South Point Owner Michael Gaughan Predicts Las Vegas Return to Normalcy in 2022
Posted on: October 19, 2020, 12:51h.
Last updated on: October 19, 2020, 01:58h.
South Point casino resort owner Michael Gaughan doesn’t believe Las Vegas will return to its pre-COVID-19 normalcy until 2022.
Gaughan says he can’t imagine things being any direr for Southern Nevada. But the businessman hopes that the worst is behind the gaming industry.
I’ve been here [Las Vegas] since 1952, and this is probably the worst thing that’s ever happened,” Gaughan said. “I don’t think it can get any worse. Hopefully, by the end of March or April, this will be over.”
However, recovery will take time. Visitor volumes remain low, and the convention business is nonexistent. Fitch Ratings says travel in the US will not substantially improve until there’s a widely available treatment or cure for the coronavirus.
“Strip hotels will have their work cut out for them,” Gaughan added. “I do think that by the start of 2022, we should be back to completely normal. I just hope Las Vegas can get back to where it was.”
Gaughan made his opinions on the Las Vegas economy, first reported by the Las Vegas Sun, during the ribbon-cutting of a new 40,000-square-foot equestrian arena at South Point.
Opened in 2005, Gaughan’s casino resort is located south of the Strip and is a popular destination for locals. Unlike the larger Strip properties, South Point doesn’t rely as heavily on tourists and conventions. And during a global pandemic, that’s an advantage.
Gaughan’s loyal regional customer base, consisting of Las Vegas locals and drive-in traffic from California, have continued to patronize South Point since the property reopened on June 4.
“We do a lot of business in the local market, and the people here have been taking care of me,” the South Point boss said. “We’re not making a whole lot of money, but we’re not losing any.”
Fitch added last week in its US gaming industry guidance that regional casinos — which rely more heavily on local customers — will rebound to pre-coronavirus revenue numbers long before the Las Vegas Strip. “The Las Vegas Strip will experience the slowest recovery relative to other major gaming markets,” the ratings house declared.
In 2018, citing tax reform legislation approved by Congress and signed by President Donald Trump, Gaughan announced that he was passing on his tax savings to his South Point workers. The casino owner doubled annual bonuses for each of his 2,300 full-time workers.
We had a big year and I’m going to save some money with The Donald,” Gaughan explained at the time. “I got a little bit of a tax break. It’s about a million dollars.”
Gaughan is supporting Trump’s 2020 reelection bid. US Federal Election Commission records show that Gaughan has contributed $100,000 this year to the president’s campaign. He also gave the Republican National Committee nearly $100,000.
In April, Gaughan furloughed his South Point casino workers, telling them that they would receive more money in state and federal unemployment assistance than what they typically earn at the casino.