Las Vegas made headlines this summer after hotel occupancy across the city showed signs of softness, sparking concerns about a potential downturn. Hotels editor Christina Jelski spoke with Sean McBurney, chief commercial officer and regional vice president for Caesars Entertainment, about current market conditions in the city, promotional strategies and the company’s expansion plans.
Sean McBurney
Q: When it comes to Las Vegas’ summer performance, what’s the reality behind the headlines?
A: I think the narrative does not accurately reflect what’s fundamentally happening in the business. The idea that “Vegas is dead” is just not accurate whatsoever. It’s important to keep it in context. In the second quarter, we were at 97% occupancy at our properties. That was down from 99%, but on an absolute basis, we were very busy. In the third quarter, we were at about 90% occupancy. Many different metropolitan areas would love to be operating a market with 150,000 hotel rooms and with occupancies in the mid-80s. What we’re seeing as we look to the fourth quarter is demand is increasing. The Las Vegas Grand Prix race is booking well, and the marquee events continue to draw very strong interest; as we look to New Year’s, all of that looks promising.
Q: Still, we’re seeing a slew of Las Vegas hotel promotions. What’s Caesars doing on this front?
A: There’s certainly a lot of promotional activity that always happens, and summertime is a prime time for that. We’ve had a variety of promotions. This was the first year that the [Las Vegas Convention and Visitors Authority] coordinated a Las Vegas sale collectively, and that was really productive for us. It put a spotlight on Las Vegas, and all of the operators came forward with a set of promotions we hadn’t historically done before. We’ve also introduced an offer for locals, with free parking and 25% off food and beverage from Sunday to Thursday.
Q: Speaking of F&B, what’s the latest with Caesars’ partnership with reality TV star Lisa Vanderpump?
A: Vanderpump’s Pinkie’s by Vanderpump opened on the southeast corner of Flamingo last December, and it is white hot. It’s surpassing our expectations. But we’re most excited about the Vanderpump hotel. We’re converting The Cromwell to The Vanderpump, and the mock room is complete. It’s a complete renovation of all hotel rooms, the gaming space and check-in areas. [Lisa will] have a couple food and beverage concepts we’ll announce later in the year. She’s a great partner; every concept is bespoke, not a copy and paste. She’s intimately involved in every aspect. It’s not uncommon when something’s being built to see her with a hard hat and stilettos walking around the construction site.
Q: You’ve also been expanding the Caesars Republic brand. Can you talk a bit about that concept?
A: Caesars Republic is inspired by the parent brand, Caesars Palace, but while Caesars Palace is playing at the high end of luxury, this is in the premium tier. It’s youthful, energetic, with great entertainment and food and beverage. What makes it different is it really tries to embody the local community. The destinations where this brand is appearing in are really great destination markets: Scottsdale, Ariz.; Lake Tahoe, Nev.; and now Sonoma in California, with views of the Russian River.
Q: What are you seeing in forward bookings?
A: When we look at our forward bookings, we’re really encouraged. In the last six weeks, we’ve had year-over-year growth in our booking pace. From a group perspective, the fourth quarter and first half of next year look very strong. There’s been a lot of negative sentiment around international travel, and Canadian visitation declines have been well documented, but many other international markets are showing strength.
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