May 14, 2021 Casino, Land-Based

All in

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Nevada Governor Steve Sisolak’s recent decision to move casinos to 100% capacity by June 1 makes Las Vegas poised for a stellar summer season.

Las Vegas was already poised for a strong summer 2021 when Nevada Governor Steve Sisolak announced casinos will be able to operate at 100% capacity starting June 1. Sisolak’s ruling is the green flag operators had been eyeing since the Covid-19 pandemic initially shut down the state’s casinos last spring.

The decision to return to full operations so soon was in many ways a no-brainer for the Governor. Demand for America’s entertainment capital has taken off since mid-March this year, when the city began to see thousands of out-of-state visitors flock back to casinos for the NCAA Tournament and St. Patrick’s Day. Each successive spring weekend has generated sprawling crowds on the Strip and Downtown, and operators are surely thrilled to raise hotel room rates to match demand.

There doesn’t seem to be any slowing down the momentum, either. With more than half of adult Americans at least partially vaccinated, appetite for travel is gaining steam. US consumer confidence is reportedly at a pandemic-high, fueled by the latest round of government stimulus checks. Arguably no American city stands to benefit as much as Las Vegas, which will have to heavily rely on domestic tourism this summer.

“Southern Nevada's tourism industry took another important step forward with Governor Sisolak's confidence Las Vegas can safely allow full occupancy at all venues starting June 1,” said Steve Hill, president and CEO of the Las Vegas Convention and Visitors Authority. “The wide availability and rapid administration of vaccines will allow our valued events industry to reconvene with confidence and in its entirety. Las Vegas will continue providing the gold standard for health, wellness and safety precautions for the benefit of its workforce, the community and our visitors.”

Of all the tell-tale signs that Las Vegas is sensing a comeback, perhaps none is stronger than multiple companies posting hiring ads for at least a dozen areas. That’s according to Alan Feldman, a Distinguished Fellow in Responsible Gaming at the International Gaming Institute and previously a long-time MGM Resorts executive.

“Clearly it’s been getting busier,” he told Gaming America. “There’s a lot of positive momentum and a lot of positive energy, while understanding that doesn’t apply to everywhere just yet. Entertainment is still a little bit of a question mark. If the governor, as he said, is able to release 100% capacity on June 1, then I think that starts to spell a much better picture for Las Vegas the rest of the year.”

Returning to full capacity by early summer appeared far from inevitable just a few months ago. An underwhelming New Year’s weekend fed into a disappointing January that saw fewer than 1.3m visitors and total hotel occupancy of 32%, according to the LVCVA. Occupancy rose to 42% in February, but that month’s visitation was still down 54% year-on-year to 1.5m people.

During those winter months, operators laid down the foundation for spring success by complying with the governor’s social distancing rules, encouraging employees to get regularly tested and later vaccinated, and ramping up hiring in anticipation for the eventual crowds that descended in March and April.

“Between the testing programs that some of the hotel companies have put in place, the fact that so many Americans are vaccinated now and will be able to discern their relative safety risk in terms of being vaccinated and travelling, I think we stand in a pretty good position to be welcoming people back,” Feldman added.

The big risk in bringing in so many people so early is that they might spread Covid-19 at the local community, particularly among front-line casino workers. Despite casinos aggressively promoting vaccination shots among their workforce, Nevada’s Covid-19 case count undeniably rose between March and April. The state reported approximately 700 new cases on April 19 compared to 173 new cases four weeks prior on March 22.

Operators, of course, have made vaccinations a top priority this spring, with Wynn Resorts even hosting a vaccination center at Encore. Wynn CEO Matt Maddox said 60% of the company’s workforce had been vaccinated as of April 8. The Cosmopolitan of Las Vegas even incentivized employees by committing to $1m of bonuses if the company reaches an 80% vaccination rate by May 1.

The month of May will be seen as a bridge between the 50% capacity rate casinos have been working with since mid-March versus full capacity at the start of June. What’s also worth mentioning is the state of Nevada will hand over Covid-19 restriction authorities to individual counties on May 1, which should benefit operators.

Clark County Commissioners already voted for Las Vegas-area businesses to being operating at 80% capacity starting May 1. Commissioners also approved changing the required space of social distancing from six to three feet.

“Our community has been great so far about getting vaccinated,” said Clark County Commission Chairman Marilyn Kirkpatrick. “If everyone just keeps it up, we’ll get to open up the community 100 percent.”

Increased capacity should also go a long way in bringing back conventions, like World of Concrete, which is schedule for June 8-10. The event, geared toward the concrete and masonry construction industries, attracted 60,000 people in 2019. It will be the first mega convention to return to Las Vegas since the start of the pandemic.

“The fact that World of Concrete is returning is a very good sign,” Feldman said. “So on the convention side there is a definite feeling of momentum.”

The same can’t be said yet about entertainment, however, where “there’s still pockets of anxiety,” according to Feldman. “We need to see a broader and better access in terms of theatres and arenas are back.”

Plenty of shows have returned, but the massive entertainment and sporting events Las Vegas is known for are temporarily on hold. The Las Vegas-based UFC hopes to be the first sport to bring full attendance crowds back to the city. UFC president Dana White has already announced a sold-out crowd of 20,800 fans for Connor McGregor and Dustin Poirier, who will fight at T-Mobile Arena on July 10. The event will likely draw in thousands more additional people to Las Vegas that weekend.

Summer visitors will be also eager to check out Downtown’s Circa, the newly opened Virgin Hotels, and of course Resorts World Las Vegas, the first ground-up casino-resort to open on the Strip in a decade. Resorts World has officially announced a June 24 opening date, which wisely gives the property more than a week to prepare for the July 4 holiday weekend.

“We are filled with gratitude and excitement as we approach our opening this June and hope to play a role in Las Vegas's rebound after what has been an incredibly challenging year for the destination and greater hospitality industry,” said Scott Sibella, president of Resorts World Las Vegas.”

With an estimated price tag of $4.3bn, the 3,500-room resort is one of the most ambitious undertakings in modern Las Vegas history. It only feels right that Resorts World should usher in the city’s next era. If all goes accordingly, it will be a grand opening celebration that lasts into the summer and far beyond.

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