Calling a redeal: Lightfoot pushes back casino application deadline, hoping to draw some action to the table
The mayor’s office is moving back the deadline by two months to give developers “more time to fully assess” the project. But one major casino operator already said “I’ve got no interest in Chicago,” and another said “Chicago is just complicated.”
Mayor Lori Lightfoot on Friday announced she’s pushing back the deadline for bids to build a long-sought casino in Chicago as the city looks to lure more developers to the table.
Proposals for the mega-casino had been due Aug. 23, but interested parties now have until Oct. 29, giving groups “more time to fully assess” the opportunity and “assemble more competitive bid packages,” according to Lightfoot’s office.
“Extending the deadline for interested bidders will allow the City to collect as many robust, impactful and transformative proposals as possible,” the mayor said in a statement. “I look forward to seeing these bids roll in and working very closely with whichever team is ultimately chosen to develop Chicago’s first-ever casino.”
Lightfoot’s office said “several potential bidders sought additional time.”
But operators have had more than two years to mull a run for the potential big-city cash cow, which was authorized as part of a massive statewide gambling expansion signed into law in 2019 by Gov. J.B. Pritzker.
After winning a legislative fix in Springfield to lower a tax rate that a state-hired consultant deemed “too onerous” for any casino operator to make a profit, Lightfoot put out a formal request for proposals in April.
This latest two-month delay could signal a lack of interest in what some industry experts still consider a risky proposition, even after the sky-high tax rate was lowered from an effective rate of about 72% to 40%. The leaders of corporate gaming giants MGM Resorts International, Wynn Resorts and Caesars Entertainment have already said they’ll pass on the project.
“I’ve got no interest in Chicago,” Caesars CEO Tom Reeg said during a quarterly call with investors earlier this week.
MGM expressed interest in the casino prospect last summer as one of 11 groups that responded to a non-binding request for information from the city, but last month, CEO Bill Hornbuckle said: “Chicago is just complicated. The history there in Chicago, the tax and the notion of integrated resort at scale don’t necessarily marry up.”
City officials haven’t said how many proposals have been submitted, if any.
Another group that has shown interest is a joint venture between developer Related Midwest and Rush Street Gaming, the latter of which is chaired by billionaire Neil Bluhm and which already operates Rivers Casino in Des Plaines, the most lucrative gambling facility in Illinois.
A potential bid from that group — with little competition — could put Lightfoot in a political bind. Bluhm’s daughter Leslie and her sister Meredith Bluhm-Wolf have given more than $200,000 to Lightfoot’s campaign fund.
Rush Street is also in the running for a new casino to be built in Waukegan.
Some analysts believe Rush Street will propose a casino for the development site downtown known as The 78, among 62 vacant acres southwest of Roosevelt Road and Clark Street.
Lightfoot is leaving it up to developers to propose locations. Her office has said it will pick “one or more qualified applicants” and hold community meetings through the end of the year, before negotiating “host community agreements” with those potential developers.
Lightfoot’s pick would then be put up for City Council approval. The Illinois Gaming Board has the final say on issuing a license. The mayor has said she expects the finished casino-resort to open by 2025, though an operator can set up shop at a temporary site once the developer gets state approval.
There are already 10 casinos operating in Illinois and five more in the pipeline, not to mention four more operating in northwest Indiana, including the Horseshoe Hammond that’s a half-hour drive from City Hall. That’s all on top of more than 40,000 slot machines operating in bars, restaurants and other establishments across Illinois.
City officials contend there is room to “grow the pie,” or increase the size of the gaming market. In 2019, consultants at Union Gaming found that per-capita spending on gaming in the Chicago area was half that of other metropolitan regions.
“The Chicago casino project is currently one of the most attractive casino-resort development opportunities in the country,” Lightfoot’s office said.
Contributing: David Roeder and Fran Spielman