do something down to 2 times covered? I only say no, because I think to get to 2 times covered, you're going to have to invest in a majority of the build in the project. And I think what you've heard from us is we're unlikely to be a majority all of the hard costs in the project. Therefore, our interest in a piece of that project is probably such that the coverage will end up being much higher than 2 to 1 on our piece. So we may have, we may have not been clear on that, but I think the point is. Our appetite for a piece of New York is probably small enough to where the coverage will be quite high. If we do it, that being said, we do have a significant appetite to participate in the projects in New York. We think there'll be good projects. And I think there's a lot of detail that need to need to be flushed out. For us to really make any kind of true investment decision and as Carlo and others have alluded to, I think the ability to raise capital unique to the New York project. will result in a very competitive field of suitors for capital, and we won't do anything dilutive. So, what I think you won't see us do is compete down to a cap rate that's not accretive to GLPI. That won't be of interest to us.

Great. Thank you. Thank you.

At this time, I would like to turn the floor back over to Brandon Moore for any closing remarks.

Thank you. Iz, hopefully you've heard today, you know, we were very bullish for 26 and 27. I think we worked hard to create a pipeline that many of you have asked for over the course of our evolution here at the company. And we're actively looking to add to and extend that pipeline as we move forward. So we're excited about the days ahead, and we appreciate all of you dialing in.

Thank you.

This concludes today's conference. You may disconnect the lines at this time. Thank you for your participation.