5 Saturdays Boost July Visitation 4.7 Percent

Don't get your hopes up too high, folks, but there's actually some seriously good news today on the economic front.

The LVCVA put out the monthly data for July, and the headline is that visitation and room-nights occupied were both up 4.7 percent and that room rates rose 4.8 percent over July 2009. Also, July 2010 saw a record drive-in traffic from California. At the same time, though, gaming revenue dropped 5 percent from last July, reflecting more frugal tourists.

The big caveat here is that there were five Saturdays in July, but guess what? That also happened in 2006, one of our peak years. I looked at the numbers from back then, and they tell the story even better:

* Visitation in July 2006 was only 1.1 percent higher than in July 2010
* There were 15,000 fewer rooms then
* The average daily room rate was $104.19, down $13.81 or 13.2 percent
* Gaming revenue for Clark County was $850,255,000, off more than $156 million or 18.4 percent.

So, the visitation gains are real. It's just that the rest of the enterprise remains a wreck. Downtown Las Vegas in particular is a disaster, down 19.3 percent in gaming revenue in July 2010 versus July 2009 but down 35 percent fr0m July 2006. Sweet lord.

Also sad: That extra Saturday didn't even help Laughlin and Mesquite, both of which still lost visitors in July 2010 versus July 2009. Laughlin room rates were down 12 percent, to $40.14 a night, although the Laughlin airport saw a 28.2 percent jump in passengers deplaning. Did a new carrier come to that market?

Bottom line: Las Vegas is still extremely popular. The notion that the city is dead, that it can never recover, is a lie. People still love coming here and they'll be back whenever they can afford it. That's the silver lining, even if it is way, way, way off in the horizon.

Economic Survivor Guilt

A number of months ago, my Little Brother's mom mentioned to me that she was looking to buy her first house but felt badly that she was going to get a killer deal on the back of someone else's misfortune. It was a fascinating notion, something I termed economic survivor guilt. It's not logical and it's not justified -- it's not her fault someone else lost their home -- but it's a unique experience to move into the living space of other people, a place where drama must have occurred.

As is often the case, it launched a story idea. It wasn't easy to pull this one off, though, because real estate agents don't want to help journalists locate people who have any misgivings or hesitations, however founded or unfounded. I did it, though, and this piece in today's USA Today is the result.

Take a read. It's obviously focused on Vegas since this is a foreclosure capital -- usually I do broaden these stories to other regions, but this one sat comfortably in one town for the most part -- but I am sure people feel this way in Florida, Detroit and elsewhere.

What is a little shocking to me is how angry so many of the USA Today commenters are. Nobody is suggesting that this sense of guilt is appropriate. But it's the human condition, usually, to feel badly for unfortunate others, isn't it?

This week's LVW col: When The Fun Stops

Here's this week's LVW col. Yes, it's a downer. Sorry. Hopefully it's a thoughtful downer, though. -sf

When The Fun Stops
Somewhere along the way, all the reasons to love living in Sin City went bye-bye
By STEVE FRIESS

For a brief bit of time earlier this month, I was reminded of how it used to be around here. Confident business leaders and politicians grazed on a sumptuous breakfast buffet at the Four Seasons, exchanging business cards and chatting about new deals they expected to come through. Then they settled down at tableclothed tables set with fancy china and watched as their leader, Nevada Development Authority CEO Somer Hollingsworth, talked up the land of opportunity that Las Vegas represents.

Hollingsworth, a man never accused of understatement, exhibited some brazen hubris in his talk, titled, “California Has Lost Its Mind and Las Vegas Is Providing Psychoanalysis,” running through the litany of challenges facing our neighbor to the west. He even—and I’m not kidding—donned a tinfoil hat as he mercilessly mocked California policymakers for their high taxes and generous state-sponsored services before explaining why the Golden State’s budget misery would lead to robust job growth here.

As weird as it was to see a grown man wearing a tinfoil hat, and as unseemly as it felt to hear people cackle at the prospect of exploiting someone else’s misery, it also was nice to hear some roundabout good news about the Las Vegas economy for a change.

Except dwelling in an alternative universe where the eastbound stampede of Californians was in effect didn’t last long. The next day we learned that Nevada, already the nation’s foreclosures champ, had hit an all-time record for unemployment, 12.3 percent. The nonprofit Kaiser Family Foundation released a study shortly thereafter that indicated that the Silver State’s economy is “the most distressed” in the United States. And CNBC did an analysis that showed that Nevada can expect the nation’s largest budget gap in 2010 by percentage of the general fund. Presumably, Mr. Hollingsworth, Kaiser and CNBC included California in their research.

By the weekend, I was exhausted from not just another week of lousy economic data but also from working my ass off to make mortgage payments on property unlikely for years to be worth even close to what we paid. When a journalist friend in New York who used to cover Vegas called to chitchat, he could hear my weariness.

“It’s just no fun anymore,” I said.

“What isn’t?”

“Vegas,” I said. “Vegas isn’t fun anymore.”

It was an epiphany of sorts. Oh, sure, Vegas is still a blast for tourists. In fact, it’s never been a bigger one. The resorts are so desperate, they’re giving away rooms, meals, flights, show tickets, whatever.

So who’s the sucker now? Wasn’t that sort of the premise of our economy, that we build all these fantastical, lovely experiences to make up for the fact that we’re relieving the masses of their cash at the tables or machines while convincing them that it’s fun? I’ve never quite believed that; I don’t think there’s anything more insidious about spending money playing games of chance than spending it on an outing at a professional sports game. But the premise sure wasn’t that this is where the world comes to rip us off.

Read the rest at LasVegasWeekly.Com.

Brother, Can You Spare A Ticket?

The economic downturn is not funny. People who lose their homes, their savings and their jobs are not amusing. Even overly ambitious multinational corporations having trouble making multimillion-dollar debt payments on massive construction projects they should've thought twice about commencing isn't really the stuff of humor.

But. I got this one press release today that cracked me UP. In fact, I'm just bummed I didn't read it before we recorded tonight's episode of "The Strip." Then again, maybe "bummed" isn't such a good word here.

The subject line was "Mac King Passes Entertainment Stimulus Plan." Really, I wonder. How so?

Turns out, comic-magician Mac King is giving away free tickets to "local families that have fallen on rough economic times. ... During the month of May, any Las Vegas resident experiencing financial hardship can present their Nevada ID to the Harrah’s box office to receive complimentary admission for two to the Mac King Comedy Magic Show."

Now I love Mac King. His show is awesome. His cartoons in the Sunday papers are always fun. He gave a great interview on "The Strip," too, in October 2007. He even triumphed in a Stripper Poll one time about the funniest regular act in Vegas. I encourage everyone to go see his show. By far, it's the best daytime show in Vegas.

That said, I'm trying to figure out how this works. Do you go to the Harrah's box office and say, "Hi, I'm poor, gimme some tickets"?

Maybe you need to show up in garb like this:


I mean, the star's in a plaid suit, so they might just think you're a Mac King groupie or something. Would they let the guy below in?


And what happens if the family picks up their freebies and then sells 'em? Do they get in trouble? I mean, these are tough times.

OMG! Great Economic News From Vegas!

Hahahaha....just funnin' ya. What, you think it's 2007 or something?

The January year-over-year data is out from the LVCVA and I'm not going to bother you with the depressing details. That, after all, is the Review-Journal's job. All I'll say is that I searched for a silver lining and the best I could come up with is that convention attendance in Laughlin was up a whopping 14.6 percent. God knows -- or cares -- why. If spending time with crappy economic stats is your idea of a thrill, then go read the LVCVA's report for yourself.

If you're delusional, you might take comfort in February real estate data, which showed a 108 percent rise in single-home sales in Las Vegas versus February 2008. Sounds great until you realize that the median value of those homes fell almost 37 percent in the same period.

All that said, the stock market was kind to Vegas today. Heck, MGM Mirage even hit $3 a share for a moment and closed up 23.18 percent at $2.87. Wynn Resorts did better, though, rising 25.4 percent, to $19.50. Woo hoo. Happy days are here again!

[Photo credit: Make Things Interesting]

Trying REALLY HARD To Look On The Bright Side

Economic news is so frigging depressing these days. People ask Miles and me what happened to our plans to adopt a child and all we can say is that adoption is expensive and we used to have a whole bunch of equity in our house that's now gone. Poof! Disappeared! So we'll wait. Every day the newspapers overflow with unhappy statistics, job losses and stock collapses. It's gotten so bad that newly minted pauper Sheldon Adelson is offering $119-a-night rooms.

So this morning, the Las Vegas Convention and Visitors Authority emailed out its monthly summary for Clark County of hotel occupancy, convention attendance, visitor volume, the works. And, true to form, it should have come with a loaded pistol for any gaming stockholder wanting to blow their brains out. It's just a bloodbath of negative percentages versus August 2007, with the most stunning drop to me being that the economic impact of conventions fell from $1 billion to $777 million, a 23.6 percent decline. Sad times and, if you want a reason to weep, you can look at all the figures here.

But I'm an optimist! I scoured the information for something -- anything! -- that was going well to cheer y'all up! And lo and behold, there was one itty-bitty happy note in... Laughlin!

Yep, Laughlin. Hotel occupancy was up 2.8 percent in August! What's more, they're getting 14.9 percent more per room -- the average room there is now $47.21 versus $41.10 in August 2007. And 19.6 percent more people were flying into the Laughlin-Bullhead "International" Airport, too. Why Laughlin? Beats the hell outta me. But there you have it.

Oh! There is one other upside, at least for consumers. Room rates in Mesquite plummetted 41.2 percent from an average of $78.42 in August 2007 to $46.11 for August 2008. Mesquite is a sensational place. If you've never been, it's so pretty up there with the mountains and the river.

And that, folks, is it. Almost every other indicator was negative except one that I don't think is actually a good thing -- there are now 3.3 percent more rooms in the Las Vegas area. We're now at 137,690, up from 133,328 last year at this time. Most of that is the Palazzo, but about 300 come from the Eastside Cannery. That's sad because the part of Vegas that took the biggest gaming-revenue drop? That would be the Boulder Strip, off 22.4 percent in August year-over-year. And just think, this time next year we'll have Encore (+2,000 rooms), Aliante Station (+200 rooms), M Resort (+390 rooms) and Caesars' Octavius Tower (+650 rooms). And that's before Aria (+4,000 rooms) and the rest of the CityCenter crowd opens.

But, you know, anyone who suggests Vegas is even temporarily overbuilt is a pooh-poohing naysayer who doesn't know his history and hasn't seen a 1955 cover of Life Magazine. Or something like that.

Las Vegas - Is Boom Overextended?

Yes, that's the famous headline from this June 1955 Life Magazine issue. And the focus and topic, in these tough economic times, of my Las Vegas Weekly column. I actually wanted to provide a scan of the entire Life spread but the Weekly folks didn't do it and my printer/scanner broke for good the other day. So you'll all have to wait!

Boom Cycle
Can Las Vegas ever be overbuilt?
By STEVE FRIESS

Every now and again, if you’re around Vegas long enough, you hear about the June 20, 1955 issue of Life Magazine with a Moulin Rouge showgirl on its cover. The issue is, to many, the “Dewey Defeats Truman” moment for Vegas journalism for the question its headline asked:

“Las Vegas—Is Boom Overextended?”

It’s a punchline to many on the Strip. Six months ago, Sheldon Adelson himself referenced it in an interview in advance of the Palazzo opening in response to my question about whether the city could be overbuilt. The implication was that almost since the dawn of the destination, naysayers have wondered whether the city could continue to sustain its own urge to constantly grow.

The reason I bring this up is because, by some quirk of fate, I found a copy of that very issue for sale for a mere $25 at the Casino Chip and Gaming Tokens Collectors Club convention at the Riviera last week. I’d bought a copy before, but it was sealed in plastic and never read; the fact that I now had a shot at another copy, unwrapped, on the exact 53rd anniversary of its publication was a minor thrill I couldn’t refuse.

It also took on more resonance this year because Vegas is in one of its worst slumps ever. Occupancy and room rates are down, gambling revenues are on track to fall for only the second time since 1970, the last time being in 2002 following 9/11.

At the very same time, the frantic building continues unabated. The various CityCenter structures, the Fontainebleau, Wynn’s Encore, Echelon and a new Caesars tower all are poised to add more than 19,000 high-end rooms to the already staggering inventory in the next couple of years. Now Adelson is looking at moving the Sands Expo Center elsewhere to make room for 7,000 more rooms, Wynn wants another 5,000 in place of his golf course, Station Casinos wants 10,000 more just west of the Strip in its Viva project and someone—maybe the Plaza folks, maybe not—is going to do something big on the former Frontier property.

Which brings us back to where Las Vegas was in 1955 when that seemingly foolish headline and article were written.

Read the rest HERE