Bally’s on Friday announced the funding for its permanent casino in Chicago.
The billion-dollar resort is set to open in September 2026. The funding is coming from a REIT, Gaming and Leisure Properties (GLPI). GLPI will own the real estate and lease the casino operations to Bally’s for a fixed annual rent of $20 million a year for 15 years. The deal was part of a larger agreement worth about $2 billion: GLPI will also acquire the real estate of Bally’s Kansas City, Missouri, and Bally’s Shreveport, Louisiana.
The deal will give GLPI more than 60 properties that it leases to Bally’s, Boyd Gaming, Caesars Entertainment, Cordish Companies, CQ Holdings, Penn Entertainment, and four other casino companies. Bally’s has 13 casinos, a racetrack, and online sports betting in 14 states.
Bally’s has grown from two casinos in Rhode Island to casinos in 10 states. Its growth slowed a bit in the last couple of years, due to debt and operational issues. The problems have caused some concern in the investment community. For example, Bally’s owns Tropicana Las Vegas. The Trop is set to be imploded to make room for a baseball stadium and potentially a new resort. But Bally’s has not announced any definite plans for a resort, citing an uncertain financial market, the development of a casino in Chicago, a bid for New York City, and some doubt about the Las Vegas market.
After a competitive bidding process, Bally’s was awarded a license for a casino in Chicago. In September 2023, the company opened a temporary casino in Chicago with the promise of a $1.7 billion resort to open in September 2026. The location of the temporary casino in the former Shriners building called the Medina Temple was highly criticized. It quickly became a not-in-my-backyard issue. The current mayor, the City Council, and the local press have criticized the operation. Every month when Illinois reports casino revenue, the narrative in the media is the failure of Bally’s to live up to expectations.
In its first 10 months, Bally’s generated $93.1 million in revenue, fourth among Illinois casinos. It hosted 1,012,889 customers and paid $22 million in taxes to the state and city. Lori Lightfoot, the previous mayor of Chicago had predicted $38 million in taxes for the city in the first 16 months of operations. Currently, the property is on track for $16 million-$18 million. In June, there was doubt that Bally’s had the wherewithal to build or operate the permanent casino.
When asked by the Chicago Sun-Times if he believed the permanent would be built, Mayor Brandon Johnson said, “I wish I could say something definitive today. 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.”
Not exactly a vote of confidence. But he welcomed the financing. Johnson also suggests the city will have a lot to say about the design.
“The city is pleased with the financing and construction of Bally’s permanent Chicago casino. We look forward to reviewing the updated plans and proceeding through the review process with the Department of Planning and Development.” To paraphrase the mayor, “We have our eyes on Bally’s.”
The permanent is located on the site of Chicago Tribune on the Chicago River. The initial renderings make the property seem attractive and welcoming. It is certainly a step up from the Media Temple location. The site is less contentious, but the debate about the design and amenities has yet to begin. The financing was good news for Bally’s; instead of a two-phase project with 100 hotel rooms to begin, the permanent will be completed in one phase with 500 hotel rooms, outdoor space and public park, restaurants, a performance venue, and a casino with 3,300 slot machines and 170 table games.
George Papanier, the property president, was more enthusiastic than the mayor. Papanier said, “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.”
The proof will be in the results. For the next two years, the temporary will continue to be judged month by month on its performance in relationship to predictions made months before it opened. The permanent will still have some critics, in part because there will always be critics of Mayor Lightfoot and the selection process.
However, when the permanent finally opens, it will be Chicago’s casino. Whether Bally’s Chicago Casino will outperform Rivers Casino is another issue. Rivers is in Des Plaines, a suburb of Chicago. It is the state’s most successful casino and generates 30 percent of the total casino revenue, four times Bally’s temporary. It will take a lot to beat Rivers, but Bally’s is investing $1.7 billion and that is a lot. The chairman of Bally’s says the new casino will be the corporate flagship. It will either be the flagship or a sign that the ship needs a new flag.
