A Caesars Entertainment employees union says the firm’s plan to spin off assets into a REIT as part of its bankruptcy plan would only lead to an even more hopelessly indebted business.
More debt would make the business vulnerable to a downturn in the gambling industry, union Unite Here! says, as the firm awaits an update from the Chicago bankruptcy judge overseeing the firm’s reorganization. The union has long been opposed to a casino REIT, Bloomberg reports.
Under the current proposal, Caesars Entertainment would leave bankruptcy as two distinct entities—one would be a REIT that owns the land, hotels and casinos, and the other would rent the properties from the REIT and run the business. The REIT would be $6.05B in debt, the second-highest level of any retail REIT with similar rental contracts. [Bloomberg]
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