• Las Vegas development site might be worth USD 500m, but weak market depresses value
• Bally’s under pressure to boost liquidity in order to meet minimum liquidity requirement
• Company explores financing options, including asset monetization, equity sale, and debt financings

Market participants are watching to see if Bally’s can monetize its Las Vegas development site as the gaming group faces pressure to boost liquidity while it pursues a major expansion, said two sector advisers and two credit analysts.

The highly levered company holds the ground lease and development rights for the former Tropicana Las Vegas site and has earmarked 26 acres for the construction of a casino/resort and mixed-use development next to a new major league baseball stadium. Each acre may be worth up to USD 20m, which could collectively bring over USD 500m in funding for Bally’s in a sale, said the first and a third sector adviser.

The development rights might be worth less than half that amount, at around USD 200m, due to the soft Vegas market, the two credit analysts said.

The gaming group said in May that revolving credit facility lenders, agented by Deutsche Bank, granted a waiver from a consolidated net leverage ratio covenant, subject to Bally’s remaining in compliance with a minimum liquidity maintenance requirement of USD 300m as of 31 December. By August the company issued a going concern warning and said in a filing that it doesn’t forecast it will be able to satisfy the liquidity requirement, absent securing new financing.

Bally’s said it is actively “pursuing a number of financing alternatives intended to enhance its liquidity, including asset monetization, an equity sale, and debt financings.”

The company ended 2Q26 with USD 390m in cash and USD 196m available under its USD 519m revolving credit facility. The company has been burning cash as it develops new projects, and revolver commitments are expected to step down by around USD 200m in October.

So far, it appears that Boyd Gaming is the only party that has shown interest in the Tropicana site, the credit analysts said. An industry journalist reported in August that Boyd has been talking to Bally about a USD 400m deal. The news sent Bally’s bonds up sharply with its USD 735m 5.875% senior unsecured notes jumping over 9 points to 69.50 on 20 August, according to MarketAxess.

Along with purchasing the rights, a potential buyer will need to raise an estimated USD 1bn to USD 2bn to develop the site, one of the credit analysts said.

Bally’s has tapped JLL to find retail tenants for the area surrounding the stadium, but it has not yet announced any prospective tenants, the same credit analyst said.

If Bally’s doesn’t sell the Vegas site, there is growing concern that it will struggle to line up additional financing to support the construction of a permanent Chicago casino and build a multi-billion casino in the Bronx to capitalize on its valuable New York City gaming licence, two of the sector advisers said.

Bally’s has relied on Gaming and Leisure Properties (GLPI) as a capital partner to purchase real estate under some of its casinos and support the Chicago project. This has effectively put a lien on Bally’s, giving it elevated leverage and making it a risky partner for additional financing sources, a credit analyst said.

“Bally’s tends to oversell on its abilities and underdeliver on executing,” the first credit analyst said, noting that Chicago casino completion was pushed to 2027 from 2026.

Still, Debtwire credit analysts wrote in August that given Bally’s history of working with lenders, the company will likely be able to work through its covenant issues and avoid a formal restructuring.

Bally’s has disclosed it signed a term sheet in July with an unnamed party to further develop the Bronx project and for general corporate purposes. It has also said it may secure an equity investment.

In February, Bally’s raised a new USD 1.1bn term loan from Ares, King Street Capital Management and TPG Credit that allowed the company to complete a sale and leaseback transaction for the Twin River Lincoln Casino Resort.

The new term loan, along with proceeds from an asset sale and the leaseback, allowed Bally’s to retire a USD 1.47bn term loan held by a group of lenders who had organized under a cooperation agreement with Akin. That group objected to a proposed pay down and modification of the loan last year.

In a statement, a Bally’s representative said the going concern language reflects a “forward-looking technical accounting analysis” and “does not consider anticipated in-the-works future funding until definitive agreements have been executed, or utilization of assets to meet future obligations.” Bally’s fully expects that it will meet future funding needs, the representative said.

This viewpoint is supported by Wall Street analysts, the representative added.

A Stifel analyst said in a note that they believe that Bally’s will attract tenants for its Las Vegas retail development, which would be used to help secure financing. Citizens analysts said that the situation “does not appear to be dire.”

Representatives for GLPI, JLL and Boyd did not respond to requests for comments.