Bally's, a Providence-based casino operator, is cashing in on the real estate for two of its Rhode Island properties in a $1B sale-leaseback deal.

The company is selling the properties for its Bally's Twin River Lincoln Casino Resort and Bally's Tiverton Casino & Hotel to Pennsylvania-based Gaming & Leisure Properties, and Bally's is leasing back the casinos, the companies announced Wednesday.

The deal was announced less than a week after the creditors for $1.9B of Bally's debt hired legal representation for a potential dispute with the company, according to Casino.org. The creditors can forbid efforts to amend the current credit agreement, which Bally's needs to be altered to move forward with its sale of the Lincoln Casino Resort property.

The two Rhode Island casinos each sit within 60 miles of Boston. Rhode Island legalized gambling before 2000, but it took years for its casinos to open, with the $220M Twin River casino debuting in 2007 and the $140M Tiverton casino opening in 2018. The state is now competing for gamblers with Massachusetts, which welcomed the MGM Springfield casino in 2018 and the Encore Boston Harbor in 2019.

Bally's operates 14 casinos in 10 states including the two up for sale in Rhode Island. GLP is its landlord for four other casinos, though Bally's owns the majority of its properties. For the Rhode Island deal, GLP agreed to pre-fund a deposit of $200M to the company with Bally's paying a $9M transaction fee at closing.

In May, Bally's won a bid to develop a $1.7B casino and hotel on the Chicago River near the midwestern city's Near North Side. The funds from leaseback are also assumed to be used to fund the Chicago project.

In February, Wynn Resorts reached a similar agreement for the Encore Boston Harbor casino, signing a $1.7B sale-leaseback deal with Realty Income.