Plans for Bally’s to open Chicago’s first permanent casino forge ahead despite Mayor Brandon Johnson’s ambivalent stance.
Johnson, who took over from former Mayor Lori Lightfoot on May 15, 2023, is not convinced Bally’s can execute the $1.7 billion project. In an interview with the Chicago Sun-Times Editorial Board last Monday, the mayor expressed concerns about Bally’s $800 million funding gap and a buyout offer by its largest shareholder.
Johnson expressed his grievances about the Illinois casino project after Lee Bey, an editorial board member, asked if he believed the permanent casino would include all the features that Bally’s initially proposed.
“I wish I could say something definitive today,” Johnson said. “I know our team is working with ownership to figure [it] out like we figured out some of the other things that I’ve inherited. It just has to make absolute sense. … I think that one’s still to be determined, to be perfectly frank with you.”
Failed takeover bid could have derailed entire project
The mayor’s skepticism has merit given that Bally’s Chairman Soo Kim and Standard General, the private equity fund he established, offered to take Bally’s private at $15 per share. Before Kim’s bid in March, the company’s stock traded at around $10 per share.
Standard General owns 23% of Bally’s stock, making it the largest shareholder.
If the company went private, Bally’s Chicago would suffer. To stop this, last April, two prominent investors strove to block Kim’s efforts.
The project, signed off on by Lightfoot’s administration, would become the largest casino in Illinois. Amenities are expected to include 3,400 slot machines and 173 table games, six restaurants, a 500-room hotel, and a 3,000-seat theater.
Bally’s proposed casino would replace the former Chicago Tribune printing plant, the Freedom Center, on 30 acres at 777 West Chicago Ave. in the River West neighborhood.
Once considered part of River North, the area is quite popular with renters. Residents say the biggest draw is the area’s easy access to the rest of Chicago. That bodes well for Bally’s future casino and will have many city developers salivating at the prospect of sinking their teeth into the areas surrounding the new casino.
Bally’s has committed to spending $1.7 billion on the casino. Contractually, it must spend a minimum of $1.34 billion on the project. However, the company has only spent $2.4 million so far.
A day after Mayor Johnson expressed his concern, Bally’s held a vendor fair, where it created provisional contracts with hundreds of businesses to help develop the casino. Many of those businesses were either woman-, minority-, or veteran-owned.
Bally’s Chicago posts strong revenue despite company’s financial woes
The proposed permanent casino is scheduled to open in 2026. In the meantime, Bally’s opened an interim casino last September inside the Medinah Temple at 600 N. Wabash Ave.
The temporary site, Bally’s Chicago, started the year strong, surpassing $10 million in gross gaming revenue in January. That’s a jump of $6.8 million from its first month of operation back in September. And in May, the casino reported another record-setting month.
Overall, however, Bally’s financial troubles are weighing it down. The company has more than $3.6 billion in long-term debt and suffered a net loss of $172.6 million in 2023.
