VICI Properties achieved investment-grade status across all three major rating agencies after Moody's Investors Service upgraded the casino landlord's rating to "Baa3" from "Ba1" with a stable outlook.

The upgrade marks a significant milestone for VICI, as investment-grade ratings from all three agencies (Moody's, Fitch, and S&P Global) typically result in lower borrowing costs and improved access to capital markets. This is particularly important for REITs that rely on capital markets for acquisition financing.

VICI's CFO David Kieske emphasized the company's strategic approach to improving its balance sheet through transformational transactions, leading to these credit rating improvements. The upgrade follows VICI's strong third-quarter results, which included a second increase to their 2024 adjusted funds from operations (AFFO) guidance.

Moody's cited several positive factors in their assessment:

• Dominant size and scale
• Resilient operating cash flow
• Good liquidity
• Disciplined financial policy
• Strong fixed charge coverage of 4.5x
• Improved Net Debt/EBITDA ratio of 4.7x (as of September 30, 2024)

However, Moody's noted tenant concentration as a significant challenge. VICI's top two tenants, Caesars Entertainment and MGM Resorts International, represent approximately 39% and 35% of total annual cash rent, respectively.

While VICI maintains significant revenue generation from the Las Vegas Strip through these partnerships, the company has expressed interest in diversifying through acquisitions outside Las Vegas and investments in non-gaming leisure properties across the United States.

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