Editorial: Chicago casino revenue remains a roll of the dice for the city
Any definitive verdict on the new Chicago gambling emporium, Bally’s Chicago, is premature. The operation is still in its temporary home at the Medinah Temple in River North, its revenue performance extends back just four months, and, as anyone who has visited the new casino can see, the operation is still finding its feet.
But if the city of Chicago were playing blackjack to buoy its underwater fire and police pension funds, it would be well advised to insure its hand.
Old revenue projections are looking like progressive jackpots that don’t often hit. And Mayor Brandon Johnson’s budgeted $35 million in 2024 local tax revenue now looks aspirational at best.
How well the casino currently is doing is a contested issue, which you can see from reporting that’s all over the map. Bally’s itself trumpets the steady rise in visitors (100,000 through the doors in December), a rise in adjusted gross receipts ($8.5 million in December, up $900,000 from the previous month) and some recent improvements for customers, including more promotions and better parking deals. That last one is crucial: Bally’s’ competitors all offer free parking and, paradoxical as it may seem, nobody hates to pay to park more than gamblers feeding slots.
But a variety of outside eyes have seen reels flashing with warning signs. Visitors and big spenders are not the same thing.
According to the Illinois Gaming Board report on December operations, the Grand Victoria Casino in Elgin, Harrah’s Joliet and, especially, Rivers Casino in Des Plaines have far higher revenue than Bally’s Chicago. Even the Hollywood Casino in Aurora, which is in a down-at-heel state in preparation for a move out of that river city’s downtown and toward the tollway, is pulling down comparable revenue to Bally’s Chicago.
Granted, those are established operations with loyal customers. But none of them have access to the visitors who come to Chicago nor do they have so many hotels or office buildings on their doorstep. Typically, new casinos get an opening novelty boost too.
When a Chicago casino was first discussed, if you’d said it would be outgrossed four months after opening by operations in Elgin, Joliet and Des Plaines, you’d have been met with skepticism. There has not been much buzz around the new Chicago casino; far less than we anticipated, given the length of the wait.
Maybe all this will change with the new building, slated for the site of the Tribune’s Freedom Center. At that point, Bally’s will have flashy bars, restaurants and a hotel, per the current plan, and a lot more stations and attractions for gamblers. That includes a dedicated parking lot.
But an important difference now in the gambling world from when this casino first was discussed has changed the odds of success — sports betting. With a Draft Kings operation at Wrigley Field and prop bets as close as your phone, the newly legal activity of betting on sports is simply more attractive to many people than feeding a slot machine. Most of the slots in the temporary Bally’s are especially unimaginative, generic and unexciting. These days, slots often are nothing more than video terminals that can easily be changed over. It’s more fun to pick a team and a parlay, especially for younger people.
Las Vegas, of course, already has figured that out and doubled down on sports and concerts at the kinds of venues, such as the eye-popping one called The Sphere, you can’t find elsewhere.
There will long be a market for local Midwest casinos, which offer a fun escape from often sleepy towns, but Bally’s still has to figure out how to position itself in the big city. Certainly, when it comes to its Chicago operations, it will need to develop, brand and market high-quality restaurants, bars and entertainment, as we’ve said before. Will it? Time will tell.
But in terms of Chicago’s dreams of windfalls to come, the smart money should assume nothing. There will be an inflow, but it’s far from clear how much.
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