A country without casinos. A thought that didn’t seem imaginable over a month ago is now the reality we’re dealing with.
Coronavirus took the country by storm just a few weeks ago. Because of the threat it poses, Nevada Gov. Sisolak mandated a 30-day closure of all casinos statewide to take place. It wasn’t long before casinos nationwide shut their doors, too.
But for the world-famous Las Vegas Strip, that’s full of some of the world’s most iconic casino-hotels, its shutdown is sending ripples through the casino industry as a whole.
Las Vegas has gone from being the city of lights buzzing with tourists the world over, to being a ghost town, all in a matter of weeks because of the pandemic.
But the troubling thing to wrestle with here has been the unknowns. While there is a current timeframe put on casino closures in Las Vegas, there’s truly no telling the direction the outbreak will take.
With cases accelerating, it could push the lockdown even further. With the unknowns in mind, it begs the question: How long can Las Vegas, a city built on the gaming industry and tourism, survive a shutdown?
Let’s take a look at what industry analysts are predicting below.
Assessing “Cash Burn” Data
According to this week’s report released by Macquarie, a gaming technology industry expert, it analyzed “cash burn” data, which is money the closed casinos can afford to burn without running out of it.
How long is that? Well, according to Chad Beynon, a research analyst with Macquarie, it ranges from “five months to a year and a half” due to the varying obligations that the casino operators have “to the banks, to their employees, and to projects.”
According to Beynon, the daily burn will remain relatively the same:
“The only thing that could change by the day is if you’re laying off employees – but you can only cut so much. I don’t think the daily burn changes. Only the amount of time they have left changes.”
The Numbers Research is Showing
Macquarie analysts found this crunching data:
- Boyd Gaming: 9.4 months, burning $3.2 million a day.
- Golden Entertainment: 10.4 months, burning $1 million a day.
- MGM Resorts International: 9 months, burning $14.4 million a day.
- Monarch Casino and Resort (Reno): 14.3 months, burning $300,000 a day.
- Penn National: 5.2 months, burning $6.4 million a day.
- Red Rock Resorts: 13.8 months, burning $1.7 million a day.
Major Economic Losses
According to the American Gaming Association (AGA), for every month that the Nevada tourism industry is shut down, it will result in an estimated $4.7 billion in economic losses.
While that’s a devastating blow to Nevada’s economy, the loss on the economic level will be even more massive.
“In total, these mass closures will rob the U.S. economy of $43.5 billion in economic activity if American casinos remain closed for the next eight weeks,” AGA President Bill Miller said.
Casinos Seek Congress’ Help
With the dire situation that casinos are in, one that none of them ever saw coming, they’re turning to Congress for emergency aid.
Casinos are seeking Congress’ help in providing emergency funds to bail the industry out of the current financial crisis that they’re in.
According to the Washington Post, casinos are looking for financial aid such as cash payments, deferred taxes, and even special bankruptcy protection.
“Gaming employees, their families and communities are bearing the brunt of this economic standstill and will continue to suffer if Congress and the administration don’t take immediate action,” Miller said.
It’s hard to predict how long this pandemic will keep casinos closed for. The outbreak situation is still fluid and hard to pin down.
Be sure to stay updated on the latest news surrounding casinos and coronavirus closures at BestUSCasinos.org.