Nov. 15, 2012
/PRNewswire/ -- Positive momentum in U.S. household net worth and improved pricing power with convention business will boost the Las Vegas Strip's outlook, according to the 2013 Las Vegas Strip Forecast & Investment Guide produced by
Newmark Grubb Knight Frank
's Global Gaming Group. This fourth annual report, which explores current and long-term trends on the Strip and what the competitive landscape is expected to look like in 2013, was released today during a luncheon for casino and resort executives and members of the local business community.
The forecast projects total revenue on the Las Vegas Strip to increase between 1.5% and 5.3% in 2013, taking into account various economic and operational factors.
"Improvements in U.S household net worth, an important leading indicator for Strip revenue performance, should provide baseline support for 2013," said
, director of Gaming Consulting for NGKF's Global Gaming Group and co-author of the report. Mr. Pirosch noted, however, that "softness in the U.S. housing market, a fragile recovery and ongoing economic uncertainty in the U.S. and abroad will keep 2013 revenue growth on the Las Vegas Strip at modest levels."
Key highlights of the report include:
- Gaming revenue excluding Baccarat is expected to increase 1.9% to 4.9% in 2013 for properties on the Las Vegas Strip.
- As a result of stronger pricing dynamics, hotel rates and non-gaming revenue are expected to grow at a faster rate than gaming at between 2.3% and 5.5%.
- Primarily due to slowing wealth metrics in China, the Baccarat market is projected to experience between a 5% decline and 5% growth in 2013.
- Changing demographic and competitive dynamics has put gaming volume per available room at historic lows.
Se Oei, director of Gaming Research and Analysis for NGKF's Global Gaming Group and co-author of the report noted that, "Development strategy on the Strip continues to focus on renovating and invigorating existing spaces. Development trends are clearly focused on maintaining or increasing market share of customer spend through non-gaming outlets over a full 24-hour cycle."