Strong baccarat volume is “a positive indicator” for high-end properties on the Strip, while the newly opened Durango Casino & Resort in southwest Las Vegas helped boost gaming revenue in the locals market, according to a Wall Street analyst.
The Las Vegas Strip recorded an all-time record for monthly gaming revenue in December; the $905 million in revenue beat the previous high of $835 million in July and was an increase of 11.2% year over year. That helped set a statewide record at $1.43 billion in revenue and baccarat, a favorite of high rollers and international visitors, helped achieve both records.
Strip baccarat win totaled $218.7 million and was up $72.9 million or 50.1%. Volume totaled $839.5 million, up 18.3% or $153.7 million, and hold was 22% versus 17% in 2022. Total gaming win excluding baccarat increased 2.7% or $18.2 million compared to 2022. That showing followed a strong November for baccarat, when Las Vegas hosted its inaugural Formula One race that brought high rollers and international visitors to the Strip.
“Table win was buoyed by strong baccarat win of $219 million, solidly the best month since the pandemic and up 5.5% year over year,” said John DeCree, an analyst with CBRE. “While there was a significant hold benefit of almost 400 basis points above the (trailing 12-month) average, baccarat volume of $993 million is still the post-pandemic high. Baccarat also performed strongly in November with the first annual F1 race. Together, both months’ baccarat trends are positive indicators for higher- end properties on the Strip.”
Slot win on the Strip hit an all-time record of $446 million and increased 10.1% year over year despite a hold of 80 basis points lower, DeCree said. Handle of $6.2 billion, however, “stands head and shoulders” above the previous record of $5.7 billion record set in December 2022. Table win of $459 million increased 12.3% year over year while table drop increased 5.5%, benefiting from a hold of 210 basis points above the 12-month average.
DeCree had other good things to say about Las Vegas in his note to investors.
Visitation to Las Vegas increased 2.7% year over year in December, bringing the annual visitation tally to 40.8 million, which is 5.2% above 2022. Average daily room rates on the Strip increased 5.8% year over year in December and were up 12.3% for the year. December Strip occupancy gained 1.1 points year over year and is up 4.6 points for all of 2023, DeCree noted.
“The occupancy increase in December comes despite the new room supply from Fontainebleau,” DeCree said. “The Fontainebleau opened on December 13 and the Strip appears to have had no issue absorbing the new supply (of 3,600 rooms).”
DeCree said locals casinos reported December gaming revenue of $241 million, a 6.5% year-over-year increase. December marked an all-time high for Las Vegas locals table win at $52.4 million, a 15% year-over-year increase.
Table drop also hit an all-time high of $368 million, with a hold at the trailing 12-month average of 14.2%. Slot win of $188 million grew 4.4% year over year despite hold headwinds of 110 basis points. Slot handle of $3.5 billion increased 6.7% year over year.
“The market benefited from new supply in the Durango property which opened on December 5,” DeCree said.
The balance of Clark County reported December slot handle of $2.1 billion and table drop of $290 million, which grew year over year by 13.9% and 14.4%, respectively. This compares to just 0.3% year-over-year growth in slot handle and 1.1% in table drop in 2023 through November.
“If we assume those year-to-date same-store growth rates continued into December with no cannibalization, it would imply Durango generated approximately $247.8 million of slot handle and $33.7 million of table drop in its first 27 days of operation,” DeCree said.
DeCree cautioned, however, inferring too much from one month of data without more detail, particularly on promotional activity and cannibalization.
“That said, we are not surprised by these numbers, given the level of visitation and traffic at Durango observed during our regular channel checks over the past two months,” DeCree said.
