Investments in Unconsolidated Entities

12 Months Ended

Dec. 31, 2024

Equity Method Investments and Joint Ventures [Abstract]

The following is a summary of our investments in unconsolidated entities as of December 31, 2024 and December 31, 2023 (dollars in thousands):


	Ownership %	Number of Properties	Carrying Amount (1) of Investment as of
	As of December 31, 2024		December 31, 2024		December 31, 2023
Data Center Joint Venture	80.0%	2	$	299,165	$	226,021
Bellagio Las Vegas Joint Venture - Common Equity Interest	21.9%	1	274,057		296,097
Bellagio Las Vegas Joint Venture - Preferred Equity Interest	n/a	n/a	650,000		650,000
Passport Park Joint Venture (2)	95.0%	3	6,477		—
Industrial Partnerships	n/a	n/a	—		—
Total investment in unconsolidated entities			$	1,229,699	$	1,172,118

(1) The total carrying amount of the investments was greater than the underlying equity in net assets (i.e., basis difference) by $7.9 million as of December 31, 2024. The basis difference is primarily attributable to capitalized interest for the data center joint venture development funding.

(2) Our investment in Passport Park Joint Venture includes $4.2 million in preferred equity. The joint venture is required to redeem all of the preferred equity investment in June 2028, with two extension options available.

Equity in earnings of unconsolidated entities consists of the following (in thousands):


	Years ended December 31,
	2024		2023		2022

Data Center Development Joint Venture	$	6,940	$	—	$	—
Bellagio Las Vegas Joint Venture - Common Equity Interest	(980)		2,139		—
Passport Park Joint Venture	—		—		—
Industrial Partnerships	1,833		407		(6,448)
Equity in earnings in unconsolidated entities	$	7,793	$	2,546	$	(6,448)

A. Passport Park Joint Venture

In November 2024, we established a joint venture with Trammell Crow Company ("TCC") to develop and operate three industrial facilities in Irving, Texas. As of December 31, 2024, we have invested $6.2 million, including $5.7 million in cash, in exchange for a 95.0% equity interest in the joint venture, including preferred equity. We have committed to investing an additional $158.0 million to finance the development. We have determined that we are not the primary beneficiary of this VIE because power to direct all activities significantly affecting the joint venture’s economic performance is shared. TCC is the managing member, and we do not have substantive kick-out rights. We will continuously evaluate whether we are the primary beneficiary as power to direct significant activities of the VIE can change over the life of the joint venture. Our maximum exposure to loss is limited to our common and preferred equity investments, including the committed development funding.

B. Data Center Joint Venture

We own an 80.0% equity interest in a joint venture that we formed with Digital Realty Trust, Inc. in November 2023. This joint venture owns and operates two data centers. As we do not control this VOE, we account for it under the equity method. As of December 31, 2024, each partner funded its pro rata share of the remaining estimated development cost for the first phase of the project, which was completed during 2024.

C. Bellagio Las Vegas Joint Venture Interests

The joint venture we formed with Blackstone Real Estate Income Trust owns a 95.0% equity interest in the real estate of The Bellagio Las Vegas. We made an initial investment in October 2023, including $301.4 million of common equity for an indirect interest of 21.9% in the property and a $650.0 million preferred equity interest. During the years ended December 31, 2024 and 2023, we recognized interest income of $52.8 million and $13.0 million for 8.1% preferential cumulative distributions, included within 'Other' revenue in our consolidated statements of income and comprehensive income. The unconsolidated entity had total debt outstanding of $3.0 billion as of December 31, 2024, all of which was non-recourse to us with limited customary exceptions.

We have determined that this joint venture is a VIE, and we are not the primary beneficiary as we do not have power to direct activities that most significantly impact the joint venture's economic performance. As a holder of preferred interests, we do not receive any additional voting rights, nor do we have conversion and redemption rights. Our maximum exposure to loss associated with this VIE is limited to our common and preferred equity investments.

D. Industrial Partnerships

All seven assets held by our industrial partnerships were sold during the year ended December 31, 2022, resulting in the recognition of an other-than-temporary impairment of $8.5 million, which was included in 'Equity in earnings of unconsolidated entities' for the year ended December 31, 2022. During the years ended December 31, 2024 and 2023, equity in earnings was primarily related to the resolution of income tax disputes and resulting distribution of cash the partnership had reserved for possible tax payments.