Vegas Strip Revenue To Grow 3-7% In 2010
-- Hotels, 11/9/2009 11:00:00 AM
PRESS RELEASE
CB Richard Ellis’ Global Gaming Group has released its 2010 Las Vegas Strip Forecast & Investment Guide. The forecast projects overall Las Vegas Strip revenue, which is expected to increase by 3% to 7% in 2010, taking into account various economic and operational factors including the anticipated CityCenter opening and the impact this project will have on the Strip.
“2008 and 2009 will go down as two of the most tumultuous years in the history of the Strip,” said Jacob Oberman, Director of Gaming Research and Analysis for CBRE’s Global Gaming Group and co-author of the report. "Although most Las Vegas Strip casinos will likely experience revenue and earnings declines in 2010, future implications for Las Vegas are positive. Investor sentiment will likely improve as 'headline' market revenue data measured on a year-over-year basis turns positive. Additionally, market revenue growth sets the stage for net positive job growth for Strip casinos in 2010, which bodes well for the local Las Vegas economy.”
The 85-page report explores how Strip Casinos have historically made money from an operator’s perspective and what the competitive landscape is expected to look like in 2010. Key highlights include:
• Market revenue growth would be 2% to 4% if no new supply came online in 2010.
• 10% to 30% of CityCenter’s revenue will be incremental revenue for the market, while the balance is expected to come at the expense of existing Strip casinos.
• Strip casinos in existence prior to October 2009 will experience a revenue decline of 3% to 6.9% in 2010.
Brent Pirosch, Director of Gaming Consulting Services for CBRE’s Global Gaming Group and co-author of the report notes that, “having worked in casinos ourselves, we bring a unique viewpoint not found in typical investment reports. We leveraged our experience to produce an in-depth analysis of the challenges Strip operators will face in 2010 and how those challenges will influence performance. Our analysis outlines strengths, weaknesses, opportunities, and threats (SWOT) which will help investors with medium and long-term time horizons determine if an investment on the Las Vegas Strip is right for them.”
The report is available for purchase from the CB Richard Ellis Global Gaming Group website, www.cbre.com/ggg.
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