BRING IT TO THE BEACH Why Were Here Todays Program Warren D. Harris, - - PowerPoint PPT Presentation

BRING IT TO THE BEACH

Why We’re Here

Warren D. Harris, Director Virginia Beach Economic Development

Today’s Program

Peter Luukko, President/COO Comcast-Spectacor

THE PROJECT

The Project:

18,500 seat / 750,000 square foot arena in the Virginia Beach Resort & Convention District

• City-owned property
• All related infrastructure in place or under

development

• 8 blocks from Oceanfront
• 1 block from Interstate 264

RESORT AREA MASTER PLAN

Why the Resort & Convention District?

Marina District 19th Street Corridor Laskin Gateway

• Strategic Growth Area Plan Approved in 2008
• 8,000 hotel rooms in Resort Area
• Virginia Beach Convention Center
• Strong Transportation Infrastructure
• Available Property for Development

“Virginia’s the best, and we’re ready for major league sports. The time is right.” – Virginia Governor Bob McDonnell

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PROJECT TIMELINE

THE MARKET

6

Southeastern Virginia

Includes 3 of Virginia’s 4 largest cities and stretches from Virginia Beach through Norfolk, Newport News, Williamsburg, and Richmond

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“As the largest metropolitan area without a professional sports franchise, this could be a wonderful opportunity for the Peninsula. This would be a team that all Virginians can embrace as their own. It is my hope that

• ur region can join the elite status of other

cities with a professional team."

• Chris Stuart, Hampton City Council

"I'm happy for the Beach. I hope this works out. A major sports team would benefit all of Hampton Roads.“ – Paul Fraim, Mayor, City of Norfolk

• 3 million people without an

arena larger than 12,000 seats for NBA or NHL

• 3 million people without a

major league franchise

• 10 Fortune 500 Companies

ready to become corporate partners

• Strong economic and

population demographics

• Proactive regional

leadership committed to developing new arena

Southeastern VIRGINIA

Southeastern VIRGINIA is larger than 22 markets currently with

• ne or more

professional sports franchises

18

Our Corporate Market

• 10 Fortune 500 Headquarters with

combined annual sales exceeding $103 Billion

• More than 178,000 total businesses
• 365 companies with annual sales of

at least $250 million

• 598 companies with at least 250

employees

10 3 1

FORTUNE 500 HEADQUARTERS COMPARISON

6

Designated Market Area (DMA) Comparison

DMA (Designated Market Area):

• A geographic area defined by Nielsen Media Research Company as a group of counties that make up a particular television market.
• These counties comprise the major viewing audience for the television stations located in their particular metropolitan area.

NOTE: Virginia Beach DMA vs Oklahoma City and Richmond DMA vs Tulsa comparisons each show similar advantages

“We bring people in from all over the world to work here. Seeing this type of entertainment venue from the plane before they land would beg the immediate question, ‘What is that?’ We would answer, that is our entertainment venue built for the people of our city where we watch sports teams, band concerts, rodeos, college sports and STIHL Timbersports.” – Fred Whyte, President STIHL Inc.

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OPPORTUNITIES

A CASE STUDY IN SUCCESS: VIRGINIA BEACH AMPHITHEATER

• Attracts customers from entire

region, with 18% of tickets sold in Richmond area

• Consistently ranks as one of

Live Nation’s Top 5 performing

• utdoor venues
• Since 1996 - 400 concerts,

selling more than 4 million tickets

• Nominated as Venue of the

Year by the Academy of Country Music

OPPORTUNITY TO CAPTURE MAJOR EVENTS

• Major concerts &

entertainment events

• College conference

championships

• NCAA – Men’s & Women’s

Basketball, Wrestling, Volleyball, Gymnastics

• Professional sporting events
• Olympic National

Championships Figure Skating, Gymnastics, Wrestling

• Holiday Tournaments

EVENT SYNERGY Arena and Convention Center

• Booking synergy with adjacent

Convention Center creates attractive venue package for sports and large assembly/ exhibitions; over 500,000 visitors/delegates in 2011

• Fan Fests, US Gymnastics, US

Figure Skating

• Religious conventions,

corporate meetings, political conventions

“The ACC’s footprint will soon stretch across nine contiguous states and as we look ahead we certainly welcome quality venues to consider as host locations for

• ur conference championships and
• tournaments. We have two conference

members – University of Virginia and Virginia Tech – that are located within the state which would make Virginia Beach an attractive location.”

– John Swofford, Atlantic Coast Conference (ACC) Commissioner

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THE PARTNERS

Comcast-Spectacor

General Partnership 1996 Established 1967 $4 billion revenue 2011

Comcast-Spectacor

Organized for Success

Global Spectrum

Last Fiscal Year: 12,251 events Event attendance over 20.9 million Over $323 million in gross ticket sales Over $633 million in gross revenue

A Worldwide Leader in Venue Management with 112 Venues

Managed by Live Nation Since 1996 Total Events: 452 Total Attendance: 4.5 million Managed by Global Spectrum Since 2007 Total Events: 2,445 Total Attendance: 483,551 Managed by Global Spectrum Since 2001 Total Events: 1,226 Total Attendance: 4,090,402

Hampton Roads Presence

Live Nation

Largest Producer & Promoter of Live Music Events in the World Produces 20,000 Shows Annually for More than 2,000 Artists Globally Spends $3.2 Billion Annually in Talent Acquisitions Own, Operate, Have Booking Rights and/or Equity Interest in 142 Venues

Initial Proposal for Virginia Beach Arena

• Comcast-Spectacor/Global Spectrum will lease,
• perate and program arena (concerts, athletic events,

family shows, corporate events, community programs)

• Comcast-Spectacor /Global Spectrum will commit to

pursuing a professional sports franchise for the arena

• 25 year lease term
• Guarantee annual lease payment
• More than 200 events annually
• 1.4 million visitors annually
• Guarantee annual operating costs

FINANCIAL PRINCIPLES

• VBDA will negotiate and present to City Council a term sheet

that will ensure all City financial obligations are met in accordance with these principles. The Virginia Beach Arena will:

• - Generate sufficient revenues to meet all debt service
• bligations as well as generate excess revenue to the City
• - Substantially increase existing City revenue streams (ie,

Admissions Tax, Hotel & Lodging Tax, Restaurant Tax, Sales Tax, Business License Fees, etc)

• - Qualify for financial support and participation from the

Commonwealth of Virginia

• Arena development fee
• Ticket sales
• Admissions tax
• Food & concessions
• Parking
• Media, advertising & sponsorships
• Naming rights
• Sales of suites, club and courtside

seating, etc

• Merchandising
• Rental payments
• Sales tax
• Business property tax
• Business License Fees

ECONOMIC IMPACT

Source: Dr. James V. Koch

Impact to Hampton Roads

• One-time Only Construction-related Jobs:

560

• One-time Only Construction Impact:

$279 million

Source: Dr. James V. Koch

NEXT STEPS

VBDA to review proposal & report back to City Council in October, to include:

• Review & negotiate financial structure
• Develop & present draft term sheet to City Council
• Identify available State resources/contributions
• Conduct outreach to community stakeholders
• Actively engage & inform the public

Comcast-Spectacor/Live Nation

• Negotiate proposal with City/VBDA
• Negotiate with potential arena tenants

IN CONCLUSION

• Opportunity to develop an estimated $350 million,18,500

seat arena

• Partnership with two of the top entertainment

companies in the world

• Guaranteed partner for 25 years
• Guaranteed lease revenues
• Guaranteed operational costs
• New regional economic generator
• $98 million first year economic impact
• 1,230 new year-round jobs / 560 construction jobs
• $279 million impact from construction

• Signature development for Resort Area
• Over 200 annual events
• 1.4 million visitors
• Year-round activity to resort area
• Regional & statewide attraction
• New national & international exposure
• Year-round capitalization of public and private assets
• New entertainment opportunities
• Unique opportunity to join cities hosting major league

sports teams

BRING IT TO THE BEACH