John Locher / AP
Friday, Jan. 15, 2016 | 5 p.m.
MGM Resorts International’s Friday announcement that it will soon start charging customers to park at its Strip resorts was a long time coming.
Speculation that the casino operator would take away free parking, historically a staple amenity on the Strip, surfaced online months ago. And CEO Jim Murren did not rule out the possibility of implementing paid parking in some fashion during an October interview with the Sun.
In fact, the idea has been “on the list of things to consider” for years, company spokesman Gordon Absher said Friday. He said MGM Resorts began “very serious consideration” of paid parking sometime last year and has been researching and analyzing it for months.
The timing of the announcement makes sense. In April, the company is set to debut its 20,000-seat T-Mobile Arena — the possible home of a professional hockey team, if Las Vegas gets one — along with a dining and entertainment district called the Park. MGM Resorts also has plans to build a 5,000-seat theater in the same area.
Hockey team or not, the arena could place a major strain on existing garages at nearby properties as swarms of customers flock there at the same time. That problem will be addressed in part when MGM Resorts builds a new 3,000-space garage near the northwest corner of the Excalibur property, a project also announced Friday, but it may not be enough. And the company has other plans for general improvements to its parking facilities, too.
Absher said the arena was part of the reason for paid parking, but was not the entire justification.
“It was a factor; it was not the deciding factor,” he said. “That is obviously going to bring a lot of people in, but even if you take that out of the equation, we would have likely come to this decision.”
The parking fees were revealed as part of a $90 million initiative that includes $54 million for the new Excalibur garage and $36 million for other improvements such as redesigned parking facility layouts, guidance systems to steer drivers toward available spots, better lighting, technology that will let guests check space availability in advance and more.
The idea is that parking fees will help the company pay for those investments. The fee program is also part of the company’s previously announced profit growth plan, which is expected to generate an extra $300 million annually in adjusted earnings before interest, taxes, depreciation and amortization.
Once fees are in place, guests can expect to pay $10 or less for overnight self-parking, but a more specific breakdown of the parking costs has not been announced. MGM is granting locals a “grace period” during which they will not have to pay; after that, locals and tourists alike will have to join the company’s loyalty program, M Life, to earn free parking privileges. It was not clear Friday at what tier an M Life membership will grant exemption from parking fees.
It was also not clear whether any other large casino operators on the Strip would follow MGM’s lead.
Chandra Knee, spokeswoman for Caesars Entertainment Corp., which has nine resorts on or near the Strip, declined to comment on whether the company plans to charge for parking or if it’s considered doing so in the past.
Ron Reese, spokesman for billionaire Sheldon Adelson’s Las Vegas Sands Corp., which operates the Venetian and the Palazzo, also declined to comment, as did a spokesman for casino mogul Steve Wynn’s company.
“We don’t have a comment on MGM’s parking decision,” said Michael Weaver, spokesman for Wynn Resorts, operator of the Wynn Las Vegas and the Encore. “We will monitor the situation for now.”
But if MGM’s parking program goes well, it may be hard for other big resorts to resist.
“At the end of the day, if there’s significant success behind it, do I think other operators are gonna take a look at it? Absolutely,” said Union Gaming Group analyst Chris Jones. “I think every operator will take a look at it to see if it’s successful.”
This is not the first time paid parking at hotel-casinos has been introduced in the Las Vegas area — it’s already the norm downtown. And MGM officials have been quick to say that it’s standard at hotels in other high-demand tourist markets.
Nonetheless, locals and others have grown accustomed to never paying for a Strip parking spot, and Friday’s announcement did prompt some backlash online.
Whether any of that frustration deters a significant amount of people from visiting the Strip, though — especially if paid parking spreads — remains to be seen.
“Since the advent of resort fees, visitation has gone up,” said David Schwartz, director of UNLV’s Center for Gaming Research. “I don’t know enough to know what impact this would have … (but) looking at the past, you can see where there’s been fees added, it doesn’t seem to have an overall negative impact on visitation.”
Sun reporter Eli Segall contributed to this report.