Dog Days

Heading into August, hotel rates along the Strip appear to be in the doldrums, judging by figures published today by J.P. Morgan analysts. Weekday rates continue to recover, typified by Caesars Entertainment properties, and weekend ones continue to decline. So far in the third quarter, weekdays are 7% better than last year (or worse, if you’re a consumer) and weekends are 6% more adverse. This reverses the momentum of 2Q11, which saw some (as in 3%) improvement midweek but much better numbers on the all-important weekends, up 11%. Morgan’s Joseph Greff offers no theories for this softening of demand, alas.

Wynncore is enjoying the midweek bounce the most (+14%), while MGM Resorts International feels the weekend pain the hardest, room rates down 12% from last year. The best overall performance, however, is turned in by Caesars, the only company in Morgan’s coverage universe to poster higher weekend rates than 2010 (+6%), in addition to a 9% bounce in midweek rates. The eschewal of resort fees is obviously playing a significant role here. But Caesars’ strong presence in the bargain and middle-class tiers, and Total Rewards also having to be factored into the matrix driving the company’s Strip outperformance.

What’s going on over at the still-fresh Cosmopolitan of Las Vegas? Its rates are 17% higher than Aria midweek and 37% higher on weekends. This explains why rooms are the Cosmo’s biggest source of revenue. But if demand has been soft enough that the Cosmo is selling suites that were meant to be comped to high rollers, that’s not indicative of a market commensurate with the Cosmo’s sky-high pricing. T’will be interesting to see where Aria’s ADR numbers go in the wake of last week’s Legionnaire’s Disease revelations.

My wife and I were among the few Americans to go see Winnie the Pooh, which eked out a Piglet-sized $8 million gross last weekend, squashed beneath that effing wizard flick. My feelings on the matter are depicted below: