Archive for December 14th, 2012

Revenues from Strip Resorts Expected to Increase by 2013

Friday, December 14th, 2012

According to some analysts, strip resorts are more likely to have a 5.3% increase or 8% decrease in revenue by next year, depending on the performance of the US economy.

Las Vegas-based Newmark Grubb Knight Frank’s Global Gaming Group, a real estate brokerage, issued its 2013 investment guide forecasting growth on Strip revenues, assuming that the country dodges another recession.

Growth forecast in Strip revenue is expected to increase about 1.5% to 5.3%. According to NGKF, a 2.5% increase in Strip revenue was observed through June. State Gaming Control Board stated that Strip gaming win has improved by 4%.

This year, operators of Strip hotel-casino have seen benefits from increased visits to the city. The visitation rate to Las Vegas was up by 1.8% through September.

By 2014, SLS Las Vegas will be adding about 1,217 hotel rooms. By next year, 650 additional rooms are planned for the opening of the Downtown Grand.

A few resorts are not seeing the growth trend though. The Stratosphere’s room rate decreased to $48.99 from the previous $50.31.

Consumer health is one factor that affects spending and visitation as measured using the household net worth. This indicator, together with the stock market and housing prices foretells growth by 2013 as indicated by a NGKF report.

The Chinese economy and its effect on high-end baccarat players is another factor to watch as well. The baccarat revenue is expected to decline or increase by 5% as projected by NGKF. However this depends on how the stock markets and the Chinese real estate perform.

According to NGKF, demand for hotel room booking with meetings and conventions is expected to grow by 1% to 4% next year with room prices increasing from 3% to 7%.

By 2013, Las Vegas will host a number of large events however economic events are more likely to cause businesses to put a hold on the group bookings, according to several analysts.