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Post: April 13, 20,24 12:29h
Updated on April 13, 2019, 12:57 a.m.
A new report claims that the Las Vegas Convention and Visitors Authority’s (LVCVA), which paid the marketing firm, exaggerated Las Vegas’ advantages in hosting the Formula 1 Las Vegas Grand Prix.
The Tuesday newspaper reported that the Las Vegas Review-Journal Applied Analysis told the LVCVA Board of Directors that the Las Vegas Grand Prix generated a net tourism impact of $1.5 Billion.
According to an independent study conducted by Berry College professor of Economics Frank Stephenson – an expert on hotel profits related to sporting events – hotel revenues increased $60 to $70 million only on race day and were down for the remainder of the week.
Stephenson’s figures were first published in The Center Square — a reliable journalism arm of the Chicago-based Franklin News Foundation 501(c)(3).
According to Stephenson, Monday, Tuesday, and Wednesday nights before the race saw occupancy down 20%, while Thursday and Friday were down around 10% year-over-year, and Saturday was up — but only 3% year-over-year, to 80% occupancy.
Stephenson stated that “the whole week prior to the event, numbers were anemic.” The Center Square I guess some people turned up at the race, but any gains were probably offset by all the weeks leading up to the event.
Stephenson also noted that, despite the fact that Las Vegas’ revenue was boosted, the additional hotel revenue “heads to the corporate owners of the hotels and does not stay in Las Vegas, to be spent again, as many economic impact reports claim.”
Applied Analysis, a Las Vegas marketing company, was retained by LVCVA for the purpose of reviewing and analyzing economic impact. According to Center Square The real role of this company is to produce figures for groups seeking subsidies for Las Vegas sporting events.
Economic impact reports are a part of marketing campaigns that have been criticized by economists. Cottage industry False figures are often used as a way to get public money for stadiums that host professional sports. The Center Square reported.
Clark County, the county that invested 40 million dollars in the F1 race, has also released its own report on costs and benefits. It also cited Applied Analytics’ $1.5 billion estimate.
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