Bally’s Bidding for Chicago Casino License, Pledges $1.6B Investment
Posted on: October 30, 2021, 02:05h.
Last updated on: October 30, 2021, 06:48h.
Bally’s Corp. (NYSE:BALY) is eyeing Chicago as the site of its flagship gaming property. It submitted a proposal to city officials pledging a $1.6 billion investment for an integrated resort in the third-largest US city.
The Rhode Island-based gaming company announced the pitch late Friday and is mulling two potential sites: The Chicago Tribune Publishing Center and the McCormick Place Truck Marshaling Yard.
Chicago is a dynamic, world-class city, which is why we are committing to make a $1.6 billion investment in establishing Bally’s Chicago as our flagship, and the only property in its class in the Chicagoland market,” said Soo Kim, Bally’s chairman, in a statement.
Bally’s entry into the Chicago casino bidding fray comes amid a flurry of activity on what was seen as a project in jeopardy due to onerous tax burdens. As Casino.org reported Friday, Hard Rock International — the gaming arm of the Seminole Tribe — and Rush Street Gaming also submitted bids.
Last year, four gaming operators participated in the city’s request for information process. MGM Resorts International and Wynn Resorts ultimately bowed out before officials extended the deadline to submit proposals.
Chicago Would Be Coup for Bally’s
Bally’s currently operates 14 casinos in 10 states. It has exposure to Illinois via Jumer’s Casino & Hotel in Rock Island, which it purchased in October 2020 for $120 million in cash.
Earlier this year, the regional gaming company made its long-awaited entry on the Las Vegas Strip. It did so when it acquired the Tropicana from Gaming and Leisure Properties (GLPI). Still, a Chicago casino would be a marquee addition to Bally’s portfolio, while continuing its transformation from upstart to major player on the US gaming scene.
When the operator of Rhode Island’s two casinos went public in March 2019, its roster of properties consisted of the pair in its home state, a Colorado dog track, Dover Downs in Delaware, and Hard Rock in Biloxi, Miss.
Since then, the company previously known as Twin River Worldwide Holdings entered prime gaming markets. It’s now in Atlantic City, NJ and Las Vegas, while forging deeper into the iGaming and online sports wagering industries.
Should Bally’s win the Chicago casino license and stay inline with the aforementioned $1.6 billion price tag, that venture would be the company’s second-largest to date. It would follow only the $2.7 billion takeover of Gamesys, which wrapped up earlier this year.
Chicago Casino Competition Could Be Fierce
The effective tax rate of 40 percent the operator of the Chicago casino will face is high relative to other US gaming markets. But the market is still attractive because of a dearth of high-end gaming venues in major domestic metropolitan areas.
California and Florida are dominated by tribal gaming enterprises, while casino gaming appears to be a low priority in Texas. And it could take years to approve and open a third gaming venue in the New York City area.
For its part, Bally’s is saying the right things, pledging that minority investors will control 25 percent of the Chicago casino project. It also promised that 45 percent of the staffers at the venue will be women, 45 percent will be minorities, and the remaining 10 percent will be veterans and people with disabilities.
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