Prominent River North developer Albert Friedman has won big with Bally’s.
The longtime Chicago real estate player with strong political connections struck a $20 million deal with the casino operator for the use of the historic Medinah Temple building as a temporary gambling hall while Bally’s builds its permanent, $1.7 billion entertainment complex at the Chicago Tribune printing plant in River West, the Sun-Times reported.
Bally’s will pay $16.5 million in total rent over a four-year term and $330,000 in management fees, plus the property tax, which has exceeded $1.1 million a year.
The Medinah Temple is about a mile north of City Hall and owned by Friedman, who has leased properties to influential figures in Chicago politics, including three mayors — Brandon Johnson, Lori Lightfoot, and Rahm Emanuel.
If Bally’s chooses to extend the lease for an additional two years, Friedman stands to gain an extra $9.6 million in rent and management fees, with Bally’s continuing to cover the property taxes.
The decision to use the Medinah Temple as the temporary casino location came as a surprise to some, as Bally’s had initially expressed a preference to build one on the Tribune property, adjacent to the site of the permanent complex. However, city officials cited complications related to the replacement of the Chicago Avenue bridge as a reason for Bally’s to go with Medinah.
The temple is a 111-year-old building previously used by the Shriners fraternal organization, and has been fitted with approximately 750 slot machines and 50 table games. Bally’s is expected to operate there for three years while the River West property is built.
Bally’s has undergone testing sessions at the Medinah Temple to obtain a temporary operating permit, with expectations of generating monthly profits ranging from $3.5 million to $5 million through the end of the year and potentially up to $60 million with a full year of gambling in 2024.
City officials are hopeful that the temporary casino will bring in up to $55 million in annual tax revenue, with the permanent casino projected to generate nearly $200 million a year upon its expected opening in 2026.
Friedman, known as the “mayor of River North,” has been involved in numerous redevelopment projects in Chicago and has financially supported various political campaigns in the city. Like many owners of big commercial properties, he hired the law firm of former Illinois House Speaker Michael Madigan — who’s currently under indictment in an unrelated federal political corruption investigation — to appeal the Cook County Assessor’s Office valuation of the building to try and lower the assessment to score a cheaper tax bill.
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Madigan’s appeal publicized Friedman’s lease with Bally’s, and resulted in the assessor agreeing to cut the Medinah Temple’s taxable value from $27.2 million to $23.4 million; the Cook County Board of Review turned down Madigan’s attempt to further argue the property should be taxed at an $18 million valuation, the outlet reported.
Bloomingdales had previously leased Medinah Temple after Friedman converted it into a furniture store for the company, but the retailer moved out in October 2020 and it’s been vacant since, which is why Friedman contended its value shouldn’t have increased nearly 20 percent as the assessor initially suggested.