Tuesday, May 11, 2010

GOOD Economic News? Whaaa?

In economics, what goes down must go up sooner or later, right? According to the Las Vegas Convention and Visitors Authority's monthly data dump:

* Total rooms occupied in March is up 0.8% and year-to-date 1.4%
* Room rates even inched up 0.8% to an average of $93.23
* Auto traffic at the NV-CA border was up 6.2%
* Gaming revenues for the Strip were in 2.4% in March and -- get this -- 9.8% year to date.
* Visitation overall increased 0.7% in March, the seventh consecutive month of positive change.
* Convention attendance in March was up 5.2%, although it's still down 8.3% year to date. Evidently, though, a big tradeshow normally in April was in March this year, so it may mean nothing.

What it means: More people -- a modest amount, but Vegas must take what it can get -- are coming, they're even paying and playing a bit more, but they're driving. (Air traffic was down 4% in March.) Also, despite MGM Mirage CEO Jim Murren's loftiest pre-opening predictions that CityCenter would be responsible for a large surge in visitation this year, there's no evidence of any impact whatsoever, large or small, as yet.

What it means to you: The end of the absurd bargain fire sale that has been Vegas for the past two years is within view. The rest of this year maybe the last time you ever can get Vegas this cheap again. It certainly won't be getting less expensive from here on out, except maybe in the downtown area where gaming revenues fell 10.6% in March.

On one last side note, the math continues to be spectacularly disastrous for Mesquite. Even with 9.6% fewer rooms available because of resort and tower closures, the charming Nevada-Utah border town's occupancy fell 6.5% and total room nights plummeted 15.7%.


robertw477 said...

I dont exactly agree about room rates with steves comments. Room rates should be under extreme pressure for a number of years. The prices that were had in the big run up 2000-2008, those days are over. Remember that these condo hotel rooms also add to the glut of rooms. Even many holiday weekends offer rates at much lower than in previous yrs. When will wynn and venetian be able to charge those 400.00 room nights for fri and sat night? Rates of 300-400 night were commonplace even on a regular weekend with no huge events in town. Even Wynn told Steve a few yrs ago in an interview how he is surprised that people will pay 400 a night to put their heads on a pillow. Midweek nights are under the most pricing pressure. I think recent stats show the "worst may be over" however take a look on how things are going over at MGM and the ARIA. Lesser hotels like circus, excalibur and luxor are suffering more because you can get a great room for ($99 a night weekdays) at wynn as a member of the players club. Keeping room rates lowered with the hope people will buy some meals and shows. Maybe even a little gambling, which was the vegas business model for many years.

martyseattle said...

'The end of the absurd bargain fire sale that has been Vegas for the past two years is within view.'

mwahahahaha ... just wait till the double dip hits.