Posted on: July 31, 2024, 10:15h.
Last updated on: July 31, 2024, 10:33h.
Hotel reservations and ticket packages for the second F1 Las Vegas Grand Prix are experiencing a rapid deceleration from last year. So said MGM Resorts execs today during the casino company’s second quarter earnings call.
“It’s off to a soft start as compared to bookings last year, when we had a lot of advance pre-bookings,” MGM CEO Bill Hornbuckle said. “It doesn’t feel soft in gaming, which is the most important piece — or one of the more important pieces. It just does in room rates at the big three, meaning, in this case ARIA, Cosmo and Bellagio.”
Average room rates for the first F1 weekend in Las Vegas were $1,666 for the Bellagio, $1,663 for the Cosmo, and $1,457 for ARIA. The average nightly cost for a room across Las Vegas was $496.
Race to the Bottom
Hornbuckle said that hotel rates for this year’s race weekend, Nov. 22-24, are about half that. Converted into dollars for the largest gaming company on the Strip, Hornbuckle estimated the difference at “30 millionish.”
That seems like small potatoes for a company that reported record net revenues of $4.3 billion in the quarter on the same call. That included $2.2 billion from its Strip properties — up 3% from the second period last year.
MGM COO Corey Sanders said the drop-off in F1 interest did not take the company by surprise.
“We’ve heard from other markets,” he said. “It’s fairly consistent. Year one, there’s a lot of hype for it. This will be a good weekend for us compared to an average normal weekend. Just in comparison to F1 last year, it was so substantial, especially on the rates at the luxury properties.”
Vroom to Grow
It may be American football that picks up some of the F1 slack — at least for MGM’s properties on the South Strip, which were only 60% full for the inaugural race. The Las Vegas Raiders take on the Denver Broncos at Allegiant Stadium on Nov. 24, the day after Saturday night’s race.
And Hornbuckle said he hopes that more non-race fans won’t be scared to visit Las Vegas during F1.
“Last year, I think we did an amazing job scaring the hell out of people in terms of traffic,” he said. “During the actual event, it was fascinating. There was no traffic. The build-up to F1 this year is already mild in comparison.”
