Las Vegas convention bookings will rebound to peak 2007 levels in the first quarter of next year, as audience attendance increases, MGM Resorts International (MGM:US) Chief Executive Officer Jim Murren forecast today.
Room bookings at MGM Resorts, the largest casino operator on the Las Vegas Strip, suggest a “tremendous” January through March for all Strip hotels, Murren said in an interview in New York. The rise comes from stronger attendance at events including the Consumer Electronics Show, in January, and the return of Conexpo-Con/Agg, the construction industry convention and exhibition held every three years in March, he said.
“The first quarter will be the best we’ve seen since 2007 for the convention business,” Murren said. “In general, 2014 is going to be a stronger year citywide” than 2013. Still, booking windows remain short, meaning attendees are reserving rooms closer to the event, Murren said.
While Las Vegas casinos have struggled to return to pre-recession growth as consumer spending has remained weak, MGM Resorts reported gains in its operations there during the second quarter. Strip earnings before interest, taxes, depreciation and amortization rose 15 percent, as casino revenue climbed 7 percent, and hotel sales added 5 percent, MGM said in August. Investment in hotel room remodeling, restaurants and entertainment has attracted more leisure travelers to the city, Murren said at the time.
Business as Usual
The federal government shutdown and the debt-ceiling crisis haven’t had an impact on the company yet, Murren said.
“It’s business as usual so far” in Las Vegas despite the government shutdown, Murren said on Bloomberg Television’s “In the Loop with Betty Liu.” It would be “devastating” if there was a prolonged federal stalemate, shaking consumer and business confidence, he said.
“People just can’t believe the government can be as immature as they seem to be acting right now,” Murren said. “We’re just hoping that adults get into the room and get something done.”
MGM shares fell 3.1 percent to $19.74 today at 12:04 p.m. in New York. The stock was up 75 percent this year through yesterday.
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