Investment in Direct Financing Leases, Net and Real Estate Investments

Amounts were recorded at fair value for real estate assets under lease through the initial Lease Agreements and the reclassification of such real estate assets to Investments in direct financing leases, net and Real estate investments accounted for using the operating method. The fair value assigned to the buildings is classified as an Investment in direct financing leases, while the fair value assigned to certain portions of land is recorded as Real Estate Investments accounted for using the operating method.

The weighted average remaining lease term for both operating and direct financing leases at December 31, 2017 was 34.9 years.

VICI’s investment in direct financing leases, net consisted of the following as of December 31, 2017



(In thousands)	December 31, 2017
Minimum lease payments receivable ⁽¹⁾	$	29,302,166
Estimated residual values of leased property (unguaranteed)	1,987,651
Gross investment in direct financing leases	31,289,817
Unamortized initial direct costs	—
Less: Unearned income	(23,021,174		)
Net investment in direct financing leases, net	$	8,268,643

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(1)	Minimum lease payments do not include contingent rent that may be received under the Lease Agreements. There was no contingent rent for the period ended December 31, 2017.

At December 31, 2017, minimum lease payments owed to VICI for each of the five succeeding years are as follows:



(In thousands)	Minimum Lease Payments
2018	$	725,875
2019	730,060
2020	734,320
2021	738,656
2022	744,647

Due to the put/call option on the Eastside Property, it was determined that the transaction does not meet the requirements of a completed sale for accounting purposes. As a result, we reclassified $73.6 million from Real estate investments accounted for using the operating method to Land. Additionally, the Company recorded a $73.6 million Deferred financing liability in its Balance Sheet.