A Las Vegas Strip casino is closing its hotel operations due to a lack of demand stemming from the COVID-19 pandemic.

Las Vegas Sands Corp announced Tuesday that it will be temporarily shutting down the overwhelming majority of the Palazzo’s hotel, according to a report from the Reno Gazette-Journal. Suite reservations are being offered exclusively at The Venetian, the other Sands-owned Strip property, until Dec. 23. After Dec. 24, guests may book a suite at The Palazzo.

The Venetian will keep its hotel operational for the time being. Employees of the Palazzo hotel will continue to be compensated. The casino portion of both properties will remain open.

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“The Venetian Resort is making a temporary adjustment to its hotel operations to better reflect occupancy patterns,” said a Venetian spokesperson in a statement. “Beginning December 7, suite reservations will be offered exclusively in The Venetian tower through December 23, 2020. The guest experience at The Venetian Resort is not expected to change. The Palazzo will remain open, including most restaurants, bars, the casino, parking garage, and Grand Canal Shoppes; however, there have been minor adjustments to operating hours and The Palazzo casino floor will have limited table games available.”

Several Las Vegas Strip hotels, including Caesars-owned Planet Hollywood and MGM’s Mandalay Bay, Mirage and Park MGM, had stopped taking midweek reservations. Wynn Resorts’ Encore casino halted its midweek operations for both its casino and hotel. Palazzo became the first Strip casino to shut its hotel down entirely.

Since Nevada Gov. Steve Sisolak reopened the state’s casino industry on June 4, the Las Vegas Strip struggles to return to pre-pandemic revenue levels. With the need for social distancing and the inability to congregate in large crowds, the demand for tourism declined, which in turn brought down revenue on both the gaming floor and in the hotel business.

In October, Strip casinos watched revenue fall more than 30% year-over-year, which was actually an improvement from the three previous months which brought a nearly 40% drop.

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It’s this trend that sparked Las Vegas Sands to announce that they were exploring the possibility of selling its two Strip casinos. In a July earnings call, Sands President and COO Rob Goldstein said that he “Never felt more gloomy than I do today about what’s happening in Las Vegas.”

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