(This is the fifth and final story in a series that looks at each proposed casino site for downtown Chicago. The previous installments explored Bally’s bids at Bronzeville and River West, Hard Rock’s bid, and Rush Street Gaming’s McCormick Place bid.)
Rush Street Gaming Co-Founder Neil Bluhm’s desire to have a downtown casino in his hometown of Chicago has always been visible. Presenting two contrasting bids among the five the city received for that license is simply another example of it.
Perhaps looking to enhance the 83-year-old Bluhm’s legacy both in Illinois and nationwide as one of the premier casino gaming entrepreneurs outside Las Vegas, Rush Street’s proposed Rivers Casino at The 78 has all the markings of a high-end bid that has both left nothing to chance and potentially includes everything the city of Chicago could want.
Rush Street Gaming is one of three companies — the others being Hard Rock International and Bally’s — that have presented five total proposals to the city of Chicago for its downtown casino license. If the process remains true to the projected timeline — no easy feat given the task of building a gaming venue in an urban metropolis — the casino would open by 2025 and be expected to generate between $160 million and $200 million in annual taxes and fees that the city of Chicago would allocate to police and fire department pension funds.
Rush Street Gaming’s “Rivers 78” proposal carries the biggest price tag of the five bids at a projected $2 billion, and its partnership with developer Related Midwest features an observation tower that would be more than 1,000 feet tall and add to Chicago’s already iconic skyline. Rush Street claims the South Loop riverfront location has the potential to draw more than seven million annual visitors, which would place it behind Navy Pier and Millennium Park as the city’s top tourist draws.
Illinois currently has 10 casinos in operation, with Rivers Casino in Des Plaines the most recent to open in the state in 2011, and one Rush Street has a significant minority stake in after selling 62% to Churchill Downs Inc. in May 2019. It is the biggest gaming revenue generator for both its operator and the state. The downtown casino license was one of six created for the state as part of a massive gaming expansion bill signed into law by Gov. JB Pritzker in June 2019 that also legalized sports wagering.
Rivers 78 a dramatic contrast to Lakeside Center bid
ICYMI: Developers behind proposed Rivers Casino at The 78 offer a closer look its pitch, which includes an observation tower an docking station @ South Loop location. It's among the finalists the city/Mayor Lightfoot is weighing, @RobertChannick reports: https://t.co/Q7gffaG74E
— Chicago Tribune Business (@ChiTribBiz) November 15, 2021
Rush Street’s naming of its “Rivers 78” proposal is a nod to the 62-acre, mixed-use parcel of land where the casino will be built as Chicago’s 78th and newest neighborhood. The casino would be on the north end of “The 78” and be accessible by various forms of public transit, including water taxi from the Chicago River. The sleek design of Rivers 78 is a marked contrast to the Lakeside Center bid, which almost looks like a casino in the utilitarian sense when its plans are viewed side-by-side with the other proposal’s cosmopolitan renderings.
Related Midwest has contributed to the Chicago skyline with its One Bennett Park, 340 On The Park, 400 Lake Shore Drive, and 500 Lake Shore Drive properties, among others. It envisions “The 78” as an “economic engine for Chicago, anchored by the University of Illinois System’s Discovery Partners Institute (DPI) and industry-leading companies.” The project calls for 12 acres of open space, including seven devoted to a park.
In terms of gaming amenities, Rush Street has remained consistent with its plans to carry 2,600 slots and 190 table games in both of its proposals. The slots are the fewest of any of the three gaming companies’ bids, while the table games are the most. Rivers Casino at The 78 would have 3,300 gaming positions and a retail sportsbook in a dedicated area of 450,000 square feet. With the downtown casino license allowing for up to 4,000 gaming positions, Rivers did not offer any clues in its proposal as to whether it would consider placing any at O’Hare and Midway airports, an option the licensee will have.
Rivers in Des Plaines has generated average revenue of $75.52 per admission at its table games in 2021 — nearly double the state average of $38.80. While some of that can be attributed to the inventory available — its 72 table games there are nearly double the next-closest venue (42 at Grand Victoria Casino) — that figure is a sizable portion of the state-leading overall $200.38 average per admission it has generated this year. Rivers is the only casino in the state generating at least 20% of its revenue via table games and also the leading revenue generator nationally per gaming position of any commercial casino.
In contrast to the Lakeside Center bid, which offers the potential to be a permanent venue opening quicker than the projected 2025 timeline based on retrofitting, Rivers 78 would have a riverboat docked at The 78 as a temporary casino while the permanent structure is built. Also separating itself from the Lakeside Center Bid is Rush Street’s commitment to a 300-suite luxury hotel that would serve as an anchor to non-gaming amenities, including Harbor Hall, which would stage both live performances and cultural exhibits; a Riverfront Plaza for year-round activities; and the Observation Tower viewing and event space, which would “draw inspiration from Chicago’s historic bridges.” The proposal also states plans for eight restaurants, cafes, and a food hall, in addition to five dedicated bars and lounges.
Rush Street projects the Rivers 78 buildout to produce 7,000 construction and permanent jobs, with $2.5 billion in annual economic impact upon completion. It plans to have 25% minority and women ownership and also plans to offer the largest “prime GC contract” to a minority-owned business in the city’s history. In its executive summary presented to the city, Rush Street noted it has “received indications of interest of $100 million in equity from 47 minority individuals to ensure that our project reflects and benefits the essential diversity that makes our City unique.”
In terms of meeting the city’s requirements of having a minimum of 26% of vendor contracts allocated to Minority-Owned Business Enterprise (MBE) and 6% to Women-Owned Business Enterprise (WBE), Rush Street has committed to BOWA Construction as its prime contractor for the Entertainment District. It also has entered a workforce partnership with HIRE360, originally co-founded by Related Midwest, to help “ensure underrepresented populations in Chicago have access to and training for gaming, hospitality, and construction jobs.”
Rush Street also stated that, since The 78 is shovel-ready in terms of construction, it can begin building immediately upon receiving the casino license should it be the winning bid. It envisions the riverfront casino as a “connecting ribbon” between The 78’s proposed innovation and residential districts.
Bluhm’s Chicago connections
A Chicago heavyweight in his own right, Bluhm’s decision to partner with Related Midwest for The 78 shows the depth and understanding of the city that has made Rush Street the perceived favorite to land the downtown casino license. That is not to say a winning bid would not come without some bruised elbows and egos during the process.
Bluhm and Mayor Lori Lightfoot have already crossed paths on gambling issues beyond casino gaming, taking opposite sides on a proposed city ordinance that would lift the home-rule ban and enable sports wagering at stadiums within the city limits. The first-term mayor was put on the defensive earlier this week regarding Bluhm’s testimony that the ordinance would create a revenue drain of more than 10% of the $800 million projected in the Union Gaming White Paper published in August 2020.
Lightfoot has long supported a downtown casino, having successfully revised the tax rates downward for such a venue in 2020. Lobbyists supporting the city ordinance for retail sports wagering at Wrigley Field, Guaranteed Rate Field, Soldier Field, and the United Center — as well as Wintrust Arena, should Pritzker sign HB 3136 as expected — argued that Bluhm was trying to funnel sports wagering business to his retail sportsbook in Des Plaines and that he overstated the impact of retail sports wagering on casino gaming as a whole.
Illinois has quickly established itself as a top-three market nationally in sports betting since accepting its first wagers in March 2020, with nearly 96% of the $4.4 billion in handle generated in 2021 coming from mobile wagers.
Photo courtesy of Rivers 78 Gaming LLC proposal submitted to the City of Chicago