A drastic drop in the demand and revenue has prompted the Ritz-Carlton Hotel Co to close Ritz-Carlton Las Vegas in May. This five-diamond property in Las Vegas has struggled in the past couple of years due to the dropping demands.

Ritz-Carlton Las Vegas is located 17 miles from the Las Vegas Strip. Opened seven years back, Ritz-Carlton, which is a division of Marriott International had played a host to many celebrities like Elizabeth Taylor, Celine Dion and the pop icon late Michael Jackson. The hotel has received a ‘five-diamond’ rating for 2010 from the American Automobile Association.

Village Hospitality LLC, which is a part of Deutsche Bank and owner of this 348-room property, will stop funding the day-to-day operations of Ritz-Carlton Lake Las Vegas from May 2

According to the spokeswoman of Ritz-Carlton, Vivian Deuschl, ‘It's nothing the hotel did. It's a simple lack of business and a decline in the tourism industry’. In the words of Deutsche Bank spokesman Scott Helfman, “The unprecedented economic downturn has had a significant impact on the hotel's operations,” he also added that “As a result, Village Hospitality LLC concluded that continuing to fund operations was no longer economically viable and consequently decided to close the hotel effective May 2, 2010”.

The hotel that boasts of its retail boutiques, gondola rides, wedding chapel suffered a backlash from the so-called ‘AIG effect’. The ‘AIG effect’ refers to the upheaval caused by American International Group’s decision to fly top brokers and executives to a resort soon after receiving a bailout check from the U.S government. 

Revenue for the luxury hotel’s last year fell almost 17% that outpaced the 14% drop in the industry. Revenue per available room or RevPAR dropped about 24% in comparison to a 16.4% drop for the overall industry.

Of the 350 people employed by the Ritz-Carlton Lake Las Vegas, some of them might get relocated to other Ritz-Carlton properties or other hotels of Las Vegas.