Report – Caesars Reverses Course on Resort Fees

writingStung by fourth quarter losses caused by the impact of Hurricane Sandy on its Atlantic City properties, Caesars Entertainment has reversed its policy on resort fees in Las Vegas.

Beginning with bookings made on or after March 1, 2013, the company will charge a $10-$25 per day resort fee on its Vegas properties, NBC News reports. The charge will cover Internet access, local calls and use of the fitness center, and guests cannot opt out. Caesars will charge the fee at properties including Caesars Palace, Paris Las Vegas, Planet Hollywood, Bally’s, Rio, Harrah’s Las Vegas, Flamingo and The Quad.

“Obviously, it’s going to upset some people, but it’s what’s happening in the industry. It’s a standard in the industry right now and I’m sure they’ll become accustomed to it over time,” Gary Thompson, a spokesperson for Caesars Entertainment, tells NBC News.

Thompson goes on to tell NBC News that the new policy is due to customer surveys that indicate guests are accustomed to paying resort fees at competing properties and that they prefer a package price over separate fees.

Travel agent Janice Hough disputes the reasoning, telling NBC News, “When it’s mandatory like that, it’s not for the customer, it’s for the (hotel’s) bottom line… it’s a way to make more money out of people.”

The new policy comes as Caesars faces down fourth quarter losses exacerbated by the impact of Hurricane Sandy, NASDAQ reports. Caesars, which hasn’t posted a profit since late 2009, saw its fourth quarter revenue hit by $40 million to $45 million due to closures in its Atlantic City and Philadelphia properties during the storm. The company has also failed to acquire a gambling license in Macau, where competitors have seen growth.

Nevertheless, reports that Caesars sees improvement in the Vegas market. In a conference call with investors, Caesars CEO Gary Loveman says Caesars is continuing efforts to refurbish guestrooms in its Vegas properties, as well as convert the recently-closed Bill’s Gamblin’ Hall into a boutique hotel concept. Loveman also highlights recent Caesars successes, such as the opening of the Nobu hotel concept within Caesars Palace.

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