December 28, 2017 - 10:16 am
Updated December 28, 2017 - 8:27 pm
Fewer tourists flocked to Las Vegas in November, extending the streak of consecutive monthly declines to six — the longest in eight years.
November visitation declined 3.7 percent compared with the year-earlier period, bringing the year-to-date decline to 1.6 percent or roughly 645,000 people, according to figures released Thursday by the Las Vegas Convention and Visitors Authority.
Annual visitation is headed for its first annual decline since 2013 and first large-scale drop since 2009, the depth of the Great Recession. Visitation in 2013 fell by just 59,000 because of one less day compared with 2012, a leap year.
If there is no growth in December, Las Vegas may see fewer visitors this year than even 2015. The LVCVA expects slightly fewer tourists to visit the city for the New Year’s celebration.
The LVCVA blamed part of the decline on a reduction in room inventory caused by casinos launching extensive property renovations. Las Vegas room inventory declined in November by 0.5 percent, or by 800 rooms, to 148,690.
Brian Gordon, an economist at Applied Analysis, said the lack of available rooms on most days in Las Vegas underscores the health of the local economy.
“Overall, the fundamentals appear stable,” said Gordon. “Occupancy levels continue to hover around 90 percent for the year, suggesting demand remains relatively strong.”
The drops in visitation accelerated in October and November compared with the summer, suggesting the Oct. 1 shooting deaths of 58 people on the Strip had a significant effect. Visitation from June through September was down between just 1 percent and 2.5 percent.
Fitch Ratings U.S. gaming analyst Alex Bumazhny said he sees Las Vegas growth continuing in the coming years at a slow pace and believes the sharp decline over the past two months can be attributed to concerns in the wake of the massacre.
“Longer-term we expect visitation to Las Vegas to slow down a bit as indicators such as convention visitation, air capacity, room rates and room occupancy are mostly back at their pre-recession peak levels,” said Bumazhny. ”However, the strong economic outlook and consumer confidence may give the recovery more legs. Therefore, it’s hard to attribute the recent slowdown to anything beyond the shooting.”
In fact, visitation in October and November of this year barely exceeded that of 2014.
Gaming revenue slides
Monthly gaming revenue news didn’t bring a cheer to casinos either.
Strip gross gaming revenue declined in November as gamblers played lucky in baccarat and blackjack, leading a statewide drop for the month.
Strip gaming revenue fell 6 percent to $486 million from $517 million in the year-earlier period, according to a statement Thursday by the Gaming Control Board.
Baccarat win fell 25 percent to $63.2 million in November as win percentage came in at 10 percent vs. 14 percent last year.
Blackjack revenue declined 14.5 percent to $63.7 million with win percentage declining to 13 percent from nearly 15 percent in the year-earlier period. Blackjack and baccarat account for more than a quarter of Strip revenue.
Strip slot revenue bucked the table game trend, rising 4.7 percent for the month to $270 million. Strip sports win though dropped 75 percent to $2.7 million, driven by baseball, which posted a $6.1 million loss in November.
Strip revenue has declined two months in a row, the first time that has happened since November and December 2016. Strip revenue declined 6.1 percent in October.
Statewide, gross gaming revenue declined last month 2.3 percent to $909 million. Downtown remained strong, with gaming revenue rising 6.8 percent to $54.2 million.
Jeremy Crudup, director of operations at Vegas Party VIP, said Brexit, a stronger dollar and rising hotel rates may also be affecting foreign tourists.
Vegas VIP Party has seen fewer Australians, British and Canadian customers this year as their respective currencies decline, Crudup said. Canadians and Brits are among the top foreign tourists to Las Vegas.