Two new and notable projects have joined the ranks of Las Vegas'
booming development pipeline, and despite taking very different
tacks, both are emblematic of the city's fast-evolving hospitality landscape.
In late August, India-based budget lodging brand Oyo
announced that it had acquired the Hooters Casino Hotel, unveiling plans to
relaunch it as the Oyo Hotel & Casino, its first flagship U.S. property.
Located just off the Las Vegas Strip on Tropicana Avenue,
the Oyo Hotel & Casino will have 657 rooms and feature a 35,000-square-foot
casino, two restaurants, four bars and a fitness center. A revamp of the
property is expected to be completed by the end of the year.
Shortly after Oyo's plans went public, news broke that the
Majestic, a luxury nongaming resort, had received approvals to break ground
next year. The property, which is a few blocks off the northern end of the
Strip and is scheduled to open by 2023, will offer 720 rooms, six restaurants
and a live entertainment venue as well as a 70,000-square-foot fitness,
nutrition and medical spa facility.
"Both these properties are catering to very specific
markets in their own ways," said Rummy Pandit, executive director of the
Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism at Stockton
University in New Jersey. "Majestic is looking for that high-end clientele
that perhaps isn't just gambling, while Oyo is providing the budget
accommodation experience, with gaming. But this is reflective of Vegas, which
has really established its marketability as a destination for all different
kinds of experiences."
With Las Vegas' overall business increasingly less reliant
on gaming, Pandit added, the Majestic's decision to eschew a casino component
doesn't necessarily put it at a disadvantage.
"When we look at the market of Vegas today, around 35%
of revenue comes from gaming, while 65% comes from nongaming, meaning
accommodations, food and beverage and entertainment," he said. "Competition
for the gaming market has become stronger in surrounding states, so what people
are now looking for is a true destination resort. They're no longer just
looking for that gaming experience."
Michael Green, associate professor of history at the
University of Nevada, Las Vegas, expressed a similar sentiment, while adding
that the Majestic's proximity to the Las Vegas Convention Center, which is
undergoing a major expansion and is expected to open in 2021, positions it to
attract a growing contingent of visitors less focused on gambling.
"Do convention visitors gamble?" Green asked. "Some
do, but some certainly don't. Fewer people are coming with gambling on the
mind, and resorts like the Majestic are thinking about what else gets them in
Conversely, Oyo is jumping wholeheartedly into the Vegas
gambling space, with the Oyo Hotel & Casino set to be the brand's first
gaming venue. But although the move might seem unexpected, Green views Oyo's
Vegas foray as very much in line with current development trends.
"If you think about the big Las Vegas resort
corporations, whether it's Wynn or MGM, going into Macau and other
jurisdictions, why wouldn't we have more entrants like Resorts World coming in
from the other direction? It's increasingly a multinational and transnational
environment, so this makes sense."
And while Oyo's U.S. presence is still relatively small,
with just over 112 of its more than 23,000 hotels located stateside, Pandit is
confident that the flag won't be short on brand awareness.
"More than 40 million people visit Las Vegas each year,
and they come from all over the world, not just the U.S.," Pandit said. "And
Oyo is everywhere too. The customer that stays there is going to be very familiar
Meanwhile, the Oyo and Majestic projects come into play as
Vegas sees a flurry of development activity. Among the more notable Vegas
projects under construction are the 4,000-room Drew Las Vegas and the
3,000-room Resorts World Las Vegas at the northern end of the Strip as well as
the 777-room Circa in downtown Las Vegas.
With those properties appearing to skew toward the more
upscale end of the spectrum, however, Green pointed out that Oyo could be
targeting a demographic that's been somewhat underserved in recent years.
"After the recession hit, the Strip became much more
interested in that luxury-oriented clientele," Green said. "There are
perhaps more luxury possibilities around the Strip right now than there are
middle-class possibilities. So Oyo may be smart in reaching for [that latter]