August 11, 2011 - 1:01 am
Early this year, lodging industry veterans scratched their heads when hotel rates were spiking upward during an apparently ho-hum weekend in late June.
But soon enough, they learned about the Electric Daisy Carnival, a three-night electronic music rave that started June 24 and put more than 240,000 tickets up for sale.
Although no one has yet quantified how many people came for the rave and how much they spent, industry observers acknowledge it played a leading role in boosting the June visitor count by 7 percent compared to last year, the second-highest increase since 2005, according to the monthly report compiled by the Las Vegas Convention and Visitors Authority.
With the number of hotel rooms flat, the influx of people drove up occupancy by 6.4 percentage points to 88.5 percent, and the average rate by 13 percent, to $101.15 per night.
"The Electric Daisy Carnival helped boost June results as convention guests were only up 2 percent," wrote Rodman & Renshaw analyst Robert LaFleur.
A crowded convention calender propelled the 8.6 percent visitor increase in January, the best performance in five years.
The authority is now trying to assess the EDC’s impact and how to capitalize on it in the future.
"At this point, we do know it was important the weekend they were here," said Kevin Bagger, the authority’s senior director of marketing.
Listed room rates were several times higher than what they would be just two weeks later.
The improving fortunes of the all-important Las Vegas visitor industry also come as the national lodging industry rebounds.
All 25 large markets surveyed by Smith Travel Research reported higher room rates and average revenue generated per room-night. In the latter category, Smith Travel said six cities grew by more than 15 percent; for Las Vegas, the figure was 21.8 percent.
Motels, which saw occupancy rates soar by 21 points to 64.1 percent, were a major beneficiary of several June events. Chris Allen, general manager of the La Quinta Inn and Suites Red Rock/Summerlin, said he did not sell many rooms to people going to EDC but still filled his property with other visitors.
In addition, Bagger said the gap between hotel and Strip resort rates has started to widen again, after the slumping economy forced the Strip to slash rates.
This has made the motels and small hotels a more attractive choice for budget-conscious travelers.
Motels account for about 10 percent of the 148,700 rooms throughout Las Vegas.
One sluggish benchmark has continued to be the number of cars crossing the state line at Primm, up 1.7 percent for June and flat for the first half of the year. This measures how well Las Vegas is playing in Southern California, the largest source of visitors.
Gasoline prices have jumped this year but have moderated in recent weeks. According to the AAA survey, the average pump price for regular stood at $3.77 a gallon on Tuesday in the Los Angeles-Long Beach area.
Based on historic trends charted by the American Petroleum Instituted, the price could drop more than 40 cents a gallon if oil remained at its Wednesday closing price of $81.41 a barrel.
Contact reporter Tim O’Reiley at email@example.com or 702-387-5290.