Victoria Community Center: Market Analysis and Feasibility Study February 2010

TABLE OF CONTENTS
Introduction CHAPTER 1: OVERVIEW OF THE COMMUNITY CENTER Facility Description Rental Spaces Photographs User Profiles Current Economic Impact Assumptions Current Impact 5 5 8 10 14 15 16 3

CHAPTER 2: OPPORTUNITIES ASSESSMENT Customer Reviews Comparison Profiles Fee Comparison Development Scenarios Forecasted Economic Impacts, Scenarios 1-3 Scenario Timing 18 20 27 30 31 35

CHAPTER 3: RECOMMENDATIONS Marketing Recommendations Rental Rate Recommendations Facility Improvement Cost Estimate 37 51 54

CHAPTER 4: FINAL IMPACT ANALYSIS

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Victoria Community Center: Market Analysis and Feasibility Study February 2010

INTRODUCTION
In June 2009, the City of Victoria, Texas, engaged Avalanche Consulting, Inc. to conduct a market analysis and feasibility study of Victoria’s Community Center. The study was sparked by the City’s desire to increase the Center’s economic impact on the area and better serve residents’ needs. Doing so will require facility upgrades and more targeted marketing activities. It is our goal to help the City identify what specific future investments will maximize the Center’s value to the area. As illustrated below, several steps are required to conduct the Study. The consulting team’s first step was to assess the current state of the Community Center. We toured the Center and discussed the facility’s strengths and challenges with Parks and Recreation Staff and the Parks Commission. Following the tour, we studied facility usage, revenue, and expenditures. Avalanche conducted an economic impact analysis of the Center based on current utilization rates. The results of this baseline assessment are presented in this Study, which comprises Chapter 1 of the Market Analysis and Feasibility Study. The team’s next step was to assess opportunities for improving the Center (Chapter 2) . Avalanche interviewed prior customers about their experiences. We also examined five benchmark community centers in Texas and contrasted their space, location, bookings, and fee structure against Victoria’s. Through discussions with the City and a meeting with BRW+ Architects, three future development scenarios were presented. In Scenario 1, the City would make necessary repairs to the Center, but would not change the function or facilities within the Center. In Scenario 2, the Arena would be demolished and, in its place, the City would construct 23,162 square feet of additional meeting space, including a large exhibit hall and six meeting rooms. In Scenario 3, the Arena would be demolished and replaced with an exhibit hall (Scenario 2) and the City constructs a standalone covered pavilion elsewhere on the property. Avalanche forecasted the estimated economic impact of each scenario and presented them in Chapter 2 of this Study. Chapter 3 presents recommendations related to marketing, rental rates, and improvements to the existing facilities. The chapter contains cost estimates for currently needed repairs as well as price per square foot for new construction. To conclude this Study, Chapter 4 provides an impact analysis on a fourth scenario that maintains the current Community Center and adds a new Exhibit Hall and a new Covered Pavilion on the Center’s grounds.

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Project Process

Assessment
Chapter 1: Overview of Current Center
   

Recommendations
Chapter 2: Opportunities Assessment Customer Reviews Competitor Profiles 3 Development Scenarios Forecasted Impact of Each Chapter 3: Recommendations Chapter 4: Expected Outcomes
 Final Economic

Facility Description  User Profiles  Rental Structure  Economic Impact

   

Physical Improvements Fee Structure Target Audiences Marketing

Impact of Selected Scenario

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CHAPTER 1: COMMUNITY CENTER OVERVIEW
FACILITY DESCRIPTION
The Victoria Community Center is a multi-faceted facility, with a variety of spaces capable of serving the diverse needs of the City of Victoria, Victoria County, and surrounding communities in the region. Located in Victoria, the Community Center is situated at the intersection of North Street and Ben Wilson Street, near Highway 87. The Center is owned and operated by the City of Victoria. The Center’s three main facilities, grounds, and other spaces are capable of hosting numerous events, including: banquets, dances, trade fairs, and livestock shows to name a few. The Center is the largest event space in Victoria, and both the Dome and Annex are booked well in advance for a majority of the year.

Rental Spaces
The following section provides a brief description of the property’s facilities. The Dome The 12,305 square foot, 1,200 standing capacity Dome is the Center’s largest and most updated indoor space. On an annual basis, the Dome hosts numerous events, including: trade shows, wrestling matches, festivals, dances, weddings, and car shows. The Dome is enclosed on all sides and offers adjustable lighting, a stage, commercial kitchen, green room, and full sound system. (See page 6, Figure 1 for a photo of the Dome’s interior.) The Annex The Annex offers an additional 7,279 square feet and a 500 average seating capacity. Smaller than the Dome, the Annex is equipped with four track-mounted dividers that allow the space to be divided into a maximum of four, 75-person average seating capacity rooms. Amenities in the Annex include adjustable lighting, a sound system, stage, and an attached loading dock and kitchen (Figures Victoria Community Center: Market Analysis and Feasibility Study February 2010 5

3 and 7). Also adjacent to the Annex is a large room capable of storing 400 long tables. The Annex frequently hosts wedding receptions, business meetings, benefits, dances, and arts and craft shows among others. The Annex appears outdated. It is not equipped to easily accommodate technologies such as LCD projectors for PowerPoint presentations, making hosting business meetings a challenge. Several customers commented on the aged color palette and surface appearance. Track-based room dividers appear bulky (Figure 1). Parks and Recreation Staff note that the Annex’s roof needs to be replaced. The Arena The 46,641 square foot, 1,625-seat Arena hosts 25-30 days of outdoor events each year, including the Victoria Livestock Show, Camper Clinic RV Show, the South Texas Farm and Ranch Show, and portions of other community events. Nonetheless, the facility lacks appropriate dirt surfacing to host most rodeo events. Other attributes limit the Arena’s use for non-livestock events. The long, narrow configuration and seating on only one side has been cited as a problem for spectators. Ventilation issues impact the Arena’s marketability during warm months of the year. Sound from the Arena can be heard from within the Dome, and the Arena lacks a separate entrance. The City’s ability to schedule simultaneous events is severely hindered, so the Arena is largely underutilized. The Grounds Area Alongside its facilities, the Center has a large and open grounds space capable of hosting carnivals, circuses, exhibits, and other outdoor needs. Approximately 500 grass area and 1,000 paved parking spaces are available for visitors (Figure 9). The lot has a limited number of RV spaces with the electrical hookups attached to the Arena’s outside wall. Other Spaces and Equipment Based on the site tour and discussions with personnel, storage space is a major issue. The Center lacks ample space to stow the hundreds of tables and chairs when they are not being used for an event. Figure 10 is an example of the server and electrical room, which is also used for storage. Around 30 percent of events require use of the Center’s kitchens. Both the Dome and Annex are accompanied by large kitchens.

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In addition, a concession stand with refrigerator, wash stations, microwave, and ice machine is located between the Dome and Annex. A $200 per day fee is charged to cover basic costs, and the City does not receive an up charge on food or drink sales. Garbage disposal has been problematic on event days. Due to the facility layout, rubbish from a Dome event must be carried around the perimeter of the building and through the Arena when there is an event taking place in the Annex. While the Dome and the Annex offer sound systems the equipment is dated (Figure 6). The current systems are not iPod accessible, which is a common request from event organizers. Surrounding Land Use The Center is surrounded by a sizable city sports complex that includes 12 youth ball fields, four adult softball fields, two soccer fields, municipal swimming pool, 15,000 square foot skate park, basketball and tennis courts. The Memorial High School campus is located across the street at 3002 East North Street. The High School will be transitioned into a middle school in 2011. Next door to the Center is an event hall managed and operated by the Jaycees. The Hall consists of a large room, kitchen and restrooms.

Rental Fees
The Victoria Community Center has a variable rental structure, with weekday and weekend events having different rates. Weekday rentals of the 12,305 square foot Dome are $750, while weekends are $900. The 7,279 square foot Annex rents for $550 on weekdays and $675 on weekends. Meanwhile the 46,641 square foot Arena rents for $450 regardless of the day and the Grounds for $450 as well. It is important to note, that unlike many other civic centers, Victoria does not charge additional fees for services such as set up and tear down of tables and chairs, use of audio and visual equipment, wireless internet access. Customers may engage the caterer of their choice, and the City does not charge a catering surcharge.

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Figure 1: Dome Interior Figure 2: Annex Ceiling

Figure 1: Annex Interior

Figure 2: Arena Ceiling

Figure 3: Arena Interior

Figure 4: Audio Equipment

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Figure 7: Dome Kitchen

Figure 8: Annex Loading Dock

Figure 9: Server and Electric Room

Figure 10: Annex Kitchen

Figure 11: Exterior Behind Arena

Figure 12: Pavilion

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USER PROFILES
As of the writing of this Study, the Victoria Community Center has booked 79 events in 2009, with many events running for numerous days. The largest categories of events have been private banquets and parties, public events and festivals, and conferences. Other common events include trade shows and livestock events. The vast majority of facility users are local groups and have hosted at the Center for many years. Although the Center has hosted sporting events such as wrestling matches in the past, in 2009 to date the only sporting event was automotive-related. The following two tables illustrate utilization of the Community Center by event type. The first table shows percentages for 2009, and the second table shows how utilization has varied over the past four years.

Percent of Events per Category (2009)
30.0%
24.4% 20.0% 23.1% 17.9%

11.5%
10.0% 9.0% 6.4% 3.8% 0.0% 3.8%

Source: City of Victoria

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Change in Facility Usage: 2006-2009
35% 30%

25%
20% 2006 2007 2008 2009

15%
10% 5% 0%

Source: City of Victoria

Private Private parties include banquets, weddings, private dances, and fundraisers. These types of events make up 24 percent of events hosted at the Center, the largest category and a significant source of repeat business. These events generally make use of the Dome, sometimes incorporating the Annex for additional space. Customers in this category are almost entirely local businesses and organizations, requiring enough space to accommodate their members, invitees, and the public in some circumstances. Public Event / Festival The Victoria Community Center hosts festivals and public events, roughly 23 percent of all events each year. The most common of these events are church festivals, but also include Czech Fest and the July 4th Concert and Fireworks Show. Public events and festivals are good opportunities to bring the community together, and Center offers the largest space in the region to host a diversity of activities, booths, eating areas, and visitors, with both outdoor and indoor options.

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Professional Professional events loosely include business meetings, educational sessions, seminars, and conferences, and make up 18 percent of events hosted at the in 2009. Examples of professional events include a Parenting Legal Clinic, the MidCoast Hurricane Conference hosted by the American Red Cross, and Parent Conferences. These events generally use the Dome for large speaking sessions and the Annex for breakaway smaller group meetings. Agricultural / Livestock Agricultural and livestock events in Victoria consist of a variety of horse, livestock, and dog shows, throughout the year. This category made up only 9 percent of events hosted at the Victoria Community Center in 2009. The largest event in this category in 2009 was the Victoria Livestock Show and Carnival, which ran from February 19 until March 1. The livestock show is hosted in the Arena. As mentioned earlier, design and dirt surface issues prohibit the use of the Arena by most rodeo events. Trade Show Trade shows make up roughly 12 percent of customers and generally occurring annually for many years. Frequent events include the Bridal Fair, Home Product Show, and Victoria Gem and Mineral Show. These trade shows and exhibits are almost all organized by local groups and cater to a local and regional audience. Youth Youth events are a relatively small category at the Victoria Community Center, including a broad range of events geared towards children and young people, including the New Wine Ministries Youth Camp, the Public Library’s Summer Reading Program Party, Head Start’s Family Celebration and a Career Fair. Alongside professional and sporting events, youth programming offers and opportunity to work with children on education, healthy living, and safety. This category also has a high potential for growth in Victoria. Entertainment Events in this category include concerts, comedy shows, and circuses. This category makes up the smallest percentage of hosted events at the Center in 2009 and has been in a steady decline over the past three years. The annual Shriner’s Circus has been a consistent event for many years. The

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dropoff in entertainment events can be attributed to the Country Opry, which stopped renting the Center for its annual show two years ago. Sports / Automotive Although they have hosted sporting events such as wrestling matches in the past, in 2009 the Victoria Community Center hosted no sporting events besides the equipment distribution for the Crossroads Youth Football League, and only two Automotive events, a Monster Truck Show and a Custom Car and Motorcycle show. Because of the infrequency of these events and increasing national interest in new sporting activities and continued interest in automotive, this category represents an area of high potential growth for the VCC.

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CURRENT ECONOMIC IMPACT
This economic impact analysis examines spending patterns and tax revenues brought into Victoria County by the Victoria Community Center (“the Center”). Out of county visitors generate the highest level of economic impact for community centers. Travel is considered an export industry because spending by tourists is a new injection of money into the local economy, generating revenue and jobs at other local venues. Visitors support the local economy with their shopping dollars, yet use virtually no city or county services, such as schools and local government. The key inputs into this analysis were based on a review of the Center’s current expenditures, revenues, and recent bookings. Avalanche met with City of Victoria officials and stakeholders to gain additional insight on the Center’s impact. The following is a basic conceptual formula for the Center’s impact as applied in this study: Annual Economic Center Impact = (Center Operations Spending x Multipliers) + (Total Visitor Spending x Multipliers) As shown in the above equation, the economic impact of the Center derives from two major sources: (1) annual expenditures by the Center on supplies, salaries, and services, and (2) annual-out-ofcounty visitor spending on lodging, food, beverages, local transportation, entertainment and other activities. The spending by both sources ripple through the local economy, boosting incomes and spending for many firms and households not directly associated with Center events. To estimate the effect the Center has on Victoria County, an input-output model was built using data on Victoria County. Input-output models are used to estimate multipliers that, when applied to direct spending, reveal the indirect impacts. A multiplier of 1.5, for example, indicates that for every $1 spent by the Center or its visitors, an additional $0.50 is generated in the local economy. In this analysis, direct effects are the sales, employment, and wages generated by operational and visitor dollars. Indirect impacts are generated by local businesses companies selling to the Center and its visitors (such as concession vendors) and the household spending resulting from an increase in wages (and jobs) at these local companies. Together, the direct and indirect effects capture a broad range of services in the local economy.

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Direct impacts are attributable to the Center’s operations, such as payroll and local purchases, as well as spending by out of county event attendees at local hotels, restaurants, and retail establishments. Indirect impacts are attributable to the additional demand for local goods and services generated by Center employees and out-of-county visitors to the Center due to their “ripple” effect in the economy. The impact assessment includes overnight and day visitors traveling to Victoria County to attend Center events. Excluded from the study are expenditures outside the Center from permanent residents of Victoria County. This off-site spending by locals does not represent new dollars into the local economy.

Inputs
For the purposes of this study, estimates were made based on current bookings and standard expenditures of tourists (as experienced at similar facilities elsewhere in Texas). Avalanche Consulting used conservative estimates of growth to formulate the following assumptions, and based the impact analysis on 2008 calendar year activity (most recent complete year of activity): The Center’s total revenue (rental income plus hotel/motel tax) and operating budget for the 2008 calendar year were $470,591. During the 2008 calendar year, the Center hosted 216 total events, including 84 public events and 132 private events. Of the 216 events hosted between January 1 and December 31, 2008, 171 attracted out-ofcounty visitors which spent new money in the county. Public and private events draw an estimated 6,467 out-of-county visitors to Victoria County each year, which translates to approximately 1,070 room-nights. The number of room night estimates includes 925 for 63 large public events plus an additional 145 associated with guests attending private parties. Events at the Center last from one to eleven days, with the average length being 1.4 days. Each out-of-county visitor who stays overnight spends an average of $90 per night on hotel accommodations and an additional $35 on retail, dining, and other miscellaneous expenditures.

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Each out-of-county visitor who does not spend the night in a hotel will spend approximately $35 per day of their stay. Total non-hotel expenditures by out-of-county visitors attending Community Center events are estimated to be $226,000 per year. Total hotel expenditures by out-of-county visitors attending Community Center events are approximately $96,000 per year.

Annual Economic Impact of Operations and Visitor Spending
The current economic impact of the Center’s operations is shown in the following table:
Baseline: Current Configuration
Annual Economic Impact Victoria Community Center Sales/Output Jobs (FTE's) Annual Wages

DIRECT IMPACTS: Facility Operations and Suppliers Current $471,000 Retail Spending by Visitors Current $226,000 Hotel Spending by Visitors Current INDIRECT IMPACTS Current

9

$182,000

5

$106,000

$96,000

2

$36,605

$375,800

12

$294,839

TOTAL ECONOMIC IMPACT
Current $1,168,800 28 $619,444

The Center generates an economic impact on the county of $1.16 million per year. 28 jobs are attributable to direct and indirect output generated by the Center’s expenditures and visitor spending. The Center and its visitors generate an estimated $619,400 in direct and indirect wages annually.

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The mix of events at the Center weighs heavily toward private parties hosted by area organizations and residents (61 percent of events), which cater primarily to a local audience but do attract a small percentage of out of town guests. Community Center customers that typically draw a higher percentage of out-of-county visitors, such as professional, trade, sports, youth-oriented, and entertainment events comprise less than 40 percent of total activity. Heavy local usage and a low operating budget attributes to the Center’s relatively small economic impact. (Avalanche Consulting, for example, conducted a similar analysis of the Brazos County Expo Complex in 2008, which revealed that the Complex generates a $12.9 million annual impact.)

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CHAPTER 2: OPPORTUNITIES ASSESSMENT
The purpose of this chapter is to explore the potential for improving or repurposing the Community Center in the future. It begins with recent customer comments about the strengths and weaknesses of the facility. Next, it highlights seven “competitor” convention / community centers in Texas, comparing them against the Victoria Community Center in terms of facility capacity and rental fee structure. The chapter concludes with an examination of two future usage scenarios, contrasting the projected economic impact of each option to aid the City’s decisions regarding investment in the Center.

CUSTOMER REVIEWS
Avalanche contacted over 20 customers of the Victoria Community Center and conducted interviews with 11 individuals. All customers contacted have been hosting events at the Center for over ten years and expressed positive reviews of their relationships with the facilities. The following section summarizes the most common responses from customers.

Facility Trends
 The Center is most frequently the chosen venue for events because it has the greatest guest capacity in the immediate region. Staff was commended for exceptional customer service. The flexibility of having three connected facility types is seen as a positive attribute because it allows for diverse programming during events. For example Czech Fest can have dining and dancing in the dome, displays and the beer and wine show in the Annex, and band member staging in the Arena. The convenient location is a major draw. Events that have vendors and booths appreciate the ample space in the Dome for set up.

 

 

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 

The venue grounds offer a nice alternative space for some events. The Center is booked for well over 200 days and evenings each year. Customers know to book early (one year in advance for many) in order to secure their preferred dates on the calendar.

Room for Improvement
 Although most events choose the Center due to its large capacity, eight of the eleven interviewees expressed a desire for more space in both the Annex and Dome. o Those seeking more Dome space were interested in additional dance floor and banquet spaces. Those seeking additional Annex space were interested in bigger training rooms.  Some customers expressed concern with the austere interiors and would like to see ‘warmer’ aesthetic. The lighting options could be improved, particularly by allowing for increased flexibility and control of the lighting, possibly from a podium set up for speaking events. The audio/visual equipment could be modernized. Professional event customers are interested in built-in screens for PowerPoint presentations, installed projectors, and improved sound systems and acoustics. Larger kitchen facilities would be helpful for some customers. Although smaller events had few problems, those that hosted over 1,000 guests would like additional and more convenient parking. Some customers expressed concern that rental fees might increase with improvements to the facility.

o

 

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COMPARISON PROFILES
A review of community and expo centers located in similar markets across Texas is helpful in understanding Victoria’s competitive position and opportunities for improvement. When identifying Victoria’s comparison facilities, Avalanche Consulting sought communities with similar (1) geographic positions to Victoria, (2) comparable distances from major cities and interstate highways, and (3) regional population base. The following facilities were identified and profiled below: Brazos County Expo Complex in Bryan-College Station, Taylor County Expo Center in Abilene, San Angelo Civic Events Facilities in San Angelo, Lufkin Convention Facilities in Lufkin, Longview Convention Complex in Longview, Nacogdoches County Expo Center in Nacogdoches, and the Wichita Falls Multipurpose Events Complex in Wichita Falls.

Brazos County Expo Complex
The Brazos County Expo Complex (BCEC) was recently expanded and now offers three modern facilities for a diverse range of activities. The complex is located in Bryan-College Station in East Texas off Highway 47. Similar to Victoria’s position between Houston, San Antonio, and Corpus Christi, Bryan-College Station is located roughly in a triangle between Houston, Austin, and Waco. Along with visitors from outside, the BCEC serves Brazos County’s population of 175,122 residents, roughly double Victoria County’s 86,755. Similarly the Bryan-College Station MSA has a population of 207,425 versus Victoria MSA’s population of 114,313. This is one of the larger communities examined in this competitor study, but the BCEC has had strong regional success and could potential offer significant lessons for Victoria. The BCEC consists of three primary facilities: the Arena, the Pavilion, and the Exhibit Hall. The 70,000 square feet 3,000-seat covered, open-air Arena hosts rodeos, livestock shows, equestrian competitions, and other outdoor events. The 60,000 square foot pavilion has space for numerous horse stalls, livestock pens, and cattle ties. The 50,000 square foot exhibit hall building contains 28,830 square feet of usable space for business meetings, conferences, trade shows, banquets, and other social events. Although the Arena is nearly twice as

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large as the Victoria Arena, the square footage to county population ratio of 0.4 is actually less than Victoria’s ratio of 0.5. The BCEC primarily hosts regional and local scale events, lacking the significant draw for national scale rodeo and other events. The facilities continue to primarily target livestock, rodeo and equestrian events for the Arena and Pavilion. The Exhibit hall is marketed to tradeshow, fair, and festival events. Local audience targets include Texas A&M University, residents, churches, non-profits organizations, school districts, and FFA/4-H Clubs. The BCEC offers a variety of rental options. For non-livestock events, the Arena’s rental rate is $1,500 for non-ticketed events and $2,500 or 10 percent of gross sales for ticketed events. The Exhibit Hall rents for $2,500 a day. The facility charges additional fees for services and every piece of equipment and furniture, including podiums, tables, chairs, and banners.

Taylor County Expo Center
The Taylor County Expo Center (TCEC) resides in the fourth largest competitor community, with 126,791 residents in Taylor County and 159,521 in the Abilene MSA. Although Taylor County is 50 percent larger than Victoria County, their respective MSAs are closer in size. Although Abilene is located relatively far from major metropolitan areas such as Dallas-Fort Worth, it is the only competitor community located directly on an Interstate Highway, I-20. Nonetheless, Abilene’s relatively remote location in Central Texas offers a comparable geographic situation to Victoria. The TCEC is an expansive development, consisting of over nine structures, including an Indoor Coliseum, Outdoor Arena, Entertainment Pavilion, three exhibit spaces, and two barns. The Exhibit space totals over 57,000 square feet including special event rooms. The 30,000 square foot Coliseum has 5,000 permanent seats, and the Outdoor Arena is roughly the same size (45,000 square feet and 2,000 permanent seats). Although the TCEC’s arena is similar in scale to Victoria’s, the ratio of arena square footage to county population is only 0.4 in Taylor County to 0.5 in Victoria. The TCEC facilities, particularly the barns, Coliseum, and Arena are primarily utilized for livestock, rodeo, and equestrian events. Although there are numerous private parties and events in the exhibit halls throughout the year, the majority of bookings are agriculture and animal-related events from Team Roping to Rodeos to a Goat Clinic. Many of these livestock and rodeo events are on a large scale, drawing farm and ranch shows with audiences from outside the county and even the state.

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The TCEC’s Coliseum rents for $2,500 a day plus utilities, while the 18,000 square foot Display Building costs $1,200 for private events and $1,400 for public events. Similarly, the Big Country Hall (8,000 square feet) has a rental rate of $900 for private events and $1,100 for public events. The smaller TCEC structures rent for $400 or less.

San Angelo Civic Events Facilities
Like Victoria, San Angelo is not located on an interstate highway and is more than two hours from a major metropolitan center. Tom Green County has a population of 107,864, and the San Angelo MSA has a population of 109,563. The City of San Angelo does not have a dedicated convention complex but numerous civic event facilities owned by the City and managed by the Civic Events Division, including the McNease Convention Center, City Auditorium, and Coliseum. The Convention Center has approximately 19,000 square feet of flexible exhibit space, including special event rooms, and the Auditorium offers 1,570 permanent seats of theater space for speakers, concerts, and other events. The Coliseum has 20,000 climate-controlled square feet and nearly 5,000 permanent seats. The ratio of coliseum square footage to county population is only 0.2, the lowest in this study, despite their hosting of a large rodeo. The Coliseum hosts the San Angelo Rodeo, one of the nation’s largest, and also can accommodate concerts, ice shows, circuses, arena football, trade shows, and numerous other events. The Convention Center has a flexible layout of space capable of hosting meetings, exhibits, trade shows, and banquets. At over 80 years old, the Auditorium is home to the San Angelo Symphony and Civic Ballet, as well as hosting frequent concerts and events, including past national attractions such as Alison Kraus and a young Elvis Presley. Despite the national scale of some events, most events hosted in the town are local users and frequently repeat users, such as the symphony with 7-8 performances a year and the stock show and rodeo with several annual events. The San Angelo Coliseum rents for $750 a day, while the McNease Convention Center has variable pricing: $2,500 for conventions, $2,250 for non-commercial fundraisers, and $2,000 for noncommercial non-fundraisers. The 12,000 square foot large meeting room in the Convention Center rents for $1,500. Additionally, city council policy offers rental incentives for users who repeat five or six times per year. The facility charges fees for equipment, furniture, and set-up services. Victoria Community Center: Market Analysis and Feasibility Study February 2010 22

Lufkin Convention Facilities
The George H Henderson Expo Center (GHEC), formerly the Angelina County Expo Center, is located in Lufkin (population 32,709) in Angelina County (population 82,038), making it one of the smaller competitor communities examined in this study. Lufkin is in East Texas at the intersection of Highways 69 and 59, northeast of Houston and southeast of Dallas-Fort Worth. The GHEC primarily consists of the Main Building, an indoor coliseum with 90,000 square feet and nearly 7,000 permanent seats. The covered outdoor pavilion has an additional 62,500 square feet but no permanent seating. Although the GHEC does not have an explicit exhibit hall, the main building contains and an 8,000 square foot glassed-in special events room. The large pavilion has a square footage to county population ratio of 0.8, nearly double Victoria’s ratio of 0.5. The GHEC hosts almost entirely livestock and rodeo events, with very few events on their 2009 schedule besides a Shriner Circus, a monster truck rally, several trade shows, and a youth fair. Regular events at the GHEC include roping, goat shows, rodeo, and livestock sales. Lufkin is also home to the Pitser Garrison Civic Center, the primary location for indoor events such as banquets and meetings. The facility includes a large main events room and numerous smaller meeting rooms. With 16,000 square feet, the large meeting room can seat 2,000 theater style or 1,400 banquet style. Modern amenities include webcasting capability, wireless internet, an LCD projector, and an advanced sound system. The 16,000 square foot Civic Center Main Event Room costs $860 for private events and $795 for non-profit events. Smaller meeting room rentals run from $100 to $470 depending on the size.

Longview Convention Complex
Longview Is one of the largest competitor communities examined, with an MSA population of 204,746. The city is located between Tyler, Texas, and Shreveport, Louisiana. It spans Gregg and Harrison Counties. Unlike other competitor communities, Longview is located on an interstate highway. The Longview Convention Complex includes three primary facilities: Maude Cobb Convention and Activity Center (40,000 square feet with a seating capacity of 3,000); an Exhibit Building (25,000 square feet with a seating capacity of 1,800); and a Rodeo Arena (27,000 square feet with a seating Victoria Community Center: Market Analysis and Feasibility Study February 2010 23

capacity of 5,000). These facilities are located on a 100-acre site near downtown and convenient to hotels and amenities. The rodeo arena has a square footage to county population ratio of 0.2. The facilities host a wide variety of events, including rodeos, business meetings, conferences, trade shows, dog shows, and festivals. Because of the metro size and location along the interstate, the complex plays host to a mixture of local, regional, and national events. The facilities have rental schedules that vary depending on use. The Convention Center costs between $1,200 and $2,000 for commercial uses and $400 for non-commercial. The Exhibit Hall costs between $725 and $1,100 for commercial uses and $450 for non-commercial. The largest Activity Room, at 650 square feet, rents for $50 commercial and $25 non-commercial. Additional equipment rental fees apply.

Nacogdoches County Expo Center
The Nacogdoches County Expo Center (NCEC) is located in the City of Nacogdoches in Nacogdoches County, which has a population of 62,768. Nacogdoches is situated in East Texas near the Louisiana border. It is not located on an interstate highway. The NCEC consists entirely of a 78,000 square foot covered open-air arena with 4,300 permanent seats. Although there is no explicit exhibit building, there is a small amount of office and exhibit space attached to the arena. Despite the size of the county, NCEC has the largest outdoor arena of any competitor communities, with a square footage to population ratio of 1.2. Despite the relatively removed location of Nacogdoches, the NCEC hosts a wide variety of events, primarily regional and local but with the occasional national draw. The facility is home to numerous livestock, rodeo, and equestrian shows. Unlike many competitors, the NCEC has a very flexible space capable of adapting to various needs, including carpeting the arena.

Recently, the NCEC has added a number of new events, including demolition derbies, motorcycle rallies, fairs, cage fights, boxing, and circuses. Although many users include local groups such as the Junior High, High School, Mexican Rodeo, and others, the facility sometimes can attract national names for concerts when their tour routing will take them through the region. They also host the National Buck and Bull Association. Because they are an open-air, non air conditioned facility, it is Victoria Community Center: Market Analysis and Feasibility Study February 2010 24

difficult for them to host gun shows and electronic shows or other trade shows that require overnight security. The Expo Center rents at a base level of $650 for the 78,000 square foot facility, but numerous additional fees apply for other services, including: $250 for use of the sky box, $150 for use of the barns, $250 for set-up, $250 for use of the stage, $250 for clean-up, $1 per ticket for ticketed events, and 10 percent of any merchandise sold. Some discounts are offered on a per case basis for nonprofits and schools.

Wichita Falls Multipurpose Events Complex
Wichita Falls Multipurpose Events Complex (MPEC) is located in Wichita Falls MSA (population 147,328) in Wichita County (population 127,321). The city is situated in North Texas along the Oklahoma Border. This community is the second largest competitor community examined in this study. Wichita Falls lies at the termination of Interstate 44, which runs northward to Oklahoma City. Similar to Victoria, Wichita Falls is not close to a major metro area. The MPEC is an expansive and well-developed set of facilities, including the J.S. Bridwell Ag Center, a 50,000 square foot livestock barn with usable floor space and arena seating for 1,200; the Key Yeager Coliseum, an indoor arena of 30,000 square feet with 6,500 permanent seats; the MPEC Events Center exhibit hall, totaling 57,141 square feet of usable floor space; and the Memorial Auditorium, a theater with 2,700 seats. The ratio of arena square footage to county population is 0.3, the second lowest among competitor communities examined in this study. Kay Yeager Coliseum is capable of hosting a wide variety of sporting events, including hockey, basketball, tennis, soccer as well as motorcycle and auto events, livestock shows, rodeos, and other equestrian and agricultural events. The facility is capable of being arranged for concerts, lectures, and conventions as well. On the other side, the Events Center hosts numerous meetings, banquets, seminars, trade shows, and other convention events. The Auditorium has a long tradition of hosting concerts and theater events from Duke Ellington to Garth Brooks to performances of Cats. The facilities primarily serve a broad regional audience from throughout North Texas and Southern Oklahoma.

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The Events Centers rooms rents at different rates, with the 19,000 square foot primary exhibit areas renting at $1,320. Smaller meeting rooms rent at $265 for 2,947 square feet and $315 for 3,588 square feet. The MPEC charges fees for specific furniture and equipment, including $20 per booth, $10 per table, and numerous fees for microphones, projectors, and other electronics.

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Comparison of Texas Event Centers
Special Event Room(s) Open Air Event Space Ratio of Arena SF to County Population Assembly Building (permanent seats) Indoor Colliseum (permanent seats) Assembly Building Convention Space Outdoor Covered Pavilion Indoor Colliseum Second Pavillion Outdoor Arena

Victoria Community Center Lufkin Convention Facilities Longview Convention Complex Wichita Falls GPEC Taylor County Expo Complex Brazos County Expo Complex San Angelo McNease Convention Center

7,279 SF 16,000 SF 40,000 SF 57,141 SF 57,000 SF 28,828 SF 19,000 SF

yes yes yes yes yes no yes

no no no yes no no yes

no no no 2,700 seats no no 1,570 seats

12,305 SF 90,000 SF no 30,000 SF 30,000 SF no 20,000 SF

no 6,950 seats no 6,500 seats 5,000 seats no 4,898 seats

46,641 SF 62,500 SF 27,000 SF 32,400 SF 45,000 SF 70,000 SF no

1,625 seats no 5,000 seats 1,200 seats 2,000 seats 3,000 seats no

0.5 0.8 0.2 0.3 0.4 0.4 0.2

no no n/a no yes yes yes

yes n/a yes n/a n/a yes no

n/a n/a n/a n/a n/a 32 n/a

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RV Hook Ups

Rental Fee Comparison
Although the Victoria Community Center has lower rental base rates than some of its competitors, they are comparable to others on a square footage basis. However, most competitor event centers charge numerous fees that significantly raise the costs per square foot. Because these fees and different facility sizes cause significant variation in the actual rates, Avalanche Consulting assessed the rate at each facility for a standard speaking event, incorporating appropriate fees for furniture, equipment, and set-up. These rates were then divided by the utilized square footage to give a comparable variable for Victoria and competitors. The resulting variable reveals that competitor locations rent convention space for between roughly $0.064 and $0.132 per square foot. At $0.067 per square foot, Victoria is just above the least expensive competitor, Lufkin’s Pitser Garrison Civic Center with $0.064 per square foot. This variable is highly flexible, however, because fees at other facilities can be greater or lower depending on the amenities utilized and the type of event. Additionally, actual useable space does not always match total listed facility size. Nonetheless, Victoria charges rates nearly half of its most expensive competitor, the San Angelo McNease Convention Center. Part of the reason for higher rates at competitor facilities such as the Brazos and Taylor County Expo Centers is more up-to-date structures and equipment.

Convention Center Rental Rate per Square Foot (2009)
Lufkin Pister Garrison Civic Center Victoria Community Center Longview Convention Complex Wichita Falls MPEC Taylor County Expo Center Brazos County Expo Complex San Angelo McNease Convention Center

$0.064
$0.067 $0.073 $0.088

$0.095
$0.095 $0.132

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Comparison Texas Event Center Fee Schedules
Convention Space Base Rate Dance Floor Fees
No n/a n/a Yes n/a Yes n/a
Ticket Surcharge A/V Equipment Rental

Furniture Fees

Utility Fees

Stage Fees

Victoria Community Center Lufkin Convention Facilities Longview Convention Complex Wichita Falls MPEC Taylor County Expo Center Brazos County Expo Complex San Angelo McNease Convention Center

$825 $1020 $1320 $2000 $2500 $2500 $2500

n/a Yes Yes Yes Yes Yes Yes

No No No Yes Yes Yes Yes

No n/a n/a Yes No Yes Yes

No n/a n/a Yes n/a Yes n/a

No Yes n/a Yes n/a Yes No

Yes n/a n/a Yes Yes Yes n/a

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DEVELOPMENT SCENARIOS
The City of Victoria is evaluating the Community Center’s long-range potential. Capacity, functionality, age, and appearance of the facility are of concern. The following section aims to assist the City in determining if and how to invest in the Center’s future. To conduct this analysis, Avalanche Consulting created three development scenarios. Each scenario represents a different direction that the City could take with regard to investing in the Center. Scenario 1: This scenario represents the baseline situation plus an additional exhibit hall and meeting facility. It projects that the City will sustain the space as it is currently while adding an exhibit hall building elsewhere on the property making needed equipment and facility repairs to keep the Center operational. Scenario 2: This scenario responds to the question of whether the Community Center can fill a larger role as a regional events center. It estimates the impact of removing the Arena and constructing a large exhibit hall and meeting rooms in its place. Scenario 3: This scenario expands the Community Center’s role as a regional events center and provides a space for covered outdoor events. In this situation, the Arena will be replaced with a large exhibit hall (Scenario 2) and a covered pavilion building will be constructed elsewhere on the property. A more detailed description of each scenario, including an economic impact and rough cost estimate, is provided below. It concludes with a side-by-side comparison of forecasted 10-year impacts of each scenario. Please keep in mind that these are concepts developed to begin the exploration of future investments in the Community Center. This is a long-term view, as some scenarios will take a decade or longer to come to fruition. Once the City determines which of the three scenarios it wants to pursue, a master site plan will be needed.

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Scenario 1: Current Configuration Plus Exhibit Hall Building
The first scenario represents the Center’s current configuration plus the addition of an exhibit hall building elsewhere on the property. The Dome, Annex, and Arena floor plans remain the same, as does event capacity. In addition, the Center would add an indoor events building, that has capacity to be broken into multiple smaller break out meeting rooms. The events building will be constructed in year 3 and economic benefits will be generated starting in year 4. The annual economic impact of this scenario is estimated to be:
Scenario 1: Current Configuration + New Exhibit Hall
Annual Economic Impact Victoria Community Center Sales/Output Jobs (FTE's) Annual Wages

DIRECT IMPACTS: Facility Operations and Suppliers Current $ 560,692 Retail Spending by Visitors Current $ Hotel Spending by Visitors Current $ INDIRECT IMPACTS Current

11

$

216,371

491,478

10

$

229,668

309,052

7

$

165,039

$

707,835

20

$

293,317

TOTAL ECONOMIC IMPACT
Current $ 2,069,057 40 $ 904,395

The total annual impact of the expanded Community Center Complex would be $2.07 million per year. Approximately 40 full time jobs and $900,000 million in annual wages would result from direct and indirect impacts. This scenario is based on the following inputs:
 

Rental activity and profile in the Dome, Annex, and Arena remain the same. The new event building rents for $1200 per day. An additional $200 per day rental fee is charged for the new building’s concession stand, and another $150 per day fee is charged for

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security.

Calculations are based on the new event building hosts 20 2-day events per year and 20 1day events per year. Ten of these events would also rent the Dome, Annex, and Dome kitchen. The other events are stand-alone and allow for separate rental activity in the rest of the Community Center complex. * Based on current requests staff feels this number is extremely conservative and would be twice the total number of days proposed for calculations with the possibility of additional days with the help of the newly formed CVB.

Please note that in addition to constructing a new events building on site, the City will need to investment in maintenance, equipment upgrades, and expansion of storage space in the existing building. These improvements will have no effect on the Center’s current economic impact, although not making needed repairs would affect demand for the Center in future years. The original concept of the new event building includes 23,162 square feet of additional rentable space. A 7,528 main exhibit / banquet hall is accompanied by two 3,982 square foot meeting rooms and four 1,925 square foot break out rooms. All walls will be movable to allow for multiple configurations, including one single 23,162 square foot room. This configuration is based on the footprint of the current Arena so that an impact comparison can be made with Scenario 2, in which the new events building replaces the Arena. Considerations

This scenario allows all current users to continue renting the Center, while providing room to expand events or recruit larger-scale functions to Victoria. Design of the new events building should integrate into the current layout. Ideally, the two buildings will be connected via a covered walkway. The specific location of the new events building is yet to be determined. The City should consider how the new building will affect parking capacity. First, will the new events building be located on top of existing parking spaces? Second, how much additional parking capacity will be needed to accommodate increased visitor traffic? As with all three scenarios, the Center’s economic impact will improve if the percentage of Center usage by out-of-county events and visitors increases. A concerted marketing effort will help. Increased rental fees could decrease local customers and open the calendar for external events (which often negotiate a discounted rate anyway, knowing that their attendees bring additional dollars into the community). The (future) opening of event space elsewhere in the community could absorb private events, again increasing opportunity to fill

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dates with out-of-county functions.

The specific size and configuration of the new events building will depend on a number of factors, and does not necessarily have to match the square footage estimated for this Study. The approximate cost of constructing the new Exhibit Hall and Meeting Space is presented in Chapter 3 of this report.

Scenario 2: Replace Arena with New Exhibit Hall
Under Scenario 2, the Community Center is expanded by removing the Arena and replacing it with a new Exhibit Hall and Meeting Space (the building described in Scenario 1). This scenario aims address local demand for additional indoor event capacity and has potential to accommodate larger out-of-county events that might utilize the Dome, Annex, and new events space simultaneously. As with Scenario 1, this scenario would happen no earlier than 3-5 years from now. In addition, Avalanche assumes Victoria adds 20 overnight and 20 one-day events per year with 30 percent or more attendees visiting from out of the county. The economic impact of the Center’s operations after construction is completed (likely 4 years from now) is shown in the following table:
Scenario 2: Replace Arena with New Exhibit Hall
Annual Economic Impact Victoria Community Center Sales/Output Jobs (FTE's) Annual Wages

DIRECT IMPACTS: Facility Operations and Suppliers Current $ 502,000 Retail Spending by Visitors Current $ 442,330 Hotel Spending by Visitors Current $ 305,902 INDIRECT IMPACTS Current

10

$

193,722

9

$

206,701

7

$

155,809

$

650,121

11

$

266,991

TOTAL ECONOMIC IMPACT
Current $ 1,900,353 37 $ 823,224

Under scenario 2, the Center would generate an economic impact on the county of $1.9 million per year.

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37 jobs would be attributable to direct and indirect output generated by the Center’s expenditures and visitor spending. The Center and its visitors would generate an estimated $823,000 in direct and indirect wages annually following the construction of the new event space.

Considerations

The replacement of the Arena with additional meeting space means that 2-3 annual public events would entirely move to another location. These include the Wild Horse Auction and possibly the Victoria Livestock Show and the Shriners’ Circus. This loss of revenue is considered in the above impact estimate. Several functions currently hosted in the Arena, including the Kennel Club Dog Match, South Texas Farm and Ranch Show, the Czech Fest, and the Outdoors Expo can be accommodated in the new convention space. The loss of Arena events results in a lower economic impact than Scenario 1 in which the new Exhibit Hall is located elsewhere on the Community Center property. The Center’s location and lack of nearby hotels and restaurants is a serious constraint on recruiting out of town conferences, even if meeting space capacity is significantly increased. Victoria Independent School District is currently considering the construction of a 1,500 seat performing arts center. The ISD currently rents the Center for student and faculty events, including elementary and GED graduation ceremonies. A private developer is currently evaluating the possibility of constructing a 5,000 square foot capacity event center in another part of town.

Scenario 3: New Exhibit Hall Plus Covered Outdoor Pavilion
As with Scenario 2, in Scenario 3 the Community Center’s Arena is replaced with a new Exhibit Hall and Meeting Space. In addition, however, the City also constructs a Covered Pavilion elsewhere on the property. The Pavilion can accommodate the events that would be lost without the Arena, such as the Livestock Show, while being flexible enough to host a wide range of other activities (live music, festivals, market days, school functions, sports tournament support, and others to name a few). The open sided Covered Pavilion would have a concrete floor and metal roof. Concession facilities and restrooms will need to adjoin the Pavilion to maximize utilization. It is assumed that the Pavilion would host 40 events per year, including 10 two-day, and 30 one-day functions. The rental rate will

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average $800 per day. The economic impact of the Center’s operations after construction of the open air pavilion is completed (estimated to occur in Year 3) is shown in the following table:
Scenario 3: Covered Pavilion + Replace Arena with Exhibit Hall
Annual Economic Impact Victoria Community Center Sales/Output Jobs (FTE's) Annual Wages

DIRECT IMPACTS: Facility Operations and Suppliers Current $ 549,942 Retail Spending by Visitors Current $ 948,575 Hotel Spending by Visitors Current $ 456,554 INDIRECT IMPACTS Current

11

$

212,223

19

$

443,269

10

$

235,759

$ 1,016,637

18

$

427,800

TOTAL ECONOMIC IMPACT
Current $ 2,971,708 58 $ 1,319,051

Under Scenario 3, the Center has potential to generate its largest annual economic impact on the county: $2.9 million per year, well more than double current conditions. Approximately 58 jobs would be attributable to direct and indirect output generated by the Center’s expenditures and visitor spending. The Center and its visitors would generate an estimated $1.4 million in direct and indirect wages annually. The estimated cost of the complete project is provided in Chapter 3.

Scenario Timing
The above economic impacts reflect the year in which the new configuration is complete. Since construction will take time, and for some years lower revenues can be expected due to part of the center being unavailable, Avalanche provides a 10-year timeline of expected impacts for each scenario.

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10-Year Economic Impact: Baseline and Scenarios 1-3
Victoria Community Center Scenario 1: Current + Exhibit Hall Scenario 2: Replace Arena with Exhibit Hall Scenario 3: Scenario 2 Configuration Plus Covered Pavilion

Baseline

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 10-Year Total

$ $ $ $ $ $ $ $ $ $ $

1,168,800 1,168,800 1,168,800 1,168,800 1,168,800 1,168,800 1,168,800 1,168,800 1,168,800 1,168,800 11,688,000

$ $ $ $ $ $ $ $ $ $ $

1,168,800 1,168,800 2,069,057 2,069,057 2,069,057 2,069,057 2,069,057 2,069,057 2,069,057 2,069,057 18,890,060

$ $ $ $ $ $ $ $ $ $ $

1,168,800 1,168,800 1,051,920 1,900,353 1,900,353 1,900,353 1,900,353 1,900,353 1,900,353 1,900,353 16,691,991

$ $ $ $ $ $ $ $ $ $ $

1,168,800 1,168,800 1,051,920 2,971,708 2,971,708 2,971,708 2,971,708 2,971,708 2,971,708 2,971,708 24,191,475

For Scenarios 2 and 3, a decrease in impact is projected in year 3 as two events (the Livestock Show and Wild Horse Auction) are lost when the Arena is demolished and the new Exhibit Hall and Pavilion are under construction. Scenario 3 is projected to produce the highest economic impact for the City of Victoria. Note: All dollar estimates are in “current dollars” and are not adjusted for inflation to keep dollars comparable from future years equal to the current year.

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CHAPTER 3: RECOMMENDATIONS
The purpose of this chapter is to provide recommendations related to improving and enhancing the impact of the Victoria Community Center. Recommendations emerge from the analysis presented in the first two chapters of this Study. It begins with a discussion about marketing the current facility to external audiences. Travel trends, target audiences, and communication strategies are described. Next, this chapter explores potential for increasing the Center’s rental revenue through rate increases and changes to fee structure. The chapter concludes with an evaluation of the physical infrastructure improvements needed to expand the Center’s meeting and event capacity.

MARKETING RECOMMENDATIONS
Before new facilities are constructed, the City can increase rental revenue and the economic impact of the Community Center by marketing to audiences located outside of Victoria. A higher number of out of town guests will result in a higher impact. The following section provides an overview of tourism trends and recommendations for promoting the Center.

Travel and Tourism Trends

The tourism industry has experienced significant decline in 2008 and 2009. As of October 2009, U.S. year to date job losses in accommodations exceeded 7 percent. Recreational jobs were down by 4 percent, and air transportation by nearly 5 percent. In addition, RevPAR (revenue per available room) for Texas and its neighboring states was down 18 percent between October 2008 and October 2009. (source: U.S. Travel Association) People are taking shorter vacations and traveling by car. Auto travel is leading tourism trends. In addition, travelers are cutting back on the number of overnight stays, and in turn seek destinations which offer a lot to do in a short amount of time. Weekend travel is increasing in popularity. The number of vacations lasting one week or longer is diminishing. More than 50 percent of American adults take at least one weekend trip each year, and 30 percent take five or more weekend trips. Many weekend trips are planned less than two weeks before travel. Cities and small towns are top weekend destinations (30 percent), followed by beaches (16 percent), mountains (10 percent), lakes (4 percent) and amusement parks (3 percent).

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Fairs and festivals are popular travel destinations. Each year, around 40 percent of adult travelers (59 million) attended at least one fair or festival. Around one-half of these individuals visited an ethnic, heritage, or folk festival, and two-thirds attended a state/county fair or arts and crafts festival. Outdoor recreation, such as visiting a state or national park, was cited by 25 percent of American adults as a travel destination. Of these, 75 percent traveled via car to the destination and around 20 percent camped in a tent or recreational vehicle. Shopping is the most popular leisure travel activity for American adult travelers. Although it may not be the primary purpose of the trip, more than 60 percent of tourists shop during a vacation. Around 50 percent of these individuals stay in a hotel or motel, and 50 percent stay with friends or family. Enclosed shopping centers and malls comprise about 60 percent of tourist shopping experiences. Sports events are a destination for around 40 percent of all travelers. Baseball and softball top the list of tourist attended events (17 percent of all American travelers), followed by football (15 percent), basketball (9 percent) and auto / truck racing (8 percent). Youth sporting events are a special area of opportunity. Communities that can accommodate regional tournaments will benefit from visitor traffic and increased brand awareness that these functions generate. Cultural activities are popular, with 75 percent of travelers attending a cultural activity during their vacation. Baby Boomers account for the largest volume of travel in the country, while individuals over 55 years old take the longest duration vacations. According to the Travel Industry Association, relatives and friends are the top source of recommendations about travel destinations as well as hotels, flights, and rental cars. Travel agents, travel companies, and community tourism offices also rank highly. This includes direct communication with these organizations as well as visits to their websites. More than 50 percent of American adults rely on travel media, such as TV, travel shows, online newsletters, and newspapers, to plan their vacations. When asked which information source is the most helpful to them, 25 percent cited websites, followed by newspaper travel sections and television travel shows. One-third said that something they saw or read in travel media determined their tourism destination.

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Today, the Internet is the dominate travel resource. More than 70 percent of travelers visited websites to plan at least one aspect of their trip, and 80 percent of these individuals used the Web to book all reservations, including flights, hotels, and rental cars.

What Trends Mean for Victoria Community Center Marketing
The trends described above are positive news for Victoria. They indicate that community centers are likely vacation destinations because they host the fairs, festivals, cultural, and sporting events that are attended by the more than 40 percent of American tourists. For the more than 50 percent of Texans taking at least one weekend trip per year, Victoria is a good option. It is located within a region that is underserved by events facilities, and the area offers a combination of amenities, historic sites, and shopping that can entertain visitors for an entire weekend. A large portion of weekend tourists book trips less than two weeks in advance, with most utilizing the Internet to plan itineraries. In response, the Community Center’s website could be redeveloped as a marketing tool. Other travel media, such as television, newspaper, and newsletter segments, also influence tourist choices. For Victoria, informing regional travel media about upcoming events will increase exposure and further the chance that tourists will choose to visit the Community Center. As noted in previous chapters, the biggest challenge in recruiting regional events is the lack of hotel infrastructure in close proximity to the Center. Expanding the number of RV spaces on the grounds is one part of the solution. The City will need to closely coordinate with the CVB and area hoteliers to package overnight stays in a way that makes it easy for event goers to navigate between accommodations and the Center. Long-term, the City should consider placing directional signage on roadways between the retail/hotel section of town and the Community Center.

External Target Audiences
The Community Center’s “target audiences” are individuals and organizations that are the primary focus of promotional activities. The more customized the marketing campaign is for specific audiences, the greater the return on investment. ‘Targeting’ is the process of narrowly defining audiences and tailoring the campaign to suit. This process requires in-depth understanding of audiences, their preferences, and the trends affecting them. It impacts all aspects of a marketing campaign, from the sales message to the methods used to reach each audience. The audiences recommended for the Community Center were selected because they meet two primary criteria: #1: They have a high probability of demanding and utilizing the Center’s facilities.

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#2: Their use of the facility results in a long-term benefit to the local economy. The universe of potential audiences is great. On the largest scale, it includes any individual or organization that hosts events in a covered event space and/or rodeo arena. This would include private parties, business functions, trade shows, festivals, craft and food events, faith based functions, concerts, sports competitions, and livestock shows and rodeos, to name a few. The Community Center’s capacity and current infrastructure, however, is a limiting factor. Outdated facilities and shortage of space limits the breadth of private parties, business functions, and trade shows that can be hosted at the Center. The Arena’s configuration and flooring surface restricts rodeo and concert activity. Rodeo and livestock centers located in nearby Gonzales, Cuero, and Bee County are better equipped to serve larger organizations, reducing Victoria’s viability. After taking larger scale state and national events from the pool of possible target audiences, Avalanche Consulting recommends that the City concentrate marketing of the current facility on the following three external targets:
  

Regional sports tournaments Tradeshows, fairs, and festivals Faith-based events

REGIONAL SPORTS TOURNAMENTS While tourism trends have been down in 2008 and 2009, sports events remain a destination for around 40 percent Regional Sports League Targets: of all travelers, or around 75.3 million U.S. adults. Baseball and softball top the list of tourist attended  Youth baseball events (17 percent of all American travelers), followed by  Youth softball  Adult softball football (15 percent), basketball (9 percent) and auto /  Soccer (long-term) truck racing (8 percent). Youth sports tournaments are a special area of opportunity, and communities that can accommodate regional events from visitor traffic and increased brand awareness that these functions generate. The Victoria Community Center is well positioned to host regional youth sports tournaments that utilize the surrounding sports complex as well as Center facilities. Registration, awards ceremonies, clinics and merchandise sales may be housed in the Center. Based on a similar study conducted by Avalanche Consulting for a sports complex in Williamson County, Avalanche estimates that Victoria could conservatively attract six 2-day tournaments and six 1-day tournaments each year. These tournaments would bring thousands of visiting players and family

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members to Victoria who would spend money on local hotels, retail, and concessions at the tournaments. Marketing collateral targeted at tournaments must package the Center as an added benefit of the sports complex. Help organizers imagine potential of incorporating the Center’s indoor space into overall event organization by providing examples of how they may utilize the Dome, Annex, and kitchen facilities. TRADESHOWS, FAIRS, AND FESTIVALS This audience group represented a variety of interests, from arts and crafts, to sporting goods, job fairs, and rallies, to name a few. No matter the subject, all event planners share the same goal: that their functions are seamlessly operated and well attended. Two main selling points should be addressed when communicating with this audience: 1. The Victoria Community Center is the region’s top choice for tradeshows, fairs, and festivals because it can accommodate a variety of audiences and facility needs. 2. The Victoria Community Center is the region’s top choice for tradeshows fairs and festivals because the Center’s staff will go out of their way to ensure your event is executed without a hitch from beginning to end.
Tradeshow, Fair, and Festival Targets:             Arts and crafts shows Cook-offs Biker rallies County Fair Bridal shows Home and garden RV, camping, and boating shows Sporting goods Classic car shows Antique shows Job fairs Music concerts

When developing collateral materials for this audience, using a casual theme stays true to the Center’s modest amenities and expresses that Victoria is not a big-city events location. FAITH BASED EVENTS The Victoria Community Center already hosts a number of local religiously-affiliated events each year, including church festivals, gospel music concerts, and family expos. There is an opportunity to extend marketing to faith based organizations located within a 1-2 hour driving distance of Victoria, and even organizations whose ministries travel across Texas.

Faith Based Event Targets:     Meetings and assemblies Musical concerts Retreats Leadership conferences Family festivals Education and certification events

 

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According to the World Religious Travel Association, religious travel and hospitality is an $18billion global industry with 300 million travelers. Of this, the U.S. market is estimated to comprise $10 billion. A recent Travel Industry Association of America reported that 25 percent of travelers today are interested in “spiritual vacations.” A large component of the U.S. religious travel market includes conventions and conferences. The Religious Conference Management Association calculates that nearly 15 million people attend more than 17,000 religious meetings each year. Within the U.S., residents of the West South Central region (Arkansas, Louisiana, Oklahoma and Texas) reported the highest religious event attendance while traveling (37 percent). Organizers of faith based events seek facilities that can accommodate a number of different functions, including hands-on learning, music, large group assembly, and recreational activities such as sports and dining. As with the other audiences, Victoria’s primary selling point will be its venue size, flexibility, and regional hub location. As external demand for the Center increases so will requests for additional event space. The property surrounding the Center allows ample room for expansion. As recommended in earlier chapters, and as agreed to by the Parks Commission, the City wishes to add new facilities to the property within the next 10-15 years. Improvements under consideration include constructing an events/meeting building that provides more than 20,000 square feet of additional indoor space as well as building a 40,000 square foot (estimated) covered pavilion with a concrete floor that can accommodate a variety of other functions. (In combination with an enhanced marketing initiative, the new meeting building and covered pavilion would double the Center’s economic impact.)

Marketing Recommendations
The following section contains recommendations for improving how the Community Center is marketed. Recommendations focus on what can be done now to boost the proportion of events hosted at the Center by external target audiences and thus increase the Center’s economic impact. It is followed by budget estimates and metrics to help the City measure its progress.

Goal: To maximize visitor spending and economic impact generated by the Victoria Community Center
Tourism is an export-oriented business for Victoria. Visitors spend money at hotels, restaurants, retailers, and other local businesses. Those sales result in new spending by local businesses and their employees, generating jobs and wages. Taxes collected on visitor spending contribute funding for community improvements, promotion, and public assets like the Community Center. The goal of marketing the Victoria Community Center is to draw visitors into the city of Victoria, whose expenditures not only afford the Center’s operations but also results in direct and indirect

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benefits to the local economy. Proactive marketing of the Community Center is a critical step in accomplishing this goal. In the next three years, building awareness of the Community Center’s name in the larger region should be the primary objective of marketing. Recommendations offered in this Study aim to increase name recognition among the Center’s external target audiences so that it becomes top-ofmind when these groups consider locations for future events. To begin, the City must develop tools to promote the Center and proactively pursue prospects. Next, launch a direct sales initiative to inform audiences about the Center. Reinforce name awareness through a targeted direct mail campaign. Finally, ensure that customers coming from outside of the City continue to have a positive perception of the Center. Word-of-mouth promotion is the strongest form of marketing and happens when customers have a great experience at the Center. Reward customers for choosing Victoria by providing outstanding customer service from initial contact through the event and follow up. Recommendation 1: Develop tools to support marketing and information needs. Set the Community Center apart from its competition by conveying a sophisticated, highly professional image in everything it does. The City will need to improve its Web presence and appearance as well as produce new coordinated printed materials. Ensure that all marketing materials share the same graphical appearance. Avalanche Consulting suggests developing the following marketing materials in 2010 to support the campaign:

A marketing website is the primary requirement for campaign. It is a “must.” While the City’s website contains good information about the Community Center, the link is buried within the Parks and Recreation section of the website. The City has an opportunity to stand out from the competition by creating a quality, standalone marketing website for the Center and the surrounding sports complex. Take the following into consideration when creating this site: o Technically, the marketing website can still be housed within the architecture of the City’s website. Purchase a separate URL that is memorable and brands the Center (e.g., www.VictoriaTXCommunityCenter.com). The URL can either link directly back to the Community Center section of the City’s website or to a new marketing website created to support this campaign. Use this URL in all marketing activities. Ensure that the Center’s website always contains a current calendar of events. Allow users to submit reservation requests online and view available calendar dates.

o o

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o

o

o

Provide information specific to each of the City’s three external audiences. Consider creating a separate webpage for each audience, describing the facility’s assets in terms that will appeal to their particular market. Include links to other tourism assets in the region such as shopping and cultural activities, to assure visitors that they will find a full weekend’s worth of entertainment in and around Victoria. Ask other Victoria travel organizations, such as hotels, the CVB, and other attractions, to include a link to the Community Center on their websites.

The website’s design should inspire the design of printed collateral materials. Avalanche believes that the appearance of Community Center materials is key factor in the success of the marketing campaign. It must be improved. The text box to the right lists model community and expo center websites that can serve as references.

Model Community/Expo Center Websites www.brazoscountyexpo.com www.theciviccenter.com www.humbleecc.com www.aransaspassciviccenter.com www.thelonestar.org

A pocket folder to house marketing and public relations materials. Folder content can be customized depending on the audience by changing out the inserts. This can be as simple as designing a stylized sticker to adhere the outside of an off-the-shelf pocket folder or as elaborate as designing and printing custom, full-color folders. One sheet “slicks” for customizing handouts in-house. These are useful for sharing information that quickly outdates, such as press releases, lists of upcoming events, or event agendas. The slick will have a pre-printed border that coordinates with other collateral materials. The Center may generate its own content, and print to the slick using its own inhouse printers. Postcards for use in a direct mail campaign. Develop postcards for mailings to each target audience group. Postcards should share a theme, each featuring a distinct sales point. Improved marketing brochure(s) to provide to prospects. The City may create one brochure providing an overview o the Center and short blurbs aimed at each target audience, or the City may opt to develop a separate brochure for each audience (sports leagues, fair/festival organizers, and faith based event organizers). Use the direct mail postcards as a palette for the brochure design and copywriting.

Recommendation 2: Populate a contact database and keep it updated.

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The City needs a comprehensive, updated contact database of its external target audiences for distributing its direct mail postcards and other communications activities. This will require legwork on behalf of the Center’s staff, but is a critical component of any external marketing initiatives. Most contact information can be found by searching the Internet for association websites, and then pulling member information. Contact lists are also available for purchase through various association directories. The database should contain names, mailing addresses, phone numbers, and email addresses (if possible), for the following:
    

Regional and state baseball and softball leagues Professional event planners, fair and festival organizers Major employers located in the region Faith based organizations located in the region and religious associations State religious associations

Recommendation 3: Launch a concentrated direct mail campaign. Direct mail is the delivery of unsolicited advertising through postal mail or e-mail. Although traditional, it has the potential to yield good results if properly executed. For the Community Center, a direct mail campaign is a good kick-off for external promotions. Begin by selecting a theme that will carry throughout all direct mail pieces. The primary reason for the campaign is to let audiences know that the City of Victoria welcomes them and has the capacity for hosting a variety of functions. The theme should convey its primary marketing message, for example: The Victoria Community Center is a premier events facility in South Texas. Engage a designer to create direct mail postcards that reflect the design of the Center’s website and printed collateral materials. The campaign will require three postcard mailings, scheduled four weeks apart, for each
Tips for a Successful Direct Mail Campaign  Spend time developing an attention-grabbing headline for each piece.   Include a call to action. Specify what you want readers to do. Target the message – one per mailing - and keep it simple. Don’t jam too much information on one piece.    Establish a design and carry it through the entire campaign. Consider using a 5”x5” postcard size to help the piece stand out. Schedule mailings so that the piece arrives on a Tuesday or Wednesday – the lightest mailing days.  Commit to at least 3 mailings in a campaign, scheduling 2-4 weeks apart.  Follow up with sales calls after the campaign is complete.

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of the three external marketing audiences (nine total designs). Postcards should be similarly formatted. The more targeted the message, the more effective the mail campaign will be. Sports tournaments have a different audience demographic than faith based events, for example. Rather than watering down a one-size-fits-all message to fit all three audiences, commit additional resources to customizing a campaign for each. Recommendation 4: Promote the Community Center through trade association membership and event attendance. Relationships are the key to long-term success, and direct marketing must be a significant part of the City’s external marketing initiative. The City should become active members of regional chapters of event planning, expo, festival, and fair associations. In addition to memberships, subscribe to state and regional publications. Peruse newsletters and magazines for upcoming events, and identify those that could be suitable for the Community Center in the future. Recommendation 5: Frequently share news about the Community Center with the local market. Victoria-based organizations and individuals will continue to provide a steady source of revenue for the Community Center. Keeping these groups informed and impressing them is important for business and reminds them of Center’s value to the community. Tactic 5.1: Produce a monthly news release listing upcoming events. Entitled “This Month at the Community Center” (or similar), the news release should list all public events at the Center scheduled in the upcoming month, including the date, time, location, and other details. Look at editorial schedules to determine the best day of the week to distribute the news release to area newspapers, neighborhood newsletters, radio stations, and television stations. This news release may be printed on the one-page slick (described in Recommendation 1) and faxed or emailed. Tactic 5.2: Help event managers navigate local marketing opportunities. The Community Center’s name recognition will naturally increase as it is listed on customer advertisements and other promotions. The City benefits if customers are successful promoters. The better customers’ marketing efforts, the more attendees, and the greater the exposure for the Community Center.

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Although the City is not responsible for promoting events held at the Center, it could be beneficial to provide customers with marketing guidance. At a minimum, develop a handout that lists regional media outlets as well as the editorial and advertising contacts for each. This will save customers time and make it more likely that they will advertise. Also, allow the new marketing assistant time each week to book appearances for customers on local television and radio stations. As a side note, one possible way to incentivize event organizers is to negotiate with local media to provide discounted advertising rates for Community Center customers. Customers will find value in any assistance the Parks and Recreation department staff can offer in navigating local media buys and identifying ways to maximize exposure. Tactic 5.3: Host familiarization tours of the Community Center. Provide lunch, a brief presentation, and tour of the Community Center. Host several familiarization tours in 2010 and 2011, one for each individual audience and for regional media. Recommendation 6: Differentiate the Community Center by continuing to provide attentive customer service from first contact through follow up after the event. It goes without saying that exceptional customer service should be engrained in the City’s management of the Community Center. As discussed in earlier sections of this Study, turnkey solutions to event planning is in greater demand than ever before. Cost is often less of a deciding factor than the comfort that event details will be carefully managed. Strong customer service will be key to developing the Community Center’s number one promotional tool outside of city limits: word-of-mouth marketing.
  

Meet as a team to develop a business friendly customer service policy. Always respond to telephone and email inquires within 24 hours. Have a professional appearance at all times. Develop attractive and informative information about the Community Center. Contact current customers (those with booked, upcoming events) on a regular basis prior to their events to ensure their needs are being met. Provide customers with a list of local media and advertising opportunities.

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Provide customers with a list of local vendors to help with overnight accommodations, transportation, catering, décor, printing, signage, and other aspects of their stay. Make sure that each event’s organizer(s) is treated very well while he/she is in Victoria. Work with the CVB to deliver a gift basket to their hotel rooms, and ask hotel managers to upgrade rooms or leave a personal note. Provide customers with an attendee survey card that allows them (and the City) to gather information about their audiences. Keep the survey brief, postcard size for example, and ask general questions appropriate for any audience. Questions could include basic demographic information, perceptions of the event, and perceptions of the Community Center. Send all customers personal ‘thank you’ notes following events. Keep customer contact information in a database. Approximate the date of the customer’s next event, and contact him/her at least 6 months before to inform them that the Community Center wants their business.

 

Recommendation 7: Consider offering inducements to customers whose economic return is higher than average. A majority of exposition centers offer perks to customers who bring a higher than average number of guests and overnight stays. These inducements take various forms. In interviews with other Texas exposition centers, Avalanche discovered that incentives are typically categorized within the marketing budget. Discounted rental fees and comped equipment rentals or dining services are common incentives. In some communities, the community center and local hotels work together to package proposals to larger events. These proposals may include discounted hotel room rates as well as reduced fees / comped services at the event facility. No exposition centers that we interviewed or researched publicly posts their incentives policies. They are viewed as competitive tools and utilized internally by staff and board members to make decisions. The City should consider offering inducements to select events on a case-by-case basis. Internally, the City should establish criteria that must be met to qualify for inducements. These criteria do not need to be publicly shared. We are aware that the Community Center is fully booked for most weekends each year, and local demand for the facility is high year-round. The purpose of the marketing campaign is to encourage the City to be proactive versus reactive. Actively marketing to its external target audiences will result in a more balanced mix of customers, increasing the Center’s economic impact and allowing flexibility to adjust pricing structure.

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Marketing Budget
The marketing budget estimates below show both ‘low’ and ‘high’ spending scenarios. A low spending scenario involves, for example, hiring freelance designers, printing on lower quality paper stock, limiting the quantity of direct mailings, and limiting participation in trade associations and their events. The high spending scenario includes, for example, employing a professional advertising agency to develop marketing materials, utilizing better quality paper stock or unusual cuts, exhibiting at trade association events, and purchasing contact lists.

Victoria Community Center Marketing Budget Estimates
Activity
Design and launch new website / webpages Design and print direct mail postcards Design and print Center overview brochure(s) Design and print pocket folder Design and produce information "slicks" for in-house printing Populate a contact database (purchase contacts) Direct mail campaign postage Trade association membership and event participation Produce monthly news release listing upcoming events Assist event organizers with navigating local media opportunities Host familiarization tours of the Center for target audiences Monthly website updates TOTAL MARKETING BUDGET (estimate) Low $ $ $ $ $ $ $ $ $ $ $ $ 5,000.00 1,250.00 1,500.00 500.00 1,000.00 500.00 750.00 1,000.00 500.00 High $ $ $ $ $ $ $ $ $ $ $ $ 15,000.00 4,000.00 7,500.00 3,500.00 2,000.00 2,000.00 1,500.00 3,000.00 2,000.00 1,500.00 42,000.00

$ 12,000.00 $

These are just estimates, and budget may change as the marketing campaign evolves. One fact is clear, however, the City must be willing to invest in marketing the Center if it is to accomplish its goals of maximizing the Center’s economic impact and boosting operating revenue.

Metrics
The Community Center’s marketing metrics are either performance-based or goal-based. Performance-based metrics are tied to the implementation of the recommendations. Ideally, the City will assign each recommendation and tactic listed in this Study to individual staff members. Some organizations tie performance-based metrics to staff evaluations. Staff reviews can be partially founded on whether an individual has performed the tasks assigned to him or her. When associated

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with performance metrics, staff rewards, such as bonuses or pay raises, are a strong management tool for ensuring that a marketing plan gets implemented. Goal-based metrics measure how well an organization is accomplishing its long-term goals and objectives. In this Study, the City’s primary goal is to maximize visitor spending and economic impact generated by the Victoria Community Center. Within this goal, the objective is to build name recognition as a premier events facility in the region. Measuring goal-based metrics goes beyond accomplishing the recommendations of this Study. Recommendations are the steps that will progress the City toward its core objectives. They should be easy to measure on a regular basis. As with performance-based metrics, they should be evaluated one to two times each year. We recommend tracking the following statistics to monitor the progress of the marketing campaign:

Increase in the number of out of county prospect inquiries – The City should track prospect inquiries to determine whether marketing tactics are producing results. Prospect inquiries can occur through e-mail, phone calls, and personal visits to the Center. Formulate a spreadsheet or other document that allows staff to input each prospect inquiry, the nature of the request, and follow-up activities. Review this on a regular basis. Establish benchmarks. For example: The number of prospect inquiries by out of county organizations should increase 15 percent each year for the first three years of the campaign. Adapt marketing efforts if this goal is not met. Increase in the number of out of county events –Beginning with the initial contact, identify prospects as either “internal/local” or “external/out of county” events. We define “out of county” events as those with more than 30 percent of attendees living outside of Victoria. Increase in the number of hotel / motel nights – One of the most significant economic impacts for Victoria by the Community Center will be from visitor expenditures at local hotels and other venues. Tracking this will require a concerted effort by both the City and the CVB. Increase in the economic impact of the Community Center on Victoria and Victoria County Ultimately, more out of county events, heightened rental revenues, and expanded facility capacity will generate a higher economic impact for the City. Update the Community Center’s economic impact analysis at least every three years to ensure that it is meeting its primary goal.

For the City to measure these metrics, it must adopt data collection tools. We strongly recommend developing a short survey issued to visitors attending Community Center events. During interviews with other Texas community centers, Avalanche Consulting learned that event facilities managers

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routinely request information from their customers related to the number of event attendees, zip codes of participating organizations and individuals, estimated travel dollars spent, and number of room nights. The City can use this data to not only track goal-based metrics but also keep its economic impact analysis updated on a regular basis.

RENTAL RATE RECOMMENDATIONS
As discussed in Chapter 2, the Victoria Community Center’s current rental rates and fees are lower than benchmark facilities on a per square foot basis. There is opportunity to gradually increase the City’s revenue generated by the Center by adopting standard industry practices. To begin our recommendations, we revisit the Comparison Texas Event Center Fee Schedules table provided in Chapter 2:

Comparison Texas Event Center Fee Schedules
Convention Space Base Rate Dance Floor Fees
No n/a n/a Yes n/a Yes n/a

Ticket Surcharge

A/V Equipment Rental

Furniture Fees

Utility Fees

Stage Fees

Victoria Community Center Lufkin Convention Facilities Longview Convention Complex Wichita Falls MPEC Taylor County Expo Center Brazos County Expo Complex San Angelo McNease Convention Center

$825 $1020 $1320 $2000 $2500 $2500 $2500

n/a Yes Yes Yes Yes Yes Yes

No No No Yes Yes Yes Yes

No n/a n/a Yes No Yes Yes

No n/a n/a Yes n/a Yes n/a

No Yes n/a Yes n/a Yes No

Yes n/a n/a Yes Yes Yes n/a

The table provides a list of potential fees charged by other similar events centers elsewhere in Texas.

The Base rate is the per diem, flat rental charge for an event space.

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Utility fees are a surcharge that compensates for power and water usage during the event. These are typically a flat fee charged on a daily basis. Ticket surcharges of $1 or more per ticket are required by several organizations. Furniture fees are charged for each table and chair used by the customer during the event. Use of dinnerware and linens, if available, may also be an additional fee. This covers the costs associated with storing, setting up, and cleaning these items. Rates vary depending on the item, but are typically under the cost charged by private rental companies. A/V equipment rentals are charged on a per event basis to customers using facility microphones, speakers, PA systems, stereo equipment, televisions, overhead projectors, and lighting, to name a few. Cost varies from $5 to $100, depending on the equipment. An hourly fee may also be associated with staff time setting up and tearing down equipment. Dance floor fees are charged for set up and use of a temporary dance floor. Typically, fees are based on a price per square foot. RV fees of $20+ per night plus a security deposit are charged to individuals parking RV campers on facility parking lots overnight.

 

In addition, there is a wide variety of other fees possible that this Study did not include in its survey. They include, for example:

Signage fees are charged for each banner approved and displayed by staff members ($10$20 average per sign). Additional hour fees of $50 or more are charged for events that run past their allocated time slot or that require additional time for set-up. Concession / kitchen surcharges of 10-20 percent of gross sales (or $1-$2 per guest) are common practice among many events facilities. The surcharges may be waived if the customer hires one of the facility’s “preferred” or “approved” vendors. Internet fees, similar to utility fees, cover a portion of the cost to provide Internet service to the facility. They only apply to events that have need for Internet access. Overnight fees for organizations setting up the day before the event. Corking / alcohol fees are charged either on a flat or per bottle rate to customers bringing alcohol on premises.

 

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Currently, the City charges customers flat, daily rates for space, kitchen, and concession rentals, as well as security services. The City’s facility fee structure provides the following items at no cost:
      

Tables and chair usage Wireless PA system Staff time to set-up and tear-down all tables, chairs, and equipment Event staff, including planning assistance and during the function Wireless internet access Video screens Utilities

Providing these services and others for free has led to a number of concerns for the Center’s staff. Staff members work long hours to accommodate customers and a booked, back-to-back event calendar. Even with event plans in place, customers frequently ask staff to reconfigure furniture arrangements and equipment set-up, adding even more staff time to an already packed schedule. Set-up and tear-down of furniture and fixtures for large events takes hours of personnel time. Storing and maintaining furniture and equipment requires time and resources. This year, for example, the City has budgeted $40,000 to replace tables and chairs. The City currently has 1400 metal folding chairs, 1200 vinyl chairs, 460 rectangular tables, 150 round tables, 10 four-foot tables, stage risers, numerous video screens and audio and video accessories. This is a large number of items to manage without receiving any compensation. It is possible that billing customers for use of furniture and equipment will reduce the number of recalled set ups and provide funds for timely replacement of damaged or outdated items. The City has a variety of options for boosting Center revenue while staying in-line with industry norms. Based on our evaluation of competitor facilities, discussions with Center employees, and an understanding of Victoria’s target audiences, we recommend the City consider the following changes to its current rental structure.

Increase the daily Dome, Annex, and Arena rental rates by 2 percent per year for the next three years. This would result in weekend rental rates of approximately $955 for the Dome, $715 for the Annex, and $475 for the Arena in Year 3. An increase of his level means that the Center will continue to be competitively priced. However, as Chapter 4 reveals, a modest rise in daily prices could mean more than $4,400 in additional annual revenue. Charge for furniture rental. Rental fees of $0.25 to $0.50 per folding chair and $3.00 - $4.00 per table are below market rates while reimbursing the City for storage, maintenance, and cleaning/repair costs. For a typical Dome event, furniture revenue could total between $300 and $700, and a typical Annex event could generate between $100 and $200.

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Charge a set-up and tear-down fee for events of 300 or more guests. The cost should be equivalent to the hourly wage rate of staff members performing the service. Outsource audio / visual support services to local companies. This ensures that customers have access to the most current technologies and have support services that may go beyond the capacity of staff. Provide customers with contact information for these local A/V companies and ask them to manage those services outside of their contract with the Community Center. Create a list of “approved” vendors for catering, party supplies, and technical support. Charge customers a fee of 10 percent of the gross cost of the services for using nonapproved vendors. Vendor approval can be based on their familiarity with the Center (e.g., require orientation), professionalism, and quality of performance. Some facilities charge vendors a fee of $250 to $1,000 to be included on the list.

Implementing these five policy changes will result in more than $40,000 in additional revenue each year, compensating the City for the significant amount of time and resources it current expends in pre- and post-event facilitation of customer requests.

FACILITY IMPROVEMENT COST ESTIMATES
In addition to providing marketing and rental rate recommendations, Avalanche was asked to advise the City on what future facility improvements would maximize the Center’s value to the community. To do so, we began by evaluating the Center’s current economic impact (Chapter 1), as well as forecasted impacts for three prospective development scenarios (Chapter 2). As a reminder, the three scenarios investigated were: 1. The Center maintains its current configuration plus the addition of an exhibit hall building elsewhere on the property. It projected that the City will sustain the space as it is currently while adding an exhibit hall building elsewhere on the property making needed equipment and facility repairs to keep the Center operational.

2. The Center fills a larger role as a regional events center. It estimates the impact of removing the Arena and constructing a large exhibit hall and meeting rooms in its place. 3. The Center expands its role as a regional events center while providing a space for covered outdoor events. In this situation, the Arena will be replaced with a large exhibit

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hall (Scenario 2) and a covered pavilion building will be constructed elsewhere on the property. Avalanche Consulting involved two firms, BRW+ Architects and Rawley McCoy & Associates, in providing cost estimates for the new Exhibit Hall and Covered Pavilion as well as needed improvements to the existing Dome and Annex. Industry standard prices and local construction prices for similar projects were taken into consideration when calculating the per square foot price.

New Exhibit Hall and Meeting Space
Scenarios 2, 3, and 4 include the construction of a new exhibit hall and meeting space building. In Scenarios 2 and 3, this space would replace the existing Arena, and in Scenario 4, the space would be constructed as a standalone facility elsewhere on the property. When estimating price per square foot costs, BRW+ Architects treated the new Exhibit Hall and Meeting Space building as a new building. The existing Arena building would not possess much that could be salvaged. Without the proper documentation on the structure or any of the data, one cannot safely assume that the structure is capable of withstanding any additional loads it might gain from the new roof structure or any walls that would be supported by the structure. Because of this, the structure would most likely be rejected by our structural engineer and therefore would have to be demolished. The new building would cost approximately $160 per square foot in current dollars.

New Covered Pavilion
The new Covered Pavilion would consist of a concrete floor and metal roof. Based on industry standards, the Pavilion cost will be approximately $20 a square foot in current dollars. This figure does not include electrical or plumbing. It does include engineered foundation and building plans. An additional $1 per square foot should be added for galvanizing. For both new structures, numbers may vary greatly depending on timing of construction and finish out options.

Repairs and Improvements to Existing Dome and Annex
In addition to construction costs of the new Exhibit Hall and Covered Pavilion, repairs and improvements to the existing structures are required in the near-term. The City has requested cost estimates for several improvements, including the addition of storage space. BRW+ Architects estimates additional storage of around 3,000 square feet is required to satisfy current needs. The approximate cost of this space will be $125 per square foot. Finally, Rawley McCoy & Associates provided cost estimates for replacing the Dome and Annex roofs, replacing air conditioning units, installing additional night lighting around the peri meter

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of the Center, and replacing the Annex and Dome kitchen walls. The tables on the following pages present these cost estimates.

IMPROVEMENT

UNIT COST

TOTAL COST

Roof Replacement on Dome and Annex Metal Roofing Costs (based on replacing existing insulation and using 24 g. R-panel roof)

West Annex roofs, 17,911 SF total (Optional upgrade for standing seam roof) East Annex roof flashing at Dome perimeter (Optional upgrade to standing seam roof)

$5.50 / SF $9.50 / SF Flat fee $9.50 / SF

$98,510.50 $170,154.50 $5,000.00 $87,324.00

Main Arena roof, 48,401 SF total (Optional upgrade to standing seam roof) Built-Up Roofing Costs: (Based upon replacing entire built-up roofing system)

$5.50 / SF $9.50 / SF

$266,205.50 $459,809.50

Dome roof, 13,016 SF total

$10.00 / SF

$130,160.00

TOTAL NEW ROOF COSTS WITHOUT OPTIONAL UPGRADES Fees and contingency GRAND TOTAL Recommended budget for roof replacement 10%

$369,716.00 $36,971.60 $406,687.60 $410,000.00

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Recommended budget with standing seam roof option

$940,000.00

IMPROVEMENT West Annex Rooftop A/C Unit Replacement

UNIT COST

TOTAL COST

Replacement of units set on existing curbs: (6) 12.5 ton units total

$1,300 / ton @ $75 tons / SF

$97,500.00

Fees & contingency GRAND TOTAL Recommended Budget Additional Night Lighting Around Entire Building Installation of 20 exterior wall pack type fixtures Fees and contingency GRAND TOTAL Recommended Budget

10%

$9,750.00 $107,250.00 $110,000.00

$500.00 / unit 10%

$10,000.00 $1,000.00 $11,000.00 $11,000.00

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IMPROVEMENT

UNIT COST

TOTAL COST

Annex Interior Wall Replacement New smooth FRP liner panels over metal wall panel: Approximately 4,446 SF total wall area (Excludes Annex storage and kitchen areas) $3.00 / SF $13,338.00

Fees & contingency GRAND TOTAL Recommended Budget Dome Kitchen Wall Replacement New smooth FRP liner panels over gypsum board: Approximately 1,606 SF total wall area (excludes restroom and loading area) Fees and contingency GRAND TOTAL Recommended Budget COMBINED BUDGET (ALL PROJECTS) RECOMMENDED BUDGET (ALL PROJECTS)

10%

$1,333.80 $14,671.80 $15,000.00

$4.00 / SF

$6,434.00

10%

$642.40 $7,066.40 $7,500.00 $553,500.00 $560,000.00*

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*Note: Prices do not include inflation costs. Due to the volatility of the market and not knowing when these projects may take place, each project budget should be increased by 3%-5%.

CHAPTER 4: FINAL FORECASTED IMPACT
The purpose of this final chapter is to explore the potential impact of the Community Center once envisioned improvements are put into place. Chapter 2 of this Study explores the impact of three potential development options. The Parks and Recreation Commission reviewed all three scenarios, and requested that we examine a fourth and final scenario which blends Scenarios 1 and 3: Scenario 4: The Center maintains its current configuration while adding a covered pavilion building and an indoor exhibit hall / event building elsewhere on the property. This Scenario is estimated to yield the highest economic impact for the City over the long term. The following table illustrates Scenario 4’s annual impact based on the current fee structure.
Scenario 4: Current Configuration Plus Exhibit Hall and Pavilion
Annual Economic Impact Victoria Community Center Sales/Output Jobs (FTE's) Annual Wages

DIRECT IMPACTS: Facility Operations and Suppliers Current $ 599,744 Retail Spending by Visitors Current $ 1,076,443 Hotel Spending by Visitors Current $ 462,854 INDIRECT IMPACTS Current

12

$

231,441

21

$

503,022

10

$

244,161

$

1,112,301

19

$

469,739

TOTAL ECONOMIC IMPACT
Current $ 3,251,343 62 $ 1,448,363

This estimate is based on the following assumptions:

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The City will construct a covered outdoor Pavilion elsewhere on the property. The Pavilion can accommodate a variety of events, including livestock shows, concerts, festivals, market days, school functions, sports tournament support, and others to name a few. The open sided, 40,000 square foot Pavilion will have a concrete floor and metal roof. Concession facilities and restrooms will need to adjoin the Pavilion to maximize utilization. It is assumed that the Pavilion will host 40 events per year, including 10 2-day, and 30 1-day functions. The rental rate will average $800 per day. The City will also construct an indoor events building elsewhere on the property. This exhibit hall / meeting facility will offer flexible space and the capacity to be divided into multiple smaller breakout meeting rooms. BRW+ Architecture’s original conceptual drawing of the new event building includes 23,162 square feet of additional rentable space. A 7,528 main exhibit / banquet hall will be accompanied by two 3,982 square foot meeting rooms and four 1,925 square foot break out rooms. All walls will be movable to allow for multiple configurations, including one single 23,162 square foot room. The configuration is based on the footprint of the current Arena, although the footprint and layout can change.

Adding a New Exhibit Hall and Covered Pavilion to the Community Center grounds is expected to generate a total economic impact of $3.25 million per year. Additional visitor spending will contribute to the majority of the additional impact. To allow for a side-by-side comparison of scenarios, this Study concludes with a 10-year comparison of the Baseline and Scenario 4. It assumes that the new Exhibit Hall and Covered Pavilion are constructed in Year 3. It is understood that timing will depend on resource availability and may take place much further in the future. The City can adjust the forecast by “sliding” total annual impact figures to the actual year of construction once it is known. It also incorporates the recommended 2% annual increase in facility rental fees over the next three years.

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10-Year Economic Impact: Baseline and Scenario 4
Victoria Community Center Scenario 4: Current Center Plus Exhibit Hall and Pavilion

Baseline

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 10-Year Total

$ $ $ $ $ $ $ $ $ $ $

1,168,800 1,174,473 1,181,233 1,187,999 1,187,999 1,187,999 1,187,999 1,187,999 1,187,999 1,187,999 11,840,499

$ $ $ $ $ $ $ $ $ $ $

1,168,800 1,174,473 1,181,233 3,251,343 3,251,343 3,251,343 3,251,343 3,251,343 3,251,343 3,251,343 26,283,904

The analysis does not include the temporary impact that will result from construction expenditures. As a whole, construction expenditure multipliers range between 1.5 and 2.0. These impacts can be maximized by engaging locally-owned contractors and suppliers.

Victoria Community Center: Market Analysis and Feasibility Study

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