Chicago Casino Operator License Open for Bids

With a population of just under 9,000,000 people, Chicago is the third-largest city by population in America. The city is also home to some of the most storied sports franchises in history, including the Chicago Blackhawks (NHL), Chicago Cubs (MLB), Chicago White Sox (MLB), Chicago Bears (NFL), and the Chicago Bulls (NBA).

With the legalization of sports betting in Illinois, there has been a drive to get a state-of-the-art retail casino built close to the heart of the city. As part of that drive, the license for the said casino would likely include a sports betting license for both retail and online sports betting operations.

About four months ago, Chicago Mayor Lori Lightfoot made the call for a request for proposal (RFP) from parties that would be interested in securing this highly regarded opportunity. The expectation was a number of the major casino operators out of Las Vegas, Nevada would be jumping at the opportunity to build and operate a casino in Chicago.

The deadline for RFP wax was originally set for August 23, 2021. As that deadline approaches, the Mayor has been disappointed with the responses she has been getting. Based on that, she has formally extended the deadline to October 29, 2021.

The Problem With Placing a New Casino in Chicago

Only four responses to the Mayor's request have been received. Of the four, only two companies seemed interested in going forward. MGM Resorts International and Wynn Resorts took a hard pass due in large part to the fact the casino industry in Illinois has not fared very well over the last few years. The only successful operation has been the Rivers Casinos – Des Plaines by O’Hare International Airport.

By the way, Rivers Casino is owned and operated by Rush Street Gaming, a company that is expected to submit a proposal to the city. In fact, they will likely be the leading candidate to land the license because of ownership's personal connections to the Mayor and Gov. JB Pritzker.

For some gambling conglomerates, a deal in Chicago is fraught with peril. First, the state is looking to claim a 40% tax rate from gambling operations. That is an insane amount to most of the major companies out of Nevada. After factoring in the reluctance of some companies have to invest in new casinos when they are trying to dig out of financial trouble due to the COVID19 debacle, this is not the right time or place for this kind of investment.

Potential Players in Chicago

With many of the "big boys" choosing to steer clear, only a few companies are interested and would seemingly be a good fit for this opportunity.

As we stated, Rush Street Gaming would have to be considered a strong frontrunner. However, the Hard Rock Florida Group has made clear they are interested. It turns out the Seminole Indian Tribe has plenty of cash resources and is looking to make a move outside of Florida. If they can clear some sports betting legal issues in Florida, they could give Rush Street Gaming a run for the money.