Chicago’s first casino set to relaunch the Bally’s brand
Bally’s Corporation was recently authorized by the Chicago City Council to construct the first casino in the city. According to the chairman of Bally’s Corp., Soohyung “Soo” Kim, Bally’s Chicago Casino will cost approximately $1.7 billion to build and will be vital to relaunching the company name.
Kim further explained that in terms of the firm’s overall strategy, the gaming venue would be made a top priority. He also labeled Chicago the best place for a proper reintroduction of Bally’s brand name.
“It’s really an opportunity to re-announce and reintroduce the Bally’s brand name nationally, and what better place than Chicago,” the Chairman said.
Standard General was co-founded by Kim and holds a 22% stake in Bally’s Corporation. Bally’s name was purchased by the hedge fund company from Caesars Entertainment in 2020 for $20 million. At the time, Standard General, which began operations in 2007, wanted to use the famous brand to broaden its influence from its home state to several other locations across 10 states.
Bally’s Chicago Casino project is set to be one of the most wide-scale casino developments in the country and the first gambling venue in Chicago. The project’s first phase will involve a one million square foot casino building, a 3,000-person event space, a 500-room hotel, and several dozen infrastructure improvements will occur in the surrounding area. The venue will also have a large amount of public open space, restaurants, and an entertainment center.
The project will make over 3,000 construction jobs available for residents of the city and 3,000 permanent jobs in the venue. Bally’s Chicago Casino will also generate millions of dollars in tax revenue yearly for Chicago.
The sheer mass of the project has put Bally’s under scrutiny in both Chicago and other locations. The brand, which dates back to 1947, has grown significantly via acquisitions; however, the Chicago casino is Bally’s first time undertaking a project of this size. Chicago aldermen have made inquiries concerning the experience and financial resources of Bally’s for them to take on such a project.
US casino giants such as Las Vegas Sands Corp. and MGM Resorts International held back from placing a bid on the Chicago project due to skepticism about the market potential of the future casino and the high tax rate.
Chicago initially faced issues securing bids due to their unattractive tax rate for the gaming venue. The rates were eventually reduced from 70% to 40% by the Illinois General Assembly per the request of Mayor Lori Lightfoot to increase the appeal of the project.
In its new location, Bally’s Chicago Casino will compete with five other sites in Illinois, four in Indiana, as well as two new suburban casinos. There are also two potential racinos and over 17,000 video gambling terminals located in the region.
Illinois casinos have recorded revenues below pre-pandemic levels and, in the past decade, experienced a downward trend. The decline can be traced to the rapid growth of online, sports, and video gambling which has kept a number of in-person bettors away from gambling venues.
According to the financial report of the state’s gambling revenue which ended on June 30, video gambling experienced a revenue boost of 40.4%, while land-based casinos recorded a 7.4% decline. The Illinois lottery holds the largest contribution to the state’s gaming revenue.
“Once more gambling opportunities arrive in the form of new casinos, the competition for the gaming dollar in this area will be larger than ever, and ‘winners’ and ‘losers’ should be anticipated,” a report by the Illinois Commission on Government Forecasting and Accountability revealed.
Kim disclosed that despite the competition, Bally’s was confident and would make use of the experience it gleaned over the years from its other properties.
“It would absolutely be our most complex challenge. We feel more than confident,” Kim said.
While other nearby cities in Illinois have been involved in gambling and video betting, Chicago has remained largely out of the loop. Despite this, the third most populous city in the US received over 30 million tourists last year. Kim stressed the importance of opening the casino and keeping the revenues within the city.
“It’s another excuse to go downtown. It’s about keeping Illinois state revenues in the state. It’s about keeping city revenues in the city,” the Chairman said.
Kim did not give any exact figures for gross and revenue receipts of the new casino. Still, according to Chicago forecasts, Bally’s Chicago Casino will likely provide approximately $200 million yearly for its two poorly funded pensions.