Las Vegas is unlike any other place in America. Each year it draws more than 40 million visitors to the dazzling casinos and hotels that “turn night into daytime”—and transform the city into a glittering jewel in the desert. With 164,000 hotel rooms, Las Vegas is the largest hospitality market in the U.S.—outpacing Orlando, Florida, the next biggest market, by approximately 15 percent, according to JLL.
The epicenter, of course, is the Las Vegas Strip, the pulsing artery of the place affectionately called Sin City. Many of the city’s 29 newest and largest hotels—each boasting more than 2,000 rooms—are located on or near the Strip. Elaborate Egyptian themes, oversized Italianate architecture, lavish homages to Hollywood glamour, and many contemporary touches pull in travelers year round.
“I think Vegas is an interesting place because it’s always evolving—its story is never complete,” says Lonnie Hendry, chief product officer at Trepp.
Once known for its smoky casinos and budget hotels, Las Vegas is increasingly catering to guests seeking wellness experiences and luxury. Its consumer base is growing and diversifying beyond casino gamblers to include sports fans, concertgoers, and attendees of the city’s large conventions.
“Having diverse demand drivers is critically important,” says Kevin Davis, Americas CEO of Hotels & Hospitality at JLL. “Las Vegas has them.”
Diverse demand drivers
The 2020 opening of Allegiant Stadium, which hosted the 2024 Super Bowl and Taylor Swift’s Eras Tour, helped to further diversify the city’s traveler base. In fact, Super Bowl weekend was so significant that it boosted revenue per available room (RevPAR) nationwide—3.9 percent year-over-year.
The city branched out even further in November 2023 by hosting Formula 1 for the first time. The event boosted hotel performance to new heights during what typically would have been a slow period.
“With the arrival of [professional sports] teams like the [NHL’s] Golden Knights and the [NFL’s] Raiders—along with Formula 1—Las Vegas is now recognized not only for gaming but also for its growing role in sports tourism,” says Amanda Belarmino, associate professor of hospitality at the University of Nevada, Las Vegas.
Ch-ch-ch-changes
Major redevelopments underscore the city’s commitment to purpose-driven adaptation and evolution. For example, the Tropicana, one of the Strip’s earliest landmark hotels and casinos, closed in April 2024, after 67 years, to make way for a new 33,000-person Major League Baseball ballpark in 2028—the future home of the relocating Oakland A’s. Although it may have held nostalgic value, the site was overdue for a second life.
“The Tropicana was a property that had not been redone in a long time, and something did need to happen,” Belarmino says.
The iconic Mirage, which revolutionized the casino resort industry in 1989, had also seen better days when it finally shuttered for good in July 2024. Hard Rock International is now building a new hotel on the site: a 700-foot-tall (213 m), guitar-shaped tower. The company plans to add 600 rooms to the existing 3,044. The revamped resort will feature a 49,000-square-foot (4,552 sq m) gaming space, 96,000 square feet (8,919 sq m) of retail and dining options, plus other amenities, including a pool, spa, fitness center, and salon. The Hard Rock Las Vegas is slated to open in early 2027.
Hotels shift focus to luxury and health
Belarmino notes that the Las Vegas consumer base has shifted in recent years to include more well-heeled travelers. Tourists who once considered the Strip a value destination—one in competition with such places as Atlantic City—have more options. “Consumers nowadays tend to compare Las Vegas to cities like San Francisco or New York, where we still offer value in comparison,” Belarmino says.
Changes in consumer preferences and traveler priorities have led many hotels to shift their focus away from the casinos and cheap buffets to emphasize luxury and health amenities instead. “Luxury has outperformed other hospitality segments,” Davis says.
The recently opened Fontainebleau Las Vegas signals the city’s move toward a “new era of hospitality” on the Strip, according to the hotel’s website. The 67-story, 3,600-room hotel has an expansive casino and hosts conventions and corporate events, leveraging its proximity to the Las Vegas Convention Center. The hotel’s December 2023 opening followed 18 years of development setbacks, including a halt during the Great Recession.
“I always think of Las Vegas as a market of rebirth and second chances,” Davis says. “The Fontainebleau is certainly an example of that.”
Since Covid-19, luxury hotels have increasingly emphasized health and wellness to attract out-of-town guests. Although gambling remains a significant market driver, Robert Schulman, chairman of Schulman Properties, estimates that 30 percent of non-gambling visitors to Las Vegas tend to focus on amenities that address their overall well-being.
“I don’t pick up a single hotel magazine that isn’t talking about wellness,” says Schulman, who in 1984 built the Alexis Park Resort, the city’s first major non-gaming hotel. He believes this wellness trend will drive medical tourism in Vegas, further diversifying the market’s consumer base.
Luxury beyond the Strip
With more affluent people moving to Las Vegas, especially individuals leaving Southern California for such benefits as Nevada’s lack of income tax, Schulman says the most opportunity lies in the growing luxury- and wellness-focused segments. He adds that many hotel guests are now more willing to book a room away from the Strip, especially ones seeking smoke-free, uncrowded resorts and locals embracing the staycation trend.
The developer has two hotel projects planned outside the Strip to fill that niche. The first is in the city’s emerging Arts District, near Charleston and Grand Central Parkway. It offers easy access to residential communities such as Summerlin and Green Valley. The hotel will focus on health and rejuvenation, reflecting Schulman’s vision of making Las Vegas “the medical capital of the world.”
The second project is in high-end Lake Las Vegas. Situated on the lake and golf course across from a Hilton, this hotel will provide a wellness-focused staycation experience. Like the Arts District project, it will emphasize relaxation and wellness, but with a more local focus, offering residents and visitors alike a peaceful retreat with easy access to urban attractions.
The shift beyond the Strip reflects a change in perception of the city as more than just its iconic thoroughfare.
“As you get other businesses and buildings outside of that small corridor, then Fremont [Street] may become more appealing,” Hendry says. “The Strip is very expensive.” By fostering growth outside the Strip, projects can be profitable with less costly land and construction.
In downtown Las Vegas, Symphony Park is a key part of this transformation. This 61-acre (24.7 ha) mixed-use development, which integrates arts, culture, science, and medicine, is now adding a dual-branded hotel: the AC Hotel by Marriott and Element by Westin. The new hotel, which broke ground in January 2024, will offer about 400 rooms and more than 18,000 square feet (1,672 sq m) of meeting space.
Sustainability trends and challenges
The Las Vegas Valley is experiencing rapid growth. Since 2020, the greater metro area has added 71,098 residents, bringing the total population to 2.33 million.
As it grows, managing water resources will be crucial. The city relies heavily on Lake Mead and, thus, the Colorado River for water supply. Both are under stress due to prolonged droughts and climate change.
“Locals will say it’s not a challenge,” Trepp’s Hendry says, “and they’re not worried about it.” But with the city’s 24/7 nature and ongoing expansion, he warns that “water could pose a longer-term problem” that is not being fully considered when underwriting real estate developments today.
To address water scarcity, Las Vegas has already implemented several innovative water management and conservation policies. “No one will beat Nevada in water conservation and figuring out how to make it work,” Schulman says.
The Southern Nevada Water Authority (SNWA) reports that about 99 percent of indoor water is recycled. Many hotels and resorts utilize so-called gray water for landscaping and cooling systems, significantly reducing the demand for fresh water. “New properties are increasingly focused on sustainability,” Belarmino says, “with many casinos making conscious efforts to reuse laundry water and implement other ecofriendly practices.”
Additional efforts to promote water conservation include the SNWA’s “cash-for-grass program,” strict watering schedules, and a tiered water-pricing system. “We have specific days to water that change seasonally,” Belarmino says. “There are incentives to replace ornamental grass with more desert-friendly landscaping.”
These measures, plus such infrastructure upgrades as Intake 3 and the low-lake-level pumping station in Lake Mead, are designed to ensure a steady water supply for Las Vegas, even if lake levels fall to historic lows.
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