The opening of the enormous Las Vegas CityCenter complex has many Vegas residents excited at the prospect of 10,000+ new jobs, but many wonder if all of these new employees might soon be in line at the unemployment office. The CityCenter boasts thousands of rooms and a vast casino, but tourism to Vegas has seen a sharp decline. Even with unprecedented flight and hotel deals to Vegas, vacationers are still shying away. In addition to the CityCenter project, new wings of the Hard Rock Hotel and Planet Hollywood add even more supply to an already very weak demand.
Both the Hard Rock Hotel and Planet Hollywood claim the new casinos are aimed to attract higher-end customers whose tastes and travelling are not affected by the recession. While high-end customers may be more inclined to travel to Las Vegas regardless of economic conditions, 500 rooms at Planet Hollywood, starting at $350 a night on weekends, may still be a huge void to fill. It is true that places like MGM, the Wynn and Belagio have faired better in the recession than lower end establishments like the Tropicana, Hooters and the Stratosphere.
Low-End Casinos Hit the Hardest
Late night at lower-end Vegas establishments can sometimes resemble a ghost town more than an action-packed entertainment destination. Things have gotten so bad that some weekday prices for a hotel room at a place like Hooters or Circus Circus have dipped to a range of $20-$25 per night. Some of the promotions low-end places are running are almost unheard of. For example, the Tropicana is currently running a promotion through January 30 that includes $50 in free slot play when booking a stay at $50 per night. At the other end of the Strip Circus Circus is running a special that entails booking two nights now and receiving a free night on a return visit. Even the higher-end New York, New York is offering a promotion where you book three nights and get the lowest-pricest night free.
Preparing for a turnaround
Each casino operator is hoping to be ahead of the curve if and/or when the economy turns around and tourism in Vegas begins to flourish once again. The problem is that there is a fine line between getting a jump on the competition and making poor business decisions. If and/or when the economy stregthens to a point where droves of people flock to Vegas again, they will have more choices than ever. Combine the drastic increase in supply with the increasing popularity of Internet gaming and it becaomes clear that things don’t look too good for a drastic upswing for Vegas casino operators any time soon.