Las Vegas Strip completes Covid comeback (thanks NFL, BTS)
Las Vegas had a dark 2020 with the pandemic forcing Sin City to shut down. Caesars (CZR) – Get the report from Caesars Entertainment Inc.MGM Resorts International (MGM) – Get the MGM Resorts International Reportwynn (WYNN) – Get Wynn Resorts, Limited Reportand the rest of the players on the famous Las Vegas Strip literally had to shut down their massive operations, and when they reopened, tourists didn’t flock.
In August 2021, temperatures were approaching 110 degrees and Las Vegas was practically glistening in the sun. Las Vegas Boulevard wasn’t completely empty of people, but homeless people seemed to outnumber tourists and it felt a bit like a post-zombie global apocalypse.
Not all casinos had opened, and some that were open lacked paying customers. It was a dark time for Caesars and MGM, which had restored many of their properties to working order only to see conventions canceled and tourists stay away due to mask mandates, social distancing and other rules related to covid.
Things weren’t so different in early January 2022, when a very low-key Consumer Electronics Show (CES) took place. It’s an event that typically draws nearly 200,000 people to Las Vegas, filling hotels and driving up room rates.
Instead, only around 30,000 people showed up, hotels were well under 50% capacity, and the city felt eerily empty. A few months later, however, March Madness and the end of mask mandates led to a revival in Las Vegas. Now, as Sin City heads into spring, the crowds have returned and investors from Caesars, MGM and Wynn can celebrate some major catalysts. This should boost business.
Las Vegas welcomes a return to normal
The former Oakland Raiders became the Las Vegas Raiders in 2020, at the height of the pandemic. That meant limited crowds and none of the party atmosphere that made Las Vegas such a popular destination. That changed in the 2021 season at the stadium which was packed, but city crowds were still lagging behind. Now, the NFL will lead the return to Las Vegas as the league draft takes over the Strip for three days to close April.
This event, broadcast on Walt Disney’s (SAY) – Get The Walt Disney Company Report ESPN and ABC will show that Vegas has regained its former glory as the party capital of the world. The draft, along with four shows from K-Pop sensation BTS, and a major trade show, the National Association of Broadcasters (NAB) show, saw April hotel room rates four to five times higher than they were in 2021, according to the Las Vegas Review-Journal.
Scroll to continue
“The numbers didn’t surprise me much because we have good events that will fill the destination meaning you can order a higher room rate and you will get a higher room rate because as capacity increases, the rate increases,” industry analyst Brendan Bussmann, founder of Las Vegas-based B Global, told the paper.
“There are a lot of factors that come into play, but it’s no different than New Year’s Eve having high rates or CES or anything else,” he added. “It will be interesting to see how much the ADR (average daily rate) is impacted when the first quarter results are released, just because CES had such low rates this year.”
It took a few months longer than expected, but Las Vegas, Caesars, MGM and Wynn seem to be back.
What it’s like in Las Vegas right now
In August 2021, with temperatures soaring, Las Vegas felt empty and the city just smelled musty rather than offering the rather fragrant marijuana smell that tends to dominate the Strip. Now, Las Vegas Boulevard doesn’t feel as crowded as it can on a busy weekend in Vegas, but a few weeks before the draft, during a slow week after March Madness, pre-NBA and the playoffs of the NHL, the city feels alive (and, yes, the Strip smells like weed).
And, over the month, hotel prices have gone from an average of around $100 per night in 2021 to over $400 per night during BTS, NAB and the NFL Draft.
“When hotels set their prices, they use what we call demand-based pricing,” Amanda Belarmino, assistant professor at UNLV’s William F. Harrah College of Hospitality, told the Review-Journal. “That means the rates fluctuate depending on what’s going on at the property or in town. For most hotels, they set an initial price 6-12 months before arrival and then make changes based on the booking.”
Las Vegas casinos, however, offer high-paying rooms to frequent gamblers (and Caesars and MGM have continued to be aggressive in sending free room offers to even mid-level/moderate gamblers). You can be sure, however, that the big casino operators know their stuff and that even “free” rooms come at a price as customers fill restaurants, casinos and pay hundreds for BTS, Adele, Sting, Zedd and more. other titles. booked this spring.
They say in Las Vegas that the house never loses. That wasn’t true during the covid pandemic, but Caesars, MGM and Wynn seem to have put together a winning hand.