Las Vegas has become one of the hottest destinations for business travelers in the United States. Corporate interest in the entertainment capital as a meeting venue is on the rise, and as prices seem to be climbing without intermission, the negotiating climate inevitably is tightening.
"The demand from corporations for Las Vegas group and meeting hotel space is constantly and steadily increasing. Over the past year, it has increased by approximately 20 percent," said Greg Malark, a senior executive vice president for HelmsBriscoe, a nationwide organization that negotiates rates for meetings on behalf of corporate clients.
Jerry Janove, director of sales for Resort Meetings Consortium, a site-selection firm, claimed even larger numbers. "When it comes to the actual requests from corporations that we get, the number has increased about 30 percent to 40 percent over the past few years," he said.
Regarding the tougher negotiating climate for travel buyers in Las Vegas, Malark said, "rates and concessions are harder to come by now, but can be offset by flexibility in time selection." To avoid the occasional difficulties in booking, he recommended that companies stay as flexible as possible in the choice of dates that they want. "A few days can make a significant difference," he said.
"It is becoming more and more difficult to negotiate with Las Vegas hotels," Janove said, "but the hotels will negotiate. How far will they go in the negotiation depends on availability." Janove also said hotels usually are less aggressive in negotiating Monday to Thursday, when they are not so packed.
Meeting buyer Todd Zint, assistant vice president for NFP Insurance Services, advised companies to look for multiple hotels, as space availability and room rates are highly dependent on the events being held in each particular hotel at the time.
Room rates have gone up substantially in the recent past. According to the BTN Corporate Travel Index
(BTN, Feb. 20), in 2005 the average non-negotiated corporate room rate for Las Vegas was $105 for a midprice hotel and $319 for an upscale one. Today, the average midprice rate is $185 to $215 and $265 to $325 for upscale, Zint said.
"Las Vegas hotels are trying to attract all different types of corporate groups," Zint said. "However, they are starting to move toward welcoming smaller business groups. They are beginning to realize that small and midsize corporate business travel groups create a large market—and they want to catch it," he continued.
In an attempt to meet the needs and desires of their corporate clients, many hotels have improved their floor plans so that the meetings can be held at a distance from the gambling areas and conference attendees also can enter their rooms without having to wade through the hotel casino's gambling madness.
Erika Yowell, a senior manager in media relations for the Las Vegas Convention and Visitors Authority, however, said demand from corporations only has been increasing significantly in the recent past. There has been a lot of space development planned, she said in reference to Las Vegas hotels. "The hotels are just bluffing," Yowell added, meaning that an actual increase in meeting space availability mistakenly is being perceived as an increase in the demand for space.
With more than 22,000 conventions held in Las Vegas last year and 6.5 million delegates, it is hard to believe how modest the numbers were three decades ago, when only 370,000 business travelers visited Las Vegas and only 325 conferences took place there.
In 2005, Las Vegas hosted a record-breaking 38.5 million visitors, including 6.5 million who traveled to Las Vegas to attend conventions or for other business purposes, accounting for approximately 15 percent of all visitors, LVCVA reported. According to LVCVA's 2005 Visitor Profile Study, convention visitation is expected to reach 20 percent of visitor volume by 2009
LVCVA has set forth a goal of attracting 43 million visitors to the destination by 2009. In order to achieve this, it is planning not only to renovate and upgrade much of the existing facilities, but also to increase the citywide hotel inventory to more than 170,000 rooms by the end of 2010.
Currently, Las Vegas has approximately 9 million square feet of convention and meeting space, including the Las Vegas Convention Center's expansion, Mandalay Bay's 1.5 million-sq.-ft. conference center and the 1.8 million-sq.-ft. Sands Expo Convention Center. This February, LVCVA board of directors approved a $737 million master plan enhancement program for the Las Vegas Convention Center. Primary projects include adding meeting rooms to support the facility's South Hall exhibition space, a new front lobby connecting the North, Central and South Halls, and constructing a 100,000-sq.-ft. general session space. Construction will begin in late 2006 and will be completed by the end of 2010. LVCVA said this enhancement program represents the largest investment in the facility in its 47-year history.
Along with the considerable hotel inventory development, the flow of visitors has been continuously rising. "The more they build, the more they come out here," Janove said. At the present time, the occupancy level in Las Vegas hotels is about 92 percent weekdays and 97 percent on the weekends.