New Year’s numbers will dip, says LVCVA

Wednesday, Dec. 19, 2001 | 11:01 a.m.

A recent trend in travel -- the last-minute bookings of flights and hotel rooms -- appears to be playing itself out for the New Year's holiday in Las Vegas.

Las Vegas Convention and Visitors Authority statisticians say visitation will be off slightly at this year's celebration and some of the city's major resorts say there's unprecedented availability of rooms less than two weeks before the parties begin.

Experts say the number of unexpected events that have occurred, colliding just ahead of the arrival of 2002, leaves them wrestling for answers about what it will mean for the local economy.

The best guess of the LVCVA is that about 282,000 people will be in Las Vegas for the New Year's holiday based on recent trends. That's 1.7 percent less than the 287,000 people who came to town to celebrate the arrival of 2001.

LVCVA researcher Kevin Bagger said New Year's revelers would have a non-gaming economic impact of $167.3 million this year, down from the $168.1 million estimated for last year. Bagger said the multiplier for calculating economic impact was revised downward to reflect tourists spending less per trip than they have in the past.

One big reason for that: Most resorts are discounting room rates to attract gamblers, even for the holiday. This is because fewer high-rollers are coming to town and more budget-conscious gamblers are being recruited to fill the city's hotel rooms.

The LVCVA expects occupancy to be at 97 percent of capacity this year, down from the virtual sellout of 99.4 percent last year.

Resort officials got their first indication that rocky times were ahead in early 2001 when the economy began cooling and companies nationwide began slashing their travel and convention attendance budgets.

Airline loads, upon which local resorts are dependent for about half their tourists, began to slump. Then, when terrorists hijacked and crashed four airliners in September, Americans responded with apprehension.

The resorts countered with cut-rate hotel rooms, knowing that building volume was key to stabilizing room rates and, eventually, casino revenues.

New Year's Eve 2002 will fall at a time when the rebound is not yet complete. While Las Vegas has fared better than most cities, airline loads are still down nationwide and on planes bound for Las Vegas. Rates are still depressed and are even less than they were for the 2001 celebration.

There are 8.6 percent fewer seats on airplanes -- 60,680 each month -- coming into Las Vegas now than there were a year ago, McCarran International Airport officials say. And, airline load factors also have declined.

On Dec. 28, a critical travel day for the four-day weekend, Las Vegas-based National Airlines' loads are down slightly from the comparable day a year ago, said Dik Shimizu, an airline spokesman.

But on the other hand, of the 14 days leading up to New Year's Eve, National had lower load factors on just five days compared with the same dates a year ago. Shimizu also said National has seen what has become a new travel trend -- last-minute reservations, known as "close-in bookings."

Shimizu said some late bookings could be the result of leisure travelers watching current events to see what happens in the war in Afghanistan or if more terrorist attacks are forthcoming. But other hesitancy could be coming from the state of the economy.

"Before they book a trip, they're asking themselves. 'Will I have a job next week?"' Shimizu said.

The same booking pattern is happening at the resorts.

MGM MIRAGE is attempting to get the word out that not all the company's rooms are sold out for the entire weekend. A spokeswoman said the Bellagio hotel-casino is sold out Dec. 31 and Jan. 1, but there are rooms still available for $599 a night on Dec. 30. Last year, the same rooms went for $799.

At the Mirage, there are rooms available for $449 on Dec. 31 and $299 for Dec. 30.

The MGM Grand bucked the trend -- but it's doing so because of a headliner entertainer at the MGM Grand Garden. Guests can get a room at the MGM Grand for $400 or a two-night package that goes for $300 a night with a two-night minimum stay required. The same rooms cost $205 on Dec. 30 and $215 on Dec. 31 last year.

The reason for the steeper price at MGM: Pop singer Neil Diamond is scheduled to play at the MGM Grand Garden Dec. 30-31. Concert tickets are still available both nights with prices ranging from $50 to $150 -- considerably less than what it cost to see big-name performers in years past.

Entertainment also is attributed for the near sell-out at Park Place Entertainment properties in Las Vegas.

A spokeswoman for the resort said popular pop crooner Tony Bennett is playing at the Paris-Las Vegas. Special guests-only events featuring Vanessa Williams also are expected to be a draw.

Debbie Munch of Park Place said the Flamingo hotel-casino is sold out and Caesars Palace is close to a sell-out for the weekend. Munch said some Park Place properties are poised to require two-, three- or four-night stays of guests, an indicator that demand is high.

A spokesman for Harrah's Entertainment Inc. said the company's resorts will be sold out for New Year's and the goal all along has been to issue complimentary rooms to the company's best customers for the holiday in a bid to boost casino revenues.

In the meantime, the Strip is expected to be alive with celebrations on New Year's Eve and a seven-minute fireworks display is planned from 13 hotel rooftops and two other locations. Local officials are hoping the fireworks will herald the arrival of a new attitude toward recovery. Many have pointed to Jan. 1 as the date when economic fortunes are expected to begin turning around.

"There's no question we're still in a recovery mode," said Rob Powers, a spokesman for the LVCVA. "Room rates are clearly lower this year than they were last year. Although weekend numbers are good, the revenue picture for hotels is not what was expected.

"We're not where we were before the terrorist attacks, but I think a lot of people will experience a psychological sense of relief to welcome 2002 because of all that has happened this year."

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