How MGM Resorts Broke Records with the Las Vegas Grand Prix
The Las Vegas Grand Prix was not only a thrilling race for Formula 1 fans but also a huge success for MGM Resorts, one of the main sponsors and hosts of the event. According to the company’s Chief Financial Officer Jonathan Halkyard, the race weekend was the highest-grossing weekend for hotel revenue in the company’s history. In this blog post, we will explore how MGM Resorts achieved this remarkable feat and what it means for the future of Formula 1 in Las Vegas.
The Investment and the Expectation
MGM Resorts had very high expectations for the inaugural Las Vegas Grand Prix, which took place on November 25-27, 2023. The company invested heavily in the event, creating a unique experience for its casino customers and some retail customers in front of the Bellagio. The Bellagio was one of the prime locations to watch the race, as it offered a spectacular view of the iconic Las Vegas Strip, where the 3.3-kilometre circuit was built.
MGM Resorts also partnered with Formula 1 and the city of Las Vegas to prepare the city for the event. Formula 1 invested hundreds of millions of dollars in capital in their paddock facility while the city worked on road construction and traffic management. The investment paid off, as the race attracted a large and diverse crowd of fans, celebrities, and VIPs from around the world.
The Record and the Revenue
The Las Vegas Grand Prix weekend was the highest-grossing weekend for hotel revenue in MGM Resorts’ history, surpassing the previous record set by CES in 2019. Halkyard did not reveal the specific dollar amount, but the Las Vegas Convention and Visitors Authority estimated that the race had an economic impact of $1.2 billion.
The high demand and the high prices for the rooms drove the high hotel revenue. According to Halkyard, the average daily rate for MGM Resorts’ hotels during the race weekend was over $500, compared to the normal rate of around $1501. The occupancy rate was also close to 100%, as the company sold out most of its rooms months in advance.
The hotel revenue was one of many sources of income for MGM Resorts during the race weekend. The company also benefited from the increased spending on food and beverage, entertainment, gaming, and retail by its guests. Halkyard said that the race weekend was also one of the highest-grossing weekends for non-hotel revenue in the company’s history.
The Future and the Feedback
The Las Vegas Grand Prix was a resounding success for MGM Resorts, but also for Formula 1 and the city of Las Vegas. The race was watched by millions of viewers around the world, showcasing the glamour and excitement of Las Vegas as a destination. The race also received positive feedback from the drivers, the teams, and the fans, who enjoyed the challenging and spectacular circuit, the night race atmosphere, and the entertainment options in the city.
Halkyard said that he was optimistic that the Las Vegas Grand Prix would be a fantastic event in the years to come, as the company plans to reuse and improve the hospitality experience it created for the race. He also said that he expected the event to be less disruptive for the residents in the future, as the construction and the traffic issues would be reduced.
The Las Vegas Grand Prix is set to return in 2024 as part of a 10-year contract between Formula 1 and the city of Las Vegas. The race is expected to grow in popularity and prestige as it becomes a staple of the Formula 1 calendar. MGM Resorts is poised to capitalize on this opportunity as it continues to break records with the Las Vegas Grand Prix.
