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Gaming Guru

Chris Jones
 

Analysts Foresee Strong Strip Hotel Results for Chinese New Year

22 January 2004

LAS VEGAS -- Like so many Las Vegas visitors, local tourism officials are looking forward to some monkeying around this weekend.

Exactly how much business will take place in town remains to be seen, but so far, sources close to the gaming industry have expressed confidence this week's Chinese New Year celebration will attract plenty of high-rolling revelers as they ring in the Year of the Monkey.

"All indications are, despite terrorist fears and threats to Las Vegas, that (Chinese) New Year visitation should be very strong," Deutsche Bank analyst Marc Falcone said Wednesday.

That sentiment was echoed by analyst Joe Greff, who said demand for local hotel rooms during the period is at an all-time high and illustrates strong momentum for the local gaming industry in early 2004.

"Chinese New Year is pretty encouraging," said Greff, a gaming analyst for Fulcrum Global Partners, an independent Wall Street investment research firm. "January is shaping up to be the best January of all time (in Las Vegas), and February seems to be coming along strong, driven by the Super Bowl" scheduled for Feb. 1 in Houston.

Year 4701 of the Chinese lunar calendar starts today. The Las Vegas Convention and Visitors Authority, which keeps official tabs on local visitor volume, did not release a tourism forecast for the upcoming weekend, but representatives from several local casino companies said they're expecting big things.

MGM Mirage has scheduled several Chinese New Year-themed activities this week at Bellagio, MGM Grand and The Mirage. All three resorts are close to sold out, while high-end accommodations such as The Mirage's villas and MGM Grand's Mansion high-roller suites are also booked at or near capacity, spokeswoman Yvette Monet said Wednesday.

"Weekday hotel rates and room reservations for this week and early next week look very strong, and are on par with last year's numbers," she added.

John Marz, spokesman for Mandalay Resort Group, said his company's flagship Mandalay Bay property will host a number of themed events this weekend, including concerts, "lucky money draws" and other activities catered toward Chinese clientele. He said the hotel "has good business coming in" from Asia as well as Chinese residents from across the United States.

"For the Chinese, it's a big holiday and they do celebrate it," Marz said.

Falcone said Asian visitation, in particular, will be strong over Chinese New Year and should include a large component of "high quality players." He said the increased international demand reflects both improvements in the Asian economy and diminished traveler concerns about safety in the United States.

A strong performance this week, combined with next weekend's Super Bowl period, will be crucial to the financial returns of gaming companies in the first quarter, Falcone added.

The average rate for rooms on the Strip booked three weeks in advance or more of Chinese New Year was $227, up 17 percent from 2002, Fulcrum survey data showed.

For the week ending Sunday, which includes Chinese New Year, the average room rate was $213, up 1 percent from $211. The average weekend rate was $176, down 30 percent from $250 the year before.

Gaming Wire editor Rod Smith contributed to this report.