Nevada’s governor implored the state’s residents on Wednesday to stay home “as much as we possibly can” over the next two weeks in order to control the latest spread of COVID-19, which spiked to record-high levels with more than 1,000 daily cases in nine out of the last 10 days.
But what about visitors to the state’s sputtering casino industry?
“They certainly should come, because those (visitors) are protecting our jobs,” Gov. Steve Sisolak said during the late-afternoon press briefing in Carson City.
“But when they come here and they’re staying in one of our properties, you need to wear a mask,” Sisolak added.
This is the conundrum facing Nevada, a state whose economic health is overly dependent on a single business model: the gaming and tourism industry. Through September, gaming revenues on the Strip were down 45%, the market’s visitation was off 55%, and airline passenger volume at McCarran International Airport dipped 56.5%.
So what happens if Nevada’s COVID-19 numbers continue to climb? On Friday, the state set a record for new cases reported in a single day with 1,857. Late Friday, Sisolak announced he tested positive for COVID-19.
“If we don’t come together at this moment, I will be forced to take stronger action in 14 days. To be clear, I don’t want to,” Sisolak said.
What does “stronger action” mean? Sisolak wouldn’t say.
A few friends walk down the Las Vegas Strip with yard-long drinks while various properties reopened to the public after a temporary shutdown caused by COVID-19 on Thursday, June 4, 2020.
A hint, however, is taking place in other gaming states.
Illinois Gov. J.B. Pritzker ordered a rollback last month for operating hours and services for certain businesses, including riverboat casinos and video gaming terminal locations. On Thursday, Pritzker warned that Illinois is heading toward another mandatory stay-at-home order.
Two weeks ago in Massachusetts, Gov. Charlie Baker issued an evening stay-at-home advisory for residents and required the state’s three casinos to close between 9:30 p.m. and 5 a.m. Other businesses were also impacted.
Ohio Gov. Mike DeWine told the state Wednesday that a partial shutdown could be in the offing. That move might include the state’s casinos.
New Jersey Gov. Phil Murphy on Thursday ordered all restaurants, bars, clubs, and lounges to close indoor dining from 10 p.m. to 5 a.m. The restriction covered casino restaurants, but gaming is continuing unabated.
“To be clear, the last thing I want to do or any of us want to do is to shut our economy back down and, thankfully, we are not at that point,” Murphy told the Press of Atlantic City.
In Colorado, casinos in Black Hawk and Central City closed blackjack, poker, and other table games Friday when Gilpin County moved to a more restrictive COVID-19 status.
Las Vegas casino operators have already taken steps to reduce the market.
Due to lack of mid-week business, companies have limited operations at certain casinos – Park MGM, Palazzo, and Encore at Wynn Las Vegas – to just weekends. Boyd Gaming doesn’t expect to open downtown’s Main Street Station until next year. Red Rock Resorts said its off-Strip Palms, which underwent $690 million in renovations in 2019, will stay dark into 2021.
Restaurant hours have been reduced at several resorts.
In October, MGM Resorts International CEO Bill Hornbuckle told analysts his management team was going through “an exercise” in considering what parts of the business they want to keep open and what should close.
“There are certain amenities or certain towers or certain brands, potentially, that will face closure for (a) mid-November timeframe give or take through the holiday season. We’ll see how it goes,” Hornbuckle said.
Nationwide, starting in the middle of March, nearly 1,000 commercial and tribal casinos in 43 states were closed to stem the spreading virus. More than 90% of the casinos returned to business starting in late May. Casinos are operating under state and tribal government-mandated COVID-19 guidelines covering health, safety, cleaning, and capacity limitations.
Regional markets, for the most part, staged a slight comeback. Several states, such as Ohio and Maryland, exceeded monthly gaming revenues from a year ago during September.
The reality for a destination market like Las Vegas is not the same. Nevada’s economy took a massive hit during the state’s 78-day gaming industry shutdown that began on March 18.
Without convention and meeting business – Las Vegas has seen six straight months of zero convention attendees – combined with a lack of international airline travel, experts predict at least two-years before the Strip sees 2019 figures, such as $6.58 billion in gaming revenue.
“As we think about the ongoing recovery here in Las Vegas, two words come to mind: long and slow,” said Boyd Gaming CEO Keith Smith.
Howard Stutz is the executive editor of CDC Gaming Reports. He can be reached at hstutz@cdcgaming.com. Follow @howardstutz on Twitter.
