Slated to open later this year, the highly anticipated $1.3 billion MGM National Harbor Resort & Casino brings gaming to the Washington, D.C., area for the first time, while raising the stakes in the increasingly competitive East Coast market.
Seeking LEED Gold certification, the striking 1 million-square-foot complex along the National Harbor in Maryland will feature 308 guest rooms and villas, 25,000 square feet of meeting space, a 3,000-seat entertainment theater, a luxury spa, high-end retail and more.
Industry experts are saying that the deluxe resort’s casino, featuring a 125,000-square-foot gaming floor, has the potential to become the most profitable in the U.S. For Atlantic City especially, where shrinking casino revenues and budget woes are fueling talk of an unprecedented municipal bankruptcy or bailout, this only increases the ante on developing a non-gaming economy.
Competitive pressure also looms in New England, where MGM is developing another gaming and entertainment complex in Springfield, Mass., and talk persists of possible casino development in Rhode Island, along with New York.
Against this tide, group business continues to deliver vital lift and buoyancy. In Atlantic City and other East Coast resort-casino destinations, significant group sales growth and capital spending present a hopeful, if not reassuring, outlook for the future.
Unwavering Commitment
At last September’s ribbon-cutting for the new Harrah’s Atlantic City Waterfront Conference Center, Mark Frissora, president and CEO of Caesars Entertainment, described the $125 million investment as “a catalyst for change” in Atlantic City.
Ahead of hosting the revamped and re-energized 2016 edition of MPI’s signature WEC this June, the 100,000-square-foot venue is helping to do just that.
“Overall bookings for the Waterfront Conference Center are beyond our expectations,” says Steve van der Molen, Caesars Entertainment’s vice president of catering and conventions for the Atlantic City region. “The pace has been strong and steady for this year, as well as for 2017 and 2018. More typical for a summer month in Atlantic City, our overall occupancy [including the brand’s Caesars and Bally’s properties] of over 90 percent in April tells of a large number of group room nights on the books.”
The Waterfront Conference Center is fulfilling its promise of attracting strong attendance as the largest hotel-conference center complex between Baltimore and Boston. Within convenient driving distance of New York City, Washington, D.C., and Philadelphia, the venue’s versatility, including two 50,000-square-foot ballrooms, 60-plus breakouts and hundreds of configuration options, is another compelling draw. Earlier this year, the venue hosted its first international group, with 5,000 general session attendees, while concurrently hosting 1,000-plus conferees in the second-level Avalon Ballroom.
“We have been able to accomplish so much in a very short time frame,” van der Molen says. “The selection of Harrah’s Atlantic City and the Waterfront Conference Center as host for MPI WEC 2016 acts as a vote of confidence and trust in our brand and services.”
Describing “strong and productive collaboration and support” from stakeholders city-wide, he says the message is resonating with customers, creating a “me-too” effect.
“We are quite excited about this,” he says. “Our outlook is optimistic.”
Making its own sure statement of confidence—and commitment to Atlantic City—Borgata Hotel Casino & Spa announced more than $50 million in property improvements throughout 2016. These include adding 25,000 square feet of new conference space to its existing 70,000 square feet of group space, scheduled for a fourth-quarter opening; a dynamic new 1,000-person capacity outdoor pool and entertainment complex; new fine dining and other F&B concepts; and debuting this spring, the new $14 million, 18,000-square-foot Premier Nightclub.
These broad investments build on strong group segment growth over the last two years.
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“In 2015, group business grew by 16 percent from 2014 and 33 percent from 2013, and we’ve noticed an increase in demand from associations and all levels of the corporate market segment,” says Mark Vanderwielen, vice president of hotel operations. “There has also been a shift in booking trends, with more requests coming to us with both shorter lead time, and for events in future years with multiple year commitments, As always, pricing influences meeting planners’ overall decisions, but they are willing to pay for the high quality value, service, and amenities found at Borgata.”
The investment trend continues at Tropicana Casino and Resort. After unveiling some $50 million in improvements last year, including renovations to the North Tower hotel tower and casino, new AtlantiCare LifeCenter Fitness facility, and Multimedia Light and Sound Show on the Boardwalk, the property is investing another $40 million this year in upgrades. Projects include renovations of 500 Havana Tower hotel rooms, new gaming spaces, and all-new multimedia shows.
“Group response to our recent renovations has been extremely positive, with tremendous buzz about the next phase,” says Jim Ziereis, assistant vice president of hotel sales. “In 2015, even with 400-plus rooms unavailable during construction, group room nights increased 10 percent, with midweek bookings up 16.5 percent year over year. With two large corporations selecting Tropicana to host employee meetings at 700-plus room nights each, 2016 is off to a strong start. Both are first-time events, showing that we are successfully attracting new visitors to Atlantic City. We are on pace and optimistic for an even better year.”
Resorts Hotel Casino is also reaping rewards from its new Resorts Conference Center. Opened in September 2015, the technologically advanced 12,000-square-foot facility boosted its group space to more than 64,000 square feet at the historic property, adding 12 conference rooms and the highly versatile 6,500-square-foot Atlantic Ballroom.
“Year over year, meeting- and convention-related room nights are up 40 percent in 2016 due to the new venue,” says Bill Jackson, the property’s director of sales & marketing. “Having 12 new conference rooms has enabled us to book larger meetings and conventions planned further in advance, increasing the booking pace for 2017 and 2018 by over 150 percent.”
Another major investment, the $35 million Jimmy Buffett’s Margaritaville Entertainment Complex, has proven a major draw for meeting planners, with programs such as island-themed networking events for up to 500 people.
Forging Ahead
Elsewhere on the East Coast, Sands Bethlehem in Pennsylvania is among resort-casino operators reporting good news.
“With a very large uptick in bookings and less budget restrictions than in the past few years, 2015 was tremendously strong for meetings and events,” says Patrick Ryan, the resort’s director of hotel sales. “So far, that trend is continuing in 2016.”
While the booking window for most groups continues to shorten to around 60 days or less, some larger groups are booking eight or more months ahead.
“We saw more 2017 business being booked in Q1 of 2016,” Ryan says. “That’s a significant difference, and if it continues, it is a great sign for the hotel industry as a whole, giving us the opportunity to strategically plan our rates, occupancy, and forecasts with more of a foundation in business.”
Greater budgetary flexibility remains another plus. “Negotiations during the contracting process have been rather favorable, less focused on budget and more on contractual terms,” Ryan says.
Slated for completion by the end of 2016, “wowing” guests is the philosophy behind the current redesign of all 302 guest rooms at the AAA Four-Diamond Sands Hotel.
Group business is also robust at the Oneida Indian Nation’s Turning Stone Resort Casino in Verona, N.Y., 30 miles east of Syracuse.
“Turning Stone Resort Casino continues to be a leader in group sales and events, on both a regional and national scale,” says Melissa Olsen, director of sales. “We are seeing a steady rise in both ADR and occupancy, and finding that the size of meetings has also grown, while the booking window has shortened,” she continues. “Looking forward, we expect to see continued growth in the corporate and incentive markets, as meeting planners learn more about our ability to host large events, and offer services and amenities unmatched by other venues.”
The resort’s 120,000 square feet of event space hostts groups of up to 2,000, and accommodations include the newly Forbes Four Star-rated all-suite Lodge; distinctive options include three championship golf courses (the resort is hosting the 2016 PGA Professional Championship in June) and the Exit 33 entertainment complex, featuring themed nightlife venues such as Turquoise Tiger—ideal for post-meeting parties and receptions.
Native American resort-casino operators are holding strong in Connecticut, where Uncasville-based Mohegan Sun, which manages Resorts Hotel Casino in Atlantic City along with Pocono Downs in Pennsylvania, is constructing a second hotel tower.
Slated to open in fall 2016, the new Earth Tower will feature 400 deluxe guest rooms, meeting space, indoor pool and fitness center. Complementing the existing 1,200-room Sky Hotel, which opened in 2002, the $120 million project significantly boosts Mohegan Sun’s hosting power in the growing New England resort-casino market. According to an official release, the Earth Tower will provide Mohegan Sun with “the opportunity to recapture the almost 500,000 room nights turned away in 2014.”
Echoing the commitment of its Atlantic City counterparts, Mohegan Sun is fully behind Connecticut.
As Kevin “Red Eagle” Brown, chairman of the Mohegan Tribe, stated at the March 2015 press conference announcing the Earth Hotel, the Mohegan Tribal Nation, having invested “well over a billion dollars” in Mohegan Sun since it opened, takes “very seriously our role in Connecticut’s tourism industry and economic welfare.”
Offering 150,000 square feet of meeting and convention space, Foxwoods Resort Casino in Mashantucket, Conn., at 9 million square feet the largest resort-casino in North America, continues to experience meetings growth. With 2,230 luxury rooms and suites and abundant amenities, the AAA Four-Diamond Award resort is adding four new celebrity-owned restaurants this year, including brasserie-style VUE 24 atop the 24th floor of the Grand Pequot Tower. Also planned for 2016 is a nearly mile-long zipline connecting the Fox Tower Hotel to the Mashantucket Pequot Museum and Research Center.
