CAA sets aside funds for expansion project

September 28, 2009
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Members of the Convention and Arena Authority altered their capital improvements budget last week, which all but assures that the northwest corner of the Van Andel Arena concourse will be expanded in the near future.

The only real question is which of two expansion options will they choose? That decision is expected to come in January.

The CAA decided to take the $1.2 million set aside for an electronic ribbon board and dedicate those dollars to two items. One is a smaller LED board estimated at $200,000 that will hang below the scoreboard. The remaining $1 million will go toward expanding a sometimes-congested corner of the concourse.

CAA board member Lew Chamberlin said the traffic tie-ups there negatively affect the building’s food, beverage and merchandise sales.

One option would expand the corner by 1,940 square feet and cost $425,100. The second would enlarge it by 3,100 square feet, provide enough space for a 60-seat food court, extend outside of the building and cost $875,000.

CAA Chairman Steven Heacock told the Business Journal recently that he favors the larger expansion. Up to 25 percent of ancillary event revenue is generated in that corner.

The CAA is also planning to have SMG — the management firm for the arena and DeVos Place — evaluate the wireless capacity at the convention center. CAA board member Joseph Tomaselli said the system should allow at least 400 users to be online to draw large conventions to the building.

SMG Regional General Manager Rich MacKeigan said he checked with other SMG-run facilities and found that Smart City is providing IT services in many of them.

Smart City has corporate offices in Orlando and Las Vegas and 15 district offices in the U.S.

MacKeigan told the board that when the building opened in late 2003, Smart City wasn’t interested in servicing DeVos Place, but the company has since changed its mind. “For the business we were projecting then, they didn’t feel it was worthwhile to come in,” he said.

Board members also met in a closed session last week to discuss what Heacock called “trial strategy” with attorney Richard Glaser, a partner at Dickinson Wright. The discussion presumably revolved around what action the board should take regarding an antitrust lawsuit filed in June 2008 by Delta-Turner LLC against the CAA and SMG. Delta-Turner owns the DeltaPlex Arena and Convention Center in Walker.

The plaintiff has alleged that the defendants struck an unfair deal with concert promoter Live Nation Inc. in an attempt to monopolize the region’s concert industry. The lawsuit also claimed that the CAA and SMG violated the open meetings and freedom of information acts. Delta-Turner is reportedly seeking damages of seven figures.

Both sides had agreed to enter into mediation earlier this year in an attempt to resolve the legal matter. Last February, U.S. District Court Judge Janet Neff denied a motion from the defendants to dismiss the case.

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