Bally’s Corporation has secured funding for its permanent casino in Chicago from Gaming and Leisure Properties thanks to a new lease arrangement. This will allow the former company’s property in the city to progress after a period of financial uncertainty.
According to the announcement, an affiliate of Gaming and Leisure Properties agreed to acquire the real estate underlying the project and amend the existing land lease via a new master lease agreement (Chigaco MLA) with Bally’s Chicago as tenant.
Rent will stand at $20 million a year, subject to escalation. In addition, the Chicago MLA can provide up to an additional $940 million of construction financing for the project’s hard costs via monthly draws.
The Chicago MLA will have an initial term of 15 years and various options for renewal.
As per the deal, GLPI will also be able to acquire and lease back additional real property interests underlying Bally’s Kansas City and Bally’s Shreveport for $395 million. Bally’s also plans to amend its Contribution Agreement with GLPI and sell and lease back its Twin River Lincoln for $735 million.
Under the Chicago MLA, Bally’s Chicago will receive $2.07 billion in financing from GLPI, reinforcing the two companies’ strategic alliance. As a company with an impressive track record in successful development and construction of casino resort projects, GLPI is an ideal partner to Bally’s, which is looking forward to benefiting from its expertise.
The New Property Will Complement the Chicago Skyline
Soo Kim, chairman of Bally’s, expressed excitement about the sale-leaseback deal with GLPI, saying that it fulfills Bally’s Chicago’s financing requirements.
We are delighted to continue our strong partnership with GLPI and to leverage its skilled resources and 30 years of experience developing and constructing successful gaming facilities. This is an amazing partnership that continues to pay strong dividends for both parties.
Soo Kim, chair, Bally’s Corporation
Peter Carlino, GLPI’s chief executive officer and chairman, also commented on the matter, expressing excitement about the new tie-up with Bally’s. He praised the latter company’s project in Chicago, calling it an “iconic addition” to the city’s skyline. Carlino also thanked Bally’s for its continued trust in GLPI.
Strategically, this is a means to grow our asset portfolio within the gaming sector that we know well and allows us to create value for our shareholders. We have strong confidence in Bally’s team and will be working hand-in-hand with Bally’s to bring this project to fruition on time and on budget.
Peter Carlino, CEO & chair, GLPI
For context, Bally’s just unveiled new renderings of its permanent Chicago casino hotel project. The property is set to be located at 777 W. Chicago Avenue and will include a 500-room hotel, a 3,000-seat theater, a 2-acre public park and multiple food and beverage options.
The casino itself will include 3,300 slots, 173 table games and VIP gaming areas.