In early 2023, the Illinois Gaming Board took a significant step forward by granting its first set of licenses for a temporary Bally’s casino. These licenses were approved for two companies, one representing the historic Medinah Temple building and the other for the land it occupies.
The plan was simple. Bally’s intended to establish a temporary casino at the Medinah Temple location while simultaneously developing a permanent casino in the River West neighborhood. Specifically, the temporary casino would occupy the site of the Chicago Tribune Freedom Center publishing facility.
In September 2023, following a successful test run monitored by state regulators, Bally’s temporary casino located at the historic Medinah Temple in the River North neighborhood officially opened its doors to the public. This marked a significant milestone in Bally’s expansion efforts in the Chicago area, providing residents and visitors with a new and exciting entertainment destination.
Bally’s has outlined a strategy to manage their temporary casino at the Medinah Temple for a maximum duration of three years, during which they will simultaneously work on constructing a permanent establishment in the River West neighborhood.
Spanning three stories, the temporary casino offers customers access to an extensive collection of entertainment options, including nearly 800 slot machines and 56 table games, meticulously curated by Bally’s.
Culinary enthusiasts can delight in two separate dining experiences: the Medinah Bistro, serving classic diner-style cuisine, and Kitchen 888, an Asian street food noodle bar. Plus, Bally’s customers can also enjoy refreshments from full-service bars located on the first and third floors, as well as a cozy coffee bar known as Wabash Café.
This temporary casino holds substantial monetary potential, with projected revenue estimations indicating a potential contribution of $55 million annually to the city’s coffers. In fact, in just the first few weeks of operation, Bally’s temporary casino had managed to net approximately $6 million and more than 80,000 gamblers.
Bally’s temporary casino also started the year off strong as it reported surpassing $10 million in gross gaming revenue this January. This was a boost of $6.8 million compared to the first month of operation back in September 2023 and an increase of 9.1% from December.
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Bally’s still working to make a permanent facility a reality
Bally’s aims to have its permanent casino running by 2026. However, some many challenges and issues need to be addressed and resolved before this can happen. In early March, executives from Bally’s revealed to the Nevada Gaming Control Board (NGCB) that they are facing a significant funding gap of $800 million for their planned permanent casino in Chicago.
This means that out of the estimated $1.1 billion needed for the project, Bally’s currently has only $300 million available. Marcus Glover, Bally’s CFO, revealed to the NGCB that the company is in discussions with a potential financing partner, although the partner was not disclosed.
Glover expressed optimism that these discussions would lead to a resolution in the coming months. Glover further explained that the permanent casino will be located at the former Chicago Tribune site, for which Bally’s still needs $800 million to complete the project. He expressed confidence in resolving the funding gap by the summer of this year.
Additionally, Bally’s has a $500 million credit facility, of which $250 million has already been utilized for acquiring land at the Freedom Center, the planned location for the permanent casino.
This gap in funds likely arises from various factors, including construction costs, regulatory requirements, and unexpected expenses that may have arisen during the development process. To address this shortfall, Bally’s is exploring various avenues to secure the necessary funds.
The gaming company has a history of owning significant real estate where its casinos are located and has previously considered selling some properties to generate funds. Another potential option is selling the operating rights to Tropicana Las Vegas, especially given the uncertainty surrounding its future due to plans for a Major League Baseball stadium.
However, Bally’s could also opt to raise cash by selling corporate debt or issuing stock. Yet another potential source of funding could be through additional investments from stakeholders or financial partners. Bally’s may also seek to attract new investors or secure additional financing through loans or bond offerings to bridge the funding gap.
Alternatively, the company might consider restructuring existing financial arrangements or reallocating resources from other projects to prioritize funding for the Chicago casino. Another option for closing the funding gap could involve negotiations with government agencies or local authorities for potential financial assistance or incentives.
Bally’s may explore opportunities for tax breaks, grants, or other forms of support from municipal or state governments to offset some of the project’s costs. Plus, Bally’s may look into optimizing its operational efficiencies or exploring cost-saving measures to free up additional funds for the Chicago casino project. This could involve streamlining processes, renegotiating contracts with suppliers, or implementing other strategies to reduce expenses and allocate resources more effectively.
Overall, addressing the funding gap for the permanent Chicago casino will likely require a combination of strategic financial planning, stakeholder engagement, and operational adjustments. Bally’s will need to navigate these challenges carefully to ensure the successful completion of the project and maximize its long-term profitability and viability.
Once construction is finished, Bally’s Chicago will stand as the largest casino in Illinois, boasting an impressive array of amenities. With 3,400 slot machines and 173 table games, the casino will offer ample gaming options for visitors. Additionally, the complex will feature six restaurants, catering to various culinary preferences.
For accommodation, a 500-room hotel will provide comfortable stays for guests. Furthermore, a 3,000-seat theater will offer entertainment options beyond the gaming floor, adding to the overall appeal of Bally’s Chicago as a premier destination.
Final Thoughts
Bally’s ambitious expansion into the Chicago market has faced its fair share of challenges, particularly regarding funding for its permanent casino project. However, the company remains committed to overcoming these obstacles and bringing its vision to fruition.
With promising revenue prospects from its temporary casino and ongoing discussions with potential financing partners, Bally’s is poised to navigate through this financial hurdle and realize its goal of establishing a flagship destination in the heart of Chicago.
