Editorial: A Chicago casino that’s a slot shed is worse than no Chicago casino at all

Chicago’s new casino was sold to this city on the grounds that here would come a world-class resort facility, replete with hundreds of hotel rooms, a dozen or more distinguished restaurants, bars and lounges, artworks and fountains, a 3,000-seat theater for shows and musical acts, shimmering exterior architecture, riverwalks and well-paying jobs and local business opportunities galore.

The prime target customers were not to be locals but well-heeled visitors. This long-awaited casino was to be another sharp arrow in the city’s tourism quiver, a way to better compete with the likes of Orlando.

For all those benefits, those with misgivings, especially in Black churches, were told by then-Mayor Lori Lightfoot’s administration to pipe down, and, for the most part, they did. Their concerns included proximate slots sucking up the paychecks of Chicagoans who could not afford to lose and the appropriateness of helping solve a city’s pension crisis through losses at games of chance.

In light of increasing concerns about just what kind of facility Chicago ultimately will get, something needs now to be said loud and clear: A casino that’s merely a shed for slots, a casino that is nothing more than a repository for gambling, as distinct from an attraction with all manner of lovely things, is worse than no casino at all.

Far worse. We’d get all of the ills and precious few of the benefits. We will have been a sold a bill of goods by Sooyhoung Kim, the chairman of Bally’s Corp. and the chief driver of the Chicago deal.

Bally’s insists that everything is on track, but significant reasons to be worried have emerged.

Gaming is a highly regulated industry, and Bally’s generates a lot of ink in Las Vegas. That’s where it hopes to redevelop the site of the historic Tropicana Hotel for a new baseball stadium for the Oakland A’s, who plan to move to Nevada. The Trop, a Vegas mainstay for decades, is set to close on April 2, costing many long-term employees their jobs. If the new baseball stadium does indeed land on the footprint previously occupied by this hotel, long noted for the lush pools and landscaping that bespeak the name, that would put the A’s in close proximity to Allegiant Stadium, which just hosted the Super Bowl.

In just a few years, Vegas, which went decades without a significant sports presence, will have two formidable new facilities. Given how sports betting is where all the gaming growth resides these days, it’s a brilliant play by Vegas.

Even with a new traditional casino, you could argue Chicago still is behind the eight ball.

Just last Wednesday, Bally’s was in front of the Nevada Gaming Control Board, disclosing it still lacked $800 million of the $1.1 billion in financing needed for the Chicago resort, as approved. (The initial talk was of a significantly larger investment.)

That shortfall revelation was pretty stunning news in and of itself, given that, following a competitive bidding process, as was the case here, you’d expect whoever was making that decision on behalf of the city to have made themselves comfy with the matter of whether or not the petitioner had the wherewithal to actually get the project built. At the hearing, as reported by gaming.org, Marcus Glover, Bally’s chief financial officer, said, “We feel pretty good about those conversations and (the shortfall) being resolved by hopefully summer of this year.”

We at the Chicago Tribune’s Freedom Center are moving out by July 1 and were under the impression that construction would begin immediately. It’s not reassuring as we approach mid-March to hear a Bally’s exec use the word “hopefully” to describe having the cash in hand to begin construction.

So that’s one worry. Adding to the complexity, a plan was floated Monday by Standard General, a hedge fund that Kim founded in 2007, to buy out Bally’s other shareholders in a deal worth around $684 million, which happens to be well under half of the total value of Standard General’s bid to take Bally’s private in 2022. That prior bid, The Wall Street Journal reported Monday, was close to $2.1 billion.

So, the share of Bally’s not owned by Standard General in two years has gone from a perceived value of $2.1 billion to $684 million. Market values rise and fall, and the new, lower bid obviously needs only to be attractive to those holding stock that was about $10 a share before news broke of Kim’s intentions in order to be successful. Still, this decline doesn’t inspire confidence. Chicago made a deal with a public company, not a potentially private one.

If you watch the raw video from Nevada, you’ll also hear Glover hedging some on the 400-room hotel tower that’s part of the agreement and that has, per Bally’s previous statement, now been moved from the planned location due to physical problems with that section of the site. Kim has said repeatedly that Bally’s still intends to build the tower and that the deal allows for that to happen in a second phase.

Good. It’s a key part of the deal.

The final worry, of course, is the sluggish results from the temporary casino in River North, which have been improving but still are generating tax revenues for Chicago well below what Mayor Brandon Johnson had in his budget proposal for the city.

We’ll add some caveats here. Regular readers will know this page strongly backed a different proposal, the Rush Street Gaming one for The 78, an enviable site now being eyed by the Chicago White Sox and other interests. We’re well aware that the city’s choice of Bally’s has prompted detractors to look for dirt on the company, often posting it anonymously on X. It could well be that some spurned suitors hope to be in a position to pick up the pieces. And how much Johnson wants to rely on the gaming income is a matter for the mayor. Bally’s is not making political budgetary decisions.

All that is by way of saying that, for now, we are holding Kim to his word.

The original expectations were hardly unachievable for a city like ours. Four Winds casino, to cite one example, managed to build an amenity-rich hotel and casino in New Buffalo, Michigan, with most all of these attributes. So did the Potawatomi Casino Hotel in Milwaukee. And Vegas goes without saying. As the third-largest city in the country, Chicago has a right to expect even more, given that there’s a single gaming license within city limits. That was the whole point of this roll of the dice.

This is a pivotal moment for this project. A stripped-down casino is in no one’s interest in this town. We’re trusting you to deliver what was promised, Mr. Kim.

Still, given the flashing warning lights we’re seeing right now, the mayor would be wise to have a contingency plan.