- MGM Resorts has announced that The Mirage, Mandalay Bay and Park MGM in Las Vegas resume 24/7 hotel and casino operations starting March 3.
- Many properties have cut back their hours of operations due to historically low demand during the COVID-19 pandemic.
- All three of the aforementioned properties have been operating their hotels on a ‘weekend only’ basis with the Mirage closing completely midweek.
After nearly a year of an endless stream of increasingly dismal news out of the Las Vegas gaming and tourism industry there’s finally something positive to report. MGM Resorts (NYSE: MGM) announced today that three of their Las Vegas Strip properties—the Mirage, Mandalay Bay and Park MGM–will be resuming 24/7 operation beginning on March 3. The company says that they’re making the move to reflect increased interest in travel to Las Vegas.
This is not only a positive step for MGM’s Las Vegas gaming interests but is also very important symbolically for the city. 24/7 life is inextricably woven into the fabric of the Las Vegas Valley and it took the unprecedented impact of the COVID-19 pandemic to change that. To use an overworked metaphor, this could be the proverbial ‘first robin of spring’ after a long, harsh winter for Southern Nevada’s tourism and gaming economy.
2020 was an extremely difficult year for all retail gaming business worldwide though the online/mobile component held up pretty well. The biggest gaming destinations were the ones hit the hardest with Las Vegas and Macau likely getting the worst of it. Following an unprecedented two month plus shutdown of the Nevada gaming industry at the height of the COVID-19 pandemic there was hope for a quick rebound once casinos were allowed to open again.
It didn’t happen like that and with no midweek convention business whatsoever the major properties in Las Vegas were all forced to take steps to cut costs and survive. By Thanksgiving, several MGM Resorts properties were among a number of major strip resorts to close their hotel towers midweek. In January, MGM took the borderline shocking step of closing The Mirage entirely midweek.
MGM was one of a number of Las Vegas gaming companies that got hit coming and going due to exposure in Southern Nevada and Macau. The revenue hit was downright brutal–in the company’s Q4 earnings call they revealed that revenues for 2020 experienced a 60% drop over the year before. Even with that troubling backdrop, the financial markets were generally heartened by narrower than expected losses for MGM during Q4.
Bill Hornbuckle, MGM Resorts’ CEO & President, is happy to finally be able to report some positive news about his company:
“As we begin to see positive signs around the public’s sentiment about traveling, coupled with important progress on the vaccination front and decreasing COVID-19 case numbers, bringing Mandalay Bay, Park MGM and The Mirage back to full-week operations is an important step for us. We remain optimistic about Las Vegas’ recovery and our ability to bring employees back to work as business volumes allow us to do so.”
There could be even more good news on the horizon. Assuming that Nevada’s COVID-19 numbers continue to improve during the next few weeks the plan is to increase casino capacity to 50% on March 15. Nevada governor Steve Sisolak recently announced a slight increase from 25% to 35% but the move to 50% could be a ‘game changer’ for the Southern Nevada gaming and tourism industry. It could also be the beginning of a return to normalcy in the state’s largest industry.
In the Q4 earnings call, Hornbuckle indicated that demand for Las Vegas accommodations, gaming, hospitality, etc. could be ‘robust’ later in the year. Alan Feldman, a distinguished fellow at UNLV’s International Gaming Institute, emphasized the symbolic importance of Hornbuckle’s announcement of MGM’s properties returning to business 24/7 to the Las Vegas Review-Journal:
“After hearing news of closures and slight openings and then some back steps … reopenings feel very good. This should bode well for the (casino) industry and the community.”
Assuming that the COVID-19 vaccine rollout continues apace and that no new snafus pop up Las Vegas gaming and tourism industry could finally be heading in the right direction.
At the time of publication, James Murphy has a long position in MGM.
