More Losses For DeVos Arena

October 28, 2005
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GRAND RAPIDS—DeVos Place had a much smaller loss in September than was projected, while Van Andel Arena had a shortfall of just under $10,000 for the month.

While expected to lose over $160,000 in September, the convention center actually lost $53,404. SMG Director of Finance Chris Machuta said event income came in over budget largely because of the annual Gordon Food Service meeting held there last month.

"They had outgrown the other facility," said SMG General Manager Rich MacKeigan about why the local company stopped using the former Grand Center and met in Fort Wayne.

MacKeigan added that the GSF event is great business for the city's restaurants, as the attendees like to go out on the town.

A quarter of the way into the fiscal year, DeVos Place is $315,747 in the red. Still, that figure is $157,000 better than where the June forecast had the building after three months.

"We're very pleased with the month overall," said MacKeigan. "The ballroom has been very busy."

Convention and Visitors Bureau President Steve Wilson said his organization has reached its yearly goals for total rooms nights at area hotels and motels, and room nights generated through bookings at the convention center. For 2005, the bureau wanted to book 89,000 total room nights and 52,000 from meetings held at

DeVos Place

The CVB has locked-in 147 meetings for

DeVos Place
this year, up from the 104 that were booked last year. Wilson said that 83 percent of all the business that has been tied down for the convention center had a local person or group involved in getting the booking.

DeVos Place
has been projected to lose $1.15 million for the year. At its current financial pace, though, that loss would drop to less than $1 million by the time June 30 rolls around.

The arena, which was projected to have a $130,000 surplus in September, lost $9,956 for the month. Machuta said event income was under budget because ticket sales for the circus performances and a concert were less than expected. Not hosting the annual Detroit Red Wings scrimmage in the building also resulted in income being less than what was expected for the month.

"We are a little behind at the end of the first quarter," said Machuta.

But MacKeigan said event revenue was trending better at Van Andel than in other parts of the country, but wasn't doing well enough here to boost the building's bottom line. For instance, a recent Def Leppard show held at the arena sold 7,000 tickets, a smaller number than when the band played the building a few years ago.  The band's management, though, told MacKeigan that in other venues only 4,500 to 5,000 seats were being sold.

MacKeigan felt the price of gas and the expected higher cost to heat a home this winter have likely cut into the disposable incomes of area households and are keeping people from attending events.

"This is the longest run we've had with some shows not doing well. Others are holding their own," said MacKeigan.

The arena has a surplus of $15,014 at the quarter mark, which is $135,000 under the forecast. Van Andel has been projected to be $1.46 million in the black by the end of the fiscal year. But if the building's current fiscal tempo should continue throughout the year, the surplus would be reduced to $1.32 million.

"We're cautiously optimistic that we will hold to the budget in October," said Machuta. "But we're not looking past that."     

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