{"id":290764,"date":"2023-09-21T17:50:44","date_gmt":"2023-09-21T22:50:44","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=290764"},"modified":"2023-09-23T21:23:18","modified_gmt":"2023-09-24T02:23:18","slug":"formula-one-sees-las-vegas-costs-surge","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/formula-one-sees-las-vegas-costs-surge\/","title":{"rendered":"Las Vegas Grand Prix Faces Massive Cost Overruns"},"content":{"rendered":"

Inflation bites and Formula One Group (NASDAQ: FWONA) is finding that out the hard way in Las Vegas.<\/p>\n

\"Las
An artist’s rendering of what the F1 race in Las Vegas on the Strip will look like in 2023. Formula One could spend twice as much as expected to pull off the race. (Image: F1)<\/figcaption><\/figure>\n

Scheduled for November 18, the company has reportedly spent more than $400 million to make the Las Vegas Grand Prix happen. That means costs associated with F1\u2019s third U.S. race are fast approaching double initial projections of $210 million. Despite the major cost overruns in Sin City, Formula One remains hopeful its first race in Sin City in four decades will achieve profit and revenue targets.<\/p>\n

Despite inflationary cost pressures, we expect no change in revenue and profitability assumptions. We remain confident of our return profile of this incredible project which will support the incremental capital investment that we are making,\u201d<\/strong> said Liberty Media CEO Greg Maffei in a recent interview with Business F1<\/em>.<\/p><\/blockquote>\n

Earlier this year, <\/em>Formula One Group forecast that the Las Vegas Grand Prix could generate revenue of $500 million<\/a>, making it one of the most lucrative events on the circuit\u2019s calendar. There\u2019s also speculation that the race will generate local economic impact on par with or above that of the Super Bowl, which Sin City will host in February 2024.<\/p>\n

Inflation Signs Abound<\/h2>\n

Formula One isn\u2019t alone in confronting the ravages of inflation, though it\u2019s unclear exactly what contributes to the Las Vegas cost overruns.<\/p>\n

\n

It\u2019s likely a toxic combination of high materials costs, a shallow labor pool, and the highest interest rates<\/a> in two decades, contributing to elevated financing costs. Led by Sin City, Nevada is posting record gross gaming revenue (GGR) figures on a near monthly basis. But there are some signs inflation is weighing on the gaming industry.<\/p>\n<\/div>\n

Some gaming executives<\/a> are already signaling that inflation is weighing on spending trends at gaming venues across the country. That manifests in various ways, including reduced trips to regional casinos because of high gas prices or less impulse spending in destination markets, such as Las Vegas.<\/p>\n

Still, there\u2019s optimism that the race\u2019s economic impact will be epic, even by Las Vegas standards, and could potentially contribute to one of the biggest gaming revenue weekends in the city\u2019s history.<\/p>\n

Room Rate Concerns<\/h2>\n

When the Las Vegas Grand Prix date was officially set, Strip operators experienced a surge in hotel room bookings at elevated price points. That\u2019s since given way to softness on that front, stirring speculation that the event may not be the boon for gaming companies it was expected to be. In a recent note to clients, Truist Securities analyst Barry Jonas explored that topic.<\/p>\n

Most higher-tier room packages have been booked (many with no\/more limited cancellation policies),\u201d<\/strong>\u00a0Jonas wrote.<\/p><\/blockquote>\n

Adding that gaming executives expect the November 20 weekend will be \u201cone of the highest-grossing gaming events in city history,\u201d Jonas pointed out that the bulk of falling room rates for race weekend is generally concentrated among lower-tier\/economy class hotels.<\/p>\n","protected":false},"excerpt":{"rendered":"

Inflation bites and Formula One Group (NASDAQ: FWONA) is finding that out the hard way in Las Vegas. Scheduled for November 18, the company has reportedly spent more than $400 million to make the Las Vegas Grand Prix happen. That means costs associated with F1\u2019s third U.S. race are fast approaching double initial projections of […]<\/p>\n","protected":false},"author":46,"featured_media":212949,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[10,83505,81886],"tags":[81903,82381,23],"acf":[],"yoast_head":"\nFormula One Sees Las Vegas Costs Surge<\/title>\n<meta name=\"description\" content=\"Formula One racing toward massive Las Vegas cost overruns.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/news\/formula-one-sees-las-vegas-costs-surge\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Formula One Sees Las Vegas Costs Surge\" \/>\n<meta property=\"og:description\" content=\"Formula One racing toward massive Las Vegas cost overruns.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/formula-one-sees-las-vegas-costs-surge\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2023-09-21T22:50:44+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-09-24T02:23:18+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/05\/\u00a9-Artistic-impressions-created-by-Tilke-Design-and-Architects-for-illustrative-purposes-only-and-are-subject-to-change-2.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"800\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/formula-one-sees-las-vegas-costs-surge\/\",\"url\":\"https:\/\/www.casino.org\/news\/formula-one-sees-las-vegas-costs-surge\/\",\"name\":\"Formula One Sees Las Vegas Costs Surge\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/formula-one-sees-las-vegas-costs-surge\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/formula-one-sees-las-vegas-costs-surge\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/05\/\u00a9-Artistic-impressions-created-by-Tilke-Design-and-Architects-for-illustrative-purposes-only-and-are-subject-to-change-2.jpg\",\"datePublished\":\"2023-09-21T22:50:44+00:00\",\"dateModified\":\"2023-09-24T02:23:18+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Formula One racing toward massive Las Vegas cost overruns.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/formula-one-sees-las-vegas-costs-surge\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/formula-one-sees-las-vegas-costs-surge\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/formula-one-sees-las-vegas-costs-surge\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/05\/\u00a9-Artistic-impressions-created-by-Tilke-Design-and-Architects-for-illustrative-purposes-only-and-are-subject-to-change-2.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/05\/\u00a9-Artistic-impressions-created-by-Tilke-Design-and-Architects-for-illustrative-purposes-only-and-are-subject-to-change-2.jpg\",\"width\":1200,\"height\":800,\"caption\":\"An artist's rendering of what the F1 race in Las Vegas on the Strip will look like in 2023. 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