Las Vegas Strip
2009 was a tough year for the casino industry in Las Vegas. With several casinos struggling under the financial pressure, big brand businesses such as Harrah’s began scooping up smaller casinos and buying them out, such as Planet Hollywood in December. However, even those at the very top of their game before the recession hit Sin City were left very much in the same position as casinos they used to consider small-fry: Both were waiting for visitors to return to their resorts and gamble.
Many within the casino and hospitality industries in Las Vegas will now be breathing a sigh of relief though, after it was revealed that for the first time in 22 months, year-on-year profit was actually up in November 2009. If you’d like to find out more about this breaking news, check out our article: Nevada Casinos Report Revenue Increases. Otherwise, read on for our brief analysis of whether Las Vegas is really out of the woods when it comes to the recession.
While overall Nevada has reported a revenue increase, when you begin to analyse the figures it’s clear some areas are still in trouble. In North Las Vegas, revenues are up by an impressive 20.7 and by 8.3% on the strip. However, venture only a mile or two from the strip and you’ll find that in downtown Las Vegas, revenues are down by 1.7%. In South Lake Tahoe, the financial picture is even more disturbing: Casinos in this area reported a loss of 27%.
Nevada’s casino revenues report for November 2009 shows a fine balancing act between profitability and revenues losses. While many may believe the industry has officially escaped the recession, in 2010 Nevada casino moguls will face even tougher challenges. In 2009 several states, such as Pennsylvania, have legalised slots and gambling venues and areas such as Atlantic City are already reporting heavy losses as a result of this. As more states begin to analyse the profitability of casinos, Nevada could lose its core visitors: US citizens who fly in for Las Vegas’ wide array of casinos.
Furthermore, poker rooms in Las Vegas could be hit by California’s attempt to legalise online poker. While casino regulators have suggested that online gambling should be legalised, it’s likely they’ll change their opinion if California and then other states legalise online poker games without allowing Nevada a slice of the action. All in all, it looks like 2010 will be the year which really makes or breaks the casino industry in Nevada.
