Bally’s Buys Plot for Chicago Complex
Major casino and sportsbook operator Bally’s Corporation has announced that it has just closed a deal worth up to a whopping $500 million (£423.3m/€488.1m) with a real estate private equity firm in Chicago. As a result of the deal, the firm has acquired the 30-acre Tribune Publishing Center site where Bally’s Chicago will be situated.
Bally’s Corporation has announced that it has just closed a deal worth up to $500 million (£423.3m/€488.1m) with a real estate private equity firm in Chicago to acquire the plot of land where Bally’s Chicago will be constructed. ©12019/Pixabay
Private Equity Firm Will Also Invest $300 Million in Bally’s Chicago Complex
In the latest development in Bally’s Corporation’s Chicago mega casino project, the world-renowned casino and sportsbook provider has revealed that it recently closed a deal worth up to an impressive $500 million (£423.3m/€488.1m) with a real estate private equity firm in Chicago. As an outcome of the deal, the firm acquired the 30-acre Tribune Publishing Center site where Bally’s Chicago is scheduled to be built and located.
The details of the agreement stipulate that Bally’s will be able to lease back the land from the real estate firm in a ground lease agreement. The agreement first stipulates an initial 99-year term, which will be followed by ten separate 20-year renewals. Also worth noting is that the private equity firm will invest up to $300 million into Bally’s Chicago’s development over the course of the deal.
Soo Kim, who acts as the chair of Bally’s board of directors, expressed excitement at being able to join forces with one of the city’s premiere private equity firms, continuing to promise fans and onlookers a world-class betting complex:
“We are excited to be partnering with one of Chicago’s leading real estate private equity firm as we progress with building our $1.7bn flagship property in the Chicago market. We continue to demonstrate our commitment to delivering a world class entertainment facility that supports Chicago’s economy and community.”– Soo Kim, Chairman, Bally’s Corporation, Press Release
Deal Allows Bally’s to Purchase Back Plot from Firm at Fixed Capitalization Rate
Another advantageous part of the deal for Bally’s is that the rental rate for the lease is set to yield an 8.5% annual capitalization rate for the private equity firm it is using to acquire the land for Bally’s Chicago, which will adjust to 7.0% after Bally’s receives specified entitlements and gaming approvals.
Furthermore, the deal also gives Bally’s the ability to repurchase the land from the equity firm at a fixed capitalization rate from the fourth to the eighth year of the lease term. Finally, as is somewhat standard procedure with such deals – if certain elements of the deal are not met or if Bally’s defaults under the lease, Bally’s may have to reacquire the site.
Chief financial officer over at Bally’s, Bobby Lavan, characterized the deal with the private equity firm as a symbolic step forward in the Bally’s Chicago project, claiming that Bally’s now has sufficient liquidity available to finance the full project:
“This transaction is an important step in our development plan for Bally’s Chicago as we continue to work towards opening the temporary casino in mid-2023. With this new real estate partnership, Bally’s has ample liquidity on hand to fund Bally’s Chicago without needing to access the capital markets.”– Bobby Lavan, Chief Financial Officer, Bally’s Corporation, Press Release
Bally’s Struck a Deal with Chicago Unions in October 2022
In other recent news concerning the massive Bally’s Chicago complex, the casino and sportsbook operator revealed just recently in October 2022 that it had finally arrived at an agreement with a consortium of trade union organizations in relation to the construction of casino complex, resulting in the signing of a multi-project labor agreement (PLA) with the collective.
The unions in question are the Chicago & Cook County Building & Construction Trades Council (CCBT) and the AFL-CIO Building and Construction Trades Department, with the CCBT in particular representing a whopping 100,000 people stemming from 23 affiliated construction trade organizations.
Soo Kim took the occasion to stress how much Bally’s supposedly values the organized labor movement, even going so far as to mention how integral it was to the development of Chicago as a major global city:
“At Bally’s, we believe our company should reflect the community. This PLA is a demonstration of our commitment to embrace organized labor that has played such a key role in building the great city of Chicago. This is the first step of a project that will be built by Chicago, for Chicago, and help the city keep its promises to the police and fire pensions. We are also committed to inclusivity and our partnerships with the CCBT, Chicago Federation of Labor, and Hire360 will ensure our workforce will reflect the rich diversity of the city.”
Bally’s Donated $600,000 to International Center for Responsible Gaming in August 2022
And in August 2022, Bally’s scored charity brownie points when it revealed that it had donated $600,000 to the International Center for Responsible Gaming (ICRG) to support the center’s continued research on the problem of gambling among young adults.
Thanks to Bally’s generous donation, the ICRG has now put out a call to scientists from around the world inviting them to apply for funding to assist with the center’s research projects into gambling.
The International Center for Responsible Gaming (ICRG), Arthur Paikowsky, explained that the grant proves Bally’s is serious about promoting safer gambling:
“With this grant, Bally’s has taken a giant stride toward understanding the health risks of young adult gamblers and improving the effectiveness of existing responsible gambling tools. The ICRG salutes Bally’s for making such a huge impact on the field of gambling studies.”
