Question of the Day - 29 May 2021

Well, it's a little early to know the particulars of Bally's (formerly Twin River Worldwide Holdings) plans for the Tropicana, once they assume ownership. The deal, in which Rhode Island-based Bally's will pay Gaming and Leisure Properties $150 million for the Tropicana's non-land assets, plus annual rent starting at $10.5 million over a 50-year period, isn't expected to close until early next year. 

We do know a few things, however, that might point to a major "practical effect" the sale will have on the 63-year-old property. 

First, Bally's is well capitalized and has been on a major spending spree over the past few years. Having a presence on the Las Vegas Strip has been a primary goal of the company, "a key step" in the words of a company statement announcing the sale. Which is why, as has been reported, Bally's will consider a "significant redevelopment of the property," in an effort to "enhance its financial profile."

In other words, the company knows that in order to compete with the newer and more popular properties nearby, it'll need to spruce up the joint, which would almost certainly include at least a refresh, if not a complete renovation, of the Trop's nearly 1,500 rooms. 

It seems to us to be a question of when, not if, Bally's will make its moves. But again, we expect it to be sooner than later. In an interview with CDC Gaming Reports, Bally's CEO Soo Kim said that the Tropicana "would not be completely redeveloped until sometime next year." 

Perhaps that sounds like a long time, but if the Trop will be completely redeveloped sometime next year, the process will have to start fairly soon. And when it does, further details will surely be revealed to us and we'll report them to you.