DeVos Place Figures Are On Hold
GRAND RAPIDS — When members of the Convention and Arena Authority reconvene their monthly meetings next month, after having taken July off, they will learn the fiscal fate of DeVos Place and Van Andel Arena for the year that ended four weeks ago.
What they will get will be the un-audited versions, but the numbers they will see will be much more than ballpark figures.
“We’re going to take a bit more time to get more accurate numbers,” said SMG General Manager Rich MacKeigan last week of the additional month given him. “We haven’t even formulated the numbers yet.”
For DeVos Place, the fiscal year deficit will likely approach $1.4 million. At least that was the most recent estimate offered in June by SMG, the firm that runs daily operations at both buildings. But the opening five months of FY04 belonged to the Grand Center, the smaller convention center that DeVos Place replaced in December and for the following six months of the fiscal year.
Because the June figures for both buildings will be held back until the CAA meets in late August, the year-end numbers for the convention center and the arena aren’t available this month as these normally would have been had the board been in session. Neither are the seven-month figures for DeVos Place. However, the six-month numbers are.
In its first six months of operation from December through May, DeVos Place dropped $292,816 for an average monthly loss of $48,803. The building had $2.12 million in income over that period and $2.41 million in expenses. The average monthly income was $353,716 and monthly expenditures averaged $402,519.
DeVos Place hosted 271 events from December’s opening woodworking convention through May, an average of 45 events each month.
DeVos Place had two months that produced surpluses, the highest of which belonged to February. The year’s shortest month had income of $535,318, or 25.2 percent of the total revenue the building took in for those six months, for a 29-day surplus of $164,838.
SMG Director of Finance Chris Machuta reported that much of the surplus was due to the consumer shows held in the building that month.
He said lower-than-expected utility expenses also contributed to the large surplus in February with charges $30,000 less than January’s bills.
May gave DeVos Place its biggest monthly loss of $196,422, even though the building hosted 55 events that month. But many of those were small meetings that occupied smaller rooms and didn’t bring in the revenue of larger meetings.
The $1.4 million that DeVos Place has been projected to lose this year is less than the original forecast projected. Initially, the convention center was expected to have a deficit of $1.6 million. But higher than expected revenue generated from catering, electrical and rental of equipment pushed that deficit back.
In contrast, SMG projected a surplus of $1.44 million for the arena and it may be a bit higher than that. At the end of May, through 11 months of the fiscal year, the arena had net revenue above expenses of $1.58 million. June is typically a slower month for the building and that net revenue figure could fall.
As for the current fiscal year, Van Andel Arena is expected to have a surplus of $1.51 million for FY05. DeVos Place has been projected to have a deficit of $1.38 million for the year. The fiscal year runs from July 1 through June 30.