VICI PROPERTIES INC. (VICI) FY 2023 MD&A

ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of the financial condition and results of operations of VICI Properties Inc. and VICI Properties L.P. for the year ended December 31, 2023 should be read in conjunction with the audited consolidated Financial Statements and notes thereto and other financial information included elsewhere in this Annual Report on Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report on Form 10-K, including information with respect to our business and growth strategies, statements regarding the industry outlook and our expectations regarding the future performance of our business contained herein are forward-looking statements. See “Cautionary Note Regarding Forward-Looking Statements.” You should also review the “Risk Factors” section in Item 1A. of this Annual Report on Form 10-K for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by such forward-looking statements.

OVERVIEW

We are an owner and acquirer of experiential real estate assets across leading gaming, hospitality, entertainment and leisure destinations. Our geographically diverse portfolio currently consists of 93 experiential assets consisting of 54 gaming properties and 39 other experiential properties across the United States and Canada. Our portfolio also includes certain real estate debt investments, most of which we have originated for strategic reasons in connection with transactions that either do or may provide the potential to convert our investment into the ownership of certain of the underlying real estate in the future. In addition, we own approximately 33 acres of undeveloped or underdeveloped land on and adjacent to the Las Vegas Strip that is leased to Caesars, which we may look to monetize as appropriate. We also own four championship golf courses located near certain of our properties, two of which are in close proximity to the Las Vegas Strip. We conduct our operations as a REIT for U.S. federal income tax purposes. We conduct our real property business through our operating partnership, VICI OP, and our golf course business through a TRS, VICI Golf. For additional information with respect to our business and operations, refer to Item 1. - Business.

Key 2023 Highlights

Operating Results

•Collected 100% of rent in cash.

•Total revenues increased 38.9% year-over-year to $3.6 billion.

•Net income attributable to common stockholders increased 124.9% year-over-year to $2.5 billion, and net income attributable to common stockholders per diluted share increased 94.8% to $2.47, primarily due to the impact of our CECL allowance in the prior year and the timing of our transaction activity.

•AFFO increased 29.1% year-over-year to $2.2 billion and AFFO per diluted share increased 11.8% to $2.15.

Significant Achievements

•Invested over $4.1 billion to acquire 51 properties and added $291.5 million in annualized rent to our portfolio.

◦Made first international property investments through the acquisition of eight gaming assets in Canada.

◦Acquired 39 other experiential properties, representing our inaugural investments in the sports and family entertainment categories.

•Originated six debt investments totaling $698.2 million of commitments.

◦Made first international loan investments in connection with our partnership with Cabot, in Saint Lucia and Scotland.

◦Funded new and existing loan commitments totaling $959.1 million.

•Announced an increase in our quarterly cash dividend to $0.415 per share (or $1.66 per share on an annualized basis) in the third quarter of 2023, representing a 6.4% increase compared to our previous quarterly dividend.

•Completed a 30,302,500 share forward equity offering with an aggregate offering value of $1.0 billion, which was settled in each of April, July and October 2023 for aggregate net proceeds of $960.5 million.

•Sold 21,365,397 forward shares under our ATM program during the year with an aggregate offering value of $643.0 million and settled 29,788,250 forward shares outstanding under our ATM program for aggregate net proceeds of $945.7 million.

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SUMMARY OF SIGNIFICANT ACTIVITIES

Acquisition and Leasing Activity

The following table summarizes our acquisition and leasing activity (each as defined in the column titled “Transaction”) for the year ended December 31, 2023:

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(1) Investment represents acquisition of the existing leasehold interest associated with Chelsea Piers from Chelsea Piers L.P. in a sale-leaseback transaction. The $71.5 million outstanding Chelsea Piers loan was repaid in full and terminated in connection with the closing of the acquisition.

(2) Amount represents USD equivalent to C$221.7 million investment based on the exchange rate at the time of closing.

(3) Amount represents USD equivalent to C$17.3 million rent based on the exchange rate at the time of closing.

(4) Simultaneous with the entrance into the CNE Gold Strike Lease, we entered into an amendment to the MGM Master Lease in order to account for MGM’s divestiture of the operations of Gold Strike and to reduce the annual base rent by $40.0 million.

(5) Amount includes the assumption of BREIT’s $1,497.0 million pro rata share of an aggregate $3.0 billion of property-level debt, which matures in 2032 and bears interest at a fixed rate of 3.558% per annum through March 2030.

(6) Amount represents our pro-rata share of the MGM Grand/Mandalay Bay Lease which had total annual rent of $303.8 million upon closing.

(7) Amount represents USD equivalent to C$271.9 million investment based on the exchange rate at the time of closing.

(8) Amount represents USD equivalent to C$21.8 million rent based on the exchange rate at the time of closing.

Real Estate Debt Investment Activity

The following table summarizes our real estate debt investment activity (each as defined in the column titled “Real Estate Debt Investment”) for the year ended December 31, 2023:

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(1) Amount represents USD equivalent to £9.0 million based on the exchange rate at the time of closing.

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(2) In connection with the Canyon Ranch Lenox and Tucson Loan and Canyon Ranch Preferred Equity Investment, we entered into (i) a call right agreement for Canyon Ranch Tucson and Canyon Ranch Lenox, and (ii) a right of first financing agreement to serve as the real estate capital financing partner for Canyon Ranch with respect to the acquisition, build-out and redevelopment of future wellness resorts. If the call right(s) are exercised, Canyon Ranch would continue to operate the applicable wellness resort(s) subject to a long-term triple net master lease with the Company. Refer to Item 1 - Our Growth Agreements for further details.

Financing and Capital Markets Activity

•January 2023 Offering. On January 12, 2023, we completed a primary offering of 30,302,500 shares of common stock (inclusive of 3,952,500 shares sold pursuant to the exercise in full of the underwriters’ option to purchase additional common stock) at a public offering price of $33.00 per share for an aggregate offering value of $1.0 billion, resulting in net proceeds, after deduction of the underwriting discount and expenses, of $964.4 million. The shares are subject to forward sale agreements (the “January 2023 Forward Sale Agreements”), which required settlement by January 16, 2024. We did not initially receive any proceeds from the sale of the shares of common stock in the offering, which were sold to the underwriters by the forward purchasers or their respective affiliates. In April, July, August and October 2023, we physically settled the January 2023 Forward Sale Agreements (as defined in Note 11 - Stockholders Equity) in exchange for total net proceeds of approximately $960.5 million.

•At-The-Market Offering Programs. During the year ended December 31, 2023, we sold an aggregate of 21,365,397 shares under the ATM Program (as defined in Note 11 - Stockholders Equity), all of which were subject to forward sale agreements, for estimated aggregate net value of $634.6 million based on the initial forward sale price with respect to each forward sale agreement. We did not initially receive any proceeds from the sale of the shares of common stock under the ATM Program, which were sold to the underwriters by the forward purchasers or their respective affiliates. In October 2023, we physically settled all the then outstanding forward shares issued under the ATM Program in exchange for total net proceeds of approximately $249.1 million.

•Entry into Forward-Starting Interest Rate Swap Agreements. During the year ended December 31, 2023, we entered into seven forward-starting interest rate swap agreements with an aggregate notional amount of $500.0 million intended to reduce the variability in the forecasted interest expense related to the fixed-rate debt we expect to refinance.

KEY TRENDS THAT MAY AFFECT OUR BUSINESS

Tenant and Industry Performance

Our tenants and the guarantors of their respective obligations, as applicable, under our lease agreements are leading gaming and experiential operators across the United States, Canada and abroad. Rental payments under our lease agreements comprise, and are expected to continue to comprise, a substantial majority of our revenues. Accordingly, we are dependent on, among other things, our tenants’ and, as applicable, their respective guarantors’, financial performance, the performance of the gaming and other experiential industries and the health of the economies in the areas where our properties are located for the foreseeable future, and an event that has a material adverse effect on any of our tenant’s business, financial condition, liquidity, results of operations or prospects could have a material adverse effect on our business, financial condition, liquidity, results of operations and prospects. In addition, the financial performance of our tenants and their respective guarantors also has a direct impact on our financial results in a given reporting period due to the impact of ASC 326 “Credit Losses” (“ASC 326”), which requires us to estimate and record non-cash expected credit losses related to our investments, including changes on a quarterly basis, that are recorded in our Statement of Operations and impact our reported net income. The change in non-cash allowance for credit losses for a given period is dependent upon, among other things, our tenants’ and guarantors’ financial performance. For more information regarding ASC 326, refer to Note 5 - Allowance for Credit Losses included in this Annual Report on Form 10-K.

Business Strategy

Our business prospects and future growth will be significantly influenced by the success of our business strategy, and the timing, availability and terms of financing of any acquisitions and investments that we may complete, as well as broader macroeconomic and other conditions that affect our tenants’ operating and financial performance, including those described herein. Further, the pricing of any acquisitions or other investments we may consummate and the terms of any leases that we may enter into will significantly impact our future results. Competition to enter into transactions with attractive properties and desirable tenants is intense, and we can provide no assurance that any future acquisitions, investments or leases will be on terms as favorable to us as those relating to recent or historical transactions.

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Impact of the Macroeconomic Environment

We anticipate that we will finance our future growth with a combination of debt and equity, although no assurance can be given that we will be able to issue equity and/or debt in such amounts on favorable terms, or at all, or that we would not determine to incur more debt on a relative basis at the relevant time due to market conditions or otherwise. Macroeconomic volatility has introduced significant uncertainty and heightened risk for businesses, including us and our tenants, including the impact of heightened interest rates, inflation, threat of recession and increased cost of capital. Our tenants also face additional challenges, including potential changes in consumer confidence levels, behavior and spending and increased operational expenses, such as with respect to labor or energy costs. As a triple-net lessor, increased operational expenses at our leased properties are borne by our tenants and do not directly impact their rent obligations (other than with respect to underlying inflation as applied to the CPI-based escalators described below) or other obligations under our lease agreements.

However, the current macroeconomic environment, including heightened interest rates and market volatility, impacts our business in certain respects, such as by increasing interest expense with respect to any borrowings under our Revolving Credit Facility and future refinancing of upcoming debt maturities, volatility of our share price with respect to sales of common stock, and, with respect to potential transactions, evaluating asset and property values in discussions with potential counterparties and obtaining transaction financing on attractive terms, all of which could increase our cost of capital and negatively impact our growth prospects.

With respect to our lease agreements, which generally provide for annual rent escalation based on a specified percentage increase and/or increases in CPI, we expect that currently elevated inflation levels will result in additional rent increases over time under our CPI-based lease provisions (subject to any applicable caps or periods in which such provisions do not apply). However, these rent increases may not match increasing inflation during periods when inflation rates are greater than the applicable CPI-based caps.

Overall Implications of Such Material Trends on Our Business

As a triple-net lessor, we believe we are generally in a strong creditor position and structurally insulated from operational and performance impacts of our tenants, both positive and negative. However, the full extent to which the trends set forth herein adversely affect our tenants and/or ultimately impact us depends on future developments that cannot be predicted with confidence, including our tenants’ financial performance, the direct and indirect effects of such trends discussed herein (including among other things, heightened interest rates, inflation, economic recessions, consumer confidence levels and general conditions in the capital and credit markets) and the impact of any future measures taken in response to such trends on our tenants.

For more information, refer to “Part I – Item 1A. Risk Factors” included in this Annual Report on Form 10-K.

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DISCUSSION OF OPERATING RESULTS

Results of Operations for the Years Ended December 31, 2023 and December 31, 2022

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Revenue

For the years ended December 31, 2023 and 2022, our revenue was comprised of the following items:

Leasing Revenue

The following table details the components of our income from sales-type lease and lease financing receivables:

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(1) Represents our asset acquisitions structured as sale leaseback transactions. In accordance with ASC 842, since the lease agreements were determined to meet the definition of a sales-type lease and control of the asset is not considered to have transferred to us, such lease agreements are accounted for as financings under ASC 310.

(2) Amounts represent the non-cash adjustment to income from sales-type leases and lease financing receivables in order to recognize income on an effective interest basis at a constant rate of return over the term of the leases.

Leasing revenue is generated from rent from our lease agreements. Total leasing revenue increased $959.6 million during the year ended December 31, 2023 compared to the year ended December 31, 2022. Total contractual leasing revenue increased $781.7 million during the year ended December 31, 2023 compared to the year ended December 31, 2022. The increases were primarily driven by the addition to our portfolio of the Venetian Lease in February 2022, the MGM Master Lease in April 2022, the Foundation Master Lease in December 2022, the PURE Master Lease and the MGM Grand/Mandalay Bay Lease in January 2023, the Rocky Gap Casino component of the Century Master Lease in July 2023 and the Century Canadian Portfolio component of the Century Master Lease in September 2023, the Bowlero Master Lease in October 2023 and the Chelsea Piers Lease in December 2023, as well as the annual rent escalators from certain of our other lease agreements.

Income From Loans

Income from loans increased $34.6 million during the year ended December 31, 2023 compared to the year ended December 31, 2022. The increase was driven by the origination and subsequent funding, as applicable, of our debt investments and the related interest income from the increased principal balances outstanding under such debt investments, partially offset by the full repayment of the $400.0 million Caesars Forum Convention Center mortgage loan in May 2023 and the $71.5 million Chelsea Piers loan in December 2023.

Other Income

Other income increased $13.7 million during the year ended December 31, 2023 compared to the year ended December 31, 2022. The increase was driven primarily by the additional income as a result of certain ground and use sub-leases assumed in connection with our property transactions and acquisitions, including the acquisition of the Venetian Resort in February 2022 (“Venetian Acquisition”), the MGP Transactions in April 2022, the Rocky Gap Casino Acquisition in July 2023 and the Chelsea Piers Sale-Leaseback Transaction in December 2023 (each as defined in Note 3 - Real Estate Transactions). We determined we are the primary obligor of the respective ground and use leases and, accordingly, record the related income and expense on a gross basis on our Income Statement. The lease agreements require our tenants to cover all costs associated with such ground and use sub-leases and provide for their direct payment to the primary landlord.

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Operating Expenses

For the years ended December 31, 2023 and 2022, our operating expenses were comprised of the following items:

General and Administrative Expenses

General and administrative expenses increased $11.3 million during the year ended December 31, 2023 compared to the year ended December 31, 2022. The increase was primarily driven by an increase in compensation, including stock-based compensation and the addition of new employees to the corporate team and additional expenses related to the significant growth of our business in 2023.

Other Expenses

Other expenses increased $13.7 million during the year ended December 31, 2023 compared to the year ended December 31, 2022. The increase was driven primarily by the additional expense as a result of certain ground and use sub-leases assumed in connection with our property transactions and acquisitions, including the acquisition of the Venetian Resort in February 2022 (“Venetian Acquisition”), the MGP Transactions (as defined in Note 3 - Real Estate Transactions) in April 2022, the Rocky Gap Casino Acquisition in July 2023 and the Chelsea Piers Sale-Leaseback Transaction in December 2023. We determined we are the primary obligor of the respective ground and use leases and, accordingly, record the related income and expense on a gross basis on our Income Statement. The lease agreements require our tenants to cover all costs associated with such ground and use sub-leases and provide for their direct payment to the primary landlord.

Change in Allowance for Credit Losses

Change in allowance for credit losses decreased $731.7 million during the year ended December 31, 2023 compared to the year ended December 31, 2022, primarily driven by lower initial CECL allowances recorded on our acquisition and loan origination activity. We recorded initial CECL allowances of $279.0 million on our $4.1 billion of property acquisition activity and $14.0 million on our $698.2 million of loan origination activity during year ended December 31, 2023, compared to initial CECL allowances of $540.5 million on our $21.6 billion of property acquisition activity and $33.1 million on our $1.2 billion of loan origination activity during the year ended December 31, 2022.

Further fluctuation in the change in allowance for credit losses are the result of (i) changes to the reasonable and supportable period, or R&S Period probability of default, or PD, and loss given default, LGD, of our existing tenants and their parent guarantors (as applicable) as a result of market performance and changes in the macroeconomic model used to scenario condition such inputs, (ii) changes to the long-term period PD as a result of changes in the credit ratings of our existing tenants and their parent guarantors, which are used to estimate the long-term PD and (iii) annual standard updates to the model used to estimate the CECL allowance. Refer to Note 5 - Allowance for Credit Losses for further details.

Transaction and Acquisition Expenses

Transaction and acquisition costs decreased $14.6 million during the year ended December 31, 2023 compared to the year ended December 31, 2022. Changes in transaction and acquisition expenses are related to fluctuations in (i) costs incurred for investments during the period that are not capitalizable under GAAP, and (ii) costs incurred for investments that we are no longer pursuing. Amounts for the year ended December 31, 2022 include costs incurred for the MGP Transactions and Venetian Acquisition during the period that are not capitalized under GAAP.

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Non-Operating Income and Expenses

For the years ended December 31, 2023 and 2022, our non-operating income and expenses were comprised of the following items:

Income from Unconsolidated Affiliate

Income from unconsolidated affiliate during the year ended December 31, 2023 represents our 50.1% share of the income of the MGM Grand/Mandalay Bay JV for the period from January 1, 2023 through January 8, 2023, immediately prior to the closing of the MGM Grand/Mandalay Bay JV Interest Acquisition. Beginning on January 9, 2023, upon the closing of the MGM Grand/Mandalay Bay JV Interest Acquisition, we consolidated the operations of the MGM Grand/Mandalay Bay JV and, subsequently, such income is included in Income from sales-type lease on our Statement of Operations.

Interest Expense

Interest expense increased $278.1 million during the year ended December 31, 2023 compared to the year ended December 31, 2022. The increase was primarily related to an additional $12.4 billion in notional amount of debt from the (i) issuance of the unsecured notes in April 2022, (ii) issuance of the Exchange Notes (as defined in Note 7 - Debt) in April 2022, (iii) assumption of the MGP OP Notes in April 2022, (iv) C$140.0 million, C$75.0 million and £9.0 million draws on the Revolving Credit Facility to finance the PURE Canadian Gaming Sale-Leaseback Transaction in January 2023, Century Canadian Portfolio Sale-Leaseback Transaction in September 2023 and Cabot Highlands Loan in December 2023, respectively, and (v) consolidation of $3.0 billion aggregate principal amount of CMBS debt in connection with the MGM Grand/Mandalay Bay JV Interest Acquisition in January 2023. The increases were partially offset by certain interest expense recorded during the year ended December 31, 2022 with no corresponding expense during the year ended December 31, 2023, which included (i) the amortization of the commitment fees associated with the bridge facilities for the Venetian Acquisition and MGP Transactions and (ii) additional interest on the $600.0 million draw on the Revolving Credit Facility in February 2022 (which was repaid in full on April 29, 2022).

Additionally, the weighted average annualized interest rate of our debt, net of the impact of the forward-starting interest rate swaps and treasury locks, decreased to 4.33% during the year ended December 31, 2023 from 4.39% during the year ended December 31, 2022 as a result of the lower interest rate on the MGM Grand/Mandalay Bay JV CMBS debt, partially offset by a higher weighted average effective interest rate on the April 2022 Notes, Exchange Notes and MGP OP Notes as compared to our outstanding debt during such earlier periods.

Interest Income

Interest income increased $14.4 million during the year ended December 31, 2023 compared to the year ended December 31, 2022. The increase was primarily driven by a significant increase in the interest rates and income earned on our excess cash and short-term investments, coupled with an overall increase in our cash on hand throughout the current year as compared to the prior year.

Other Gains

During the year ended December 31, 2023, we recognized a $4.5 million gain in Other gains, which primarily relates to the sale of excess land in April 2023 and foreign currency remeasurement adjustments associated with our investments in Canada and the United Kingdom. In connection with the PURE Canadian Gaming Sale-Leaseback Transaction, Century Canadian Portfolio Sale-Leaseback Transaction and Cabot Highlands Loan, we entered into intercompany debt and drew C$215.0 million and £9.0 million on the Revolving Credit Facility, which are denominated in a foreign currency and, since such debt is held at entities with USD as their functional currency, certain of the related assets and liabilities are remeasured through the Statement of Operations. There is no comparable amount during the year ended December 31, 2022, as we did not have any foreign investments or comparable land sales during such time.

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Benefit from (Provision for) Income Taxes

Benefit from (provision for) income taxes was a net income tax benefit of $6.1 million during the year ended December 31, 2023 compared to a $2.9 million net income tax expense for the year ended December 31, 2022. The change was primarily driven by the recognition of deferred tax benefits on our Canadian investments arising from temporary differences on our CECL allowance, partially offset by certain other temporary GAAP basis to tax basis differences.

Results of Operations for the Years Ended December 31, 2022 and 2021

For a comparison of our results of operations for the fiscal years ended December 31, 2022 and 2021, see “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our annual report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on February 23, 2023 and incorporated by reference herein.

RECONCILIATION OF NON-GAAP MEASURES

We present VICI’s Funds From Operations (“FFO”), FFO per share, Adjusted Funds From Operations (“AFFO”), AFFO per share, and Adjusted EBITDA, which are not required by, or presented in accordance with, generally accepted accounting principles in the United States (“GAAP”). These are non-GAAP financial measures and should not be construed as alternatives to net income or as an indicator of operating performance (as determined in accordance with GAAP). We believe FFO, FFO per share, AFFO, AFFO per share and Adjusted EBITDA provide a meaningful perspective of the underlying operating performance of VICI’s business.

FFO is a non-GAAP financial measure that is considered a supplemental measure for the real estate industry and a supplement to GAAP measures. Consistent with the definition used by the National Association of Real Estate Investment Trusts (NAREIT), we define FFO as VICI’s net income (or loss) attributable to common stockholders (computed in accordance with GAAP) excluding (i) gains (or losses) from sales of certain real estate assets, (ii) depreciation and amortization related to real estate, (iii) gains and losses from change in control, (iv) impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity and (v) our proportionate share of such adjustments from our investment in unconsolidated affiliate.

AFFO is a non-GAAP financial measure that we use as a supplemental operating measure to evaluate VICI’s performance. We calculate VICI’s AFFO by adding or subtracting from FFO non-cash leasing and financing adjustments, non-cash change in allowance for credit losses, non-cash stock-based compensation expense, transaction costs incurred in connection with the acquisition of real estate investments, amortization of debt issuance costs and original issue discount, other non-cash interest expense, non-real estate depreciation (which is comprised of the depreciation related to our golf course operations), capital expenditures (which are comprised of additions to property, plant and equipment related to our golf course operations), impairment charges related to non-depreciable real estate, gains (or losses) on debt extinguishment and interest rate swap settlements, other gains, deferred income tax benefits and expenses, other non-recurring non-cash transactions, our proportionate share of non-cash adjustments from our investment in unconsolidated affiliate (including the amortization of any basis differences) with respect to certain of the foregoing and non-cash adjustments attributable to non-controlling interest with respect to certain of the foregoing.

We calculate VICI’s Adjusted EBITDA by adding or subtracting from AFFO contractual interest expense (including the impact of the forward-starting interest rate swaps and treasury locks) and interest income (collectively, interest expense, net), income tax expense and our proportionate share of such adjustments from our investment in unconsolidated affiliate.

These non-GAAP financial measures: (i) do not represent VICI’s cash flow from operations as defined by GAAP; (ii) should not be considered as an alternative to VICI’s net income as a measure of operating performance or to cash flows from operating, investing and financing activities; and (iii) are not alternatives to VICI’s cash flow as a measure of liquidity. In addition, these measures should not be viewed as measures of liquidity, nor do they measure our ability to fund all of our cash needs, including our ability to make cash distributions to our stockholders, to fund capital improvements, or to make interest payments on our indebtedness. Investors are also cautioned that FFO, FFO per share, AFFO, AFFO per share and Adjusted EBITDA, as presented, may not be comparable to similarly titled measures reported by other real estate companies, including REITs, due to the fact that not all real estate companies use the same definitions. Our presentation of these measures does not replace the presentation of VICI’s financial results in accordance with GAAP.

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Reconciliation of VICI’s Net Income to FFO, FFO per Share, AFFO, AFFO per Share and Adjusted EBITDA

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(1) Represents non-cash foreign currency remeasurement adjustments and gain on sale of land.

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LIQUIDITY AND CAPITAL RESOURCES

Liquidity

As of December 31, 2023, our available cash and cash equivalents balance, short-term investments and capacity under our Revolving Credit Facility were as follows:

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(1)In addition, the Revolving Credit Facility includes the option to increase the revolving loan commitments by up to $1.0 billion to the extent that any one or more lenders (from the syndicate or otherwise) agree to provide such additional credit extensions.

(2)Assumes the physical settlement of the 13,194,739 outstanding forward shares as of December 31, 2023 under our at-the-market forward sale agreements at a forward sales price of $28.97 calculated as of December 31, 2023.

(3)Subsequent to the year ended December 31, 2023, we sold a total of approximately 9.7 million shares under our at-the-market offering program at a weighted average price per share of $31.61 for an aggregate value of $305.5 million, all of which were sold subject to a forward sale agreement. After fees and other adjustments calculated in accordance with the forward sale agreement, the aggregate net value of $302.4 million yielded a net initial forward sales price per share of $31.30. Such amount is not included in the table above and we did not initially receive any proceeds from the sale of the shares of common stock in the offering, which were sold to the underwriters by the forward purchasers or their respective affiliates and remain subject to settlement in accordance with the terms of the forward sale agreement.

We believe that we have sufficient liquidity to meet our material cash requirements, including our contractual obligations, debt maturities and commitments as well as our additional funding requirements, primarily through currently available cash and cash equivalents, cash received under our lease agreements, existing borrowings from banks, including our undrawn capacity under our Revolving Credit Facility, and proceeds from future issuances of debt and equity securities (including issuances under any future “at-the-market” program) for the next 12 months and in future periods.

All of our lease agreements call for an initial term of between fifteen and thirty-two years with additional tenant renewal options and, along with our loans, are designed to provide us with a reliable and predictable long-term revenue stream. Our cash flows from operations and our ability to access capital resources could be adversely affected due to uncertain economic factors and volatility in the financial and credit markets, including as a result of the current inflationary environment, higher interest rates, equity market volatility, and changes in consumer behavior and spending. In particular, we can provide no assurances that our tenants will not default on their leases or fail to make full rental payments if their businesses become challenged due to, among other things, current or future adverse economic conditions. See “Overview — Impact of Material Trends on our Business” above for additional detail. In the event our tenants are unable to make all of their contractual rent payments as provided by our lease agreements, we believe we have sufficient liquidity from the other sources discussed above to meet all of our contractual obligations for a significant period of time. For more information, refer to the risk factors incorporated by reference into Part I. Item 1A. Risk Factors.

Our ability to raise funds through the issuance of debt and equity securities and access to other third-party sources of capital in the future will be dependent on, among other things, general economic conditions, general market conditions for REITs and investment grade issuers, market perceptions, the trading price of our stock and uncertainties related to the macroeconomic environment. We will continue to analyze which sources of capital are most advantageous to us at any particular point in time, but financing through the capital markets may not be consistently available on terms we deem attractive, or at all.

Material Cash Requirements

Contractual Obligations

Our short-term obligations consist primarily of regular interest payments on our debt obligations, dividends to our common stockholders, distributions to the VICI OP Unit holders, normal recurring operating expenses, recurring expenditures for corporate and administrative needs, certain lease and other contractual commitments related to our golf operations and certain non-recurring expenditures. For more information on our material contractual commitments, refer to Note 10 - Commitments and Contingent Liabilities.

Our long-term obligations consist primarily of principal payments on our outstanding debt obligations and future funding commitments under our lease and loan agreements. As of December 31, 2023, we had $17.1 billion of debt obligations outstanding. We have $1.1 billion of debt that matures on May 1, 2024. For a summary of principal debt balances and their

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maturity dates and principal terms, refer to Note 7 - Debt. For a summary of our future funding commitments under our loan portfolio, refer to Note 4 - Real Estate Portfolio.

Pursuant to our lease agreements, capital expenditures, insurance and taxes for our properties are the responsibility of the tenants. Minimum capital expenditure spending requirements of the tenants pursuant to our gaming lease agreements are described in Note 4 - Real Estate Portfolio.

Information concerning our material contractual obligations and commitments to make future payments under contracts such as our indebtedness, future funding commitments under our loans and Partner Property Growth Fund and future contractual operating commitments (such as future lease payments under our corporate lease) are included in the following table as of December 31, 2023. Amounts in this table omit, among other things, non-contractual commitments and items such as dividends and recurring or non-recurring operating expenses and other expenditures, including acquisitions and other investments:

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(1) Estimated interest payments on variable interest debt under our revolving credit facility are based on the CDOR and SONIA rates as of December 31, 2023.

(2) Excludes ground and use leases which are paid directly by our tenants to the primary lease holder.

(3) The allocation of our future funding commitments is based on construction draw schedules, commitment funding dates, expiration dates or other information, as applicable; however, we may be obligated to fund these commitments earlier than such applicable date.

Additional Funding Requirements

In addition to the contractual obligations and commitments set forth in the table above, we have and may enter into additional agreements that commit us to potentially acquire properties in the future, fund future property improvements or otherwise provide capital to our tenants, borrowers and other counterparties, including through our put-call agreements and Partner Property Growth Fund. As of December 31, 2023, we had $1.0 billion of potential future funding commitments under our Partner Property Growth Fund agreements, the use of which are at the sole discretion of our tenants and will be dependent upon independent decisions made by our tenants with respect to any capital improvement projects and the source of funds for such projects, as well as the total funding ultimately provided under such arrangements.

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Cash Flow Analysis

The table below summarizes our cash flows for the years ended December 31, 2023 and 2022:

Cash Flows from Operating Activities

Net cash provided by operating activities increased $237.6 million for the year ended December 31, 2023 compared with the year ended December 31, 2022. The increase is primarily driven by an increase in cash rental payments from the addition of the MGM Master Lease, Foundation Master Lease, MGM Grand/Mandalay Bay Lease, PURE Master Lease, the Rocky Gap Casino and Century Canadian Portfolio component of the Century Master Lease, Bowlero Master Lease and Chelsea Piers Lease to our real estate portfolio, the annual rent escalators on our Caesars Leases and certain of our other lease agreements, the proceeds from settlement of our forward-starting derivative instruments in connection with the April 2022 Notes offering and an increase in loan interest income as a result of an increase in the principal balance of our loan portfolio.

Cash Flows from Investing Activities

Net cash used in investing activities decreased $6,404.9 million for the year ended December 31, 2023 compared with the year ended December 31, 2022.

During the year ended December 31, 2023, the primary sources and uses of cash from investing activities included:

•Net payments of $1,266.9 million, including acquisition costs, in connection with the MGM Grand/Mandalay Bay JV Interest Acquisition;

•Payments for property acquisitions during the year for a total cost of $1,373.1 million, including acquisition costs, of which $1,132.0 million was classified as investments in financing receivables and $241.1 million was classified as investments sales-type lease;

•Disbursements to fund investments in our loan and securities portfolio in the amount of $959.1 million;

•Principal repayment of loans in the amount of $482.0 million, of which $400.0 million related to the full repayment of the Caesars Forum Convention Center mortgage loan;

•Maturities of short-term investments, net of investments of $217.3 million;

•Proceeds from the sale of land of $6.2 million;

•Acquisition of property and equipment costs of $4.0 million; and

•Capitalized transaction costs of $1.5 million.

During the year ended December 31, 2022, the primary sources and uses of cash from investing activities included:

•Net payments of $4,574.5 million in relation to the closing of the MGP Transactions;

•Payments for property acquisitions during the year for a total cost of $4,314.5 million, including acquisition costs, of which $296.7 million was classified as investments in financing receivables and $4,017.9 million was classified as investments sales-type lease;

•Investment in short-term investments, net of maturities, of $217.3 million;

•Disbursements to fund investments in our loan and securities portfolio in the amount of $193.7 million; and

•Capitalized transaction costs of $7.7 million.

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Cash Flows from Financing Activities

Net cash provided by financing activities decreased $5,798.1 million for the year ended December 31, 2023 compared with the year ended December 31, 2022.

During the year ended December 31, 2023, the primary sources and uses of cash from financing activities included:

•Net proceeds of $2,480.1 million from the issuance of an aggregate 79,065,750 shares of our common stock pursuant to the full physical settlement of certain of our forward sale agreements;

•Dividend payments of $1,583.8 million;

•Draws of $419.1 million in aggregate on our Revolving Credit Facility and subsequent repayment of $250.0 million on our Revolving Credit Facility;

•Distributions of $28.6 million to non-controlling interests; and

•Repurchase of shares of common stock for tax withholding in connection with the vesting of employee stock compensation of $5.0 million.

During the year ended December 31, 2022, the primary sources and uses of cash from financing activities included:

•Gross proceeds of $5,000.0 million from the April 2002 Notes offering;

•Net proceeds of $3,219.1 million from the sale of an aggregate 119,000,000 shares of our common stock pursuant to the full physical settlement of certain of our forward sale agreements;

•Dividend payments of $1,219.1 million;

•Initial draw and repayment of $600.0 million on our Revolving Credit Facility;

•Debt issuance costs of $146.2 million;

•Distributions of $17.7 million to non-controlling interests; and

•Repurchase of shares of common stock for tax withholding in connection with the vesting of employee stock compensation of $6.2 million.

Debt

For a summary of our debt obligations as of December 31, 2023, refer to Note 7 - Debt. For a summary of our financing activities in 2023 refer to “Summary of Significant 2023 Activity - Financing and Capital Markets Activity” above.

Covenants

Our debt obligations are subject to certain customary financial and operating covenants that restrict our ability to incur additional debt, sell certain asset and restrict certain payments, among other things. In addition, these covenants are subject to a number of important exceptions and qualifications, including, with respect to the restricted payments covenant, the ability to make unlimited restricted payments to maintain our REIT status.

At December 31, 2023, we were in compliance with all required debt-related covenants, including financial covenants.

CRITICAL ACCOUNTING ESTIMATES

Our Financial Statements are prepared in accordance with GAAP which requires us to make estimates and assumptions about future events that affect the amounts reported in the financial statements and accompanying notes. We believe that the following discussion addresses our most critical accounting estimates, which are those that have a significant level of estimation uncertainty, requiring our most difficult, subjective and complex judgments, and significantly impacts the Balance Sheets and Statement of Operations in the reporting period. Actual results may differ from the estimates. Refer to Note 2 - Summary of Significant Accounting Policies for a full discussion of our accounting policies.

Purchase Accounting

Our property acquisitions are accounted for under ASC 805 “Business Combinations” (“ASC 805”), which requires that we allocate the purchase price of our properties to the identifiable assets acquired and liabilities assumed, as applicable. Our acquired properties generally meet the definition of an asset acquisition under ASC 805-50 and we typically allocate the cost of real estate acquired, inclusive of capitalizable transaction costs, to (i) land, (ii) building and improvements and (iii) site improvements, based in each case on their relative estimated fair values using industry standard practices such as market comparables and the cost approach. In an acquisition of multiple properties, we must also allocate the purchase price among the

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properties, and in certain cases investments in unconsolidated affiliates, which is based on the (a) asset quality and location, (b) property and lease-level operating performance and (c) supply and demand dynamics of each property’s respective market. In addition, any assumed mortgages are recorded at their estimated fair values.

Such allocations use significant estimates which can impact the determination of the accounting as a business combination or asset acquisition and the allocation to the differing components of an acquisition. Management uses industry standard practices to estimate the value assigned to the assets acquired and liabilities assumed in an acquisition, including the value assigned to each property, the liabilities assumed, as applicable, and the land and building property components within each property. Although management believes its estimate of both the value assigned to each property and to the land and building property components within each property is reasonable, no assurance can be given that such amounts will be correct. In particular, a change in the estimates could have a material impact on the business combination determination and the timing and amount of income recognized over the life of the assets acquired and liabilities assumed.

Lease Accounting

We account for our investments in leases under ASC 842 “Leases” (“ASC 842”), which requires significant estimates and judgments by management in its application. Upon lease inception or lease modification, we assess the lease classification of both the different components of the property, generally land and building, to determine whether each component should be classified as a direct financing, sales-type or operating lease. The determination of lease classification requires the calculation of the rate implicit in the lease, which is driven by significant estimates, including the estimation of both the value assigned to the land and building property components upon acquisition (as further described in “—Purchase Accounting” above) and the estimation of the unguaranteed residual value of such components at the end of the lease term, which includes the non-cancelable period and any renewal terms that, in our judgement, are reasonably certain to be exercised. If the lease component is determined to be a direct financing or sales-type lease, revenue is recognized over the life of the lease using the rate implicit in the lease.

Management uses industry standard practices to estimate both the value assigned to the land and building property components upon acquisition and the unguaranteed residual value of such components, including comparable sales and replacement cost analyses. Although management believes its estimate of both the value assigned to the land and building property components upon acquisition and the unguaranteed residual value of such components is reasonable, no assurance can be given that such amounts will be correct. In particular a change in the estimates could have a material impact on the lease classification determination and the timing and amount of income recognized over the life of the lease.

Allowance for Credit Losses

ASC 326 “Financial Instruments-Credit Losses” (“ASC 326”) requires that we measure and record current expected credit losses (“CECL”) for the majority of our investments, the scope of which includes our Investments in leases - sales-type, Investments in leases - financing receivables and Investments in loans. We have elected to use a discounted cash flow model to estimate the Allowance for credit losses, or CECL allowance for our leases. This model requires us to develop cash flows which project estimated credit losses over the life of the lease and discount these cash flows at the asset’s effective interest rate. We then record a CECL allowance equal to the difference between the amortized cost basis of the asset and the present value of the expected credit loss cash flows.

Expected losses within our cash flows are determined by estimating the probability of default (“PD”) and loss given default (“LGD”) of our tenants and their parent guarantors over the life of each individual lease or financial asset. The PD and LGD are estimated during a reasonable and supportable period for which we believe we are able to estimate future economic conditions (the “R&S Period”) and a long-term period for which we revert to long-term historical averages (the “Long-Term Period”). We are unable to use our historical data to estimate losses as we have no loss history to date.

Given the length of our leases, the Long-Term Period PD and LGD are the most material and significant drivers of the CECL allowance. The PD and LGD for the Long-Term Period are estimated using the average historical default rates and historical loss rates, respectively, of public companies over the past 40 years that have similar credit profiles or characteristics to our tenants and their parent guarantors. We have engaged a nationally recognized data analytics firm to assist us with estimating both the PD and LGD of our tenants and their parent guarantors. Changes to the Long-Term Period PD and LGD are generally driven by (i) updated studies from the nationally recognized data analytics firm we employ to assist us with calculating the allowance and (ii) changes in the credit rating assigned to our tenants and their parent guarantors.

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The following table illustrates the impact on the CECL allowance of our investment portfolio as a result of a 10% increase and decrease in the weighted average percentages used to estimate Long-Term PD and LGD of all of our tenants and their parent guarantors:

Although management believes its estimate of the Long-Term PD and LGD described above is reasonable, no assurance can be given that the Long-Term PD and LGD for our tenants, or other drivers of the CECL allowance, will be correct. Any significant variation of Long-Term PD or LGD from management’s expectations could have a material impact on our financial condition and operating results.