Las Vegas Wins Big from Arrival of F1 Race
LISTEN TO THIS ARTICLE:Las Vegas' historic Formula 1 race in November proved to be a resounding success, driving a surge in revenue for the city's gaming industry. It has also set the stage for an even more exciting 2024, with the upcoming Super Bowl and more racing events.
Record-Breaking Gaming Revenue
In November, gross gaming revenue reached a milestone by surpassing $820.9 million, marking a substantial 22.6% surge compared to the previous November and securing itself as the second-highest monthly total ever recorded. This boom can be directly linked to the race, which drew an extensive crowd of affluent gamblers and international tourists to the city.
That surge greatly influenced the financial impact of the Formula 1 race on the economy. This, in turn, has had a remarkable impact on upscale gaming properties. Consequently, the average daily rate surged to an unprecedented $249, marking a significant 33.7% increase compared to 2022.
The Strip experienced a noteworthy surge in revenue per room, witnessing a rise of 7%. This boost can be predominantly attributed to a surge in the average daily rate, which skyrocketed by 35% and consequently achieved an unprecedented monthly milestone of $270. Revenue per available room (RevPAR) also soared, exceeding $204, up 34.8% compared to last year.
John DeCree, an analyst at CBRE, attributed the incremental revenue generated in table game play to the Formula 1 race, as well. Table win surged 61.9% year over year to $410.1 million, driven by a 39.8% increase in table drop.
Baccarat, a favorite among high-rollers, was the driving force behind the impressive gains in table game revenue. Baccarat win increased 208.7% over November 2022 to $178.3 million, on a 90.1% increase in volume to $938.5 million.
Operators See Varied Results
Despite the overall success, not all operators reaped the same benefits from the Formula 1 race. Caesars Entertainment acknowledged that the company missed its expectations for a $25 million year-over-year improvement in adjusted earnings from the race weekend.
MGM Resorts International, however, emerged as a clear winner, with the company reporting record hotel revenue for the race weekend and November. MGM also anticipated that this quarter might also set a new record.
The New Year is anticipated to witness the energy generated by the recent Formula 1 race being carried forward, as projected by the Las Vegas Visitors and Convention Authority. It foresees an impressive gathering of close to 400,000 attendees for the city on New Year's Eve. Subsequently, the city's tourism industry will receive a significant uplift with the inaugural Super Bowl event at Allegiant Stadium in February.
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