Las Vegas Strip Empty Without Conventions

When the rodeo left Las Vegas, it removed the last big event this year that could have re-energized the city’s Strip and battered convention business.

The Professional Rodeo Cowboy Association’s National Finals Rodeo, held in Las Vegas since 1985, moved to Arlington, Texas, in September because of Nevada’s pandemic restrictions. The 10-day rodeo attracted 170,000 fans last year and ranks as one of Las Vegas’s top draws annually.

As other states have opened more swiftly, Nevada’s public-health restrictions and a weakened travel industry have kept conventions and meetings from returning to Las Vegas, a continuing setback for the city’s battered casino industry and the state’s overall economy. City officials and event producers say they expect to return as coronavirus concerns ease, but no one knows when that might be or how conventions will be operating by then.

Nevada Gov. Steve Sisolakrecently increased the maximum gathering size to 250 people, from 50. Conventions of up to 1,000 people are also allowed, as long as attendees remain separated into 250-person sections, including partitioned waitstaff and amenities.

In a Sept. 29 news conference, Mr. Sisolak said Nevada is taking safe steps in reopening “with the goal of preventing a rollercoaster of up and down cases that leads to uncertainty for...meeting and convention and event planners.”

The Las Vegas Strip has transformed over the past two decades into a hub for conventions and events, competing with cities like Orlando, Chicago and New Orleans. Casino companies have relied on group bookings to fill hotel rooms, restaurants, banquet halls and entertainment venues, keeping the Strip humming through the week.

The state’s new gathering policy likely won’t attract much new business, people in the industry say, but it gives meeting planners some confidence for 2021.

AtCaesars Entertainment Inc.,group bookings accounted for 15% of hotel occupancy at the company’s Las Vegas properties and up to 30% at Caesars Palace alone last year, the company said. Caesars companywide has had 2,500 meetings and events canceled since the start of the pandemic, and that number is growing, said Michael Massari, Caesars chief sales officer. The company’s other Strip properties include Planet Hollywood, Bally’s and Paris.

Casino companies say they will have to prove to public-health officials that they have implemented effective Covid-19 testing and other safety protocols to get the maximum size to increase gradually.

Mr. Massari described Nevada’s current restrictions as a competitive disadvantage. “You can keep your group of 1,000 people together in many great American cities,” he said.

The group business Caesars has on the books for the first quarter of 2021 is about half what it would be in a normal year, Mr. Massari said. But, he added, the company has signed more contracts for future events in the past six months than in any six-month period in its history, representing $200 million in future business, a sign Las Vegas is still an attractive destination.

Hotel-room occupancy on the Strip averaged 42% in August, compared with 90% the year before, according to the most recent data available from the Las Vegas Convention and Visitors Authority. About 42.5 million people visited Las Vegas last year, and 6.6 million attended conventions, the authority said.

With 11.5 million square feet of meeting space and an additional 3.5 million square feet under construction, Las Vegas has more capacity than any other U.S. city, said Steve Hill, chief executive of the Convention and Visitors Authority. He said the current pain is only temporary.

“There’s just no place like Vegas, and that’s going to be the case on the other side of this,” Mr. Hill said.

Industry leaders insist businesses will still want to network and show off products in person in the future, but the threat remains that some groups will go virtual for the long haul.

The Las Vegas hospitality industry took a hit when CES, the world’s largest consumer-electronics exhibition, scheduled for January 2021 in Las Vegas, said in July that it would go virtual next year. The Las Vegas Convention Center is undergoing a $980 million expansion to add 1.4 million square feet of space, intended to be ready in time for CES 2021, before it decided to go virtual.

MGM Resorts International,the largest operator on the Strip, is launching a pilot program this month with a rapid-testing and screening program for meetings and conventions that includes technology by Clear, an airport-security contractor.

Conventions accounted for about 20% of hotel nights booked at MGM properties last year, and the segment has more than doubled over the past 10 years, saidAtif Rafiq,a senior MGM executive who oversees business growth, including marketing and events. The recent increase in gathering sizes is keeping groups with future plans from canceling, he said.

“Las Vegas is trying to figure it out, step by step, and I think that is building momentum,” Mr. Rafiq said.

Las Vegas Sands Corp.has more than 2.2 million square feet of meeting space at its Sands Expo facility, where the company recently staged a mock trade show for public officials, including Gov. Sisolak, to experience its safety protocols.

Wynn Resorts Ltd.is working with a Las Vegas-area hospital to develop a rapid-testing lab at the Wynn casino, aiming to open it by Thanksgiving, the company’s CEO,Matt Maddox,said in an op-ed published in the Nevada Independent. A Wynn Resorts spokesman didn’t respond to requests for comment.

Last month, Connect Meetings, which hosts live events, moved a convention from New Orleans in August to the Wynn resort for October—only to move it again to Orlando because of public-health restrictions. The meeting typically attracts about 5,000 people, but this year, about 800 are expected in person.

“Orlando did decide to fully reopen, and Las Vegas has taken a more measured approach,” said Chris Collinson, president of Connect Meetings.

In the long run, he predicted, Las Vegas will maintain its place as a top destination for conventions. “People are going to be really desperate for some of the fun that Vegas offers,” he said.