CONFIDENTIAL DRAFT
Feasibility Study for a New Multi-Purpose Entertainment & Conference Center Development on the South Shore
Presented to the:
January 20, 2015 CONFIDENTIAL Presentation Outline DRAFT
Executive Summary 1. Introduction 3 2. Local Market Analysis 8 3. Demographics Analysis 24 4. Analysis of Competitive &Comparable Facilities 31 5. Market Demand – State & Regional Organizations 60 6. Market Demand – Corporate & Other Events 81 7. Market Demand – Promoted Entertainment Events 98 8. Market Demand - Broadway/Theatrical Performances 105 9. Market Demand – Sporting Events 107 10.Economic & Fiscal Impact Analysis 110 2 DRAFT COPY
Executive Summary
CSL has completed a market and economic analysis for potential development of a multi-use event center to be located on the South Shore. Our research has included extensive local market analysis and stakeholder interviews; review of competitive and comparable venues in the local, regional and national market; and surveys of over 60 planners of events representing hundreds of concerts, entertainment, sports and conference events.
Based on this research, we have developed an assessment of potential event center program elements and community- wide economic impacts. This analysis is structured to help key project stakeholders in making informed decisions as to next phases of project planning.
Within this summary, we highlight key project analysis results and findings. A full presentation of analysis results is included in the attached slide presentation. This summary is organized into the following sections:
Local Market and Demographic Analysis Analysis of Competitive &Comparable Facilities Market Demand Analysis Market Demand and Program Summary Event Levels and Economic Impact Analysis
In evaluating the feasibility of the project, it is common to consider various metrics including the market demand for event space, the ability to host valuable community events, the ability to support valuable hospitality industry businesses, and the regional economic and tax revenue impacts (taking place in both Nevada and California). As part of this study, we consider and evaluate each of these metrics.
The proposed multi-use event center could be considered a hybrid between traditional flat floor conference and convention center projects, and tiered seating music, entertainment and sporting event venues. The market research, including event planner research, has therefore been necessarily broad in order to address each of these markets.
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Local Market and Demographic Analysis
The South Shore of Lake Tahoe is an internationally known-destination with significant year-round recreation activities in a resort/casino environment. These features help to support market demand from a broad cross section of events including meetings, conferences, music, and entertainment.
With the proliferation of gaming within a several hundred mile radius surrounding the Lake Tahoe area, and with increasing gaming options throughout the U.S., gaming revenue within Douglas County has decreased by more than 40 percent since 2000, from a high of more than $352 million to $208 million in 2013. Local market conditions have hampered the viability of the gaming infrastructure, exemplified by the closing of the 539-room Horizon Casino Resort in 2014. Note that the potential conversion of the property to a Hard Rock Hotel and Casino may improve the overall trajectory of gaming revenue in the market. Lake Tahoe Area Drive Time Map There is a significant population base within a 180-minute driving distance of the market that captures Reno, Sacramento and into the Bay Area of California. The more than 4.3 million people within a three-hour drive of Stateline represents a large potential population base from which to draw entertainment event attendees. The above average median household income levels indicate a moderate to strong availability of disposable income.
The corporate base in the immediate region is low, which can impact event levels at an event facility, as well as the availability of advertising and sponsorship opportunities. However the recent announcement of the Tesla Motors battery factory and plans for corporate expansion from Apple and Amazon, along with supporting industry, will expand the area corporate base. In addition, the corporate base within the broader region (including Sacramento and the Bay area) is significant. Given its resort setting, a conference facility in the South Shore area has the potential to draw various incentive and board retreat meetings.
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Analysis of Competitive and Comparable Facilities
There are 20 hotels in the South Shore with more than 100 sleeping rooms, and eight of these properties offer event space. The largest contiguous space available at these properties ranges from 700 to 9,200 square feet. To create a net new benefit for the local market, an event center will have to accommodate events significantly larger than current hotel capacity.
Hotel rates have increased each of the past three years, while occupancy has remained consistent at around 60 percent. During peak summer months, occupancy rates above 75 percent are common and often drop below 50 percent in winter. These seasonality patterns will help guide the event focus for a new center, with a goal of attracting event activity during slower periods.
Air access to the market is primarily served by airports in Reno and Sacramento (located 60 and 160 miles away, respectively). Reno provides non-stop service to 16 destinations. Given the lack of direct air access, a new multi-use event center will have to attract a drive-in audience, in addition to events that draw attendees flying into regional airports.
Competitive Regional Event Venues The South Shore market currently houses several entertainment venues including Harvey’s outdoor theater (8,000 seats), Montbleau Theaters (4,800 outdoor and 15 2 18 2010 3 12 5 1,750 indoor); and Harrah’s South Shore 13 14 Venue Location Capacity Room (750 seats). In addition, 1 Sleep Train Amphitheatre Wheatland, CA 18,500 1 2 Lawlor Events Center (Univ. of Nevada-Reno) Reno, NV 11,784 consideration is being given to a new 2,000 3 Reno Events Center Reno, NV 7,000 4 Ironstone Vineyards Murphys, CA 6,700 to 3,000-seat indoor theater as part of the 5 Reno Sparks Livestock Event Center Reno, NV 6,200 7 8 17 Hard Rock project. A new indoor venue of 11 6 Mountain Winery Saratoga, CA 2,500 7 Sacramento Community Center Theater Sacramento, CA 2,452 this size may have a material impact on 8 Wells Fargo Pavilion Sacramento, CA 2,200 16 9 Bob Hope Theater Stockton, CA 2,042 event activity for any new multi-use venue. 10 Silver Legacy Resort Casino Reno, NV 2,000 4 11 Mondavi Center Davis, CA 1,801 9 12 Grand Sierra Resort Reno, NV 1,800 13 Pioneer Center for Performing Arts Reno, NV 1,500 Regionally, there are competitive venues 19 14 Cargo Reno, NV 1,100 15 Robert Z. Hawkins Event Amphitheatre Reno, NV 900 ranging in size from the 18,500 seat Sleep 16 Uptown Theatre Napa Napa, CA 860 Train Amphitheater, the 7,000 seat Reno 17 Harris Center For The Arts Folsom, CA 850 18 John Ascuaga's Nugget Sparks, NV 775 6 19 SF JAZZ San Francisco, CA 700 20 The Plaza (Harrah's Reno Hotel/Casino) Reno, NV 500 Page 3 of 15 DRAFT COPY
Events Center, the 6,700 seats at the Ironstone Vineyards, the 2,200 seat Wells Fargo Pavilion in Sacramento, and 16 other large and small venues. Each of these caters to particular segments of the music, entertainment, sports and other fixed seating event segment. Our demand and event projection analysis carefully considers the potential impact of these venues.
From a flat-floor event perspective, we have identified 20 venues throughout the region and nationally that are competitive or that offer some form of comparability to a proposed multi-use venue on the South Shore. These include a mix of multi- purpose convention and conference facilities that were selected based on characteristics including location, market population, building size and event focus. Regional & National Flat Floor Venues – Total Sellable Space
Branson, MO 87,100 On average, these convention and conference St. George, UT 76,700 oriented facilities offer approximately 35,700 Springfield, MA 63,400 square feet of exhibit space, 7,700 square feet of Syracuse, NY 59,700 meeting space and 18,000 square feet of Enid, OK 49,600 Bellevue, WA 48,000 ballroom/multi-purpose space. Note that not all Salisbury, MD 46,900 venues provide exhibit, meeting and ballroom Layton, UT 43,500 space. For example, the Boise Centre offers Brookings, SD 42,000 Redding, CA 39,000 24,400 square feet of contiguous space that is Boise, ID 33,300 considered a ballroom, but no exhibit space. Plano, TX 33,000 Conversely, the Meydenbauer Center in Bellevue, Fort Myers, FL 32,000 Monterey, CA 30,300 Washington offers 36,000 square feet of carpeted Ogden, UT 27,700 space considered exhibit space, but not ballroom Loveland, CO 26,500 Average= 40,800 space. Rio Rancho, NM 25,000 Grand Junction, CO 22,900 Median= 36,200 Pueblo, CO 21,100 In practice, these multi-use venues can Mountain Village, CO 7,500 accommodate a wide variety of exhibit, banquet, 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 general session and other flat floor functions. On average, the total sellable space among the comparable and competitive flat floor venues reviewed approximates 40,800 square feet. The market demand analysis specific to the South Shore market summarized later is required to more specifically target supportable sellable spaces for any new multi-use facility development.
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Market Demand Analysis
As part of the market demand analysis, we have conducted the following research:
• 50 surveys of California and Nevada state/regional association organizations. • 40 surveys of regional corporate event planners representing over 75 annual events. • Interviews with ten major music and other entertainment event promoters with extensive experience in the regional and national event market.
This research is supplemented with the results from the extensive local stakeholder interviews, and interviews with management of regional competitive and comparable venues. Market demand results are summarized below.
State & Regional Association Organizations • Event planners were asked to indicate the likelihood of hosting an event at a proposed South Shore venue (definitely, likely, possibly, not likely or definitely not). The percent positive response rate (definitely, likely or possibly) among California organizations was 32 percent. However, this positive response rate drops to 13 percent if the new venue were located in Nevada. It is our view that in practice, if a headquarter hotel were located in California, the impact of the location of a center in Nevada could be mitigated. • The positive response rate among Nevada organizations was 58 percent. • When considering the cumulative responses for California and Nevada weighted by event population, the resulting positive response rate averages 38 percent. Given the size of the California population base, we expect slightly more event activity from California organizations as compared to Nevada organizations. This assumes headquarter hotel availability on the California side of the state line.
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Segmentation of Interest Level – California and Nevada
• Primary reasons for a lack of interest in = California Organizations = Nevada Organizations a South Shore location included an inability among California organizations Definitely Use 0% to be in Nevada, preference for urban areas, lack of area membership and accessibility concerns. Likely Use 6% 4% • In defining the sizing parameters for any new venue, it is important to target a Possibly Use 18% 10% sufficiently large market capture rate, creating opportunities for sufficient event activity without falling into an Not Likely 28% 12% “overbuilding” scenario. Market capture rates between 70 and 80 percent Definitely Not 22% should be considered when defining the sizing parameters for public assembly 0% 10% 20% 30% 40% 50% facility devilment. • The average attendance among Source: CSL State & Regional Organization Survey, 2014. interested state and regional groups is approximately 570, with attendance levels at the 70th to 80th percentile of between 700 and 800. Additional exhibitor attendance averages 170, with approximately 200 exhibitors at the 70th to 80th percentile. • Peak hotel room requirements average 260; however 400 to 600 nearby rooms would be needed to accommodate 70 to 80 percent of this market. • To accommodate 70 to 80 percent of this market, 15,000 to 20,000 square feet of exhibit space is necessary, in addition to 10,000 square feet of ballroom space and 8,000 to 10,000 square feet of meeting space. • These events are most likely to occur in spring, early summer and fall months. • More than 30 percent of the market is not willing to consider shuttling from hotels to an event facility.
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Corporate Events • Approximately 40 percent of regional corporate event planners surveyed have hosted past events in the market, including events held at the Hyatt Regency, Montbleu, Edgewood, Lake Tahoe Resort Hotel and other such venues. • A large share of interviewed organizations expressed an interest in the market for a future event. The share of planners indicating that they would either definitely or likely use the facility represents a fairly strong overall interest from this segment. • Applied to the significant corporate base in the Bay Area and other surrounding markets, survey results indicate that there will be corporate event market demand for the project, largely in the form of incentive, executive, planning retreats, training and other sector components. • The majority of interested organizations envision using the facility once per year. • Importantly, there is a strong demand for weekdays. Sixty-five percent of planners surveyed host events which require rooms on a Thursday or Friday night, 57 percent require a Wednesday night, and 48 percent require a Tuesday night. • Eighty-seven percent of corporate planners surveyed require the availability of a headquarter hotel. Seventy to eighty percent of corporate event demand requires a hotel room block of 400 rooms or less. • Corporate event seasonality is generally distributed evenly throughout the year, with a drop off in the October to December period. th th • Peak night hotel room needs at the 70 to 80 percentiles are between 200 and 400 rooms. Nearly 90 percent require a headquarter hotel. • The provision of an attached hotel will be very important in attracting corporate business—especially in the offseason months. th th • Space requirements at the 70 to 80 percentiles include 20,000 to 30,000 square feet of exhibit space; 4,000 to 6,000 square feet of meeting space; and 10,000 to 15,000 square feet of ballroom space. • Approximately 35 percent of this market is lost if shuttling is required between the hotel block and the event venue.
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Promoted Entertainment Events • As presented earlier, there are no facilities able to provide an indoor seating capacity of more than 1,800 seats. It is important to note that the proposed entertainment venue would be intended to compliment existing or potential individual property sponsored entertainment (i.e., the MontBleu Theatre or very successful summer outdoor concert series at Harveys). • Events promoted by those interviewed include concerts, sporting events, comedy shows, family shows, illusionists, movies, private events and various theater events, including Broadway shows. • Concerts, Cirque, comedy and other acts could potentially serve as resident artists during various periods of the year, although the lack of population base in the market may make such residencies difficult to sustain for long runs. • Approximately two-thirds of interviewed promoters expressed an interest in bringing their events to a new event facility in Lake Tahoe. This represents a strong to modest level of support for a new multi-use venue. • There are a variety of existing facilities in the region (i.e., Reno, Sacramento, Bay area, etc.) that would compete with a new venue on the South Shore. Even with this competition, promoters generally viewed the potential demand for a new venue favorably. • Accessibility/travel to Lake Tahoe can be very difficult and often unpredictable during winter months and was a noted concern among some promoters. Lake Tahoe is sometimes viewed as a summer destination for events. • As a result, while many promoters expressed demand for year-round events, the uncertainty of weather conditions may have some impact on event activity outside the warmer months. • The success of Harveys Summer Concert Series, as well as a robust inventory of smaller acts hosted in the market, indicates that there is a viable demand for concerts and other entertainment events on the South Shore. • The new Hard Rock property will offer some level of indoor event space (perhaps allowing for as many as 3,000 attendees). The impacts of this space will need to be considered going forward. • Attendees of entertainment events at a new venue would originate from throughout the region—as far away as the San Francisco Bay area. The destination appeal of the market could become an advantage. • The idea of a non-casino-affiliated event venue in the market is particularly appealing to several promoters.
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• Most promoters suggest that the market could support a total seating capacity of 3,000 to 5,000, with only limited consistent demand for larger capacities. • The flexibility of the event space will be important. The ability to scale down or “right size” the venue to meet a variety of event sizing needs and to provide an intimate feel for smaller events will be critical. • The ideal configuration would consist of a flat floor venue allowing for a floor show with a surrounding element of retractable seating for a theater-type set up. The space should also offer the potential to have significant standing/general admission space (which is preferred for certain events). This type of facility represents the most versatile space offering, allowing for a maximum of music and entertainment event configurations.
Broadway Shows/Theatrical Performances • Reno’s Pioneer Center hosts a variety of Broadway and theatrical events and would provide competition for a new venue on the South Shore seeking to attract these types of events. The population base in the Reno/Sparks area is able to attract and support a variety of successful shows at the Pioneer Center. • Luring shows away from the Reno market would likely require a substantial investment to out-bid offers made by the Pioneer Center and other regional facilities. • More popular and longer-running shows often reside in San Francisco for a month, which could also affect demand in the South Shore. • To accommodate the needs of the majority of Broadway and theatrical events, several “Broadway specific” amenities are typically required o A first-class proscenium space would be necessary to attract and host Broadway shows. o An extensive state-of-the-art fly system and grid would also be required and could cost approximately $10 million. o If the facility is going to be very flexible and multipurpose in nature, it could be very expensive to have both a flat floor and raked floor. • The uncertainty of the weather in winter could affect the success of this event market at a new South Shore venue. Broadway’s major season is in the late fall, early spring and all of winter.
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Sporting Events • Existing sports facilities in the South Shore area are very limited, and include only two multipurpose fields and a combined softball/baseball diamond. • Competition from Reno will be a challenge to attracting significant sporting activity to the South Shore. The Reno-Sparks Convention Center/Atlantis Resort offer a desirable package of nearly 375,000 square feet of contiguous flat floor space and 975 sleeping rooms. In total, Reno is able to offer over a package of 4,000 hotel rooms to large sports groups for around $120 per night. • Regional volleyball and basketball competitions that take place in Reno have expressed an interest in a South Shore venue, and would like a space near the Lake for events they would consider bringing to the market. • Some larger (800 plus participant) martial arts events and volleyball events would consider a new South Shore venue. • Fixed or retractable seating for at least 2,000 would be necessary. Seating for up to 4,000 or 5,000 would be ideal and could be achieved by supplementing with temporary bleachers or temporary chairs. • To be fully effective as a large scale tournament sports venue, 50,000 square feet of usable space would be necessary to attract major events. A 25,000 to 30,000 square foot floor area could accommodate 5 to 7 basketball or volleyball courts; however, the event potential would be significantly more limited.
Market Demand and Program Summary
• The market research indicates that sufficient demand exists for a multi-purpose event venue on the South Shore. Music/entertainment event promoters and corporate event planners in particular have registered interest in the project. • The entertainment and gaming reputation of the destination, world-class outdoor/natural amenities and a desire from many planners to book non-traditional event locations help support the viability of such a venue. • It is important to note that there are risk factors that need to be considered including the non-California location of the venue (and resulting impact on convention business), uncertain weather in winter months, a level of air access that won’t likely improve significantly in the near term, and significant competition from regional event centers.
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• In addition, many of the event planners interested in the destination have not held events in the South Shore market in the past, creating some uncertainty as to ultimate facility market capture. Finally, the development of a large (up to 3,000 capacity) venue as part of the Hard Rock Hotel & Casino project could significantly reduce the demand for an additional indoor entertainment venue in the South Shore market. • The multi-use venue could also provide space for numerous local functions including meetings, senior and youth activities, festivals, banquets and other such events. In effect, the multi-use venue could serve as a community gathering space in addition to an economic impact/room night generator. • Future planning for a new multi-purpose indoor event venue should consider the following parameters:
Capacity for 4,000 to 6,000 attendees for concert and other touring entertainment acts. Retractable seats allowing for approximately 25,000 square feet of contiguous flat floor area. Finished space for meetings and banquets of 15,000 square feet, sub divisible into smaller rooms. Lobby, support and storage space roughly equivalent to total sellable space. Location adjacent to existing and/or new hotel inventory, with close proximity to California hotel properties. Ample parking on-site or on adjacent parcels. Take advantage of natural surroundings with glass curtain walls. Site area planning that allows for outdoor functions adjacent to the venue.
• The site area for the project is assumed to approximate 120,000 square feet of built space, requiring approximately 4 acres for facility and circulation needs. • Parking needs for a new facility, assuming 30 percent of event attendees are staying in “walkable” hotels, two people per vehicle and 300 square feet per vehicle (to account for spacing, circulation, etc.), could range from 10 to 14 acres. • Construction costs have not been estimated in detail, and a qualified cost estimator will be needed to develop final cost estimates. Based on general industry standards, the construction costs for the mixed-use entertainment venue could approximate $50 million to $55 million, inclusive of design fees and FF&E. Costs for the conference component could reach $12 million to $15 million. Total construction, design and FF&E costs could therefore approximate $62 million to $70 million.
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Event Levels and Economic Impact Analysis
Based on the market analysis summarized above, we have developed estimates of the event potential and associated economic impact for a potential new multi-use venue on the South Shore. The assumptions assume an aggressive sales and marketing approach, and a well-funded operation with the ability to fund the attraction of concert and other entertainment events. The proximity to headquarter hotel inventory, including access to large properties on the California side of the state line, will also be important. For purposes of our analysis, and given the untested nature of this concept, we have presented two potential operating scenarios to account for differences in assumptions regarding the event mix captured by the facility.
Event Levels
The following exhibit summarizes the estimated event activity for the proposed venue on an annual basis for each of the first five years of operation. Estimates are provided under scenarios that assume and exclude a new large indoor concert venue as part of the Hard Rock project.
Summary of Potential Multi-Use Venue Event Activity
Scenario 1 Scenario 2 Year 1 Year 2 Year 3 Year 4 Year 5 Year 1 Year 2 Year 3 Year 4 Year 5 Concerts & Entertainment 18 20 22 25 26 25 28 28 30 30 Conventions & Conferences 2 2 3 4 4 3 4 4 5 5 Public/Consumer Shows 2 2 3 3 4 2 3 4 5 5 Corporate & Association Meetings 28 30 35 38 40 30 35 40 45 45 Sporting Events 1 2 2 3 4 1 2 3 4 5 Banquets/Receptions/Other Events 30 30 35 35 35 30 30 35 40 40 TOTAL 81 86 100 108 113 91 102 114 129 130
As summarized, in a stabilized year of operations (assumed to occur in year five), total event activity reaches between 112 and 142 events annually. A significant level of corporate and association meetings (largely from the regional area), and smaller banquets and receptions are assumed. With no large Hard Rock concert venue, music and entertainment activity could also be significant.
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We also note that this summary of event potential does not include the potential for a resident artist program, Broadway shows or other theatrical performances. Opportunities may exist to host concerts, comedy, Cirque or other such events types over a 10 to 20 show run. Based on initial conversations with concert promoters, interest in the South Shore market for longer-running resident artist programs is limited. When considering the limited surrounding population base and the oftentimes very high talent fees required to sign these acts, it may be difficult to put together a viable financial package. This being said, other entertainment, such as illusionists, Blue Man Group, comedians, etc. could present some opportunities for shorter-term residencies or a series of shows over several days. The viability of such a program will require further, more detailed conversations with potential promoters. As will be further discussed, the ability to attract and host Broadway shows and other theatrical performances would likely require significant investment in “Broadway specific” amenities (proscenium space, fly system and grid, raked floor, etc.).
Economic Impacts Estimated Annual Economic Impacts (Upon Stabilization of Operations in 2014 Dollars) Based on the event analysis, as well as various assumptions Auto Rental/ Other Industries as to per-capita, per day spending (ranging from $122 for Other Transit 5% Hotel Retail 2% 44% amateur and other sporting events to $252 for conventions 8% and conferences), length of stay, origination of attendee, occupants per room and other such assumptions, we have developed estimates of the direct visitor spending generated as a result of the operations of the proposed venue.
As noted above, visitor spending within the market on hotels, Entertainment restaurants, gaming/entertainment, retail and other areas is 20% Restaurant estimated at between $22.1 and $25.7 million on an annual 21% basis during a mature year of operations. Note that these estimates do not include the potential impacts of a resident Estimated Annual Direct Spending: artist or Broadway shows. While the limited population base in Scenario 1: $22,096,000 the market may prevent longer runs, a 10 performance Scenario 2: $25,682,200 residency act with an average attendance of 2,500 could
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generate an additional $6.5 million in annual direct spending. Should substantial investment be made in facility upgrades, a Broadway show with six performances could generate an additional $3.9 million in direct spending.
This direct spending will cycle through the local economy, creating a modest amount of additional spending. Given the limited base of supply-oriented industries in the South Shore area, much of the support for the direct spending originates from outside the market. The resulting total impacts are summarized in the following exhibit.
Estimated Annual Economic Impacts (Upon Stabilization of Operations in 2014 Dollars)
Scenario 1 Scenario 2 Number of Events 113 130 Event Days 175 221 Attendee Days 135,000 156,900 Out-of-Town Attendee Days 90,600 105,000 Room Nights 51,600 59,700 Total Direct Spending $22,096,000 $25,682,200 Total Output $28,821,300 $33,502,500 Personal Income $11,810,600 $13,738,900 Total Emnployment 332 386
As outlined in the table above, the estimated level of annual direct spending associated with a stabilized year of operations for a new multipurpose event facility on the South Shore could generate approximately $28.8 million to $33.5 million in total output (total direct, indirect and induced spending), earnings of approximately $11.8 million to $13.7 million, supporting between 332 and 386 full and part time jobs.
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The direct, indirect and induced spending serve to generate tax revenue for various public sector taxing entities. The following exhibit summarizes the tax revenue generated by type for jurisdictions in Nevada and California under two potential operating scenarios.
Estimated Annual Tax Revenues (Upon Stabilization of Operations in 2014 Dollars)
Incremental Incremental Current Tax Generated Tax Generated Rate Scenario 1 Scenario 2 Sales Tax - Douglas County 7.10% $544,200 $634,800 Sales Tax - South Lake Tahoe (CA) 8.00% 408,800 476,500 Transient Occupancy Tax (TOT) - Douglas County 10.00% 575,200 665,100 Lodging License Fee - Douglas County 3.00% 172,500 199,500 (1) Transient Occupancy Tax (TOT) - South Lake Tahoe (CA) 10% - 12% 290,900 336,300 SLT Tourism Improvement District (TID) Nightly Assessment $3.00 46,400 53,700 Nevada Indirect Spending 7.10% 60,300 70,100 California Indirect Spending 8.00% 39,700 46,200 Total Direct & Indirect Taxes $2,138,000 $2,482,200 Total Direct & Indirect Taxes - Nevada $1,352,100 $1,569,500 Total Direct & Indirect Taxes - California $785,800 $912,700
(1) Rate varies between 10% and 12% based on whether or not hotels are defined as redevelopment properties or not. Note: Development scenario conditions assume a stabilized year of operations in 20014 dollars. The fo llo wing assumptio ns,ro vided by lo cal industry representatives, are used in preparing these estinates: Share o f direct spanding taking pace in Nevada: Hotel 70% Restaurant 70% Entertainment 50% Retail 50% Auto Rental 75% Other Local Transit 70% Other Industries 70% 90% o f Nevada ho tel sales take place in designated redevelo pment pro perties.
As noted above, the total annual direct and indirect tax revenue generated by a potential new multipurpose event facility on the South Shore is estimated at between $2.1 million and $2.5 million per year (in a stabilized year of operations, in 2014 dollars). Of this total, approximately $1.4 million to $1.6 million (or approximately 63 percent), is derived from spending taking place in Nevada.
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INTRODUCTION
3 CONFIDENTIAL The Question of Feasibility DRAFT
• Typical measurements used to determine project feasibility: Market
Financial Economic spending Tax generation Cost/benefit, return-on-investment Intangible and indirect benefits, public good, quality of life issues
4 INTRODUCTION CONFIDENTIAL Event Facility Industry Models DRAFT
SPECTATOR / ENTERTAINMENT • Outdoor stadiums • Perf. Arts Theaters • Speedways/racetracks • Amphitheaters • Specialty sports facilities • Auditoriums
• Arenas • Outdoor am. sports • Cultural centers • Civic centers • Event centers • Concert halls/clubs • Indoor stadiums • Equestrian/Fair • Outdoor parks/event plazas • Indoor am. sports/rec • Special event venues
• Convention centers • Expo/trade centers • Conference centers • Banquet halls • Meeting space
FLAT FLOOR / BUSINESS
5 INTRODUCTION CONFIDENTIAL Typical Facility Requirements DRAFT
High Ehxibit/ Upscale Nearby Quality Lg. Event Banquet Breakout Spectator Nearby Secondary Visitor Finish Facility Hall Rooms Seating Parking Hotels Facilities Amenities
Conventions HIGH HIGH HIGH HIGH LOW MED HIGH LOW HIGH
Conferences HIGH MED HIGH HIGH LOW MED HIGH LOW HIGH
Meetings HIGH LOW MED HIGH LOW LOW LOW LOW MED
Banquets/Receptions HIGH LOW HIGH MED LOW MED LOW LOW MED
Tradeshows MED HIGH LOW LOW LOW HIGH MED LOW HIGH
Consumer/Public Shows LOW HIGH LOW LOW LOW HIGH LOW LOW MED
Agricultural Shows LOW HIGH LOW LOW LOW HIGH LOW HIGH LOW
Equestrian Events LOW HIGH LOW LOW MED HIGH LOW HIGH LOW
Rodeos LOW HIGH LOW LOW HIGH HIGH LOW MED LOW
Tractor pulls LOW HIGH LOW LOW HIGH HIGH LOW MED LOW
Sporting Events LOW HIGH LOW LOW HIGH HIGH LOW LOW LOW
Concerts LOW MED LOW LOW HIGH HIGH LOW LOW MED
Festivals LOW HIGH LOW LOW LOW HIGH LOW LOW LOW
6 INTRODUCTION CONFIDENTIAL Typical Characteristics of Industry Models DRAFT
Facility Footprint (in GSF) Construction Cost Per GSF Construction Costs Annual Operating Income
Owner Operator low high Range Average low high low high
Arena (non-NBA/NHL) Public Public or Private 175,000 500,000 $350-$450 $400 $70,000,000 $200,000,000 ($1,000,000) $2,000,000
Civic/Event Center Public Public or Private 125,000 275,000 $275-$325 $300 $37,500,000 $82,500,000 ($1,000,000) $500,000
Performing Arts Theater Public or Private Public or Private 90,000 300,000 $375-$750 $400 $25,000,000 $100,000,000 ($2,000,000) $2,000,000
Amphitheater Public or Private Public or Private 25,000 150,000 $50-$250 $120 $3,000,000 $20,000,000 ($300,000) $1,500,000
Concert Hall/Club Private Private 20,000 60,000 $100-$300 $150 $3,000,000 $9,000,000 $0 $1,000,000
Outdoor Park/Event Plaza Public or Private Public or Private 10,000 100,000 $50-$150 $75 $750,000 $7,500,000 ($500,000) $500,000
Special Event Venue Private Private 10,000 50,000 $100-$500 $175 $1,750,000 $8,750,000 $100,000 $1,000,000
Convention Center Public Public or Private 100,000 1,000,000 $250-$500 $350 $35,000,000 $350,000,000 ($2,000,000) ($200,000)
Expo/Trade Center Public or Private Public or Private 200,000 1,000,000 $100-$200 $175 $35,000,000 $175,000,000 ($300,000) $2,000,000
Conference Center Public or Private Public or Private 20,000 80,000 $250-$500 $300 $6,000,000 $24,000,000 ($250,000) $1,000,000
Banquet Halls Private Private 25,000 75,000 $150-$300 $200 $5,000,000 $15,000,000 $250,000 $750,000 7 Typically integrated w larger Meeting Space Private Private 5,000 20,000 $200-$300 $250 $1,250,000 $5,000,000
INTRODUCTION business unit CONFIDENTIAL DRAFT
LOCAL MARKET ANALYSIS
8 CONFIDENTIAL South Shore DRAFT Key Activities & Attractions
• Skiing & Snowboarding • 40 feet of snow and 300 days of sun a year • 3 alpine ski resorts, 5 cross country skiing trails
• Gaming
• 5 casinos • Nightlife • Numerous casinos, pubs, and dance clubs • Golf • 6 distinctive courses • Hiking, Running & Biking • Extensive network of backcountry trails • Designated as a “Bike Friendly Community” • 72 miles of trail around Lake Ta • Water Recreation
9 • 7 marinas LOCAL MARKET LOCAL CONFIDENTIAL Drive Time Map DRAFT
(30, 90 and 180 minute Drive Times)
10 LOCAL MARKET LOCAL Source: ESRI, 2014 CONFIDENTIAL Drive Times to Major Markets DRAFT
Redding, CA
Miles from Approximate Market City, State South Lake Tahoe Drive Times Population Reno, NV 57 1:08 233,294
Sacramento, CA 105 1:56 479,686 Reno, NV Modesto, CA 164 2:55 204,933 Oakland, CA 184 3:06 406,253 San Francisco, CA 190 3:14 837,442 Sacramento, CA San Jose, CA 214 3:42 998,537 Fresno, CA 254 4:29 509,924 Redding, CA 411 2:51 91,119 San Francisco, CA Las Vegas, NV 443 7:05 603,488 Henderson, NV 458 6:58 270,811
Oakland, CA Modesto, CA
San Jose, CA
Fresno, CA 11 (1) Includes space that is either planned or under construction.
Note: Data sorted by total sellable space.
LOCAL MARKET LOCAL
Source: Facility management; CSL International, 2014 CONFIDENTIAL Air Accessibility DRAFT
Bellingham, WA
Seattle, WA Portland, OR
Chicago, IL–Midway
Reno, NV Salt Lake City, UT Oakland, CA Chicago, IL–O’Hare San Francisco, CA 16 non-stop Denver, CO San Jose, CA air destinations Las Vegas, NV
Los Angeles, CA Dallas, TX San Diego, CA Phoenix, AZ
Houston ,TX
12
LOCAL MARKET LOCAL
CONFIDENTIAL South Shore Hotel and Event Facilities DRAFT
3 7
2
5
1
4
6 Number of Total Sellable Largest Maximum Hotel Rooms Space Contiguous Space Seating Capacity
1 Harveys Resort & Casino 734 17,100 9,200 8,000 2 Hard Rock Casino (1) 539 15,000 7,500 3,000 3 Edgewood Tahoe Resort & Clubhouse (1) 154 14,400 6,000 -- 4 Harrah's Lake Tahoe 535 13,800 8,600 750 MontBleu Resort Casino & Spa 437 12,400 9,200 1,500 13 Note: Data sorted by total sellable space. 5 Source: Facility management; CSL International, 2014. 6 Lake Tahoe Resort Hotel 400 8,200 4,200 --
(1) Includes space that is either planned or LOCAL MARKET LOCAL under construction. 7 The Ridge Tahoe 302 3,600 1,300 --
CONFIDENTIAL Hotel and Event Facilities – DRAFT South Shore
Number of Exhibit Meeting Ballroom Total Sellable Largest Maximum Hotel Rooms Space Space Space Space Contiguous Space Seating Capacity Harveys Resort & Casino 734 -- 7,900 9,200 17,100 9,200 8,000 Hard Rock Casino (1) 539 -- -- 15,000 15,000 7,500 3,000 Edgewood Tahoe Resort & Clubhouse (1) 154 -- 3,400 11,000 14,400 6,000 -- Harrah's Lake Tahoe 535 -- 5,200 8,600 13,800 8,600 750
MontBleu Resort Casino & Spa 437 -- 3,200 9,200 12,400 9,200 1,500
Lake Tahoe Resort Hotel 400 -- 2,200 6,000 8,200 4,200 -- The Ridge Tahoe 302 -- 3,600 0 3,600 1,300 -- Forest Suites Resort at Heavenly Village 119 -- 2,900 -- 2,900 690 -- Lake Tahoe Vacation Resort 368 ------0 -- -- Beach Retreat & Lodge at Tahoe 262 ------0 -- -- Aston Lakeland Village Beach & Mountain Resort198 ------0 -- -- Tahoe Seasons Resort 180 ------0 -- -- Motel 6 South Lake Tahoe 143 ------0 -- -- Tahoe Beach & Ski Club 140 ------0 -- -- Lakeside Inn and Casino 124 ------0 -- -- Quality Inn & Suites 120 ------0 -- -- Rodeway Inn Casino Center 118 ------0 -- -- Park Tahoe Inn 116 ------0 -- -- Super 8 Motel 108 ------0 -- -- Inn by the Lake 100 ------0 -- --
14 (1) Includes space that is either planned or under construction. Note: Data sorted by total sellable space.
Source: Facility management; CSL International, 2014
LOCAL MARKET LOCAL
CONFIDENTIAL Hotel and Event Facilities - DRAFT North Shore
Number of Exhibit Meeting Ballroom Total Sellable Largest Hotel Rooms Space Space Space Space Contiguous Space Resort at Squaw Creek 405 0 6,900 14,600 21,500 9,500 Hyatt Regency Lake Tahoe Resort, Spa and Casino 422 0 4,700 11,800 16,500 5,900 Cal Neva Resort, Spa and Casino 199 0 6,658 7,932 14,590 4,500 Squaw Valley USA 200 0 4,420 9,010 13,430 6,050 The Ritz Carleton, Lake Tahoe 170 0 1,248 9,902 11,150 6,600 Granlibakken Conference Center and Lodge 200 0 2,700 8,400 11,100 5,400 North Tahoe Event Center 0 0 2,760 4,800 7,560 4,800 Tahoe Biltmore 113 0 0 6,000 6,000 6,000 Plumpjack Squaw Valley Inn 57 0 0 6,000 6,000 3,000 The Chateau at Incline Village 0 0 0 5,200 5,200 5,200 Northstar-at-Tahoe 200 0 3,600 0 3,600 2,700 Squaw Valley Lodge 130 0 2,015 0 2,015 1,500 Hampton Inn and Suites Tahoe/Truckee 109 0 1,500 0 1,500 1,000 Larkspur Hotel Truckee - Tahoe 100 0 1,195 0 1,195 1,045
15 Note: Data sorted by total sellable space.
Source: Facility management; CSL International, 2014
LOCAL MARKET LOCAL
CONFIDENTIAL Average Daily Hotel Rates and DRAFT Occupancy Percentages for the South Shore
ADR (overall) ADR (casinos) Occupancy (overall) Occupancy (casinos)
80% $90
70% $80
$70 60% $60 50% $50 40% $40 30% $30 20% $20
10% $10
0% $0 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 16
Source: Douglas County, Nevada, 2014.
LOCAL MARKET LOCAL
CONFIDENTIAL South Shore Hotel Occupancy DRAFT
2011 2012 2013 2014 90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
17 LOCAL MARKET LOCAL Source: Douglas County, Nevada, 2014. CONFIDENTIAL Gaming Revenue per Year (in millions) DRAFT
$400,000
$350,000
$300,000
$250,000
$200,000
$150,000
$100,000
$50,000
$- 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 18
Source: Nevada Gaming Control Board, 2014
LOCAL MARKET LOCAL
CONFIDENTIAL Gaming Revenue Per Month DRAFT (in millions) 2011 2012 2013 $35,000
$30,000
$25,000
$20,000
$15,000
$10,000
$5,000
$-
19 LOCAL MARKET LOCAL Source: Nevada Gaming Control Board CONFIDENTIAL Douglas County Room Tax Revenue DRAFT
Lake Casinos Lake Other Total Valley $7,000,000
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
20 $0
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 LOCAL MARKET LOCAL Source: Douglas County, Nevada, 2014. CONFIDENTIAL MontBleu Resort, Casino & Spa DRAFT
FACILITY: MONTBLEU THEATER Owner: Tropicana Entertainment Overview: The 15,700 square-foot theater is part of the 437-room Operator: Tropicana Entertainment MontBleu Resort, Casino & Spa in . It features a theatrical Key Facility Theater: 1,500 theater style capacity stage and lighting and a 4,500 square foot stage. The resort Components: 1,800 G/A style capacity opened in 1978 and underwent renovations in 2006. The 950 banquet style capacity facility is planning to re-launch its outdoor concert series in 4,500 square-foot stage 2015 with an outdoor venue capable of accommodating up to 15,700 total square feet
4,800 people. 13,900 square feet of contiguous ballroom space 40,000 square-foot casino The property is currently planning a $27 million renovation. 437 guest rooms AAA 4-Diamond restaurant Ciera Steak + Chop Outdoor Theater: 4,800 capacity
Events: The indoor theater hosts approximately 20 entertainment events each year.
It is expected that the outdoor venue will host three to four concerts per year.
Event STYX Examples: Daniel Tosh Bassnectar Cheap Trick America Bret Michaels
21
LOCAL MARKET LOCAL
CONFIDENTIAL DRAFT Harrah’s Lake Tahoe
Owner: Caesars Entertainment Corporation FACILITY: SOUTH SHORE ROOM Operator: Caesars Entertainment Corporation City, State: Key Facility Theater: 750 seated capacity Overview: The $3.5 million South Shore Room opened in 1959. The theater Components: 7,000 total square feet has a 750-seating capacity with a built in stage. The resort is Built-in stage connected by tunnel to Harveys (also owned by Caesars 11,100 square-foot ballroom Entertainment Corporation). Other resort amenities include a 6,900 square feet of meeting space
11,100-square foot ballroom and a 65,000-square foot casino. 65,000 square-foot casino 525 guest rooms
Events: The South Shore Room hosts approximately 50 to 60 entertainment events each year.
Event The Beach Boys Examples: The Zombies ZZ Ward Walk Off The Earth Kellie Pickler Jefferson Starship Ben Folds Five Foghat Travis Tritt Tower of Power
22
LOCAL MARKET LOCAL
CONFIDENTIAL Harvey’s DRAFT
FACILITY: HARVEY’S OUTDOOR THEATER Owner: Caesars Entertainment Corporation City, State: Operator: Caesars Entertainment Corporation Overview: Harvey’s outdoor theater seats over 8,000. Every summer, the Key Facility Outdoor theater: 8,000 capacity theater hosts the Outdoor Summer Concert Series with big name Components: 9,200 square feet of contiguous ballroom space artists such as Tim McGraw, Beyonce, The Eagles and more. The 7,900 square feet of meeting space contracted concert promoter for the venue is Another Planet 87,500 square-foot casino Entertainment. 740 guest rooms
Six restaurants including Hard Rock Café
Events: 10 – 12 shows per year
Event Rascal Flatts Examples: Paul Simon Beyonce Brad Paisley The Eagles Journey Bruno Mars Lady Gaga Zac Brown Band Carrie Underwood Journey / Steve Miller Band Dave Matthews Band Stevie Wonder
23
LOCAL MARKET LOCAL
CONFIDENTIAL DRAFT
DEMOGRAPHICS ANALYSIS
24 CONFIDENTIAL Demographics – Douglas County DRAFT Summary Douglas Demographic Variable County 30-minute 90-minute 180-minute U.S.
Population (2000) 41,259 52,029 571,810 3,613,240 281,421,906 Population (2010) 46,997 49,288 672,392 4,242,359 308,745,538
Population (2014 est.) 47,459 51,285 689,577 4,337,125 316,296,988 % Change (2000-2014) 15.0% -1.4% 20.6% 20.0% 12.4%
Population (2019 est.) 48,033 53,426 714,920 4,501,260 327,981,317 % Change (2014-2019) 1.2% 4.2% 3.7% 3.8% 3.7%
Avg. Household Inc. (2014 est.) 59,209 49,473 51,365 54,480 72,809 Avg. Household Inc. (2019 est.) 74,164 57,452 58,776 61,744 83,937 % Change (2014-2019) 25.3% 16.1% 14.4% 13.3% 15.3%
Median Age (2014, in years) 48.8 43.7 40.0 36.8 37.7
Businesses (2014 est.) 3,705 4,155 46,776 290,030 24,262,035 Employees (2014 est.) 18,933 24,334 302,289 1,720,512 141,523,742 Employee/Residential Population Ratio 0.4:1 0.47:1 0.44:1 0.4:1 0.45:1 25
Source: ESRI Business Analyst, 2014.
DEMOGRAPHICS
CONFIDENTIAL Demographics – Douglas County DRAFT Summary Comparable Markets Douglas County % of Rank Low High Average Median Estimate Avg. (out of 21)
Population
County 7,500 2,017,000 345,500 178,100 47,459 14% 19
30-Minute Drive 5,300 2,464,200 498,400 226,200 51,285 10% 19 90-Minute Drive 55,600 7,102,300 1,929,500 1,055,100 689,577 36% 16 180-Minute Drive 469,400 31,126,500 6,333,500 4,262,800 4,337,125 68% 10
Median Household Income County $37,100 $90,000 $54,200 $51,800 $59,209 109% 5 30-Minute Drive $39,900 $70,800 $52,800 $51,200 $49,473 94% 13 90-Minute Drive $38,600 $81,100 $53,500 $51,900 $51,365 96% 12 180-Minute Drive $40,200 $68,200 $53,400 $53,100 $54,480 102% 9
Median Age County 27.5 48.8 37.5 37.8 48.8 130% 21 30-Minute Drive 30.0 45.9 37.3 37.8 43.7 117% 20 90-Minute Drive 29.6 48.6 37.7 37.9 40.0 106% 17 180-Minute Drive 30.1 42.1 36.8 37.1 36.8 100% 10
Corporate Base County 1,000 208,410 30,860 15,210 3,705 12% 19 30-Minute Drive 850 266,150 45,490 19,600 4,155 9% 19 26 90-Minute Drive 6,300 612,450 164,080 75,620 46,776 29% 16 180-Minute Drive 43,510 2,335,690 519,950 290,030 290,030 56% 11
Source: ESRI Business Analyst, 2014.
DEMOGRAPHICS
CONFIDENTIAL Demographics – Comparable Market DRAFT Population Market County 30-minute 90-minute 180-minute Springfield, MA 466,400 825,269 6,586,180 31,126,518 Salisbury, MD 100,075 180,304 719,443 16,708,812 Fort Myers, FL 652,447 583,281 1,892,613 12,807,526 Monterey, CA 424,013 226,201 2,541,827 10,836,727
Plano, TX 854,004 2,464,237 7,102,266 10,090,762 Syracuse, NY 468,117 475,801 2,022,930 6,823,854 Bellevue, WA 2,016,956 2,161,412 4,308,464 6,106,403 Loveland, CO 314,619 574,876 3,670,928 4,823,705 Pueblo, CO 160,022 162,398 1,055,068 4,670,984 Stateline, NV 47,459 51,285 689,577 4,337,125 Enid, OK 61,836 66,007 880,459 4,262,820 Redding, CA 178,100 168,076 412,197 3,503,671 Branson, MO 55,000 87,097 790,785 3,239,584 Layton, UT 324,338 674,707 2,525,012 3,128,744 Ogden, UT 239,921 536,910 2,459,586 3,116,666 St. George, UT 146,977 138,151 238,213 2,337,484 Brookings, SD 33,836 44,446 477,784 1,742,486 Rio Rancho, NM 138,371 336,668 1,088,566 1,413,345 Boise, ID 414,844 558,953 738,336 967,691 Grand Junction, CO 150,179 145,645 264,245 489,401 Mountain Village, CO 7,486 5,345 55,574 469,419
Average (excluding Stateline) 360,400 520,800 1,991,500 6,433,300
27 Stateline Rank (out of 21) 19 19 16 10 Note: Sorted by 180-minute drive time.
Source: ESRI Business Analyst, 2014.
DEMOGRAPHICS
CONFIDENTIAL Demographics – Comparable Market DRAFT Median Household Income Market County 30-minute 90-minute 180-minute Salisbury, MD $47,878 $48,959 $52,339 $68,169 Monterey, CA $55,428 $58,789 $81,102 $67,198 Springfield, MA $47,440 $51,180 $62,292 $61,629 Bellevue, WA $71,992 $70,842 $65,206 $59,342
Loveland, CO $58,712 $56,543 $60,828 $58,366 Pueblo, CO $41,360 $40,907 $54,757 $57,976 Ogden, UT $53,493 $60,073 $58,648 $56,295 Layton, UT $70,201 $56,463 $58,766 $56,277 Stateline, NV $59,209 $49,473 $51,365 $54,480 Plano, TX $90,014 $68,677 $58,008 $53,157 Grand Junction, CO $51,817 $51,570 $50,308 $53,057 Brookings, SD $48,607 $49,129 $52,418 $51,309 Redding, CA $43,504 $43,815 $42,117 $51,165 Syracuse, NY $53,922 $53,787 $51,939 $51,095 St. George, UT $50,169 $50,124 $45,685 $50,152 Mountain Village, CO $61,672 $63,984 $47,788 $48,868 Enid, OK $41,718 $41,914 $50,397 $46,813 Rio Rancho, NM $55,576 $58,300 $48,323 $45,925 Fort Myers, FL $46,385 $45,196 $46,553 $45,585 Boise, ID $51,511 $48,846 $46,561 $45,123 Branson, MO $37,142 $39,900 $38,598 $40,240
Average (excluding Stateline) $52,000 $52,100 $53,400 $53,400
28 Stateline Rank (out of 21) 5 13 12 9 Note: Sorted by 180-minute drive time.
Source: ESRI Business Analyst, 2014.
DEMOGRAPHICS
CONFIDENTIAL Demographics – Comparable Market DRAFT Median Age Market County 30-minute 90-minute 180-minute Fort Myers, FL 46.8 45.9 48.6 42.1 Syracuse, NY 39.0 39.1 39.8 41.1 Springfield, MA 39.1 39.4 40.1 38.9 Branson, MO 41.4 41.7 39.7 38.3
Mountain Village, CO 40.5 39.0 44.3 38.2 Brookings, SD 27.5 30.0 36.8 37.9 Bellevue, WA 37.8 37.6 37.9 37.9 Rio Rancho, NM 38.6 37.3 38.1 37.8 Grand Junction, CO 38.4 38.2 39.0 37.7 Salisbury, MD 36.0 38.5 42.1 37.7 Redding, CA 42.6 41.8 39.2 37.1 Stateline, NV 48.8 43.7 40.0 36.8 Enid, OK 37.7 37.8 36.2 36.5 Monterey, CA 33.4 37.7 36.3 36.4 Pueblo, CO 39.0 38.6 36.8 36.4 Loveland, CO 36.2 34.5 36.0 36.3 St. George, UT 33.0 33.3 32.5 35.9 Boise, ID 35.4 34.2 34.8 35.2 Plano, TX 35.7 34.7 34.4 35.1 Ogden, UT 31.6 30.4 29.7 30.1 Layton, UT 29.8 30.6 29.6 30.1
Average (excluding Stateline) 37.0 37.0 37.6 36.8
29 Stateline Rank (out of 21) 21 20 17 10 Note: Sorted by 180-minute drive time.
Source: ESRI Business Analyst, 2014.
DEMOGRAPHICS
CONFIDENTIAL Demographics – Comparable Market DRAFT Corporate Base Market County 30-minute 90-minute 180-minute Springfield, MA 27,989 58,134 522,362 2,335,692 Fort Myers, FL 79,656 69,978 241,782 1,669,549 Salisbury, MD 7,070 12,833 56,614 1,293,865 Plano, TX 84,725 266,151 612,448 813,441
Monterey, CA 25,194 19,597 193,073 789,009 Bellevue, WA 208,405 217,674 376,070 525,037 Loveland, CO 35,090 55,508 397,896 496,553 Pueblo, CO 11,220 11,269 92,995 481,780 Syracuse, NY 30,749 30,974 123,411 419,351 Enid, OK 4,374 4,713 71,508 315,538 Stateline, NV 3,705 4,155 46,776 290,030 Redding, CA 14,197 13,593 31,390 252,705 Layton, UT 23,339 51,893 199,626 238,460 Ogden, UT 15,205 35,445 195,614 237,690 Branson, MO 5,130 7,684 57,174 209,378 Brookings, SD 2,743 3,949 46,255 166,254 St. George, UT 13,158 12,667 18,509 128,303 Rio Rancho, NM 7,245 22,871 75,617 91,266 Boise, ID 32,697 40,527 52,506 69,984 Grand Junction, CO 15,258 14,812 27,780 51,560 Mountain Village, CO 998 846 6,296 43,508
Average (excluding Stateline) 32,220 47,560 169,950 531,450
30 Stateline Rank (out of 21) 19 19 16 11 Note: Sorted by 180-minute drive time.
Source: ESRI Business Analyst, 2014.
DEMOGRAPHICS
CONFIDENTIAL DRAFT
ANALYSIS OF COMPETITIVE &COMPARABLE FACILITIES
31 CONFIDENTIAL Competitive Regional Event Venues - Map DRAFT
15 2 18 20 10 3 12 5 13 14
Venue Location Capacity
1 Sleep Train Amphitheatre Wheatland, CA 18,500 1 2 Lawlor Events Center (Univ. of Nevada-Reno) Reno, NV 11,784 3 Reno Events Center Reno, NV 7,000 4 Ironstone Vineyards Murphys, CA 6,700 5 Reno Sparks Livestock Event Center Reno, NV 6,200 7 8 17 11 6 Mountain Winery Saratoga, CA 2,500 7 Sacramento Community Center Theater Sacramento, CA 2,452 8 Wells Fargo Pavilion Sacramento, CA 2,200 16 9 Bob Hope Theater Stockton, CA 2,042 10 Silver Legacy Resort Casino Reno, NV 2,000 4 11 Mondavi Center Davis, CA 1,801 9 12 Grand Sierra Resort Reno, NV 1,800 13 Pioneer Center for Performing Arts Reno, NV 1,500 19 14 Cargo Reno, NV 1,100 15 Robert Z. Hawkins Event Amphitheatre Reno, NV 900 16 Uptown Theatre Napa Napa, CA 860 17 Harris Center For The Arts Folsom, CA 850 18 John Ascuaga's Nugget Sparks, NV 775 6 19 SF JAZZ San Francisco, CA 700 20 The Plaza (Harrah's Reno Hotel/Casino) Reno, NV 500
32
LOCAL MARKET LOCAL
CONFIDENTIAL Competitive Regional Event Venues DRAFT Capacity Chart Sleep Train Amphitheatre 18,500 Lawlor Events Center (Univ. of Nevada-Reno) 11,784 Harveys Outdoor Theater 8,000 Reno Events Center 7,000 Ironstone Vineyards 6,700 Reno Sparks Livestock Event Center 6,200 MontBleu Outdoor Theater 4,800
Hard Rock Theater (Planned) 3,000
Mountain Winery 2,500 Sacramento Community Center Theater 2,452 Wells Fargo Pavilion 2,200 Bob Hope Theater 2,042 Silver Legacy Resort Casino 2,000 Mondavi Center 1,801 Grand Sierra Resort 1,800 MontBleu Theatre (MontBleu Hotel) 1,750 Pioneer Center for Performing Arts 1,500 Cargo 1,100 Robert Z. Hawkins Event Amphitheatre 900 Uptown Theatre Napa 860 Harris Center For The Arts 850 Average = 3,600 John Ascuaga's Nugget 775 South Shore Room (Harrah's Resort) 750 Median = 2,000 SF JAZZ 700 33 The Plaza (Harrah's Reno Hotel/Casino) 500
0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 20,000
LOCAL MARKET LOCAL
Source: facility management; CSL International, 2014. CONFIDENTIAL DRAFT Comparable National Event Venues
Facility Name Location Boise Centre Boise, ID Branson Convention Center Branson, MO Budweiser Events Center Loveland, CO Davis Conference Center Layton, UT Dixie Center St. George, UT Enid Events Center Enid, OK Harborside Events Center Fort Myers, FL Mass Mutual Center Springfield, MA Meydenbauer Center Bellevue, WA Monterey Conference Center Monterey, CA Ogden Eccles Conference Center Ogden, UT Plano Centre Plano, TX Pueblo Convention Center Pueblo, CO Redding Civic Auditorium Redding, CA Santa Ana Star Center Rio Rancho, NM SRC Events Center Syracuse, NY Swiftel Center Brookings, SD Telluride Conference Center Mountain Village, CO 34 Two Rivers Center Grand Junction, CO
Wicomico Youth & Civic Center Salisbury, MD
COMPARABLE FACILITIES COMPARABLE
CONFIDENTIAL DRAFT Map of Comparable National Event Venues
Meydenbauer Center
Mass Mutual Center
SRC Events Center Boise Centre Swiftel Center
Ogden Eccles Conf. Ctr. Redding Convention Ctr. Davis Conf. Ctr. Budweiser Events Ctr. Two Rivers Ctr. Wicomico Civic Center Pueblo Convention Ctr. Dixie Center Monterey Conf. Ctr. Telluride Conf. Ctr. Branson Convention Center
Santa Ana Star Ctr. Enid Events Center
Plano Centre
35
Harborside Events Center
COMPARABLE FACILITIES COMPARABLE
CONFIDENTIAL DRAFT
Comparable Event Venues – Exhibit Space
Syracuse, NY 57,000 Comparable facilities that Branson, MO 47,200 don’t offer exhibit space:
St. George, UT 46,600 • Boise, ID • Fort Myers, FL Springfield, MA 40,000 • Grand Junction, CO Redding, CA 39,000 • Monterey, CA • Mountain Village, CO Salisbury, MD 37,600 • Ogden, UT • Plano, TX Bellevue, WA 36,000 • Pueblo, CO Enid, OK 31,500
Brookings, SD 30,400
Rio Rancho, NM 25,000 Average= 35,700 Loveland, CO 20,000 Median= 36,800 Layton, UT 18,400
0 10,000 20,000 30,000 40,000 50,000 60,000 36 Note: Data presented includes only facilities offering exhibit space.
Source: Facility management; CSL International, 2014
COMPARABLE FACILITIES COMPARABLE
CONFIDENTIAL DRAFT
Comparable Event Venues – Meeting Space
Branson, MO 17,200 Comparable facilities that Bellevue, WA 12,000 don’t offer meeting space: Plano, TX 11,400
Monterey, CA 10,700 • Redding, CA St. George, UT 9,800 • Rio Rancho, NM Salisbury, MD 9,300 Boise, ID 8,900 Springfield, MA 8,400 Ogden, UT 8,200 Enid, OK 6,800 Loveland, CO 6,500 Pueblo, CO 4,900 Brookings, SD 4,800 Grand Junction, CO 4,300 Syracuse, NY 2,700 Average= 7,700 Layton, UT 2,700 Median= 8,200 Fort Myers, FL 2,000 Mountain Village, CO 1,400 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 20,000 37 Note: Data presented includes only facilities offering meeting space.
Source: Facility management; CSL International, 2014
COMPARABLE FACILITIES COMPARABLE
CONFIDENTIAL DRAFT
Comparable Event Venues – Ballroom Space
Fort Myers, FL 30,000 Comparable facilities that Boise, ID 24,400 don’t offer ballroom space: Branson, MO 22,700 Layton, UT 22,400 • Bellevue, WA • Loveland, CO Plano, TX 21,600 • Redding, CA St. George, UT 20,300 • Rio Rancho, NM • Salisbury, MD Monterey, CA 19,600 • Syracuse, NY Ogden, UT 19,500 Grand Junction, CO 18,600
Pueblo, CO 16,200
Springfield, MA 15,000 Enid, OK 11,300 Average= 18,200 Brookings, SD 6,800 Median= 19,600 Mountain Village, CO 6,100
0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 38 Note: Data presented includes only facilities offering ballroom space.
Source: Facility management; CSL International, 2014
COMPARABLE FACILITIES COMPARABLE
CONFIDENTIAL DRAFT
Comparable Event Venues – Total Sellable Space
Branson, MO 87,100 St. George, UT 76,700 Springfield, MA 63,400 Syracuse, NY 59,700 Enid, OK 49,600 Bellevue, WA 48,000 Salisbury, MD 46,900 Layton, UT 43,500 Brookings, SD 42,000 Redding, CA 39,000 Boise, ID 33,300 Plano, TX 33,000 Fort Myers, FL 32,000 Monterey, CA 30,300 Ogden, UT 27,700 Loveland, CO 26,500 Rio Rancho, NM 25,000 Average= 40,800 Grand Junction, CO 22,900 Median= 36,200 Pueblo, CO 21,100 Mountain Village, CO 7,500 39 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000
Source: Facility management; CSL International, 2014
COMPARABLE FACILITIES COMPARABLE
CONFIDENTIAL DRAFT
Comparable Event Venues – Largest Contiguous Space
Syracuse, NY 57,000 Branson, MO 47,200 St. George, UT 46,600 Springfield, MA 40,000 Redding, CA 39,000 Bellevue, WA 36,000 Enid, OK 31,500 Brookings, SD 30,400 Fort Myers, FL 30,000 Salisbury, MD 28,000 Rio Rancho, NM 25,000 Boise, ID 24,400 Plano, TX 21,600 Loveland, CO 20,000 Monterey, CA 19,600 Grand Junction, CO 18,600 Layton, UT 18,400 Average= 28,500 Pueblo, CO 16,200 Median= 26,500 Ogden, UT 13,800 Mountain Village, CO 6,100 40 0 10,000 20,000 30,000 40,000 50,000 60,000
Source: Facility management; CSL International, 2014
COMPARABLE FACILITIES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
WICOMICO YOUTH & CIVIC CENTER
City, State: Salisbury, MD Owner: Wicomico County Overview: The 46,960 square feet civic center is host to an average of over Operator: Wicomico County 400 events a year. They have a regional reputation as a great place for concerts, sporting events, family shows, trade shows, Key Facility Rebuilt in 1980, continual renovations since 2008 meetings and receptions. Locally, WY&CC competes for event Components: Total sellable space: 46,900 sf bookings with 29 similar venues, 80 venues within a days drive. Arena: 28,000 square feet, 5,200 capacity, retractable seating Midway Room: 9,612 square feet 10 Meeting Rooms: 9,348 square feet In House Catering; Encore Catering
Events: 881 Events in 2013 with total attendance of 281,354 Sports related events accounted for 25% of revenue Serve an average of 20,000 plates a year
2013 Events Mix: Entertainment/Sports Events - 14.5% Trade Shows - 1.4% Meetings – 27% Receptions – 4.1% Public Recreation – 43.7% Educational Functions – 3.7% Other Rentals – 5.6%
Event Bob Dylan Examples: Stars of the Temptations Sesame Street Live 41 WWE
Elvis Live Broadway Show
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
OGDEN ECCLES CONFERENCE CENTER
City, State: Ogden, UT Owner: Municipal Building Authority of Weber County Overview: Ogden Eccles Conference Center consists of two adjacent Operator: SMG buildings in downtown Ogden; the conference center & Peery’s Egyptian Theater. The conference center also houses nearly Key Facility Theater originally built in 1924, conference center 20,000 of ballroom space, seven meeting rooms and an outdoor Components: opened in 1997 amphitheater. Theater: indoor, 6,131 square feet, 800 fixed seats Amphitheater: outdoor, 1,508, 75 fixed seats, 150 max Junior Ballroom: 5,720 square feet Grand Ballroom: 13,776 square feet 1st Floor Meeting Rooms: 3,168 square feet 2nd Floor Meeting Rooms: 3,168 square feet
Events: Average of over 100 events at the conference center annually, almost half are private events Just under 250 events held in 2014 at conference center & theater Commercial theater rental: $1,700
Event Boys & Girls Clubs of Weber-Davis Fundraising Event Examples: 2014 Utah Tourism Conference JUMP Dance Competition Weber School Foundation Christmas Tree Jubilee Boy Scouts of America Holiday Auction
42
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
MASS MUTUAL CENTER
City, State: Springfield, MA Owner: Massachusetts Convention Center Authority Overview: MassMutual Center is a multi-purpose arena and convention Operator: Global Spectrum center complex located in downtown Springfield. Originally opened in 1972 as the Springfield Civic Center, the complex Key Facility Over 63,000 square feet of total sellable space underwent renovations in 1997. In 2003, the MCCA entered into Components: Exhibit space: 40,700 square feet a partnership with Massachusetts Mutual Life Insurance Ballroom space: 14,900 square feet Company earning naming rights to the now MassMutual Center. Five meeting rooms: 8,400 square feet of total space Arena: floor, 19,000 square feet; 6,663 max capacity
Events: Have an average of 100 events per year 61% of events held in MassMutual Arena Arena sells an avg. of 3,387 tickets per event; $131,419 in avg. gross ticket sales per event Arena tenants: AHL Springfield Falcons
Event The Harlem Globetrotters Examples: Styx Wale Disney on Ice presents Passport to Adventure A$AP Rocky Scotty McCreery Lonestar Big Time Wrestling 2014 Basketball Hall of Fame Holiday Showcase
43
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
REDDING CIVIC AUDITORIUM
City, State: Redding, CA Owner: City of Redding Overview: Redding Civic Auditorium, previously the Redding Convention Operator: Advance Redding Center was built in 1970. It has continually undergone interior updates since management was transferred from the City of Key Facility Built in 1970 Redding to a locally owned, non-profit, Advance Redding. During Components: Leased to Bethel Church by the City of Redding the week the auditorium serves as a classroom for Bethel Church Total sellable space: 39,000 sf classes, but is also host to concerts, conventions, banquets and Auditorium: 2,072 max capacity other public events. 1,260 removable floor seats 812 balcony seats with hydraulic lifts to expose space
Events: Average about 82 event days a year In 2013, held 9 larges scale concert/ent. events Sell an avg. of 1,409 tickets per event; $74,187 in avg. gross ticket sales per event Rental costs: $2,500 or 10% of gross ticket sales
Event Jerry Seinfeld Examples: Chris Young In My Life: A Musical Theatre Tribute to the Beatles Elvis Lives: The Ultimate Elvis Tribute Artist Scotty McCreery Alice Cooper The Oak Ridge Boys Beatles Vs. Stones – A Musical Shoot Out NextWorld EDM Rave Kool April Nites
44
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
SANTA ANA STAR CENTER
City, State: Rio Rancho, NM Owner: City of Rio Rancho Overview: The $47 million multi-functional arena was built in 2006. It is the leader among event venues throughout the entire state of New Operator: Global Spectrum Mexico. The arena can accommodate up to 7,500 for events with Key Facility Opened in October 2006 retractable seating. The flexible setup allows a range of events Components: $47 Million in construction cost from large-scale concerts, sporting events, tradeshows, to 6,000 retractable seats intimate meetings or banquets. 7,500 max capacity 17,000 square feet of floor space 25,000 square feet of floor space w/ seats retracted
Events: Host an avg. of over 25 large-scale public events a year Sell an avg. of 2,515 tickets per event; $120,262 in avg. gross ticket sales per event Rental costs: $5,500 or 12.5% in gross ticket sales; 7% tax rate; 15 – 30% of merchandise
Event Cirque du Soleil Examples: The Harlem Globetrotters Carrie Underwood Disney Junior Live Winter Jam Tour Spectacular Mission of Mercy Free Dental Clinic Army Vs. Marines Extreme Cage Fighting Championships
45
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT SWIFTEL CENTER City, State: Brookings, SD Overview: Swiftel Center was opened in 2001 and has established itself as Owner: City of Brookings one of the premier event and convention venues in South Operator: VenuWorks Dakota. In its first 10 years, the Swiftel Center provided an economic impact of nearly $93 million for the city of Brookings. Key Facility 42,000 square feet of total sellable space Annually, roughly 30% of events are sporting related, 25% are Components: Daktronics Banquet Rooms: 6,800 square feet meetings and conferences. They are also host to concerts, 2 Meeting rooms: 4,800 square feet conventions, banquets and community events. 6,500 arena max capacity
Events: Avg. of 228 events per year and 307 event days Sell an avg. of 2,801 tickets per event; $97,866 in avg. gross ticket sales per event Rental costs: $1,500 per day / 10% gross ticket sales; taxes: 8.5% ticket sales, 7.5% merch, 6% state sales tax
Event The Price is Right – Live Mannheim Steamroller Examples: Florida Georgie Line The Rude Band Justin Moore The Johnny Holm Band Merle Haggard Miranda Lambert with Eric Hairball Church
335
276
249
240
225
209
208
200
194
140
46
04 05 06 07 08 09 10 11 12 13 COMPARABLE VENUES COMPARABLE TOTAL EVENTS BY YEAR CONFIDENTIAL Comparable Facility Case Studies DRAFT
ENID EVENTS CENTER & CONVENTION HALL
City, State: Enid, OK Owner: City of Enid Overview: Winner of 2014 Best Public Improvement Project, the original Operator: Global Spectrum 1921 convention hall was renovated alongside a new events center that was opened in 2013. The new two-story arena is a Key Facility Total sellable space: 49,600 square feet multi-use facility with 2,946 retractable, stadium style seats. It Components: Exhibit space: was constructed as part of the Enid Renaissance project, a $24 • 33,000 square feet flat floor space w/ seats retracted million project which included the renovation of Convention Hall • 11,200 square feet with seats extended and the addition of 1,100 additional parking spaces in the downtown area. 11 meeting rooms: 6,800 square feet Ballroom space: 11,300 square feet
Events: The grand opening was June 23, 2013 with country artist Gary Allen. In the first full year of operation, Enid Event Center brought in a diverse set of entertainment options with 41 ticketed events. Events in the first year included the sold out Darius Rucker and Reba concerts, family shows with Harlem Globetrotters and Sesame Street Live, and sporting events with the 2013 PBR Challenge and BattleGrounds MMA 4.
Event Cirque Musica Rodney Atkins Examples: Enid Chamber of Commerce MercyMe Concert Jackson Concert Justin Moore Concert United Way Chili Cookoff Discover the Dinosaurs PBR Challenge Harlem Globetrotters Miss Oklahoma Teen Coronation
47
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
HARBORSIDE EVENTS CENTER
City, State: Fort Myers, FL Owner: City of Fort Myers Overview: The Harborside Events Center is located in Fort Myers, Florida Operator: Fort Myers Conference & Convention Council along the Caloosahatchee River. It includes 32,000 square feet of total sellable space, and a grand foyer and upscale pre-function Key Facility Total sellable space: 32,000 square feet lobby. 30,000 square feet of flexible contiguous space is used for Components: Exhibit space: 0 banquets, concerts, sports, and tradeshows. 4 meeting rooms: 2,000 square feet Ballroom: 30,000 square feet
Events: Events include banquets, concerts, corporate meetings, trade shows and weddings.
Concerts sell an average of 5,681 tickets per event, with $140,712 in average gross ticket sales per event
Event Ink Life Tour Examples: John Edward Insane Clown Posse Festival of Praise 2014 Barb Wire Dolls Days of the New Community Art Showcase Fort Myers High School Homecoming Special Olympics Florida 48 Annual Fort Myers Boat Show
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
BOISE CENTRE
Owner: City of Boise City, State: Boise, ID Operator: Greater Boise Auditorium District Overview: The Boise Centre is the largest convention facility in Idaho with over 33,000 square feet of total sellable space. In July 2014, Key Facility Total sellable space: 33,300 square feet workers broke ground on the expansion of the facility adding a Components: 8 meeting rooms: 8,900 square feet 15,000 square feet ballroom, 14,000 square feet of additional Ballroom space: 24,400 square feet meeting space, 8,000 square feet of meeting space and 7,000 square feet of additional pre-function and lobby space. 375 fixed seat auditorium Undergoing a $38 million expansion
Events: In 2013, hosted 215 events resulting in 347 event days • 37 conventions • 178 local events
Approximately 132,000 total attendees Nearly $4,000,000 in total convention and meeting revenue
Event State of Idaho Governors' Trade & Business Conference Examples: Boise Valley Economic Partnership Meeting Idaho Humanities Council Lecture & Dinner St. Luke’s Kid For a Night Saint Alphonsus Festival of Trees State of Idaho Industrial Commission Seminars Iron Man Pre Race Activities University of Idaho Graduation 49 Botanical Society of America
Dress For Success Luncheon
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
BRANSON CONVENTION CENTER
City, State: Branson, MO Owner: The City of Branson Overview: The Branson Convention Center is a multi-purpose event facility Operator: SMG that opened in 2007. It is located adjacent to the Hilton Branson Hotel and can accommodate up to 4,000 attendees in a state-of- Key Facility Total sellable space: 87,100 square feet the-art lakeside setting. The space is set up ideally for events Components: Exhibit space: 47,200 square feet with 140 exhibit booths, and a general session and meal function 15 meeting rooms: 17,200 square feet for 800. Ballroom: 22,700 square feet
Events: Primary event types include: Company meetings, SMERF events, banquets, conventions and gated shows.
The facility is occupied approximately 259 event days each year, with a revenue per event day of approximately $14,000. Total attendance is approximately 150,000 per year.
The facility operates at an annual deficit of approximately $650,000-$900,000 per year
Event Intuitive Websolutions Conference Examples: Special Olympics MO Leadership Conference Branson Chamber Business Networking Event Missouri Community College Assn. Convention Boys and Girls Club of the Ozarks Gala JAMfest Cheer and Dance
50 Pure Joy Women’s Retreat
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
BUDWEISER EVENTS CENTER
City, State: Loveland, CO. Owner: Larimer County Overview: The $28 million Budweiser Events Center is a 7,200 seat multipurpose arena and events facility within the Ranch Events Operator: Global Spectrum Complex in Loveland, CO. The arena opened in 2003, and is home to the Colorado Eagles (ECHL) and the Colorado Ice (IFL). Key Facility Exhibit space: 20,000 square feet In 2012, Venue’s Today Magazine ranked Budweiser Event’s Components: 2 meeting rooms: 6,500 square feet Center 17th among top facilities in the world in the publication’s 7,200 seats “Top Spots” report. 777 club seats 24 luxury suites Suite level Executive Club Room
Events: The complex hosts over 850,000 guests each year at events including sports, rodeos, concerts, conventions, family shows and tradeshows
Two primary tenants: • Colorado Ice (indoor football) • Colorado Eagles (hockey)
Tenant Sports: 29% Family Shows: 21% Concerts/banquets/etc.: 50%
Event Disney on Ice Examples: Larry the Cable Guy Barnum and Bailey Circus Sesame Street Live 51 The Harlem Globetrotters Rod Stewart
Cirque du Soleil
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
DIXIE CENTER
City, State: St. George, UT Owner: Washington County Overview: The Dixie Center is the largest convention center in southern Operator: Washington County Utah. It opened in 1998, and offers 76,700 square feet of total sellable space, including over 6,000 seats for concerts and Key Facility Total sellable space: 76,700 square feet special events, 13 breakout meeting rooms, a 46,600 square feet Components: Exhibit space: 46,600 square feet exhibit hall and 20,300 square feet o ballroom space. The $20 13 meeting rooms: 9,800 square feet million facility was financed by both the sale of the previous Ballroom space: 20,300 square feet Dixie Center (to a local college) and a bond issue. Can seat over 6,000 for concert or special event
Events: Hosts a variety of events including expos, conventions, sporting events, seminars, meetings, weddings.
Event UFC Cage Fighting Examples: The Spring Home and Garden Expo Dixie Regional Transportation Expo What Women Want Expo Huntsman World Senior Games Washington County General Elections Ultimate Outdoor Expo Southern Utah Green Conference Jubilee of Trees
52 Southern Utah University Open House
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
MEYDENBAUER CENTER
Owner: Bellevue Convention Center Authority City, State: Bellevue, WA Operator: Bellevue Convention Center Authority Overview: The Meydenbauer Center opened in 1993 as the greater Seattle area’s second largest convention facility. The Center is owned Key Facility Total sellable space: 48,000 and operated by the Bellevue Convention Center Authority, a Components: Exhibit space: 36,000 square feet public development authority. In 2013, it contributed $34.6 9 meeting rooms: 12,000 square feet million in economic impact for the community. Ballroom space: 0
Attached to the Theater at Meydenbauer In 2009, the facility added a 2,500 square feet executive conference suite
Events: In 2013 hosted 282 Conventions: 7% events and attracted Meetings: 62% a total of 138,200 Tradeshows: 1.5% attendees. Consumer shows: .5% Banquets: 22% Other: 8%
Event Youth America Grand Prix Examples: All Things Cheer Northwest Dairy Association Annual Meeting Newport High School graduation Crossfit Games Washington State Bar Exam 2013 Pacific Northwest Dental Convention 53 Romanian Pentecostal Church Convention Creating Keepsakes Scrapbook Convention
SalonCentric Hair Show COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
MONTEREY CONFERENCE CENTER
City, State: Monterey, CA Owner: City of Monterey Overview: The $8 million Monterey Conference Center opened in 1977. It is Operator: City of Monterey attached to the 341-room Monterey Marriott and 379-room Portola Hotel & Spa, combining to form the Monterey Key Facility Total sellable space: 30,300 square feet Conference Center and Meeting Connection. Operating costs of Components: Exhibit space: 0 the Center are paid totally from revenues generated, and hotel 10 meeting rooms: 10,700 square feet room tax revenue the City receives. Ballroom space: 19,600
In early 2014, the City of Monterey approved of a plan to pay for a $32 million renovation, with a goal of bringing more national association, corporate and incentive business to the facility.
Events: Historically, the Monterey Conference Center has hosted a variety of association, corporate, SMERF (social, military, educational, religious and fraternal), government/internal and other such events. In recent years, the Center has hosted an average of approximately 420 events per annum.
Event MISS Job Fair Examples: Boys and Girls Club of Monterey AT&T National Pro Am Golf Reception Technology, Entertainment & Design Conference California Credit Union League Meeting California State Chess Championship 54 United States Golf Association Meetings
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
PLANO CENTRE
City, State: Plano, TX Overview: The Plano Centre is located in Plano, Texas and offers total sellable space of 33,000 square feet, including 14 breakout Owner: City of Plano meeting rooms and ballroom space for banquets, receptions and Operator: City of Plano conferences. The Dallas Business Journal ranked Plano Centre the 13th largest meeting and convention facility in the Dallas- Key Facility Total sellable space: 33,000 square feet Fort Worth area. Components: Exhibit space: 0 14 meeting rooms: 11,400 square feet Ballroom space: 21,600 square feet
Events: Events held at the Plano Centre include cocktail parties, conferences, holiday parties, meetings and retreats, product launches, seminars, receptions, tradeshows and weddings.
Event Dallas Builders Show Examples: Log and Timber Home Show Junior League of Collin County ‘Neath the Wreath The Mom Expo A Night with the Stars Gala Dallas Area Train Show Stamp and Scrapbook Show Plano Bridal Show
55
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
PUEBLO CONVENTION CENTER
City, State: Pueblo, CO Owner: Pueblo Urban Renewal Authority Overview: Located in the heart of downtown Pueblo, the Pueblo Operator: Global Spectrum Convention Center offers a total of 21,000 square feet of sellable space. It is attached to the 164-room Pueblo Marriott, and within one block of the Historic Arkansas Riverwalk of Pueblo. In FY Key Facility Total sellable space: 21,100 square feet 2013, total revenue at the Center was approximately $1.6 Components: Exhibit space: 0 million. Completed in 1997, the Center offers a total of 300 on- 6 meeting rooms: 4,900 square feet site parking spaces. Ballroom space: 16,200 square feet
Events: In 2013, the Pueblo Meetings/seminars: 60% Convention Center Banquets/receptions: 25% hosted 422 events Conventions: 7% which brought in Special events: 4% over 45,000 Consumer shows: 3% attendees. Trade shows: 1%
Event Zumba Glow Party Examples: Pueblo Convention Center Bridal Show Music Munchin’ World Wine Tour Holiday Fair Quilt & Stitch Expo NCAA Division II Track & Field Banquet CSU-Pueblo Football Annual Signing Day Dinner 56 Rotary Club of Pueblo District Conference Colorado Health Care Association
Big Bear Brew Fest COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
SRC EVENTS CENTER
City, State: Syracuse, NY Owner: Onondaga Community College Overview: The $12.4 million SRC Arena and Events Center opened in Operator: Onondaga Enterprises Inc. December, 2011 and is located on the campus of Onondaga Community College. The multi purpose arena facility includes a Key Facility Total sellable space: 59,700 square feet 6-lane track, 3 flexible courts for basketball, volleyball, tennis, Components: Exhibit space: 57,000 square feet 59,700 square feet of exhibit space and flexible, retractable 3 meeting rooms: 2,700 square feet seating for up to 6,500 people. Ballroom space: 0
Events: Home venue for the Onondaga Community College Lazer men's and women's basketball teams.
The center hosts championships in a variety of sports, including basketball, track & field, wrestling, and cheerleading. The arena is able to host everything from sporting and community events to national concerts and trade shows.
Event March of Dimes Walk Examples: Syracuse Nets Basketball Women of Purpose Concert CNY’s Premiere Fall RV Show Gem World Show College Graduation Ceremony Professional Championship Bull Riding
57 Montgomery Gentry Concert
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
TELLURIDE CONFERENCE CENTER
City, State: Mountain Village, CO Owner: Town of Mountain Village Overview: The Telluride Conference Center is located in Mountain Village, Operator: Cadence Group Colorado, a winter ski resort destination. The $8.5 million facility opened in 1999 and offers three meeting rooms totaling 1,400 square feet, as well as a 6,100 square feet ballroom. Key Facility Total sellable space: 7,500 square feet Components: Exhibit space: 0 3 meeting rooms: 1,400 square feet Ballroom space: 6,100 square feet
Events: 2008 2009 2010 2011 Avg. Number of Events Conferences 5 7 5 5 6 Meetings 28 20 11 4 16 Banquets 21 5 11 19 14 Concerts & Events 20 15 13 16 16 Assemblies 16 11 0 0 7 Total 90 58 40 44 58 Average Attendance Conferences 443 332 161 83 255 Meetings 71 44 150 143 102 Banquets 150 297 264 262 243 Concerts & Events 720 567 527 446 565 Assemblies 119 126 0 0 61
58
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL Comparable Facility Case Studies DRAFT
TWO RIVERS CENTER
City, State: Grand Junction, CO Owner: City of Grand Junction Overview: The Two Rivers Convention Center is the largest multipurpose Operator: City of Grand Junction event facility between Denver and Salt Lake City. The convention center offers 22,900 square feet of total sellable space, and is Key Facility Total sellable space: 22,900 square feet attached to the 900+ seat Avalon Theater that was built in 1923. Components: Exhibit space: 0 Located in downtown Grand Junction, the center provides 500 6 meeting rooms: 4,300 square feet on-site parking spaces. Ballroom space: 18,600 square feet Concert capacity: 976
Events: Hosts a variety of meetings, seminars, reunions, weddings, receptions, banquets, concerts, galas and trade shows. In addition to business meetings, exhibits and concerts. The majority of events are locally-based.
Average tickets sold per concert is 936, resulting in average gross income of approximately $36,000 per show.
Event West of I-50 Daily Sentinel Senior Fair Examples: Rocky Mountain Women’s Expo HopeWest Fashion Show Grand Junction Chamber of Commerce Turkey Trot Ghost Busters – Dinner and a Movie Lime Street Entertainment 59 Western Colorado Congress Film Fest Moscow Ballet Great Russian Nutcracker
So You Think You Can Dance
COMPARABLE VENUES COMPARABLE
CONFIDENTIAL DRAFT
MARKET DEMAND – State & Regional Events
60 CONFIDENTIAL California Organization Survey – DRAFT List of Organizations Surveyed
Participating California Organizations
California Alliance of Child and Family Services California Orthopaedic Association California and Nevada Credit Union Leagues California Parks & Rec Society California Association of Clerks & Election Officials California Physical Therapists Association California Association of Marriage and Family Therapy California Professional Firefighters Association California Association of Nonprofits California Society of Association Executives California Association of Physician Groups California Speech-Language-Hearing Association California Association of Realtors California State Parent Teacher Association California Association of School Business Officials California Transit Association California Beet Growers Association California Veterinary Medical Association California Dental Association Far West Equipment Dealers Association California Farm Bureau Federation Occupational Therapy Assocation of California California Fashion Association Painting and Decorating Contractors of America California Library Association Southwest Association of Rail Shippers California Medical Transportation Association Western Fairs Association California Mortgage Bankers Association Western Insurance Agents Association California Moving and Storage Association Western United Dairymen
61 MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL Nevada Organization Survey – DRAFT
List of Organizations Surveyed
Participating Nevada Organizations American Waterworks Association West Nevada Restaurant Association Association Management Specialists - Nevada Nevada Rural Water Association Nevada Associated Builders and Contractors Nevada Society of CPAs Nevada Broadcasters Association Nevada Urban Chamber of Commerce Nevada Dental Association Painting and Decorating Contractors of America Nevada Nevada Mining Association Western Association of Chamber Executives Nevada Nurse Association Western Forestry and Conservation Association Nevada Propane Dealers Association Wild West Veterinary Association
62 MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL State/Regional Organization Survey – DRAFT Population of State/Regional Organizations by State
California 74%
Nevada 26%
63 Note: There are approximately 613 state/regional organizations based in California and 211 based in Nevada
Source: Columbia Books and Information Services, 2011
MARKET DEMAND MARKET
CONFIDENTIAL California Organization Survey – DRAFT
Likelihood of Utilizing New South Shore Event Space
Definitely Use 0% Positive Response = 32% Negative Response = 68% Likely Use 8%
Possibly Use 24%
Not Likely 38%
Definitely Not 30%
0% 10% 20% 30% 40% 50%
64 MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL California Organization Survey – DRAFT
Likelihood of Utilizing New Event Space if Located in Nevada
Definitely Use 0% Positive Response = 13% Negative Response = 87%
Likely Use 5%
Possibly Use 8%
Not Likely 41%
Definitely Not 46%
0% 10% 20% 30% 40% 50%
65 MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL Nevada Organization Survey – DRAFT
Likelihood of Utilizing New South Shore Event Space
Definitely Use 0% Positive Response = 58% Negative Response = 42%
Likely Use 15%
Possibly Use 40%
Not Likely 45%
Definitely Not 0%
0% 10% 20% 30% 40% 50%
66 MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL State/Regional Organization Survey – DRAFT Segmentation of Market Interest
= California Organizations = Nevada Organizations
Definitely Use 0%
Likely Use 6% 4%
Possibly Use 18% 10%
Not Likely 28% 12%
Definitely Not 22%
0% 10% 20% 30% 40% 50%
67 MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL California Organization Survey – DRAFT Likelihood of Utilizing New South Shore Event Space
Past CSL State/Reg. Comparable Markets:
Telephone Surveys Ames, IA McAllen, TX
50 Comparable Markets Appleton, WI Midland, TX Arlington, VA Moore County, NC Bellevue, WA Muskegon, MI Bemidji, MN New Braunfels, TX Boise, ID New Haven, CT Boulder, CO New Iberia, LA Branson, MO Oklahoma City, OK Carbon County, UT Owatonna, MN
Charleston, WV Palmer, AK
South Lake South Tahoe Lake MEDIAN metric Low metric High AVERAGE Covington, KY Park City, UT California Cullman, AL Pinehurst, NC Interest Levels: Davis County, UT Plainfield, IN Fairbanks, AK Port Huron, MI Definitely Use 0% 10% 9% 0% 33% Franklin, KY Provo, UT Likely Use 8% 13% 12% 3% 29% Grand Junction, CO Richmond, IN Possibly Use 24% 28% 28% 9% 44% Hammond, LA Salisbury, NC Not Likely Use 23% 25% 25% 7% 48% Havre, MT Sarasota, FL Definitely Not Use 30% 23% 25% 0% 48% Henderson, NV Sioux Falls, SD Hendersonville, NC St. Charles, MO Positive Response 32% 51% 50% 21% 86% Hendricks Cty., IN St. Cloud, MN Homer, AK St. Paul, MN Strength of Interest 0.89 2.25 2.02 0.54 4.50 Hoover, AL Stillwater, OK Jackson, MI Temple, TX Jacksonville, FL Waterbury, CT Lansing, MI Watertown, SD Laredo, TX Wichita, KS 68 Lewistown, MT Vermillion, SD
* - based on state population of California MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL Nevada Organization Survey – DRAFT Likelihood of Utilizing New South Shore Event Space
Past CSL State/Reg. Comparable Markets:
Telephone Surveys Ames, IA McAllen, TX
50 Comparable Markets Appleton, WI Midland, TX Arlington, VA Moore County, NC Bellevue, WA Muskegon, MI Bemidji, MN New Braunfels, TX Boise, ID New Haven, CT Boulder, CO New Iberia, LA Branson, MO Oklahoma City, OK Carbon County, UT Owatonna, MN
Charleston, WV Palmer, AK
South Lake South Tahoe Lake MEDIAN metric Low metric High AVERAGE Covington, KY Park City, UT Cullman, AL Pinehurst, NC Nevada Davis County, UT Plainfield, IN Interest Levels: Fairbanks, AK Port Huron, MI Definitely Use 0% 10% 9% 0% 33% Franklin, KY Provo, UT Likely Use 15% 13% 12% 3% 29% Grand Junction, CO Richmond, IN Possibly Use 40% 28% 28% 9% 44% Hammond, LA Salisbury, NC Not Likely Use 45% 25% 25% 7% 48% Havre, MT Sarasota, FL Definitely Not Use 0% 23% 25% 0% 48% Henderson, NV Sioux Falls, SD Hendersonville, NC St. Charles, MO Positive Response 55% 51% 50% 21% 86% Hendricks Cty., IN St. Cloud, MN Homer, AK St. Paul, MN Strength of Interest 1.55 2.25 2.02 0.54 4.50 Hoover, AL Stillwater, OK Jackson, MI Temple, TX Jacksonville, FL Waterbury, CT Lansing, MI Watertown, SD Laredo, TX Wichita, KS 69 Lewistown, MT Vermillion, SD
* - based on state population of Nevada MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL State/Regional Organization Survey – DRAFT Reasons for Negative Interest
Can't Go Over State Border 21%
Preference for Urban Areas 21%
Lack of Membership in Area 17%
Driving Distance 14%
Lack of Airport 10%
Prefer Warmer Climate 7%
Presence of Gambling 7%
Prefer Hotel/Conference Centers 3%
0% 10% 20% 30% 70
Note: Of those respondents with a negative interest in South Shore. MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL State/Regional Organization Survey – DRAFT Average Attendance
Delegate Exhibitor
1,750 Average Delegate Attendance = 570 Median Delegate Attendance = 350
Average Exhibitor Attendance = 170 1,500 Median Exhibitor Attendance = 95
1,250
1,000 Attendees 750
500
250
0
1 2 3 4 5 6 7 8 9
10 11 12 13 14 15 16 17 18 19 20 21 22 23 71
Note: Of those respondents with a positive interest in South Shore. MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL State/Regional Organization Survey – DRAFT Peak Hotel Rooms Required 800
Average – 260 700 Median – 190
600
500
400 Hotel RoomsHotel 300
200
100
0
1 2 3 4 5 6 7 8 9
10 11 12 13 14 15 16 17 18 19 20 21 22 23 72
Note: Of those respondents with a positive interest in South Shore. MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL State/Regional Organization Survey – DRAFT Total Exhibit Space Required 90,000
80,000 Average –13,500 Median – 3,000 70,000
60,000
50,000
40,000
Exhibit Space Exhibit 30,000
20,000
10,000
0
1 2 3 4 5 6 7 8 9
10 11 12 13 14 15 16 17 18 19 20 21 22 23 73
Note: Of those respondents with a positive interest in South Shore. MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL State/Regional Organization Survey – DRAFT Total Ballroom Space Required
16,500
15,000 Average – 5,800 13,500 Median – 4,500
12,000
10,500
9,000
7,500
6,000 Ballroom Space Ballroom
4,500
3,000
1,500
0
1 2 3 4 5 6 7 8 9
10 11 12 13 14 15 16 17 18 19 20 21 22 23 74
Note: Of those respondents with a positive interest in South Shore. MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL State/Regional Organization Survey – DRAFT Total Meeting Space Required 25,000 Average – 5,200 Median – 3,200
20,000
15,000
10,000 Meeting Space Meeting
5,000
0
1 2 3 4 5 6 7 8 9
10 11 12 13 14 15 16 17 18 19 20 21 22 23 75
Note: Of those respondents with a positive interest in South Shore. MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL State/Regional Organization Survey – DRAFT Total Sellable Space Required 125,000 Average – 24,500 Median – 13,500
100,000
75,000
Square Feet Square 50,000
25,000
0
1 2 3 4 5 6 7 8 9
10 11 12 13 14 15 16 17 18 19 20 21 22 23 76
Note: Of those respondents with a positive interest in South Shore. MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL State/Regional Organization Survey – DRAFT Seasonality
20%
15%
10%
5%
0%
77
Note: Of those respondents with a positive interest in South Shore. MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL State/Regional Organization Survey – DRAFT Consideration of Shuttle Service from Hotel to Event Facility
Yes 38%
No Possibly 31% 31%
78
Note: Of those respondents with a positive interest in South Shore. MARKET DEMAND MARKET Source: CSL State & Regional Organization Survey, 2014. CONFIDENTIAL State/Regional Organization Survey – DRAFT Amenity Preferences
• Spacious exhibit area and a separate, spacious carpeted space.
• Hotel rooms available for under $199 per night. • No more than $25 per person for catering. • Plenty of breakout rooms; 20 would be a good max. • Video conference capabilities in breakout rooms. • A/V service affordable and provided. • Affordable food and beverage. • An engaging staff that provides good catering with a variety of food options. • Beautiful views from Center and places to walk to.
79
MARKET DEMAND MARKET
CONFIDENTIAL State/Regional Organization Survey – DRAFT Comments on the Market
• Beautiful location.
• Would make a great impression on our directors.
• Perfect spot for a getaway.
• Relaxing resort-like atmosphere.
• Our Vegas-heavy membership would really enjoy the change of pace.
• Proximity to the Lake fits what we have wanted for a long time.
• We’d go there instead of Reno if the proper space was provided.
80
MARKET DEMAND MARKET
CONFIDENTIAL DRAFT
MARKET DEMAND – Corporate & Other Events
81 CONFIDENTIAL Market Demand – Corporate & Other Events DRAFT List of Organizations Surveyed
360 San Francisco Innovative Entertainment Abaxis Kaleidoscope Productions Access Destination Model N, Inc.
American Association of Critical-Care Nurses Mountain Travel Symposium Associated Entertaniment Consultants National Marine Manufacturers Association Carol Leslie Special Events Peggy Anderson - Independent Event Planner CASSS, An International Separation Science Society Persian Snow Festival Collinson Media and Events Silicon Valley Bank Destination Tahoe Meetings & Events Streamline Events Ernst & Young The David & Lucile Packard Foundation Fast Forward Events United Business Media Free Masons US Navy Heavy Attack Squadron 13 Reunion Global Healthcare Vintage Chevrolet Club of America Good Sense Events West Coast Expos, Inc. Helmsbriscoe
82 MARKET DEMAND MARKET CONFIDENTIAL Corporate & Other Events – DRAFT Past Event in South Shore Yes
24% If yes, where?
• Hyatt Regency • Montbleu • Edgewood • Riva • The top of Heavenly Tram • Tahoe Queen No • MS Dixie 76% • Zephyr Cove Resort • Round Hill Pines Beach • Lake Tahoe Resort Hotel • Embassy Suites
83
MARKET DEMAND MARKET Source: CSL Corporate & Other Events 2014. CONFIDENTIAL Corporate & Other Events – Expected DRAFT Frequency of Use of a New South Shore Facility
60% 59%
50%
40%
29% 30%
20%
10% 6%
0% 0% 0%
84 Note: Of those respondents with a positive interest in South Shore.
Source: CSL Corporate & Other Events 2014. MARKET DEMAND MARKET CONFIDENTIAL Corporate & Other Events – Event Seasonality DRAFT
Hotel Occupancy Percentage (2013)
80%
70%
60%
50% 42%
40% 35% 35% 29% 30% 26% 26% 26% 26% 23% 23% 20% 13% 10% 10%
0%
85
MARKET DEMAND MARKET Source: Douglas County, Nevada; CSL MPI Survey, 2014. CONFIDENTIAL Corporate & Other Events – DRAFT Event Days of the Week
74% 75% 68% 65% 58%
55% 55%
50% 42%
25%
0%
86 Note: Of those respondents with a positive interest in South Shore.
MARKET DEMAND MARKET Source: CSL Corporate & Other Events 2014. CONFIDENTIAL Corporate & Other Events – Attendance DRAFT
Delegates Exhibitors 3,000
2,500
2,000 Attendance 1,500
1,000
500
0
5%
10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60% 65% 70% 75% 80% 85% 90% 95% 100%
Percent of Market Captured 87 Note: Of those respondents with a positive interest in South Lake Tahoe.
MARKET DEMAND MARKET Source: CSL Corporate & Other Events 2014. CONFIDENTIAL Corporate & Other Events – Exhibit Space DRAFT
35,000
Average – 12,300 30,000 Median – 7,000
25,000
20,000
15,000 Exhibit Space Exhibit
10,000
5,000
0
5%
10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60% 65% 70% 75% 80% 85% 90% 95% 100%
88 Note: Of those respondents with a positive interest in South Shore. MARKET DEMAND MARKET Source: CSL Corporate & Other Events 2014. CONFIDENTIAL Corporate & Other Events – Ballroom Space DRAFT
40,000
35,000 Average – 8,800 Median – 6,400
30,000
25,000
20,000
15,000 Ballroom Space Ballroom
10,000
5,000
0
5%
10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60% 65% 70% 75% 80% 85% 90% 95% 100%
89 Note: Of those respondents with a positive interest in South Shore. MARKET DEMAND MARKET Source: CSL Corporate & Other Events 2014. CONFIDENTIAL Corporate & Other Events – Meeting Space DRAFT
18,000
16,000 Average – 4,600 Median – 2,900 14,000
12,000
10,000
8,000 Meeting Space Meeting 6,000
4,000
2,000
0
5%
10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60% 65% 70% 75% 80% 85% 90% 95% 100%
90 Note: Of those respondents with a positive interest in South Shore. MARKET DEMAND MARKET Source: CSL Corporate & Other Events 2014. CONFIDENTIAL Corporate & Other Events – Total Sellable Space DRAFT
55,000
50,000 Average – 16,000
45,000 Median – 11,100
40,000
35,000
30,000
25,000
20,000 Total Sellable Space Sellable Total 15,000
10,000
5,000
0
5%
10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60% 65% 70% 75% 80% 85% 90% 95% 100%
91 Note: Of those respondents with a positive interest in South Shore. MARKET DEMAND MARKET Source: CSL Corporate & Other Events 2014. CONFIDENTIAL Corporate & Other Events – DRAFT Average Utilization Days
Event Days
2.8
Move-Out Days Move-In 0.9 Days 1.1
92 Note: Of those respondents with a positive interest in South Shore.
Source: CSL Corporate & Other Events 2014. MARKET DEMAND MARKET CONFIDENTIAL Corporate & Other Events – Hotel Requirements DRAFT
Headquarter Hotel Required Peak Hotel Rooms Required
2,000
1,800 Average – 380 Median – 100 1,600 Yes 90% 1,400
1,200
1,000
800
600
No 400 10% 200
0
5%
10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60% 65% 70% 75% 80% 85% 90% 95% 100%
93 Note: Of those respondents with a positive interest in South Shore.
MARKET DEMAND MARKET Source: CSL Corporate & Other Events 2014. CONFIDENTIAL Corporate & Other Events – DRAFT Consideration of Shuttle Service from Hotel to Event Facility
Possibly
29.0%
Yes No 41.9% 29.0%
94 Note: Of those respondents with a positive interest in South Shore.
Source: CSL Corporate & Other Events 2014. MARKET DEMAND MARKET CONFIDENTIAL Corporate & Other Events – DRAFT Event Facility Requirements
• We need a show office, ticket booths and an attendee registration area. • WiFi; flexible meeting space • We need space for approximately 100 truck and trailers to park.
• We need space for 450 cars to be judged.
• We need an open paved, or grassy lot for a small scale swap meet for vintage car parts. • We always have issue for getting exclusive night club for our party. • As a Destination Management Company (DMC) we are always looking for offsite venues that accommodate groups in the So Shore area. We are very limited with options for groups larger than 200 wanting to go offsite from the casino locations. • We look for facilities that focus on sustainability. Technology, particularly internet connectivity is important. • We want state of the art A/V and internet, good restaurants around it, and prefer non-smoking venues. • We don’t like huge open spaces.
95 Note: Of those respondents with a positive interest in South Shore. Source: CSL Corporate & Other Events 2014. MARKET DEMAND MARKET
CONFIDENTIAL Corporate & Other Events – DRAFT Perceptions of South Shore • I could make it work but it's a very small market.
• I love the area but, due to airlift it is hard to convince our attendees.
• Accessibility (flights) and weather make it a harder location to consider.
• Very nice... traffic can be a little tough.
• This is an annual event so frequency would be 3-6 years. Would very much like to come to South Shore, currently to do so would require getting very "creative". We currently have North shore in our rotation of hosting locations.
• Great area for winter and summer activities. We really need support from city. There is no support from city.
• Exciting possibility, the destination is a pleasant location to visit. It is a hidden gem compared to what it could be, I would want to protect the environmental impact.
96 Note: Of those respondents with a positive interest in South Shore. Source: CSL Corporate & Other Events 2014. MARKET DEMAND MARKET CONFIDENTIAL Corporate & Other Events – DRAFT Perceptions of South Shore
• South Shore is a fantastic location for corporate, association and incentive groups in addition to the leisure and public based events. Facilities in the area are limited currently based on capacity
unless you are in a casino ballroom or outdoors. A new facility or event space in the area would have great potential for helping to secure additional conferences or meetings. • There is already a lot of event space there. • It is gorgeous, quaint and lovely, but it does have a bit too much roughness and smoking. • I love the area, it’s entertaining. • The weather could be a challenge. • Difficult to get to, limited hotel rooms, inclement weather in Fall, beautiful area but not much for attendees to do after-hours.
97 Note: Of those respondents with a positive interest in South Shore.
Source: CSL Corporate & Other Events 2014. MARKET DEMAND MARKET CONFIDENTIAL DRAFT
MARKET DEMAND – Promoted Entertainment Events
98 CONFIDENTIAL Event Promoters – DRAFT List of Organizations Interviewed
• AEG Live
• Another Planet Entertainment • Headline Entertainment • The Knitting Factory • Nederlander Productions • Police Productions • PR Entertainment • Prescient Entertainment • Scott Dean Agency • Vail Resorts (Heavenly) • Warner Gaming (Hard Rock)
99
MARKET DEMAND MARKET
CONFIDENTIAL Event Promoters – DRAFT Examples of Regional Event Venues Currently Being Used
• Montbleu
• Harvey’s • Harrah’s • University of Nevada Campus • North Tahoe Regional Park • Reno Events Center • Cargo (Reno) • Reno casinos (Grand Sierra Resort, Silver Legacy) • Wells Fargo Amphitheater • Las Vegas casinos (The Joint @ Hard Rock, Coliseum @ Caesars)
100
MARKET DEMAND MARKET
CONFIDENTIAL Event Promoters – DRAFT Summary of Survey Findings • Approximately two-thirds of interviewed promoters expressed an interest in bringing their events to a new event facility in Lake Tahoe. This represents a modest to strong level of support, and there are numerous challenges that would have to be addressed for a new venue to attract a viable share of the regional entertainment market. • Events promoted by those interviewed include sporting events, comedy shows, traditional concerts, boxing, mixed martial arts, family shows, magicians/illusionists, private & corporate events, etc. • Competition is fierce. There are a variety of existing facilities in the region (i.e., Reno, Sacramento, Bay area, etc.) that would compete with a new venue in South Shore. • Lake Tahoe is sometimes viewed as a summer destination for events. • The winter ski market represents a unique opportunity for some events that appeal to this demographic; however, accessibility/travel to Lake Tahoe can be very difficult and unpredictable during these months and was a noted concern among some promoters.
101
MARKET DEMAND MARKET
CONFIDENTIAL Event Promoters – DRAFT Summary of Survey Findings • The success of Harvey’s Summer Concert Series indicates that there is a market for concerts in Lake Tahoe. The Series is a premier summer event
and this should not change. • The new Hard Rock property will offer some level of indoor event space (perhaps allowing for as many as 3,000 attendees). The impacts of this space will need to be considered going forward. • Based on initial conversations with concert promoters, interest in the South Shore market for longer-running resident artist programs is limited. When considering the limited surrounding population base and the oftentimes very high fees required to sign these acts, it may be difficult to put together a viable financial package. This being said, other entertainment, such as illusionists, Blue Man Group, comedians, etc. could present some opportunities for shorter-term residencies or a series of shows over several days. The viability of such a program will require further, more detailed conversations with potential promoters. • A new event facility will need to allow for a wide variety of musical and other
102 acts (i.e., Electronic Dance Music (EDM), hip hop/rap, etc.).
MARKET DEMAND MARKET
CONFIDENTIAL Event Promoters – DRAFT Summary of Survey Findings • Most promoters suggest that the market could support a total seating capacity of 3,000 to 5,000, with only limited consistent demand for larger capacities.
• Flexibility of the space will be important. The ability to scale down or “right size” the venue to meet a variety of event sizing needs and to provide an intimate feel for smaller events will be critical. • Attendees of entertainment events would come from throughout the region—as far away as the San Francisco bay area. The destination appeal of the market could become an advantage. • The idea of a non-casino-affiliated event venue in the market is particularly appealing. • Gaming properties all compete for the same acts. Some promoters commented that casinos are not easy to work with and it creates a demand for promoters who do not wish to work with casinos. • The ideal configuration would be a flat floor, ballroom-style venue, which would allow for a floor show with retractable seating in the back and on the sides for a theater type set up, while also offering the potential to have significant standing/general admission 103 space (which is preferred for certain events). This type of facility is the most versatile
and provides multi-use space that can serve a number of purposes.
MARKET DEMAND MARKET
CONFIDENTIAL Event Promoters – DRAFT Summary of Survey Findings
• Examples of amenities that should be considered for a new facility as noted by promoters include the following: • Production office(s) • Concert stage (ideally 89’ x 48’ or 4,300 square feet) • Adequate storage and back-of-house space • Modern artist facilities, with showers and all modern technology available. • Sufficient electrical power • Front-of-house production space • Spotlight positions • Rigging capabilities • Full catering capabilities • In-house production (sound and lighting) • Broadcasting equipment
104
MARKET DEMAND MARKET
CONFIDENTIAL DRAFT
MARKET DEMAND – Broadway/Theatrical Performances
105 CONFIDENTIAL Summary of Broadway/Theatrical Event Demand DRAFT
• Reno’s Pioneer Center hosts a variety of Broadway and theatrical events and would provide competition for a new venue on the South Shore seeking to attract these types of events. The population base in the Reno/Sparks area is able to attract and support a
variety of successful shows at the Pioneer Center.
• Luring shows away from the Reno market would likely require a substantial investment to out-bid offers made by the Pioneer Center and other regional facilities. • More popular and longer-running shows often reside in San Francisco for a month, which could also affect demand in the South Shore. • To accommodate the needs of the majority of Broadway and theatrical events, several “Broadway specific” amenities are typically required • A first-class proscenium space would be necessary to attract and host Broadway shows. • An extensive state-of-the-art fly system and grid would also be required and could cost approximately $10 million. • If the facility is going to be very flexible and multipurpose in nature, it could be very expensive to have both a flat floor and raked floor. • The uncertainty of the weather in winter could affect the success of this event market at a new South Shore venue. Broadway’s major season is in the late fall, early spring and all of winter.
106
MARKET DEMAND MARKET
CONFIDENTIAL DRAFT
MARKET DEMAND – Sporting Events
107 CONFIDENTIAL Summary of Sporting Event Demand DRAFT
• Existing sports facilities in South Tahoe include only two multipurpose fields and a combined softball/baseball diamond.
• Competition from Reno will be a challenge. The CVB has a productive working relationship with the hotels that surround the Reno-Sparks Convention Center/Atlantis Resort. Reno is able to offer over a package of 4,000 hotel rooms to large sports groups for around $120 per night. • Regional volleyball and basketball competitions (50-60 team events needing 6+ basketball courts, 12+ volleyball courts) that take place in Reno have been looking at South Tahoe hotels as a place to stay; however, the drive is too long. They would like a space near the Lake for the events themselves. • Some larger (800 plus participant) martial arts events and volleyball events would consider a new South Tahoe venue. • Shuttling sporting event participants and attendees to and from an event facility could be considered. For larger events (800 – 1,200 participants, 2,000 – 4,000 spectators and needing 12+ basketball courts, 24+volleyball courts) a shuttle running every 20 minutes that holds 40-45 people would be ideal. For mid tier events (300 - 500 participants) a 20 person shuttle every
108 20-30 minutes would suffice.
MARKET DEMAND MARKET
CONFIDENTIAL Summary of Sporting Event Demand DRAFT • Degree of interest by sport (on a scale of 1-10, with 10 being the highest possible score): • Basketball: 7/10 - Would need 5 courts minimum to attract more than 300-
player events, 12 to get 800. Girls basketball is very popular in Northern CA. • Volleyball: 8/10 - Northern CA has a very large market for girls volleyball. • Wrestling: 2/10 • Martial Arts: 6/10 - Higher interest for 200-participant events, but might be too small. If 50,000 to 60,000 square feet were available, could increase odds of landing national events) • Weightlifting: 2/10 • Dance/Cheer: 5/10 - Larger regional events and national events for girls sports are always more interested in locations such as Disneyland. • Fixed or retractable seating for at least 2,000 would be necessary. Seating for up to 4,000 or 5,000 would be ideal and could be achieved by supplementing with temporary bleachers or temporary chairs. • To be fully effective as a large scale tournament sports venue, 50,000 square feet of usable space would be necessary to attract events. A 25,000 to 30,000 square
109 foot floor area could accommodate 5 to 7 basketball or volleyball courts. MARKET DEMAND MARKET CONFIDENTIAL DRAFT
ECONOMIC & FISCAL IMPACT ANALYSIS
110 CONFIDENTIAL Estimated Annual Direct Spending – DRAFT (Upon Stabilization of Operations in 2014 Dollars)
Auto Rental/ Other Industries Other Transit 5% Hotel Retail 2% 44% 8%
Entertainment 20%
Restaurant 21% Estimated Annual Direct Spending: Scenario 1: $22,096,000
Scenario 2: $25,682,200
ECONOMIC & ECONOMIC FISCAL IMPACT IMPACT FISCAL 111 CONFIDENTIAL IMPLAN Economic DRAFT Impact Multipliers Utilized
Industry Output Employment Earnings
Hotel 1.264 10.326 0.403 Restaurant 1.316 19.119 0.545 Entertainment 1.358 16.197 0.769 Retail 1.318 21.174 0.569 Auto Rental 1.386 17.987 1.048 Other Local Transit 1.386 17.987 1.048 Other Industries 1.283 14.284 0.297
Note: Employment multiplier is applied to direct spending divided by 1,000,000.
Source: Minnesota IMPLAN Group, 2014
ECONOMIC & ECONOMIC FISCAL IMPACT IMPACT FISCAL 112 CONFIDENTIAL Estimated Annual Economic Impacts DRAFT Upon Stabilization of Operations (in 2014 Dollars)
Scenario 1 Scenario 2
Number of Events 113 130 Event Days 175 221 Attendee Days 135,000 156,900 Out-of-Town Attendee Days 90,600 105,000 Room Nights 51,600 59,700 Total Direct Spending $22,096,000 $25,682,200 Total Output $28,821,300 $33,502,500 Personal Income $11,810,600 $13,738,900 Total Emnployment 332 386
Note: Future estimates reflect a stabilized year of operations (assumed to occur in Year 5) in 2014 dollars.
ECONOMIC & ECONOMIC IMPACT FISCAL 113 CONFIDENTIAL Summary of Fiscal (Tax) Impacts DRAFT
Incremental Incremental Current Tax Generated Tax Generated
Rate Scenario 1 Scenario 2
Sales Tax - Douglas County 7.10% $544,200 $634,800 Sales Tax - South Lake Tahoe (CA) 8.00% 408,800 476,500
Transient Occupancy Tax (TOT) - Douglas County 10.00% 575,200 665,100 Lodging License Fee - Douglas County 3.00% 172,500 199,500 (1) Transient Occupancy Tax (TOT) - South Lake Tahoe (CA) 10% - 12% 290,900 336,300 SLT Tourism Improvement District (TID) Nightly Assessment $3.00 46,400 53,700 Nevada Indirect Spending 7.10% 60,300 70,100 California Indirect Spending 8.00% 39,700 46,200 Total Direct & Indirect Taxes $2,138,000 $2,482,200 Total Direct & Indirect Taxes - Nevada $1,352,100 $1,569,500 Total Direct & Indirect Taxes - California $785,800 $912,700
(1) Rate varies between 10% and 12% based on whether or not hotels are defined as redevelopment properties or not. Note: Development scenario conditions assume a stabilized year of operations in 20014 dollars. The fo llo wing assumptio ns,ro vided by lo cal industry representatives, are used in preparing these estinates: Share o f direct spanding taking pace in Nevada: Hotel 70% Restaurant 70% Entertainment 50% Retail 50% Auto Rental 75% Other Local Transit 70%
Other Industries 70% ECONOMIC & ECONOMIC FISCAL IMPACT IMPACT FISCAL 90% o f Nevada ho tel sales take place in designated redevelo pment pro perties. 114