First, the good news. That “inclusive pricing” strategy that the Las Vegas Strip filched from Downtown is working. The bad news is that it will probably be quickly abandoned, turning a promising recovery in Las Vegas into an anemic one, at best. Given all the misguided economic “policy” coming out of Washington, D.C., a nascent Vegas bounce-back could yet be smothered in the crib. It’s not like those fellows ever bankrupted a casino, is it? Oh, wait …
But we’re getting ahead of ourselves. So far in 2026, room rates on the Strip have been fairly squishy, with the CON/AGG Expo providing a March bright spot. Next month, however, they start looking much better overall, with the Strip up 11% and Caesars Entertainment enjoying a 34% spike. (The latter is partly attributable to an only-at-Caesars State Farm Insurance convention.) The underperformer is MGM Resorts International, which has been lagging its Strip brethren and will be up just 1% in May. Perhaps it’s coincidence but the home of the $13 Snickers bar has become synonymous with corporate gouging and consumers appear to be voting with their feet.
June, when the inclusive-pricing deals apparently peter out, is good but not great. MGM is up 2%, Caesars 3% and everybody overall 5%. (The Wynn Resorts of the world are carrying the Strip, as we’ll get into presently.) As Truist Securities analyst Barry Jonas put it, “We think the Low-End proxy inflection seen in May could be partially attributed to the recently announced (MGM, Resorts World and CZR’s) all-inclusive promotion/package type deals with a minimum stay required to help draw the value-oriented customer … While creative, it remains to be seen if non-inclusive pricing can meaningfully drive sustainably higher hotel occupancy, along with non-gaming and gaming spend.” See what we mean?
Leaving aside low-end players, the middle class could use some Vegas love, too. Lower-tier room rates may have plunged 10% during 1Q26 but mid-tier ones weren’t far behind: -7%. Indeed, middle-tier rates continued to be underwater in March, when both high- and low-end business improved markedly. In the meantime, rooms that cost $300/night or more saw a 6% spike, enough to lift the entire Vegas hotel-rate picture 1% overall. Which brings us to the phenomenon that Jonas describes as a K-shaped recovery in the market.
Or, as Jonas puts it, “Unsurprisingly, the high-end has consistently outperformed the total Strip Proxy as these customers have been resilient despite the geopolitical and macro uncertainties.” Somebody’s making out like bandits and it’s not John Q. Customer. So far in 2026, catering to the upper crust has worked for Sin City. The open question is how sustainable it is over the long term. 2Q26 room rates are 13%, lifting the average 4%. But middle-class rates are still slumping 7% and low-end ones 8%. The ability of Big Gaming to get by on $300/night rooms certainly the explains the apparent disconnect from economic reality, bordering on callousness, that pervades Big Gaming’s “let them eat cake” rhetoric.
So it’s a shaky-looking recovery, perhaps almost a mirage. Jonas does hold out some hope for the summer months into the autumn. He writes, “we note that the NFL schedule and NHL playoff schedule (Golden Knights are set to make the playoffs) has not been released yet. In the near term, WWE, Morgan Wallen and BTS are some notable events to be held from April-June with Metallica and Mayweather vs. Pacquiao set for later in 2H26.” So the balance of 2026 hinges on a bout between two tomato cans, eh? (We confess that we had to google Mr. Wallen.) Las Vegas Raiders, a lonely city turns its eyes to you.
A Tale of Two Governors. In the great state of New Jersey, the irresolute Gov. Mikie Sherrill (D) won in a landslide and is governing as though she just squeaked into office. Down in Virginia, a similar double-digit mandate was enjoyed by Gov. Abigail Spanberger (D), who’s governing like she means it. While Sherrill waffles on casino smoking and upstate racinos, Spanberger took two decisive actions last weekend. Ironically, both the existing casinos AND opponents of gambling could take heart from what she did.
In the first of two gambling-oriented vetoes, Spanberger nixed a casino that the Lege was cramming down Fairfax County‘s throat. The good burghers of Fairfax are mostly against hosting a casino and that should be respected. Instead, lawmakers inserted an insidious provision into the bill that would have short-circuited local referenda on the issue. They mandated a five-year “temporary” casino, whether local voters wanted it or not. Now a casino is forever. Once that “temporary” facility took route, good luck restoring the status quo ante, barring a calamitous business failure. We don’t know of one casino that was ever voted out of existence. That’s because they’re good for the economy, in most cases, but jamming Fairfax County up with one is not the way to make friends and influence people for Big Gaming.
Hell, other casinos in Virginia were opposed, notably Churchill Downs. Over in Maryland, gargantuan MGM National Harbor was not amused, but that’s of minor relevance. It cannot be easy to make a business plan for one’s Cavalier State casino, what with Richmond forever moving the goal posts. Ethically fungible legislator Scott Surovell (D) seems bent upon sticking his constituents with a casino they don’t want, so we’ve not heard the last of this.
Spanberger also zapped an attempt to flood the state with 25,000 gray-market slot machines masquerading as “skill games.” Way to undercut all those Churchill Downs slot parlors, Lege! Fortunately, Spanberger wasn’t having it. Localities could have opted out of the slot routes via referendum, which was mighty white of the Lege, which took the path of least resistance to dubiously legal gambling. Fortunately, there was a grownup in the room.
In vetoing the bill, Spanberger addressed the elephant in the chamber. Gambling in Virginia has growed like Topsy, which isn’t a bad thing in and of itself. Public demand has been there and then some. But there is no, we repeat, NO regulatory oversight in the Cavalier State. That’s not opinion. It’s fact.
Legislators proposed a mushrooming of gambling without anyone riding herd on it. As Spanberger said, “The absence of a centralized regulatory authority for gaming creates gaps in oversight that threaten the Commonwealth of Virginia’s ability to provide consistent enforcement, prevent illicit activity and protect all consumers.” As for the black-market slots, “Legalizing these machines at this moment would also reward operators who knowingly disregarded state law for years and set a troubling precedent for how business is conducted in Virginia.”
We favor gaming’s growth … responsible growth. So does Spanberger.