On Saturday morning, Chicago will become the largest city in the United States to have a casino within city limits.
The Illinois Gaming Board issued a temporary operating permit to Bally’s on Friday afternoon to conduct casino gaming at Medinah Temple, and the gaming company will open its doors to the public at the temporary venue at 8 a.m. Saturday. Bally’s conducted two days of live test wagering to the IGB’s satisfaction Wednesday and Thursday after having its infrastructure reviewed Tuesday.
Medinah Temple, which is located in the River North neighborhood, had been vacant since Bloomingdale’s moved out of the property in October 2020 and was designated as the site for the temporary casino very late in the process. Bally’s original $1.7 billion proposal called for the temporary casino to operate in close proximity to the permanent one while it was built in River West, but city officials under previous Chicago Mayor Lori Lightfoot persuaded Bally’s Chairman Soo Kim to switch the short-term venue to Medinah Temple.
Bally’s beat out proposals from Hard Rock and Rush Street, which both have casinos in operation in Illinois. Rivers Casino, which is in Des Plaines near Chicago’s O’Hare International Airport, is currently the largest casino revenue generator in the state and less than 20 miles from Medinah Temple.
“We would like to thank the Illinois Gaming Board for granting Bally’s the approval to begin welcoming public guests,” Bally’s VP and General Manager Mark Wong said in a statement. “Their confidence in our team’s ability to meet or exceed all regulatory requirements comes after months of extensive validation.
“It is an honor to present our guests with a first-class gaming experience and accomplish the goal of opening a casino within the city limits. We look forward to opening our doors and allowing patrons to enjoy every aspect of the latest entertainment destination in this beautiful city.”
A moment decades in the making
Bally’s began in 1932 as a Chicago-based pinball and slot machine manufacturer and eventually changed its name to Bally Entertainment in 1994. Hilton Hotels acquired the company in 1996 and it spun Bally’s off into a casino division called Park Place Entertainment three years later.
Harrah’s bought Park Place in 2005, which then became Caesars Entertainment in 2010 and part of the merger with Eldorado Resorts in 2020. Twin River acquired the naming rights for Bally’s in October 2020, which began a massive rebranding and expansion under the Bally’s name that now includes 16 casinos in 10 states.
The desire to bring casino gaming to Chicago goes back to the 1990s and the administration of former Mayor Richard M. Daley. Lightfoot, who lost her bid for re-election this year, was a key contributor toward realizing the goal as her administration re-wrote the proposed tax rates following a 2019 study by Union Gaming Analytics that showed the proposed numbers created an effective 72% tax rate. The revised tax structure is a progressive one based on revenue benchmarks, similar to how the state levies taxes.
Bally’s submitted its application for the casino license to the IGB in August 2022, and the state agency deemed it “preliminarily suitable” in June, which allowed the gaming company to move equipment into Medinah Temple to begin preparations for gaming. Bally’s cannot apply for a sports wagering license until it is issued a full casino license.
During its conference call this month to discuss second quarter earnings, Bally’s projected its monthly revenue at Medinah Temple will be between $3.5 million to $5 million for the remainder of 2023 and between $50 million and $60 million in the entire 2024 fiscal year. It will have nearly 800 slots and 56 table games in the multi-story layout along with three dining options and full-service bars on two of the three floors.
Bally’s is projected to make $800 million annually in casino revenue at full maturation, which would start in 2028, with the city receiving approximately $200 million in tax revenue should that projection be met. The city is expected to put that tax revenue towards it underfunded police and fire pensions.
The city and state have long been eager to have a Chicago casino serve as a revenue engine, looking to repatriate approximately $190 million of the estimated $331 million in annual gaming revenue the state loses to neighboring Indiana, which has three casinos just over the state line.
How long until the permanent venue?
Though Bally’s is required to open a permanent venue within two years of Medinah Temple taking its first bets, Bally’s can — and is expected to — file for a 12-month good-faith extension similar to what Hard Rock and Full House did in June, as both those companies are in various stages of construction for their permanent venues.
It has publicly targeted 2026 as an opening date for the River West location, making an extension request all but a formality. Bally’s has yet to break ground at its permanent venue at the Freedom Center in River West, where the Chicago Tribune has its printing operations until next July.
There has been pushback from some areas of the city for both the temporary and permanent venues, with residents voicing concerns over safety, traffic, and noise pollution. Alderman Brendan Reilly, whose 42nd Ward includes Medinah Temple, offered some of the most strident opposition and criticisms of the process during City Council meetings prior to Bally’s being approved by a 39-5 vote.
Bally’s has yet to decide if it will put any gaming positions at O’Hare or Midway airports, an option acquired as the city’s casino operator, but did note that possibility in its second-quarter earnings presentation.
Bally’s will be the fifth casino to open from licenses that were created in the 2019 gaming expansion bill signed into law by Gov. JB Pritzker that also legalized sports wagering in Illinois, increasing the overall total to 15 casinos statewide.
It will also be the fourth casino to open in the state since February, following The Temporary at American Place in Waukegan, the Golden Nugget in Danville, and Walker’s Bluff Casino in Williamson County. Hard Rock was the first of the new licensees to begin gaming back in November 2021 in Rockford.
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