Posted on: Saturday, October 6, 2001

The September 11th attack
Deals lure visitors back to Las Vegas

Bloomberg News

Las Vegas — Casinos are reporting occupancy at their hotels is returning to pre-attack levels after they cut room rates by as much as 50 percent to lure travelers to Las Vegas.

MGM Mirage casinos will be 100 percent full this weekend, said spokesman Alan Feldman. Rates are averaging half the typical amount, he said.

"We're trading off short-term profitability for what we hope is long-term stability," Feldman said. "The objective now is to get the rooms full and get our employees back to work."

The Las Vegas Convention and Visitors Authority expects the city's hotels to be 84 percent occupied this weekend, up from 67 percent the first weekend after the Sept. 11 terrorist attacks that prompted airlines to cut schedules 20 percent and spurred fears of flying. The hotels are usually 94 percent full in October, the convention authority said.

Lower nightly rates are attracting more budget-minded customers who are less likely to gamble large sums of money or spend in the casinos' retail malls such as Forum Shops at Caesars Palace, analysts said.

"We're seeing customers stay at properties they never thought they would," Bear Stearns analyst Jason Ader said. "It's much easier to find $5 blackjack tables on a Saturday night."

The convention authority last week underestimated hotel occupancy for the weekend, predicting 84 percent of the rooms would be filled. Including walk-in guests who booked rooms during the weekend, rooms ended up 93 percent full, said convention authority spokeswoman Erika Brandvik.

Casinos are marketing to drive-in customers from Nevada's adjacent states such as California. Average weekend rates are rising faster than weekday rates, an indication that tourists are returning before business travelers, Ader said.

On Wednesday, the authority began a $13 million advertising campaign to lure tourists back to the city's mega-resorts. The eight-week ad campaign, with television, radio, print and Internet messages, focuses on the city's leading drive-in and fly-in markets, including Southern California, San Francisco, Phoenix, Houston, Dallas and Chicago.

Visitors to Las Vegas dropped dramatically after the attacks in New York and Washington, leading to unoccupied hotel rooms and as many as 15,000 layoffs.