Land & Buildings acquires stakes in Boyd casino shares, MGP

Posted: May 18, 2021, 7:26 a.m.

Last update on: May 18, 2021, 11:20 a.m.

Land & Buildings Investment Management, LLC (L&B) handled casino stocks in the first quarter, adding new positions in Boyd Gaming (NYSE: BYD) and MGM Growth Properties (NYSE: MGP).

L&B Boyd
Land & Buildings founder Jonathan Litt. His company acquired stakes in Boyd Gaming and MGM Growth Properties in the first quarter. (Picture: the Wall Street newspaper)

Jonathan Litt’s firm is considered an activist investor with a knack for focusing on real estate assets. Boyd and MGP are two of four stakes added by the fund manager in the first three months of the year, and the only two playing names among that quartet. L&B sold off a stake in Caesars Entertainment (NASDAQ: CZR) – one of three names it dropped between January and March.

L&B bought 341,787 shares of regional casino operator Boyd during the quarter, valued at $ 20.15 million at the end of March, according to a Form 13F filed with the Securities and Exchange Commission (SEC). The activist investor also bought 344,771 shares of MGP, worth $ 11.24 million as of March 31.

Boyd has lost 7.82% over the past month. But there’s a good chance L&B is in the green on this position, as stocks are higher today than they were at any time in January, February and the first half of March.

Some analysts like the operator because it plays on renewed consumer confidence, rising levels of coronavirus immunizations, and the strength of key demographics, such as people 55 and older and residents of Las Vegas.

Future plans uncertain for Litt and Boyd

Boyd operates 28 gaming sites in 10 states, including 11 in Nevada. The company owns almost all of the real estate on which its casinos reside.

It is not immediately clear whether L&B plans to push Boyd to monetize his real estate assets. Such a declaration is not made in 13F repositories. However, this is the type of scenario Litt is well versed in. He took a stake in MGM Resorts International (NYSE: MGM) in 2015 and pushed the casino giant into the MGP spin-off. L&B manages part of the MGM complexes.

His plans for the Real Estate Investment Trust (FPI) casino are also not public knowledge at this point. Last week, the company bought MGM Springfield from its former parent company for $ 400 million.

By buying MGP shares in the first quarter, not only is Litt’s company sitting on a noticeable gain, it was in the stock before the MGM Springfield deal was announced, and that’s an advantage because the REIT has said the transaction would add to Adjusted Operating Funds (AFFO) per share.

VICI Gaming REITs and Properties

As L&B added MGP to its roster in the first quarter, it reduced its position in another gaming REIT, bringing its stake in VICI Properties (NYSE: VICI) to 776,537 shares from about 1.01 million.

Last year Litt pushed Gaming and Leisure Properties, Inc. (NASDAQ: GLPI) – the other publicly traded gaming REIT – to merge with VICI. This agreement was not successful and L&B finally liquidated its position in GLPI.

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