DKNG - Casino REITs: The House Always Wins

• Game On? Casino REITs - the highest dividend-yielding REIT sector - have slumped over the last quarter amid renewed COVID concerns, but continue to provide strong value for income-oriented investors.
• VICI Properties plans to acquire MGM Growth Properties, forming one of the world's largest real estate owners and giving the firm a dominant competitive position in the critical Las Vegas market.
• Despite their ultra-long term triple net lease structures, casino REITs provide excellent inflation hedging characteristics. VICI Properties, in particular, has one of the most inflation-hedged lease structures of any REIT.
• We remain bullish on the Casino REIT sector as a whole, which we view as a more compelling - and perhaps "under the radar" - alternative to other seemingly "cheap" sectors facing stiffer secular headwinds.
• Casino REITs - which emerged in the late 2010s - should eventually trade at multiples that are in-line or above their traditional net lease peers and we discuss several catalysts that will drive this re-pricing.

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