CAA Has Six New Goals

March 6, 2006
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GRAND RAPIDS — Keeping customers of

DeVos Place
and Van Andel Arena satisfied topped the goals that Convention and Arena Authority Chairman Steven Heacock recently listed for the board this year.

"We're going to emphasize customer service in those contracts," said Heacock of nine agreements the board has to negotiate for the two buildings it oversees.

One of those contracts, the management agreement with SMG, has been completed, and he said the new pact should bring the board about $500,000 in net revenue each year from events held at both buildings, instead of the $250,000 the board has received in past years.

Heacock also said the CAA should get about $350,000 in parking revenue annually from the underground ramp in the convention center.

Another contract, the food and beverage agreement for the arena, expires at the end of the fiscal year, and SMG is expected to challenge Centerplate for the pact. Centerplate has held the contract since the arena opened in 1996 and wants to keep it.

"They've done a good job for 10 years," said CAA board member Joseph Tomaselli.

But some board members paid a visit to the SMG-managed arena in Oklahoma City, where the firm also operates the concessions business.

"I think we were quite impressed," said Tomaselli, who made the trip.

The CAA has hired The Bigelow Companies of Kansas City to serve as a consultant in the bidding between Centerplate and SMG. Bigelow is one of only two firms in the nation that does this type of work and the contract is for $9,000. The food-and-beverage bids are expected to be reviewed in April.

So in lieu of a "State of the CAA" address, Heacock simply listed six goals he would like the board to meet this year. Besides ensuring that those who do business with the convention center and arena have a satisfying experience, the other five were to:

  • Create a stronger bond with the Convention and Visitors Bureau through a potential marketing fund or a formal relationship.
  • Review the governance and administration of the CAA.
  • **Look at helping the public museum center financially during its transition from the city to a nonprofit organization.
  • Examine potential regional collaborations, especially with the lakeshore area.
  • Help fund the art project for
    DeVos Place
    .

Though his focus was on the current year, Heacock did look back to the just completed one and felt the board accomplished much of what it set out to do last year. He said the booking policy was reviewed and would get another look this year, and a long-term plan to pay for capital improvements for both buildings was put in place.

"We now have a capital fund that lets us take care of the $300 million in assets that we're responsible for," said Heacock.

He felt the board strengthened its relationship with Kent County and the city of Grand Rapids and was on its way to encouraging more minorities to attend events at the buildings.

Just one item remains from his 2005 agenda, and that was to determine whether building an outdoor amphitheater to capture more of the summertime concert business would be a profitable venture.

Heacock said the CAA contacted a national firm to do a feasibility study, but the $175,000 price was too steep. He said, though, that he was currently working with an unidentified local company that is capable of filing a similar report for a more reasonable $50,000.

"It's still a good idea if it can be built for $15 million to $20 million," said Heacock. "It's still something that is on the board."

Convention and Visitors Bureau President Steve Wilson told board members that January was a solid month for conventions at

DeVos Place
, as revenue to the lodging-excise tax for January was up by 16 percent from the same month last year.

DeVos Place
has had the economic impact that we thought it would have," said Heacock. "And I'm excited about (the arena's) future."    

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