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Howard Stutz

Gambling industry: Three-ring circus of a weekend

21 February 2007

LAS VEGAS, Nevada -- Last weekend's triple whammy on the Strip -- the National Basketball Association's All-Star Game, Chinese New Year and Presidents Day Weekend -- brought large crowds but may not have translated into the overflowing casino cash boxes that operators had expected.

Several gaming analysts, speaking on the condition of anonymity, said the audience associated with the NBA All-Star Game overwhelmed some of the Strip's largest casinos, displacing the deep-pocketed gamblers associated with Chinese New Year.

The overlap of the three events, along with a layover by attendees from the Men's Apparel Guild in California show that brought more than 100,000 delegates to town last week, may have been a little much for the casinos to handle.

Wall Street research analysts said that spending for hotel rooms and nightclubs, restaurants and other amenities run by the casinos could calculate into a banner weekend. The Las Vegas Convention and Visitors Authority said late Tuesday that nongaming spending was an estimated $90.6 million.

The casinos themselves were also crowded, but with nongamblers, analysts said.

"Apparently, a lot of the high-end folks came in and left quickly," said one analyst. "The atmosphere wasn't to their liking. We may see some disappointing numbers."

Publicly traded casino companies will report results from last weekend as part of their first-quarter earnings during April and May. Nevada gaming regulators won't release February's official statewide and Las Vegas casino revenue results until April.

Last February, Strip casinos reported $551.1 million in gaming revenues. The biggest month ever on the Strip for gaming revenues was $642.4 million in November. Gaming Control Board senior research analyst Frank Streshley said resort operators were optimistic before last weekend that the Strip results in February could shatter all records.

"We know the hold percentage (what casinos keep vs. the amount gambled) will play a big part in the overall numbers," Streshley said. "Last year, Chinese New Year fell into both January and February, but this year, it's all in February."

Until the results become public, the question for some is whether it was good to have the NBA All-Star Game at the same time as the start of Chinese New Year.

"In a perfect world, we would have preferred two of the events to happen on another weekend," MGM Mirage spokesman Alan Feldman said. "I think the availability of rooms was much harder to come by coupled with the three-day weekend."

Harrah's Entertainment spokeswoman Debbie Munch said Caesars Palace had a busy weekend because of the casino's long-standing tie-in with Chinese New Year. But the resort also hosted several All-Star-related activities. TNT's "Inside the NBA" broadcast for three straight evenings on a stage above the hotel's famous fountains, attracting large crowds of NBA fans.

"We had a huge mix of visitors at the property," Munch said.

At the off-Strip Palms, which is known for its trendy nightclubs and customers that are gossip columnists' fodder, the expected large crowds arrived because of the All-Star Game. Palms President George Maloof said in an interview last week that Chinese New Year historically had never been a large driver of business at the casino.

As the host hotel for the NBA, however, the Palms housed the 24 All-Star Game participants and league personnel in 600 of the hotel's 707 rooms.

The Palms' nightclubs and themed luxury suites hosted over-size special events and parties throughout the weekend while nongambling fans lined the casino hoping to catch a glimpse of Kobe Bryant, LeBron James and their All-Star teammates.

"It was exactly what we expected," Palms spokesman Larry Fink said. "Our restaurants were busy, the clubs were extremely busy and from what I saw, the casino was very busy. Everything seemed to play out exactly how we thought it would. We had people looking to take pictures and get autographs."

Feldman said 75,000 extra visitors jammed Mandalay Bay over five days to attend the NBA All-Star Jam Session in the casino event's center. Feldman said many of those crowds flocked to the casino's restaurants and retail areas.

It's unclear, however, if there was a payoff at the tables or slot machines.

"There wasn't a huge noticeable increase in casino activity because this was a huge social function," Feldman said of NBA All-Star fans. "They wanted to be out and about."

Feldman said the pure Chinese New Year customer that has been flocking to Las Vegas since the casinos started promoting the event, was able to find available hotel rooms. The ancillary business associated with the Chinese New Year crowd may have been chased away because of a lack of rooms.

Review-Journal writer Arnold M. Knightly contributed to this report.