Just a few days ago, Governor Steve Sisolak announced that casinos could begin reopening on June 4. That is, if the number of COVID-19 cases continue to be low. According to plans released by casinos that are preparing to reopen, around 41% of the hotel rooms on the Las Vegas Strip will be available. This number would fall in line with the facilities working to provide services at a much lower capacity.
Gaming Analyst Insight
Deutsche Bank gaming analyst Carlo Santarelli provided a research note on Friday to investors stating that right now, the estimates are most likely an overestimation of capacity. There is a reasonable chance that hotel floors and towers will stay dark in the early stages.
After announcing the casinos might be able to reopen on June 4th, speculation began as to who would open back up first. Some brands seem to be ready, but no one has given the full go-ahead as to if they will relaunch that day.
The Gaming Control Board hosted a hearing this morning with health and safety experts that are managing the state’s response to COVID-19. The results of this meeting are unknown. The governor will hold a press conference today that will discuss the second phase of the economic reopening.
As far as hotel rooms are concerned, Santarelli’s research suggest that just over 40% will be available, including rooms at the Las Vegas Sands, Caesars, Wynn Resorts and MGM Resorts. Others are considering opening during the first phase including the Cosmopolitan and the Sahara.
Limits Set by the Board
The Gaming Control Board has limited hotels to no greater than 50% of the maximum capacity per property. This includes hotels as well as the gaming floor. Casinos are to keep guests distanced by six feet, at hotel check-in counters as well as when playing games. Slot machines should have spacing in between each unit and less players will be seated at the table games.
To begin, casinos will have to rely on drive in traffic for their guests. Last year, from June to August, the city saw around 28% of their total visitor volume derived from drive in traffic. So, the casinos will most likely just offer a few rooms based on first come first serve basis and then work their way up to offering more rooms based on consumer demand.
Will Players Visit?
It is unclear as to if players will be willing to visit Las Vegas including if consumers will be ready to spend the night away from home. We might see players travel to play a few games but then head home after only a few hours away. While states are opening back up, the number of total cases continue to rise. Some people seem okay with getting out and about while others, not so much.
The challenge that casino operators will have to face is assessing the demand for services. Many resorts started accepting reservations in May only to cancel bookings and change dates to June. This effort helped to provide a base of customers who are interested in traveling.
We shall see in the coming weeks as the properties start opening if there is a demand for both gaming and hotel stays. If not, the casino industry may continue to struggle with little to no revenues coming in and face continued uncertainty as we try to wrap our heads around this weird and uncertain time.