Resorts look to Chinese New Year

War could lead to last-minute cancellations

January 31, 2003 - Accounts vary on whether Year 4700 on the Chinese lunar calendar will be known as the Year of Goat, Year of the Sheep or Year of the Ram.

Local casino operators simply hope to call it the Year of the Big Bucks.

Saturday's Chinese New Year holiday marks the beginning of what many now consider the city's second-largest gaming event behind New Year's Eve. Although there are no official estimates on how many travelers will celebrate the holiday in Las Vegas, few question Chinese New Year's impact on casino performance levels.

"A lot of our top casino clients are Asian, so anytime there's an event that brings a lot of people from that sector together you're bound to see a blip on the screen when looking at your gaming numbers," MGM Mirage spokesman Alan Feldman said.

That sentiment was echoed by Park Place Entertainment spokesman Michael Coldwell, who said, "This is a very important market segment for Las Vegas and our properties. Having a successful Chinese New Year is key to the quarterly success of the city."

Although both declined to cite specific figures, both Coldwell and Feldman said they're optimistic Chinese New Year occupancy levels will be near or above those of last year, when approximately 278,000 people came to town for a three-day weekend that occurred within seven days of Valentine's Day and Presidents Day.

The city averages about 255,000 visitors on normal weekends, said Kevin Bagger, research director for the visitors authority.

Still, the potential for war in the Middle East could lead to last-minute cancellations from many foreign travelers, particularly in light of President Bush's recent State of the Union address, said Brian Gordon, a principal with Las Vegas-based research firm Applied Analysis.

"(Bush) basically said it's imminent that we're going to war with Iraq so I think there may be some drop-off based on what's going on there," Gordon said. "A lot of these (Asian) guys tend to shy away from any potential disasters."

Hordes of Asian no-shows would be detrimental to gaming interests, Gordon added.

"If people don't come or limit their expendable gaming dollars, you'll see it on (gaming companies') first-quarter numbers," Gordon said.

John Mulkey, an analyst for Bear, Stearns & Co., said many Asian gamblers typically schedule their one annual trip to Las Vegas to coincide with the week of Chinese New Year. This year, though, Mulkey is also leery of a war's potential to reduce Las Vegas tourism.

"Generally, the fears of us going to war aren't helping things," Mulkey said. "(Chinese New Year) could be pretty disappointing overall."

Feldman said he's yet to see signs of last-minute cancellations among Asian guests, though. In addition, McDonald Investments casino industry analyst Dennis Forst downplayed nonspecific talk that a potential war with Iraq could scare off would-be Asian travelers. Instead, Forst is optimistic this year's event will compare favorably with those of most recent years, though he admits February 2002 will be tough for gaming companies to top.

"Last year was a pretty lucky time," said Forst, who explained casinos a year ago won at a higher percentage than is statistically normal for a given month.

In February 2002, the Nevada Gaming Control Board said the statewide gaming win totaled $752.6 million, fueled in part by $40 million in baccarat win at Strip casinos. Baccarat is the casino game of choice for most high rollers.

Coldwell said sites such as Caesars Palace have taken unusual steps to make Asian players feel lucky this weekend. The hotel is adorned with hundreds of Mandarin orange trees, which symbolize good luck. Conversely, the company has taken steps to shield its Chinese patrons from so-called bad omens like the number four and empty swimming pools.

Feldman added the Bellagio's conservatory is decorated with Chinese symbols depicting good luck and several restaurants will offer special Chinese menus to coincide with the event.

"Our marketers have really learned to focus on this event," Feldman said.

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Article Copyright ©: C. Jones, Gaming Wire, LVRJ