In a recent editorial, the Chicago Sun-Times stated, “With each passing month, the planned Bally’s Chicago casino seems less like the promised sure thing that will generate enough revenue to help solve the city’s pension crisis, and more like a potential bust.” The newspaper listed several areas of concern regarding plans for the $1.3 billion project.
First, the editorial noted Bally’s officials are hopeful they can find $800 million by this summer to fund casino construction. “But they better get cracking: Demolition has yet to begin on the 30-acre Chicago Tribune property, and by state law, the $1.3 billion permanent casino has to be built and open by September 2026,” the editorial said.
Also, it mentioned Bally’s recently formed a special committee to review New York hedge fund Standard General’s buyout offer of $15 per share. Two years ago, the newspaper wrote, Bally’s stock was being offered at $33 a share, “and a buyout bid at that price was rejected by the gamer, which should raise alarms about the direction in which the company is heading and its ability to build the Chicago casino as promised.” Standard General already owns one-quarter of Bally’s; a buyout would privatize the publicly traded company.
The Sun-Times also noted that while Bally’s stock price declines, its debt does not. Bally’s ended 2023 with $163 million in cash, but also with “a whopping $3.6 billion in debt,” according to company management.
The editorial also noted in January it was revealed that a 400-room, 35-story hotel tower approved for the permanent site has to be relocated to avoid damaging underground city water pipes. “Three months later, Bally’s and city officials are still figuring out where to place the tower,” the editorial stated. It added since the Chicago Plan Commission and city council already had approved the plan, those two entities should re-approve any new plan.
The editorial said the temporary casino that opened in 2023 at the Medinah Temple is “an underperformer, generating $1.5 million in tax revenue, a far cry from the $3 million to $4 million monthly haul Bally’s initially promised.”
Also mentioned was potential competition, for example the Wind Creek Chicago Casino and Hotel, opening this summer in East Hazel Crest/Homewood, the 12th casino in the Chicago/Northwest Indiana region. “Bally’s, of course, would have the lure of being in the city,” the Sun-Times wrote, noting the Civic Federation had said, “While a casino may generate some budgetary relief, gaming revenues can be unreliable, particularly over the long run, and should be budgeted with caution.”
The writers said, “We’ve never been a fan of this Bally’s project, nor of the selection process under then Mayor Lori Lightfoot that picked the company as the winner.” And they expressed alarm that Mayor Brandon Johnson told Crain’s Chicago Business “advisers have indicated to us that Bally’s is going through the normal financing process. Therefore, we have no concerns at this time.”
The editorial said, “Chicago has so much riding on this casino’s success. We encourage City Hall and Mayor Brandon Johnson’s administration to hold Bally’s fully accountable and remind them of their responsibilities to the city and its taxpayers.”
It concluded, “City Hall should be concerned, and if so, not just privately. Especially when a billion-dollar project that is supposed to bring relief to taxpayers seems so fraught with trouble. At this point, to simply trust that the Bally’s project will turn out right has the makings of a sucker’s bet.”
