Bally’s Credit Downgrades Won’t Keep Company From Pursuing Petersburg Casino

Rhode Island-based Bally’s Corporation suffered its third credit rating downgrade this week when Fitch Ratings on Monday lowered its outlook on the casino company from “B+” to “B.”

A Bally’s sign goes up on the former Eldorado Resort Casino Shreveport in Louisiana in 2021. Bally’s has been downgraded yet again, this time by Fitch, but the development won’t impede the company’s ability to pursue a casino project in Virginia. (Image: Shreveport Times)

The non-investment grade implies Bally’s has a “negative” outlook because of its murky financial situation. The company is scrambling to raise $800 million to fund the construction of its $1.1 billion casino resort scheme in downtown Chicago at the Freedom Center.

Along with Chicago, Bally’s wants to build a smaller casino in Pennsylvania near the Penn State University campus. Bally’s officials have also expressed interest in building a casino in Virginia should an opportunity arise by way of Petersburg.

Bally’s bid on the Richmond casino opportunity in 2021 but was not picked by local officials in the Virginia capital. Richmond’s casino plan was ultimately rejected by city voters.

Legislative efforts have since relocated the Richmond casino license about 25 miles south to Petersburg.

The Virginia General Assembly last month passed legislation to allow the Petersburg City Council to field proposals for a casino resort, but the bill hasn’t yet been signed by Gov. Glenn Younkin (R). The governor has until April 8 at 11:59 pm EST to act on the measure.

Bally’s Remains Interested in Petersburg 

Fitch joined its “Big Three” credit rating counterparts —  Moody’s and S&P — in lowering its grade for Bally’s. Despite the demotions, Bally’s brass told The Progress-Index that the rating adjustments won’t impact the company’s ability to participate in a competitive bidding process should one occur in Petersburg.

We remain confident in our proposal to construct a world-class casino resort in Petersburg,” a Bally’s spokesperson wrote in an email to the Petersburg news outlet.

“The success of this proposal, however, is contingent upon our selection by the city and the city’s voters’ approval via referendum in November,” the Bally’s release continued. “We are optimistic and look forward to the next steps in the process.”

Though Bally’s might still bid on the Petersburg casino license should the city become authorized to conduct a bidding period, the city council might be smart to go with a competitor due to the company’s situation.

It’s unknown at this juncture how many companies might bid on a Petersburg casino, but Maryland-based Cordish Companies has expressed interest. Cordish in late 2022 floated a $1.4 billion mixed-use development in Petersburg that would include a casino resort. The project would be built over many years through several construction phases.   

Youngkin Mum on Casino Bill

Youngkin is reviewing hundreds of bills the Virginia General Assembly passed during its 2023 legislative session, with one being Senate Bill 628. The legislation seeks to qualify Petersburg as a host city for a commercial casino.

Virginia has four other cities where casinos are allowed — Norfolk, Portsmouth, Bristol, and Danville.

There were recent rumblings in Richmond that the governor might use the Petersburg casino bill to rally support for his Potomac Yard Entertainment District. But after billionaire Ted Leonsis last week agreed to keep his professional sports teams in Washington, D.C., effectively ending the Potomac Yard project, that bargaining chip is off the table.  

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