November 22, 2022November 22, Summary
* Bally’s sell’s Chicago casino property site for $500m.
* The company plans to lease back the property to operate the casino over a 99-year term.
* The private equity firm that now owns the property will provide $300m in funding for the project.
Bally’s Corporation announced this week that it has sold the property it plans to use for a casino in Chicago to the tune of $500 million. The deal is a lease back agreement where a private equity firm now holds ownership and Bally’s will lease back the site for a 99-year term.
Details of the Transaction by Bally’s
The casino site is a 30-acre tract of land where the Chicago Tribune Publishing Center formerly operated. Bally’s will be able to lease back the property for many years to offer services, and once the 99-year time frame is up, the contract allows for 10 separate 20 year renewals.
The $200 million transaction includes $300 million in additional funds that will be used by Bally’s to continue the development of the casino. Board chairman for Bally’s Soo Kim commented that the company is excited to be partnering with a top real estate private equity firm in Chicago as they work towards building the $1.7 billion property.
Chicago Mayor Lori Lightfoot selected Bally’s Corp for the first casino in Chicago as part of a selection process that was ongoing for quite some time. Bally’s has plans to offer 3,400 slot games plus 170 table games, 10 dining options, and a hotel tower with 500 guest rooms.
Lease Back Deals are Common for Bally’s
The recent transaction by Bally’s is one of several lease back deals the company has completed this year. Back in April, the company sold a casino in Illinois and one in Colorado in a deal valued at $150 million to Gaming & Leisure Properties.
Gaming & Leisure took over the ownership of the land and buildings of both casinos. Bally’s will now lease back the sites, Quad Cities in Illinois and Black Hawk in Colorado, paying an annual rent of $12 million. The amount is subject to an increase over time.
In June, Bally’s agreed to sell the property and associated buildings of two casinos in Rhode Island, also to Gaming & Leisure Properties. This deal was valued at $1 billion. Bally’s will lease back Twin River Casino and Tiverton Casino, owning the casinos and managing all gaming operations.
By September, Bally’s completed an acquisition of the Tropicana Las Vegas, taking over from Penn Entertainment and Gaming and Leisure Properties. Bally’s paid $148 million for the nonland assets of the casino.