Bally’s Corporation has been beset with questions and concerns over its plan to build a permanent casino in Chicago by 2026.
It boils down to two issues: Can Bally’s procure the immense sum of money needed for the project, and will it meet the deadline?
The casino company insists it has both under control.
Bally’s president says 2026 opening date will be met
There are currently 15 casinos operating in Illinois, including Bally’s temporary casino in downtown Chicago. Illinois online casinos remain illegal, but sweepstakes and social casinos are open for online play.
Late last week, Bally’s announced a “refreshed” Chicago casino permanent site plan. It said the new plan “prominently features a planned 500-room, 34-story hotel tower into a single-phase construction project at the 30-acre former Tribune Publishing site, pending approval of the Chicago Department of Planning & Development.”
George Papanier, president of Bally’s Corporation, said the project, initially estimated to cost $1.7 billion, will be fully funded by the company and will be delivered on time.
“We’ve been working hard in the background to restore the full hotel tower for Bally’s Chicago Casino and absolutely intend to meet the September 2026 opening date as planned. We are also happy to announce that Gaming and Leisure Properties has agreed to finance this entire development in a single phase to ultimately deliver a better project in a more efficient manner.
“With keys to the property in hand, the new financing secured, a site plan that exceeds the original, and demolition set to start this summer, let there be no doubt that Bally’s Chicago Casino and Hotel will soon rise up along the Chicago River.”
Bally’s working with Gaming and Leisure Properties
Bally’s also announced it has entered into “a binding term sheet for a strategic construction and financing arrangement with Gaming and Leisure Properties, Inc.” The Pennsylvania-based real estate investment trust is providing $940 million in the deal, shoring up an estimated $800 million funding gap.
And according to Bally’s, “GLPI will provide in aggregate up to $2.07 billion of financing to Bally’s, thereby further cementing the companies’ long-term strategic alliance.” That arrangement includes:
“Gaming and Leisure Properties to acquire and lease back certain real property interests underlying Bally’s Kansas City and Bally’s Shreveport for $395 million in total consideration, in exchange for $32.2 million in initial annual rent with annual escalators consistent with Bally’s existing master lease agreement with GLPI. Bally’s expects to use all the proceeds from the Sale Leaseback Transactions to repay amounts currently drawn under its $620 million revolving credit facility and for general corporate purposes.”
The Chicago Tribune reported that “Gaming and Leisure Properties has a portfolio of 65 locations across 20 states, including several Bally’s properties. The business model entails buying, financing, and owning the land then leasing it back to gaming operators.”
The new renderings were provided by HKS, a global design firm with an office in Chicago. The firm has designed the Grand Hyatt Nashville, the MGM National Harbor gaming resort in Maryland, the Palazzo in Las Vegas, and The Venetian Macao.
Investors respond positively to new plan
While the arrangement addresses the funding part of the equation, steering away from a controversial proposal to take Bally’s private, there are still logistical questions that remain.
Demolition of the site, currently occupied by Tribune Publishing at 700 W. Chicago Ave., will be environmentally complex. The introduction of a new plan could potentially delay construction.
However, Chicago Mayor Brandon Johnson, who recently expressed concerns about Bally’s ability to build a permanat casino in Chicago, offered encouragement. Per a Chicago Sun-Times report, Johnson’s office said it was “pleased with this development. … We look forward to reviewing the updated plans and proceeding through the review process with the Department of Planning and Development.”
Even if the review process is fast-tracked to coincide with the soon-to-start demolition, Bally’s vision of a hitch-free, delay-free construction project might be overly optimistic.
But for now, the perception that Bally’s now has its Chicago casino plans firmly handled is helping its stock price. Last week, Bally’s stock closed at $11.86 a share. Currently, it has jumped to $13.95, more than a 15% increase over the time span.
