THE ECONOMY:

Report: Las Vegas tourism tumbles 11.9 percent in January

Average daily room rates plunge nearly 20 percent compared to January 2008

Tuesday, March 10, 2009 | 3:49 p.m.

Report from the LVCVA on January visitor numbers

Visitor volume took another header in January with fewer than 3 million tourists visiting Southern Nevada for the third straight month.

The Las Vegas Convention and Visitors Authority reported today that 2.8 million people visited in January, an 11.9 percent decline from January 2008.

Worse, average daily room rates plunged 19.9 percent from the previous year, the steepest decline since the 9/11 terrorist attacks, and citywide occupancy fell 13 points to 71.9 percent for the month. For area motels, occupancy fell 16.6 points to dip below half full for the first time in recent memory, calculated at 42.7 percent.

The statistics came on the same day that LVCVA board members voted unanimously to postpone its $890 million Las Vegas Convention Center enhancement project. The LVCVA board also received a report saying that since the fourth quarter of 2008, 340 groups have canceled meetings in Las Vegas, 236,700 room nights have been lost, 111,800 visitors stayed away and the local economy suffered a $131.6 million hit.

Terry Jicinsky, the LVCVA’s senior vice president of marketing, said those figures were based on a survey of Las Vegas properties. He said some organizations blamed the cancellations on the weak economy, but some said it was due to the public perception of conducting meetings in Las Vegas.

Several LVCVA officials left for Washington this afternoon to meet with government leaders about perceptions of Las Vegas.

Convention attendance in January showed continued erosion of the meetings industry, which Las Vegas has dominated for years.

The LVCVA statistical report said in January there were 1,368 meetings, 19.5 percent fewer than in January 2008, and attendance at those shows was 538,415, 20.6 percent off from the previous year.

But the lower average daily room rate and the reduced citywide resort occupancy were even more troubling for industry observers. Weekend occupancy was down 3.2 points to 79.7 percent and midweek occupancy was down 18.1 points to 67.6 percent. Just two years ago, Las Vegas enjoyed occupancy rates in the high 80s and low 90s.

The average daily room rate hit $104.89, creeping toward $100, a level that hasn’t been seen in Las Vegas ADR since December 2005.

Lower room rates translate into lower room tax receipts, a key factor in the LVCVA board’s decision to postpone the Convention Center project until at least the second quarter of 2010.

Brenda Siddall, the LVCVA’s vice president of finance, told board members that the LVCVA is facing a $53 million shortfall in room tax revenue in the next fiscal year as a result of the slumping economy. Although the LVCVA plans to cut operating expenses by 3 percent, it still wouldn’t be enough to offset the additional capital expenses and debt. Rather than risk default, board members reluctantly decided to suspend the project.

The LVCVA already has spent 15.7 percent of the project budget – $140 million – on the program to date. Workers already have completed a Metro substation, the refurbishing of one meeting room established as a prototype for the rest of the project, the paving of a parking lot and the design of the first two phases of renovations. The design of the third phase of renovations is about 90 percent complete, Terry Miller of HNTB Architects, which is coordinating the project, told the board.

Discussion: 17 comments so far…

By neiman1

3/10/09 at 4:20 p.m.

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Thank you harry Reid. You and Mr. Obama have destroyed what was left of Las Vegas. Your insistence on high fuel prices, which will soar when you pass the carbon tax, and his demonizing our city as an extravagant waste of dollars has made sure the lay offs in Las Vegas will soar and housing will continue to plummet. Hope and change, what a joke.
By caroyn

3/10/09 at 4:52 p.m.

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I just love it when people blame Harry Reid and our President for our problems here in Las Vegas. I work in the casino industry and believe me last year tourism was down then. And gas prices? Wasn't the gas prices exhoberent last year, when the country was being run into the ground by ex President Bush. If you don't like our city or how this country is run. Then get out and move away. Stop complaining!
By James_P_Reza

3/10/09 at 5:28 p.m.

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Really, "caroyn," we're not allowed to criticize how our government makes a mess of things? Are you kidding?

I (reluctantly) voted for Obama, but he said the wrong thing about Las Vegas, and I, for one, will never forget it.
By Frankm507

3/10/09 at 5:29 p.m.

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You can't have it both ways, running the "what stays here" commercials. Business travel nationwide is off 50%. All co's are cutting back on trade shows, Vegas, Orlando, Chicago, doesn't matter. Don't blame Obama.
By James_P_Reza

3/10/09 at 5:33 p.m.

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I blame Obama for opening his mouth, saying something uninformed, and hurting my city. These things he did. End of story.
By torn

3/10/09 at 5:51 p.m.

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OBAMA THE MAGNIFICENT WILL CHANGE ALL THIS - BE PATIENT
By stevem

3/10/09 at 5:54 p.m.

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too many people without jobs, too many that HAVE jobs are paranoid, too many baby boomers that were going to retire in 5 - 10 years are now having to save every penny now that their 401k is down and they no equity in that big home they were going to sell.

all the attractions in vegas from the stratosphere rides to the shark reef and mandalay bay needs to be free for one weekend.

it will get people into town. gotta get people into this city. not going to be able to nickel and dime them every 10 feet anymore.
By MrTorcheEnt

3/10/09 at 7:01 p.m.

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This comment is for Mr. James_P_Reza. For you to blame the current administration for the economic downturn of the economy that was created by greedy hedge fund managers, wall street executives, average citizens living above their means, and lets not forget the past president, you are a FOOL. For you to blame the man that is simply trying to fix what your republican buddies have created shows the ignorance on your part, and the funny part about it is your probably going to benefit the most from Obama's efforts. Amazing!
By geenab65

3/10/09 at 8:55 p.m.

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Obama made a comment in FEBRUARY about Las Vegas and you two are talking about something that has been happening all over the world for the past 18 months?!?!? Is it just me? Gentlemen, take some time, review the tape, re-read what he said, do something to inform yourselves of what he actually said in its entirety, not just what you want to read and/or hear. Make informed comments and stop the unnecessary moaning and complaining. The bottom line is that REGARDLESS of what Obama said, if you have a choice between feeding your family and sitting at a slot machine, I can guarantee that feeding your family will win out each and every time.
By 1of12oldies

3/10/09 at 9:19 p.m.

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I've been visiting your cities casinos with family and friends since 1993.
Our little group has noticed many changes, the worst was trying to appeal to families with children by the Corporate, non-gaming, investors.
Now they think that cutting back on Comps, perks, etc. will bring back their bottom line. The "free lunch" was never free we paid for it with our gaming losses.
Rather than blame the loss of revenue on politics, governence, or the state of economies, offer your "lost customers" the comps they took for granted in the old days and see how many will give you a second chance.
I remember the bartender who never filled a shotglass over the line, instead he bought a drink for his customer and was repaid with friendship and loyalty.
By azsk8fan

3/11/09 at 5:57 a.m.

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Hey neiman1 why not state ALL the facts - Vegas is a big waste of TAX PAYERS DOLLARS - you conveniently left that little catch phrase out of your proclamation didn't you. And as for high fuel prices??? Wasn't it as high as 4.00 a gallon sometime BEFORE Obama took office? So who gets that blame for THAT???
By LV4LIFE

3/11/09 at 2:34 p.m.

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Hey Neiman, its the economy stupid!! Your well known dislike of President Obama and Mr. Reid are well know here. I would suggest you leave your broken record blame theme behind. It has gotten tiresome.
By LV4LIFE

3/11/09 at 2:39 p.m.

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If Mr. Obama hadnt said what he did, do you honestly think these groups would still be coming here? I think not. At this time of lay offs and down sizing most companies are looking to save money and cut cost. Not taking a meeting in Las Vegas or anywhere else besides the company's base of opps only supports their bottom line.
By redferret

3/11/09 at 3:05 p.m.

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lv4life, don't waste your breath. Before Obama was elected magically the price of oil wasn't the president's fault but Congress'. After Obama is elected, it was all his fault. Even the stuff before Jan 20. He is just a rabid ideologue who can't get past seeing America in red and blue. Instead, it's America (f-yeah!), and we all need to pitch in together to solve this crisis. The sooner all involved get on board to find multilateral solutions, the sooner all involved can take the credit to the campaign trail. Easy enough on paper, but...
By 9ballguy

3/11/09 at 3:31 p.m.

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Kiddies there are powers that be, way above Obama that are steering the financial ship in the world now. If you believe the main stream media you are going to be needlessly upset and frustrated. What you had all better do is get out of debt and save as much as you can. The best thing to do is buy gold or any tangible assets.
By brownln4

3/12/09 at 8:55 a.m.

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Just because some of you have bad luck, don't assume its the casinos' fault. I just returned from seven days in your city and had all my rooms and food for seven days comped and I hit slots for $400, $320 and many $100 hits on dollar machines. The crew at the craps tables were freiendly and I can't wait to get back - the deals are amazing right now. So, if you lose, could it be just bad luck on your part rather than the casino trying to screw you???
By cole

3/12/09 at 11:13 a.m.

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There is no need to blame only Obama since there were high gas prices and a poor economy last year. Oh yes, which party has controlled the House and Senate for the last 2 years, with climbing gas prices and a refusal to increase domestic supplies, the Democrats. Led by Harry and Nancy with help this year from Obama there is a serious problem with our Las Vegas economy which will not be resolved until these socialist leaning Democrats are voted out of office beginning in 2010. Its hard to justify a vacation here when your 401K has tanked by 40-50% in the past 4 months.