LAS VEGAS - Visitors to Las Vegas are spending money.
"(My spending) could vary anywhere to four or five hundred dollars," said tourist Vellynn Chang. "I plan to spend about seven or eight hundred dollars," added tourist Gary Oliver.
But, tourists are not spending as much as they did in previous years, and downtown Las Vegas is feeling the brunt of that trend. Union Gaming Group principal Grant Govertsen says downtown cash flow is down nearly 55 percent from a peak in 2006.
"It's clearly not a pretty story when you look at both the revenue and, more importantly, the cash flow," Govertsen said. In response, downtown properties slashed room rates. While the lower rates lure customers, they hurt profitability. "Whether it's charging $125 or $25 a night, you still need roughly the same amount of people to staff that hotel," Govertsen said.
The Nevada Gaming Control Board reports downtown gaming revenue dropped by nearly six percent from February 2009 to February 2010. Gaming revenue on the Las Vegas Strip, however, jumped 33 percent during the same time-frame. "Clearly the Strip is doing better on a relative basis," Govertsen said.
Many downtown tourists admit they are spending less on gaming then they have in the past. "We like to see the shows. So, that's what we spend our money on," tourist Lisa Gunn said. "The economy is down, so people aren't spending as much. They are cutting back," tourist Mark Haskins said.
Others, however, say they're willing to open their wallets to have fun. "You come to enjoy yourself," tourist Gary Oliver said. "That's what you do when you go away. Enjoy yourself." "We have saved for it. We are here to have a good time. We'll spend the money if we have to spend the money," added visitor Jackie Oliver.
Govertsen says it's too soon to tell when the downtown economy will improve. He says recovery could be years away.