July closing of Mirage could boost room rates, benefit newer, nearby, and comparable properties, analysts say

Home » July closing of Mirage could boost room rates, benefit newer, nearby, and comparable properties, analysts say

The closure of the Mirage July 17 and the elimination of 3,000 rooms from the market will create opportunities for neighboring properties for the three years until it reopens as the Hard Rock, according to Las Vegas observers.

The Mirage, the Strip’s first integrated resort when it opened in 1989, is shuttering to pave the way for its renovation and reopening as a guitar-themed hotel on the Strip in spring 2027 under the Hard Rock brand of the Seminole Tribe of Florida.

“A host of people will automatically benefit,” said Brendan Bussmann, managing partner of B Global. “Within the area of the Mirage are Caesars Palace, Treasure Island, and the Venetian. Taking more than 3,000 rooms offline, Fontainebleau having added about that same amount, offers opportunities for some of the newer properties. People coming out for G2E in October who were booked at the Mirage will go to the Fontainebleau. Or they’ll see who has the best rates right now, getting in before they’re changed.”

Andrew Klebanow, principal at Klebanow Consulting, said anytime 3,000 four-star hotel rooms are taken out of the inventory, particularly in a market that enjoys 90% occupancy year-round, an impact will be felt on average daily rates.

“The primary beneficiaries will be properties that compete head-on with Mirage,” Klebanow said. “While it may have lost some luster over the past few years, the Mirage still provided outstanding accommodations, which competed with other four-star properties, particularly those in the MGM portfolio. Park MGM, New York-New York, and MGM Grand, some of the Mirage’s primary competitors, will be able to press rates upward. Also, a few properties in the Caesars portfolio stand to benefit, in particular Horseshoe, Planet Hollywood, and some of the older towers at Caesars Palace.”

Josh Swissman, founding partner and managing director of GMA Consulting, said the Mirage falls into the casual-luxury segment and expects Caesars Palace, Resorts World, and the Venetian to be among those that benefit. Wynn Resorts could also see some benefit since Wynn founder Steve Wynn created the Mirage, he said.

“He has a super-loyal longtime customer base, because that was the original integrated resort on the Strip,” Swissman said. “I would like to think that Fontainebleau will enjoy the Mirage closure, but my understanding is that they’re having a tough time in terms of general volume and visitation as a result of being new operators on the Strip. It seems like a logical place to go, but I don’t think the Fontainebleau will get as much benefit as other properties.”

Oliver Lovat, CEO of the Denstone Group, said his research into customer lodging behavior in 2012 showed that the Mirage ranked number three behind the MGM Grand and Flamingo Las Vegas in terms of where people had stayed in the previous decade. When asked the same question in 2022, the property also polled third behind the Cosmopolitan and Aria.

“To argue that the Mirage was nearing the end of its lifespan would not be correct,” Lovat said. “However, its position was certainly eroded in the MGM hierarchy and I argue that they struggled to find a unique identity for it as part of their corporate portfolio. It’s not quite Bellagio or Aria, but on par with the MGM Grand and Mandalay, albeit in a noncontiguous location.”

Being part of the MGM Rewards program certainly gave it a competitive advantage over independent properties, but it was down the pecking order for reinvestment and attention, Lovat said. “Its closure and departure from the market will be as meaningful to my generation as the Sands’s implosion in ’96 was to an older generation.”

As for the future, Lovat said the Seminole know what they’re doing; the Hard Rock brand is as recognizable as any. It has a strong product in other markets and has an international database of customers. “I would bet that after their transformation of the site is complete, we’ll be looking at one of Las Vegas’s leading resorts. To today’s customers, many of whom are finding Las Vegas for the first time, the Mirage’s story doesn’t resonate.”

Klebanow said the Seminole Hard Rock Hollywood, Florida, and the Hard Rock in Atlantic City offer some clues about the future in Las Vegas. The renovation and rebranding of the Taj Majal into the Hard Rock Atlantic City had a positive impact on that building’s performance and “knocked the cover off the ball when it reopened.”

“Perhaps the greatest impact will be the re-introduction of the Hard Rock brand into Las Vegas,” Klebanow said. “The brand, as manifested in its casinos, cafés, and hotels, resonates well with all age groups, people from multiple cultures who speak different languages, and multiple generations, from aging Boomers to Gen Z. Every generation has its music and music is the essence of the Hard Rock brand. It keeps the brand relevant across multiple age groups and is why it’ll succeed in Las Vegas.”

Bussmann said the rebirth of the Mirage as a Hard Rock will create a splash in the marketplace. “You haven’t had a Hard Rock brand in this market for four years,” Bussmann said. The former Hard Rock Hotel & Casino was converted into Virgin Las Vegas.

Swissman said the Hard Rock has been tight-lipped about what market segments they’re going after when the property reopens. The rest of their properties attract a younger and hipper crowd and many people will check out the new hotel-casino on the Strip.

When the Mirage closes in a month or so, it will end an era.

“For those of us who study the casino industry and Las Vegas history, the Mirage is arguably the most important resort ever built,” Lovat said. “The sad fact is that when I walked a group through it a couple of weeks ago, it was difficult to find many of the original features that made the property so groundbreaking and innovative back in 1989. And that’s the real shame.”

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