The perils of Bally’s

That promised megaresort in Chicago is disappearing like a mirage. This week, Windy City Mayor Brandon Johnson (D) met with the editorial board of the Chicago Sun-Times and expressed doubts that $1.7 billion Bally’s Chicago will ever get built. It’s already lost the support of the pro-casino Chicago Tribune … and now Hizzoner appears to be slinking away. Said the mayor, “I know our team is working with ownership to figure it out like we figured out some of the other things that I’ve inherited. It just has to make absolute sense … I think that one’s still to be determined, to be perfectly frank with you.”

We’ve suspected for a while that Bally’s Corp.’s evolving endgame is to indefinitely extend its juiced-in license at Medinah Temple as a sop to the city, permanently establishing a foothold near the Loop. Cheaper and, for Bally’s, more realistic. For how many earnings calls has Bally’s management promised that funding for Bally’s Chicago is just around the corner? Just.Around.The.Corner. Uh-huh.

News outlets are obligingly touting “record” (but not impressive) May revenue at Bally’s Casino downtown. The place is on track to deliver only $13 million of a promised $35 million in tax dividends. That’s a mighty big shortfall. Johnson has already moved on, laying the groundwork for slot routes in Chicago, a threat to Bally’s main source of revenue. Still, stung by the mayor’s mild comments, Bally’s quickly lashed out, saying everything was hunky-dory. However, in a telling move, the start of construction was pushed back until sometime this autumn, another sign that the money isn’t there. Bally’s media onslaught was, at least, good enough to get Johnson’s office to walk back his confession.

Alderman Brendan Reilly cut to the chase, saying, “I think the bigger issue is whether or not Bally’s can actually afford to develop the site. If we look at what we’re hearing from Wall Street, they’re short hundreds of millions of dollars in cash to deliver the casino.” So far, the only substantive move from Bally’s has been to hold an entirely laudable DEI vendor fair. Said one bakery owner, “The leadership team is clearly invested in giving local minority- and women-owned companies as much business as possible. The onboarding process was seamless, and we have seen a steady stream of orders since day one.” DEI initiatives are under siege these days from troglodytes so it’s praiseworthy that Bally’s is sticking to its guns.

On another Bally’s battlefront, company Chairman Soo Kim was exuding optimism out his sphincter regarding the company’s push for a Bronx casino on the current site of Bally Links. Kim’s op-ed paean to the Big Apple begs the obvious question: Using what for money? The company is leveraged to the gills and lenders are obviously skeptical of it. One would think that if you’re promising “the largest private development in the history of the Bronx” you’d want to have a few dollars in the kitty. But then you’re not Soo Kim, for whom realism has rarely been more than an optional state of mind.

Also pertinent to the discussion is that Bally’s need to have its golf course ‘alienated’ in order to be converted from a public course to a private casino megaresort. And New York City politicians haven’t exactly been flocking to that standard. Although the recent kibosh of Steve Cohen‘s Citi Field casino plan improves Bally’s chances by default, the alienation process needs support in Albany that it doesn’t have so far. The relevant assemblyman, Michael Benedetto (D), is taking a wait-and-see attitude, which doesn’t portend well. We’re still a year and half away from the New York casino award … although, the way Kim is running Bally’s, it may no longer be a going concern by that point.

Another state where Bally’s would like to play (in Lake of the Ozarks), Missouri, had a good May. An extra weekend day was sufficient to bump revenues up a percentage point, to $163 million, 7% higher than in 2019 as well. Ameristar St. Charles gained 4% to lead the state with $25 million. Other St. Louis-area competitors fared differently. Sometime rival Hollywood St. Louis dipped 3% to $21 million, while sister property River City was up 1.5% to $21.5 million. Horseshoe St. Louis fell 6% to $12 million, a distant fourth. Kansas City saw Bally’s Kansas City continue to gobble up market share, jumping 10.5% to $12 million. It crept up on Harrah’s North Kansas City, down 1.5% to $14 million. Ameristar Kansas City led with $17 million (+2%) while Argosy Riverside hopped 4% to $15 million. Downstate, Century Casinos‘ new pavilion in Caruthersville helped draw 5.5% more business ($4 million), while it did well in Cape Girardeau also ($6 million, +5%).

May was also strong for casinos in Detroit, which leapt 6% overall (to $111 million), albeit 11% short of where they were in May 2024, an indicator of how much the Covid-19 lockdown altered consumer tendencies in re Motown. No surprise, MGM Grand Detroit was foremost with $52 million (+5%), a vindication of its best-in-class facility. Hollywood Greektown continues to make a believer of us, leaping 10%, if still 13% off its pre-Covid pace. Its tally was $25.5 million. MotorCity was up 5% to $33.5 million, proving there’s enough business to keep everyone happy.

Continuing the parade of good news, Indiana reported casino winnings of $215 million last month, up 9.5% from last year and 3% higher on a same-store basis. Terre Haute Casino continued its hot start with $12.5 million, while Hard Rock Northern Indiana continued to shrug off Chicagoland competition with a mega-boffo $39 million (+16.5%). Nobody else in the state came close to Hard Rock. The best they could do was Horseshoe Indianapolis‘ $27.5 million (-1%). Harrah’s Hoosier Park did $20.5 million, a 6.5% gain for the newly revamped racino. Along Lake Michigan, it was $22 million (-11%) for Horseshoe Hammond and $14.5 million (-2%) for Ameristar East Chicago, while Michigan-facing Blue Chip jumped 5.5% to $10.5 million.

The Hoosier State’s one other big gainer was Bally’s Evansville, up 9% to $14.5 million. Southern rival Belterra Resort was up 4% to $7.5 million, Rising Star hopped 2% to $3.5 million and Hollywood Lawrenceburg gained a point to $13 million. Caesars Southern Indiana and French Lick Resort were flat at $22 million and $7.5 million respectively. Sports betting generated another $39 million (15.5% more) off of $361.5 million of handle. Hold was a high 11%. FanDuel was way out front with $24.5 million, trailed by DraftKings‘ $12.5 million. Caesars Sportsbook did $2 million, BetRivers $2 million, ESPN Bet $2.5 million, while everybody else’s gross was negligible. Small wonder that Truist Securities analyst Barry Jonas recently opined that there are no second-tier operators (anywhere), just DraftKings, FanDuel and a bunch of third-tier ones.

Sticking with sports betting, let’s hop across the border (back) to Illinois. OSB providers made 3% more last month despite low hold. They grossed $92 million although handle was 23% higher this year. DraftKings made the highest share of handle but had to settle for second place and $28.5 million. FanDuel raked in $44 million, BetRivers $5.5 million and ESPN Bet $4 million. Further back were BetMGM ($3.5 million) and Caesars Sportsbook ($2.5 million). FanDuel held at a tight 11% clip, DraftKings at a loose 7%.

Also seeing a big leap in OSB win was Maryland, where it catapulted 21% to $50 million. Handle was $419 million and hold a super-tight 12%. Seems that OSB providers are squeezing players even when they don’t need to. FanDuel drubbed DraftKings, $30 million to $12.5 million. BetMGM made $3 million, ESPN Bet $1.5 million and Caesars Sportsbook $1 million. Fanatics also grossed a million, while BetRivers did half that.