The Palms, Las Vegas’ first tribal-owned casino, opens Wednesday night after a two-year closure amid the NFL Draft that starts Thursday, with a record-breaking number of people expected to be in town for the three-day event.
It’s perfect timing for the San Manuel Band of Mission Indians of Southern California that in December closed on the $650 million deal to acquire the Palms from Red Rock Resorts.
San Manuel Gaming and Hospitality Authority
Nevada has reported a record 12 consecutive months of gaming revenue of at least $1 billion. Convention business has started to return midweek, which has boosted room rates for properties, and visitation numbers continue to grow. March’s gaming numbers will be released Thursday and based on traffic counts, there’s a good chance it will be 13 consecutive months.
On Tuesday, Harry Reid International Airport reported that 4.27 million passengers flew in and out of Las Vegas in March, the most since the pandemic began in March 2020, surpassing 4.18 million in October. The 4.27 million is 66% higher than the 2.57 million in March 2021, but just below the 4.41 million in March 2019 and 4.29 million in March 2018.
For the first three months of 2022, 10.7 million people have passed through the airport, an 89% increase over the 5.69 million during the first quarter of 2021. The return of international visitors, led by Canada, Mexico, and Europe, has helped, with 154,104 traveling through the airport in March, up from 17,150 in March 2021.
Drive-in traffic figures from Southern California will be released Thursday; they’ve been running strong, which is a positive for the Palms, given that the San Manuel Tribe draws from the database at its casino in San Bernardino County. It opened a 432-room hotel at Yaamava’ Resort & Casino at San Manuel in Highland in December.
The Palms reopens more than two years after Red Rock Resorts closed the property in March 2020 when COVID-19 shuttered the gaming industry in Las Vegas for more than two months. It’s better timing than the Resorts World Las Vegas opening in June 2021, just before the delta wave of COVID-19 hit and the state’s mask mandate was reinstated a month later.
San Manuel Gaming and Hospitality Authority
“It is certainly better timing than anytime in the past three years and I think the potential is there to catch the wave,” said casino consultant James Klas, founder and principal of KlasRobinson Q.E.D. “Typically, you come into a market to build up for a couple of years and establish your position, but maybe riding a wave could speed up that process.”
Consultants said the property is well positioned, with former MGM executive Cynthia Kiser Murphey at the helm as general manager. The 766-room Palms, occupies a name and place in the city’s history, after opening in November 2001. That will ease the transition under a new ownership.
“If you had to open, this is a great time,” said Josh Swissman, a casino consultant and founder of The Strategy Organization. “It’s definitely a baptism-by-fire scenario, where you have all those folks in the city for the Draft.”
Not only will the Palms focus on the San Manuel database, but market to the rest of Southern California, Arizona, Utah, and the Pacific Northwest. Unlike Strip properties, the Palms, on the west side of I-15 across from the Gold Coast, has also served Las Vegas residents.
San Manuel Gaming and Hospitality Authority
The Palms has traditionally catered to a younger audience with its nightclub and vibe, but the new ownership said it plans to focus on all ages. Las Vegas Raiders’ football in the fall will also be important, given its location on the same side of the freeway as Allegiant Stadium and accessible via a shuttle on S. Valley View Blvd. adjacent to the property.
“I think it’s particularly interesting that they’re operating in that local-slash-Strip market,” Swissman said. “They inherited a great property with a lot of cool assets and as they operate them effectively, it will be a great draw for the Strip and out-of-town group customers. I think they’ll be pretty successful. They’re pretty savvy and a database is what it takes to make it in the locals’ gaming business.
They’re among a small handful of casinos uniquely positioned to drive incremental value from that database to hit the ground running when it comes to customer volume.”
The Palms isn’t disclosing its occupancy numbers. It opens to the public at 9 p.m. Wednesday with a concert and fireworks show, but the hotel won’t start accepting guests until Thursday.
The hotel’s marketing is already touting the property for offering value compared to the Strip, which its early room rates depict. Its website quoted a rate of $159 on Thursday, $209 on Friday, and $199 on Saturday. Most weekdays between May and July run $79 to $99 a night. The weekend rates vary on Saturdays, starting on Kentucky Derby Day, May 7, at $189 and on subsequent Saturdays are $299, $570, $309, $249, $209, $199, and $189.
The California tribe will attract guests to fill those room nights, Klas said.
“The database is a major advantage,” Klas said. “That was Harrah’s stock and trade for most of its existence, the quality to Marriott’s stock and trade, and the loyalty program is Disney’s stock and trade. Having a set group of people in California has always been the biggest feeder market for Nevada by far. They don’t have to rely on that, but having it is a big advantage. Vegas is no different than anywhere else. It’s about getting your name out and being the place to have fun.”
Steve Neely, general manager of the Rolling Hills casino in Northern California, said when the Palms was owned by the Maloof family, it was considered a great hangout for locals. He predicts the tribal ownership will bring back those same elements.
“They’re well funded and have a strong owner behind them,” Neely said. “I can only imagine what they can do with that place and restore it to its previous glory. I would be licking my chops if I were at the Palms and had the database they have for Southern California. That is going to be a great extension for them.”
The Palms’ 1,400 employees have been gearing up for the opening and some were on property Monday afternoon when media tours of the property were conducted.
Patrons who frequented the Palms won’t see any references to the tribe, other than the model display of its property in Southern California at the west entrance. The Palms has renamed its cafe the Serrano Vista, the same name used at the Southern California property.
Klas said there’s no disadvantage in letting people know a commercial casino is a tribal property, but there’s no reason to focus on it, unless they thought it would bring additional customers.
Neely said while the symbols may not show it, the Palms will be a tribal property, most of which focus on employee retention, taking care of staff, and treating customers like guests in their homes.
“I hope those same philosophies translate to their commercial space and I can’t imagine they won’t,” Neely said.
The layout of the gaming floor looks different, with new slot machines and stations, but the biggest change on the entire property is the partnership with sports betting operator William Hill. That has led to a complete renovation of the race and sports book.
Instead of the previous layout with rows of seating, it more resembles a lounge with chairs and tables, with a private VIP area in an enclosed booth from which radio shows can be broadcast. The new setup, which accommodates 100 customers, has a stage that allows for musical entertainment to start after the West Coast games are completed, said Michael Grodsky, vice president of marketing and public relations with William Hill.
The change is part of creating an upbeat vibe in the casino, with live music that can be heard in the nearby bar and casino area.
“There will be great energy, so people will stick around after the games are done,” Grodsky said.
Swissman said there was no need for a major remodel, given the investment by Red Rock Resorts. He applauded the change in the sportsbook, saying the one feature missing from the Palms was a lounge with live music for older patrons.
Gone is Kaos as a nightclub, but the venue is available for private events and will be used for live music and entertainment in the future.
The other major change is with the Brenden Theaters, which have been remodeled with new seating; they’ll also host IMAX movies and serve alcohol.
Unlike around 75% of casinos that reopened after the pandemic shutdown, the Palms’ A.Y.C.E Buffet will reopen, though serving breakfast and dinner only. The former Green Street Kitchen will serve as a pop-up restaurant featuring chefs and won’t operate on a regular schedule.
The Pearl, the 2,500-seat theater, will reopen in the summer. The Ghost Bar, the boutique nightclub on the 55th floor, has returned to its previous name and will reopen this summer.
