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Penn National Gaming Inc. Message Board

  • hairyape59 hairyape59 Dec 26, 2012 12:26 PM Flag

    First gaming REIT...

    Not Penn, but if i remember right, Richard Rainwater split his Cresent REIT company similarly OpCo & REIT for tax reasons.

    Anyone remembers how it ended? Maybe they went private, because i haven't heard so much about them since late 90's.

    Sentiment: Hold

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    • I think the order was different. Rainwater started Crescent REIT as an office REIT and later bought anything and everything under the sun, including some hotels. Crescent Operating was formed in 1997, before Crescent had gotten into gaming, and it operated some of the businesses where Crescent REIT owned the properties. Later OpCo owned all sorts of businesses, but I don't think either Crescent company was ever predominately hotel or gaming. At one time, Crescent was supposed to buy Station Casinos but I think it backed out of the deal.

      Anyway, OpCo was liquidated in bankruptcy in 2003 or so, and Crescent REIT was acquired by a Morgan Stanley fund in 2007, just before the real estate market cratered.

      The PENN deal seems to be different, at least at the start, because the only assets to be owned by the REIT are ones that are operated by PENN. Crescent REIT had lots of outside tenants, which made the tax issues a lot simpler.

      At least I think that's what happened.

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