There’s multiple levers for us to continue to find financing there. But at the end of the day, I think there’s a generalized like belief that we’re going to be subject to unlimited inflation. It’s actually almost the opposite. The minute we hit our number, we fulfill the — that’s the main substantive point in the host community agreement with the city, and therefore, we’re allowed to open the facility. And let me tell you, we will make sure that, that 4,000-game position facility opens on time and on budget. So that’s the main of it. The Trop is actually sort of an interesting situation in the sense that — again, I think as Marcus has alluded, it’s actually caused — the good news has been — in the very near-term bad news, because as we’ve lost — as we now know that at some point we will redevelop the site, that where we — when we first purchased it, it was operating at a EBITDAR decently positive, and then we had the rent, and so, it was a carry-positive asset.
As the — to be completely frank, the EBITDAR has declined as bookings are harder to manage, because people don’t know when it’s going to close, and also, frankly, our employees are starting to leave as there are new properties opening in the area, and they don’t know when we’re going to redevelop. So, in the very near-term, actually, it’s caused a hit to our financials, but obviously, again, as Marcus has spoken to, we believe that the asset value we have here has gone up a reasonable amount. So look, we just have to decide based on what we think the financing and partnership picture is here, how we’re going to go. And so, we’ll just say that, look, we are well aware of where our shares trade. We’re well aware of what we think the return on capital is in properties like Chicago, New York, and Las Vegas, and we will spend — we will prioritize correctly and make sure that we allocate capital to what we think is the most attractive, and obviously, [force-rank] (ph) that capital, so it’s not like we’re going to run out of capital spending it on everything.
And then obviously, if there are projects that we think force-rank lower, then we would look to find partners or essentially even offload them. So look, I think you have to believe that the Board and the shareholders of this company are going to be rational about how we allocate capital. On New York, probably the most speculative because, obviously, it’s something that is just an RFP that’s continuing. But, again, as George pointed out, we happen to have the only site that currently has our local electives in support. Things could change, but that’s pretty exciting, and, obviously, it’s a prize that pretty much every gaming company in some way, shape, or form is competing for. So I guess the question would be if we were to win the prize, would we be able to find the right kind of financing and partnership to get that developed.
Again, that’s a little further out, but I think you can make the assumption that we will make a prudent decision.
Operator: Our next question comes from Brandt Montour, Barclays.
Brandt Montour: In Las Vegas, the lease you hold where the Trop is currently, that lease is arguably much more valuable today with the A’s pending decision. Is there a world in which you would sell that lease to create liquidity to fund the other projects, buy back debt, or buy back equity? Just curious how you look at that, how you balance that cost-benefit?
Marcus Glover: Yes, I guess the best way to answer that is I think for the right price, we’d probably unload anything. But if you think about the nature of that transaction, we traded into that deal with a couple of our properties and got a lease that is very attractive and it’s traded into a value that is enormous for us right now. And so, whether we develop that ourselves or whether someone presents us an offer that at a minimum valued at $9 million an acre, we’d absolutely entertain that. We have no plans at this moment, but if someone approached us, we’d absolutely entertain divesting of it.
Brandt Montour: And then, on International Interactive, in the prepared remarks, and I hope I caught this correctly, there’s a sort of target margin of low to mid-30%s, and I think you guys mentioned reinvesting or sort of ramping up investments in Asia and maybe another locale. And I guess the question is, is there a — maybe not, but is there a subtle sort of strategy shift? I mean, I think the story had been sort of cutting marketing margins, had been going up quarter-on-quarter for the last three quarters. And so — and I think you guys did 35% this quarter. So, yes, is there — are you going back on offense there? And what would you — how would you respond to that?
Robeson Reeves: Yeah, thank you. Robeson here. We will spend where the ROI stacks up. We have enough — as we’ve been showing you, we’ve got real control and real grip on these businesses. So you’ve got your revenues and we’ll pull the levers to make sure that we extract them right EBITDAR. Yes, I think we’ll hold mid-30%s, but if opportunities come, we’ll spend for growth. We want to get the right growth, but we want to get the right EBITDAR at the back. I’m very happy with where International Interactive is. We should remember that these are highly competitive, mature markets, and we continue to grow share. I believe there’s many mature markets in the world out there where we’re showing that we can also grow share, such as New Jersey, such as Pennsylvania.
I’m very, very positive with where we are and we’re really showing that we have a grip on our cost structures. Just to add there, we announced the headcount reduction because we’ve gained confidence with White Hat and Kambi providing a platform for us in North America, which will be a better product offering in the long term for us. That will result in approximately a 300-person headcount reduction. That will make us a stronger company, but also improve our margins too.
Operator: Our next question comes from Ricardo Chinchilla, Deutsche Bank.
Ricardo Chinchilla: I was wondering if you could provide some color regarding the funding of the hard cost for the Chicago project in 2025, perhaps including the total amount needed, although being a rough estimate, the alternatives that the company has identified, like doing additional say lease by transaction at the restricted groups, sending the money, looking for a REIT partner, what’s the preferred funding source that the company at this point has identified, and perhaps some color on the timing for a financing transaction? And if you could also please confirm that if the company decides to raise money at the restricted group, do you have plenty of avenues to do that, that you have enough restricted payment capacity and investment capacity to send money to the unrestricted sub? Is that capacity in excess of like $300 million?
