Bally’s Chicago Halts Construction as Casino Ups Ante in Video Gaming Terminal Fight

Bally’s Chicago has halted construction on its $1.7 billion resort casino, seemingly raising the stakes in the developer’s ongoing battle against slot-like video gaming terminals (VGTs) across the city.

On Sunday (Aug. 9), Bally’s Corporation notified the Chicago Community Builders Collective (CCBC) that it was pausing construction on the 34-story hotel and other non-gaming amenities. The permanent casino is still set to open early next year in the River West neighborhood.

The shocking news comes as Bally’s fights the city’s plan to authorize VGTs in bars and taverns, restaurants, truck stops, and veterans and fraternal organizations. Bally’s contends that the City Council’s VGT endorsement violates the casino company’s Host Community Agreement, struck in June 2022 when Lori Lightfoot was still mayor, that stipulates no other casino-style gambling shall be permitted within the city’s limits.

“The potential for an uncontrolled proliferation of VGTs is in breach of the City’s commitment not to expand gaming in the Host Community Agreement and creates uncertainty that could be harmful for Bally’s Chicago prospects,” the company said in a statement.

Mayor Brandon Johnson, who has been at odds with the City Council regarding VGTs, did not immediately respond for comment on Sunday.

Bally’s Bluff?

Bally’s told the CCBC that it’s “resetting the pace of construction” of certain “elements” of the $1.7 billion project. The 34-story hotel tower, however, was topped off in May, and Bally’s at this point has spent hundreds of millions of dollars in borrowed funds, largely lent by the resort’s forthcoming landlord, Gaming & Leisure Properties, Inc.

Bally’s could be using the construction stoppage as a bargaining chip in its ongoing mission to keep Chicago free of VGTs. The Chicago Tribune reports that Bally’s is also planning to withhold an annual $4 million city payment due in September unless the City Council rethinks its VGT support.

In late June, Bally’s enlisted Lightfoot’s law firm, Fahner Rosenberg (then RFK Global), to handle its government affairs in dealing with the VGT dispute.

“As we ramp up our efforts to protect our investment in the city, we have also brought on the strategic counsel of RKF Global, where former Mayor Lightfoot is a partner,” a Bally’s statement read. “We are pleased to have built an excellent and knowledgeable team here in Chicago.”

Bally’s Chicago is a planned casino with 3,400 slot machines, 170 table games, and a sportsbook. Resort amenities include the 500-room hotel, a 3,000-seat theater, numerous restaurants and bars, and a public park along the Chicago Riverwalk.

The temporary Bally’s Chicago casino has operated in the Medinah Temple since September 2023.

Gaming Exclusivity

Bally’s won Chicago’s highly competitive bid for a downtown casino resort license, which was authorized through state legislation in 2019. The city’s selection committee, led by Lightfoot, chose Bally’s over several other bids, including from Hard Rock International and Chicago-based Rush Street Gaming.

Bally’s pledged to make a one-time $40 million payment upon being deemed the winner and an annual $4 million contribution to support the city. Bally’s also said it would create 3,000 construction jobs and 3,000 permanent positions.

Those pledges, Bally’s officials say, were made on the condition that it would have gaming exclusivity.

“[Exclusivity] drove up our bid. If we had known we wouldn’t have exclusivity, our bid would have been completely different,” said Christopher Jewett, Bally’s senior vice president of corporate development. “Exclusivity was promised.”