Bally's reaffirms Chicago casino commitment amid VGT concerns, secures $560m for Bronx project

Bally's Corp leadership has reiterated its commitment to completing the permanent Bally's Chicago casino resort by early 2027 despite adjusting construction sequencing in response to the city's video gaming terminal (VGT) expansion. During an eight-minute conference call, Chairman Soo Kim emphasized that approximately 1,000 workers remain on site daily, calling media reports of halted construction "inaccurate".

Chicago project adapts to VGT landscape

The company is reevaluating 12% of planned non-gaming amenities after Chicago City Council legalized VGTs in January against Mayor Brandon Johnson's opposition. This decision came as part of the city's latest budget and has created ongoing tension within city government. George Papanier, Bally's president and interim CFO, warned that widespread VGT proliferation could reduce casino revenue by 30-50%, making it "irresponsible" to proceed without understanding the market impact. The Illinois Gaming Board has already approved 65 VGT licenses in Chicago, where the devices outperform traditional casinos in revenue generation.

Construction progress and challenges

Kim stated that construction continues daily with about 1,000 skilled tradespeople working on the permanent resort. The company is changing how it sequences certain development elements to better align with its Host Community Agreement. Bally's plans to soon arrange construction site tours for investors and shareholders. However, the project has faced multiple obstacles since winning Chicago's sole casino license in 2022, including temporary work stoppages for debris overflow issues and the use of unapproved contractors. The hotel design required significant revisions due to potential interference with city water lines.

Regulatory and financial hurdles

The Illinois Gaming Board previously ordered a temporary stoppage following reports of alleged ties between an unapproved dumpster service and organized crime. Bally's faced an $800 million funding gap that was eventually resolved through a financing agreement with Gaming and Leisure Properties. The project has received two deadline extensions from the Illinois Gaming Board, most recently through language included in June's state omnibus revenue bill. Without these extensions, Bally's would have been forced to close its temporary casino at Medinah Temple until the permanent venue's completion.

Political context and support

Mayor Brandon Johnson has publicly supported the project's economic development potential despite his opposition to VGT legalization. In March, Johnson indicated his administration remains committed to projects like Bally's Chicago that create jobs across city neighborhoods. The mayor acknowledged Bally's partnership in a social media post, recognizing the thousands of construction workers involved in the project. However, the VGT issue remains largely unresolved between the mayor and city council majority who overruled his opposition to the machines.

Financial market reaction

Bally's stock rose 7% to $9.84 following Monday's announcements, recovering from a 30% monthly drop driven by Chicago uncertainties and Q2 earnings concerns. The company's financial leadership remains in flux after CFO Mira Mircheva's September 4 resignation, with Papanier serving as interim replacement. In its second quarter earnings report, Bally's had warned about its ability to continue as a growing concern, contributing to recent stock volatility.

Bronx project advances with $560m financing

Separately, Bally's announced $560 million in financing from WhiteHawk Capital Partners for its $4 billion Bally's Bronx resort, one of three New York City casino licenses awarded last year. The funds will support pre-construction planning and general corporate purposes, with closing expected this quarter. WhiteHawk's Bob Louzan noted the financing demonstrates their ability to structure complex transactions for major developments. Bally's plans to begin construction this month, eight to nine months after securing the NYC license, with a single-phase opening targeted for 2030.

Future outlook for Chicago project

While maintaining its 2027 opening target for Chicago, Bally's is prioritizing delivery of the event center, 100 hotel rooms, and required food and beverage components first. The full 500-room hotel and other amenities will follow based on market conditions. Kim emphasized the company is "over-delivering" on its Host Community Agreement commitments while protecting its investment value. The chairman stressed Bally's remains fully committed to Chicago, stating investors should view the company's actions as protecting significant investments while fulfilling contractual obligations.