Perspective Of The Week
"Making Money Off Other People's Entertainment"
As you know by my name, I love dividends. And in addition to sharing on here, I write regularly in the investment platform- Seeking Alpha.
My goal there is to teach everyday investors about building wealth, so they won’t to need to work to traditional retirement age.
I want to help you take control of your life, have F.I.R.E.
Yesterday I got back from a vacation in Las Vegas, a place I usually visit at least 3 to 4 times a year. For months I had been reading and seeing reports that Las Vegas was dead.
This past weekend was anything but. However, it did happen to be a busy holiday (weekend) with Mexican Independence Day and there a huge boxing event. But the perspective I wanted to give readers this week was changing the way you view your investments.
At Dividend Collection Agency, my goal is to change your perspective on investing instead of just telling readers or followers what and when to buy. Changing your entire thought process is how you become a successful investor in my opinion.
VICI Properties (VICI) is a REIT that many are likely familiar with. And most know that they own properties on the Las Vegas Strip. While many investors prefer to own physical real estate, I’ve always preferred to own REITs.
REITs are a way to receive income from real estate, but without the tenant headaches. But what’s most attractive about owning VICI is that you get paid from other people’s entertainment. And it only would cost you $32 a share.
I remember years ago joking with colleagues about going to Las Vegas to check on my properties. Although they considered this to be a joke, this is how I view my holdings, as businesses. If you owned a business or physical property, wouldn’t you stop by to check on it frequently?
Las Vegas is widely known as one of the most popular tourist destinations in the world. And while foot traffic has declined as consumers have been impacted by high interest rates, Las Vegas isn’t going anywhere anytime soon.
Did you know that VICI is the largest owner of hotel room real estate in the United States? VICI also owns 26 undeveloped acres on the strip right behind Planet Hollywood and the land underneath the Sphere.
They also own some of the most popular hotels on the strip like Caesar’s Palace, The Venetian, Mandalay Bay, & MGM Grand to name a few. But current and potential investors shouldn’t view this as just buying a stock. Look at yourself as a real estate owner of the most iconic assets in the world.
VICI Properties also owns golf clubs, spas, health & wellness centers, theme parks, and indoor water parks. What do they all have in common? They’re entertainment hubs where people gather to get an experience.
Las Vegas is also known for partying. There’s a reason it’s nicknamed Sin City. Those popular nightclubs? Hakkasan? Omnia? The ones that usually have long lines on Friday & Saturday nights? Owning VICI means you own a piece of those and get paid from young partygoers that frequent those destinations.
VICI also owns casinos in Canada, the Chelsea Piers in New York, and hotel & casinos in Biloxi, Mississippi. As an investor, this is how you should view your investment, partial ownership. And not just as a stock you hold.
VICI also continues to expand with $450 million invested in a new project in Beverly Hills, California. This is expected to be 17.5 acres of entertainment and luxury shopping with plans to be completed by 2027. And because of its location, this will likely draw in a lot of high-end shoppers.
Aside from the high quality real estate VICI owns, the stock also pays a nice dividend yield over 5% of $0.45 a share on a quarterly basis. Moreover, VICI has grown its dividend at a rapid rate since going public in 2018 with a CAGR of 6.6%. And from the chart below, you can see this is significantly higher than peers.
So, not only can you brag about owning some of the highest quality real estate owning VICI, you get paid from consumer spending. And with Las Vegas being an entertainment hub that’s continuing to grow, your dividends will likely continue growing for the foreseeable future.
One thing for sure, people will not stop vacationing and seeking experience. Therefore, VICI will likely continue investing and owning quality real estate in tourist destinations all over the world.
So, when considering becoming a real estate owner, owning REITs like VICI Properties is one of the best ways to start.
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