Las Vegas Casino Revenues Up for Fifth Year in a Row
Posted on: January 9, 2016, 08:55h.
Last updated on: January 10, 2016, 09:00h.
Las Vegas has staged many a celebrity revival and now it’s staging one of its own. The city that was once dubbed “ground zero of the world economic crisis,” as the downturn of 2008 crashed its property market and ravaged its casino industry, continued its bounce back throughout 2015.
This week the Nevada Gaming Control Board reported the city’s fifth consecutive year for increases in total casino revenue.
The state’s major casinos reported a 2.9 percent increase in revenues over 2014, at $24.6 billion, although this is still 2.6 percent lower than the 2007 pre-recession all-time record high.
The figures illustrate the shift away from reliance purely on gaming, which made up just 43.2 percent of the total haul, the industry’s lowest-ever percentage.
While the Las Vegas Convention and Visitors Authority (LVCVA) recorded an all-time record for visitor numbers last year, a recent LVCVA study suggested fewer people are coming to Vegas purely to gamble, or even to wager money at all.
Only 12 percent of the 41 million Vegas visitors in 2014 came primarily to gamble, according to the research, although 71 percent placed at least one bet during their stay.
Instead, the multitudes are coming for the non-gaming amenities: the restaurants, the nightclubs and pool parties, the shopping, and maybe even for the daring feats such as the Stratosphere’s bungee jump from 829 feet. Gambling, it seems, is so last century.
“It’s a sign of the changing market,” David Schwartz, director of the University of Nevada, Las Vegas, Center for Gaming Research, told NevadaAppeal.com this week. “Food is growing and gaming as a percentage is shrinking. What I’m hearing from people is they spend more on food and entertainment than gambling. This is what the visitors seem to want.”
And when all the accounting was done, Nevada’s casinos still showed a net loss of almost $661.8 million for the year, although this figure was down 11 percent compared to the previous 12 months.
It’s almost as if the loss leaders are now totally reversed, with gaming being the shill for all the other money-making stuff that now lures visitors to Sin City, instead of the other way around.
Caesars Spoils the Party
Much of this loss can be attributed to Caesars and the interest paid on its billions of dollars of debt, and to the writing down of assets as part of its bankruptcy proceedings.
Caesars’ predicament aside, the mood is positive. The industry’s losses have been narrowing every year, and analysts are optimistic that gaming may well find itself in the black again by the end of 2016, a year that is expected to break visitor records once again.
Meanwhile, the off-Strip casinos are going from strength to strength. Downtown was hit especially hard by the economic downturn.
As the big Strip hotels slashed their prices as a response to the recession, downtown casinos were forced to go even lower in order to fill rooms at any cost.
But now, in a happier financial climate, the Strip prices are up and the casinos of Fremont Street have reasserted themselves as the budget alternative Vegas experience.
Increased visitors and several years of investment and regeneration are all contributing to downtown’s upturn.
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