Taxes on Las Vegas’ 150,000 hotel rooms, which are the city’s economic engine, fell 61%. Number of events in the convention center: down 87%. Income from convention center events has decreased by more than 90%.
The endless nature of the pandemic combined with the delay in state and local financial reporting means that we are only now getting the full picture of the destruction of bond issuers from COVID-19, and the results are not pretty. However, that doesn’t mean Vegas is permanently broken.
The Las Vegas Convention and Visitors Authority is selling $ 23.6 million in revenue bonds this week to repay a deal sold in 2019, and the tentative official statement on the issue includes audited data for fiscal 2020, which ended on 30 as well as estimated Data from fiscal year 2021.
That fiscal 2020 data includes eight months when the picture was still looking good, and then the shutdown when business stalled. “The first eight months of the fiscal year were strong for the Las Vegas Convention and Visitors Authority,” read the audited financials. “In March 2020, LVCVA room tax collections were up 5.3% year over year, and the Las Vegas metropolitan area had an unemployment rate of 4.0%.”
Then came the shutdown, and “after March there were no noteworthy congresses in the 2020 calendar year,” as the documents say. In January 2021, the number of visitors to the city began to rise, and July marked the seventh consecutive month that the nation’s gambling capital gained in visitors. Only then did the congress business pick up, and then only by leaps and bounds. According to the documents, on September 15, the National Association of Broadcasters canceled an event planned for this October.
The pandemic was brutal for the meeting business. Room taxes decreased from $ 286.4 million in fiscal 2019 to $ 111.2 million in 2021. The number of events at the Convention Center decreased from 93 in fiscal 2019 to 12 in 2021, and revenue from those events decreased decreased from $ 54.5 million to $ 5.2 million.
But the pandemic is now entering the past tense. Total attendance in Vegas this year has risen sharply and is approaching 2019 levels. Moody’s Investors Service rated the new bonds Aa3 with a stable outlook and said the rating “reflects the agency’s well-established position as the nationwide market leader for major conventions and reflects the region’s extensive tourist facilities across the Las Vegas area, which will have a strong post-pandemic hotel tax return over the next two years. “
Translation: Don’t bet against Las Vegas.
