NF NY focused on industry and boomed for quite a while. The decline started in ~1960 when industry downsized or closed up entirely, and the population went from 102k to only 48k today (half size of NF Ontario). During the past couple of decades it has tried to focus on tourism, with less success than its Canadian sister city across the river.
NF, Ontario focused on tourism and while that's a seasonal industry, it's transformed the city into sort of a playground for the ~7 million folks of the Greater Toronto Area (GTA) and weekend getaway for anyone within an 8 hour drive of the Falls (Quebec, NY, NJ, PA, Ohio, Massachusetts license plates common sight).
I know the OP says most go once and then that's it, but the constant flow of traffic down the QEW/420 from the GTA to the casinos means people treat NF kind of like Atlantic City.
There's 2 casinos, waterparks, the tacky Clifton Hill attractions, practically every American chain restaurant imaginable
, a fairly new (built 2011, renovated 2018) 300k sq ft convention centre, and a new (2020) 5,000 seat theatre run by the Fallsview Casino for Vegas style shows.
When Covid shut the border down, people from the GTA and Quebec kept restaurants and hotels going, albeit at much reduced capacity.
NF Ontario is not lacking in the hotel department. There's currently over 16,000 "guestrooms" (including B&B's & campgrounds) in the city according to Niagara Falls Tourism, roughly 14,000 hotel rooms according to a 2019 article I found.
If tourism bounces back fully expect more highrise hotels to come. Currently the 58 storey addition tower to the Hilton (2009) is the tallest at 581ft.
TL;DR: Niagara Falls will never be a Vegas. but it is kind of like a Reno and if tourism bounces back more hotels and attractions will be built.
Also the city is undergoing a residential building boom and is rapidly approaching 100k residents.
citypopulation.de (click image to be taken to website)