Improved room rate
The average occupancy at the Las Vegas Strip stood at ~83.7% in January 2015 compared to ~85.9% in January 2014. Las Vegas lodging market occupancy levels have remained well above the US historical norm.
Occupancy rate shows the relationship between the number of occupied rooms and the total number of rooms. The average daily room rate (or ADR) stood at $145.80 in January 2015, up 13.1% year-on-year. Revenue per available room (or RevPAR) stood at $122.03 in January 2015, up 10.2% year-on-year.
This shows that RevPAR has increased on account of pricing improvements at the Strip. RevPAR, which is ADR times the occupancy rate, is the most important performance indicator of the lodging industry.
Visitor arrivals reached nearly 3.4 million in January 2015, remaining almost flat on a year-on-year basis.
ETFs such as the Consumer Discretionary Select Sector SPDR Fund (XLY) and the VanEck Vectors Gaming ETF (BJK) help investors gain access to the leisure industry. BJK has ~20% exposure in these companies. XLY gives a broader exposure to the consumer and retail sectors.
Las Vegas convention attendance grew 8.0% year-on-year, driven in part by increased baccarat win versus weaker hold last January.
Full year 2014 performance
Visitation to Las Vegas reached a record 41.1 million, up 3.7% for 2014. Citywide Occupancy reached 86.8%, the highest annual occupancy since 2008. Las Vegas saw an annual increase in ADR rate, reaching nearly $117 in 2014, up 5.4% for the fifth straight year.