Bally's Reaffirms Commitment to Chicago Casino Amid VGT Concerns, Secures $560M for Bronx Project

Bally's Corporation leadership held an unusually brief eight-minute conference call this week to clarify the status of their Chicago casino development while simultaneously announcing significant financing progress for their separate Bronx casino project. The dual announcements highlight Bally's ambitious expansion plans across major urban markets while addressing growing concerns about regulatory hurdles and market changes in Chicago.

Chicago Construction Timeline Adjustments

During the call, Bally's Chairman Soo Kim and Chicago board chair Wanda Wilson emphasized that approximately 1,000 skilled workers continue daily construction on the permanent casino resort. Kim specifically addressed what he called inaccurate reports about construction halting or slowing significantly following the company's August announcement about resetting the project's pace. The chairman stressed that while sequencing of certain non-gaming elements has been adjusted, the core timeline remains intact for an early 2027 opening.

"Construction continues every day, and there are approximately 1,000 skilled tradespeople working on the construction of the permanent Bally's Chicago resort,"

Kim stated. He added that the company is actually over-delivering on its commitments to Chicago and reset the construction timeline to better align with its Host Community Agreement.

Impact of Video Gaming Terminals

The primary factor behind Bally's construction adjustments stems from Chicago's legalization of video gaming terminals (VGTs) earlier this year, which passed despite Mayor Brandon Johnson's opposition. The Illinois Gaming Board approved 65 VGT license applications in the city, with these machines already generating substantially more revenue than traditional casinos in the state. Bally's interim CFO George Papanier warned city officials that widespread VGT adoption could reduce their Chicago casino revenue by 30-50%, leading to careful reconsideration of about 12% of planned amenities.

"It would be irresponsible to continue construction until we understand what the landscape looks like,"

Papanier told the Chicago City Council's License Committee. The company maintains it will still deliver the required event center, 100 hotel rooms, and food and beverage components by the 2027 target, with plans eventually expanding to 500 hotel rooms.

Political and Regulatory Challenges

The VGT issue represents just the latest challenge in Bally's troubled Chicago journey since winning the city's sole casino license in 2022. The project has faced multiple work stoppages including for debris overflow issues and alleged organized crime connections with an unapproved dumpster service. The company also handled an $800 million funding gap that required a complex financing agreement with Gaming and Leisure Properties, along with potential interference with city water lines that necessitated significant hotel redesigns. Bally's has received multiple deadline extensions from Illinois regulators, most recently through language in June's state omnibus revenue bill that prevented the potential closure of their temporary Medinah Temple casino. Mayor Johnson's administration continues publicly supporting the project's economic benefits, with the mayor praising the thousands of construction jobs created, even as his administration remains divided on VGT policy.

Bronx Casino Financing Details

Simultaneously, Bally's announced securing $560 million in financing from WhiteHawk Capital Partners for its larger $4 billion Bally's Bronx project, one of three New York City casino licenses awarded last year alongside Resorts World New York City and Hard Rock's Metropolitan Park. This funding will support pre-construction planning as the company works toward a projected single-phase opening in 2030.

"This important financing allows us to progress the pre-construction planning process so that we are ready to complete the remainder of the capital raise and remain on schedule,"

Kim explained. WhiteHawk's managing partner Bob Louzan emphasized their ability to structure flexible solutions for complex transactions, noting the funding would support the project's pre-construction work as Bally's advances its broader financing plan.

Financial and Leadership Developments

Bally's stock reacted positively to the announcements, rising 7% to $9.84 after a 30% decline over the previous month amid concerns about the Chicago project and broader financial challenges. The company's Q2 earnings report included warnings about its ability to continue as a growing concern, and former CFO Mira Mircheva's September 4 resignation prompted Papanier to assume the CFO role on an interim basis. These financial pressures add context to the company's careful approach to capital allocation across its Chicago and New York projects. Kim told investors they should view the company's actions through the lens of protecting significant investments while executing contractual obligations, emphasizing their continued commitment to both markets.

Strategic Outlook for Urban Casino Development

As Bally's navigates these parallel major urban casino developments, the company faces distinctly different challenges in each market. The Chicago project must contend with local regulatory changes and political divisions while maintaining construction momentum, whereas the Bronx development requires massive capital raises in a competitive New York market. Kim's assertion that temporary casino closure in Chicago wouldn't be the end of the world suggests the company views its broader national portfolio as a buffer against individual market uncertainties. With both projects representing long-term investments in lucrative urban gaming markets, Bally's appears committed to seeing them through despite the complex operating environment, as evidenced by their continued capital investments and public reassurances to stakeholders in both cities.