Amphitheater Moves Into Front Row

May 5, 2006
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GRAND RAPIDS — The Convention and Arena Authority has begun talking with Kent County about acquiring 40 acres of land in Millennium Park for an outdoor concert venue.

CAA Chairman Steven Heacock told the Business Journal last week that Progressive AE, a leading architectural and engineering firm, has been selected to conduct a feasibility study to determine whether the park site is suitable for an amphitheater that would join Van Andel Arena and DeVos Place under the CAA banner.

The study is expected to cost $50,000.

SMG, the management firm that oversees daily operations at the arena and convention center and would likely do the same for an amphitheater, is paying for the feasibility study. That payment comes from a clause in the agreement SMG recently signed to take over the food and beverage and catering business at the arena starting July 1.

Heacock and SMG Director of Finance Chris Machuta met late last month with county officials, including Administrator and Controller Daryl Delabbio, Commission Chairman Roger Morgan and Parks Director Roger Sabine.

“After the discussion, the sense that I left with was that we should go ahead and do it, and that we ought to look at the feasibility. There are no guarantees. There are no commitments made. I view this, by the way, as an extension of the original plan,” said Heacock.

As county commission chairman from 2000-2002, Heacock was a driving force behind the creation of Millennium Park. When the blueprint for the 1,500 acres of open land in the northwest corner of the county was unveiled, an amphitheater was part of the design.

“When Roger (Sabine) and I first put Millennium Park together, even before Peter (Secchia) was involved, there was going to be an amphitheater in it. We didn’t know about the size or location, or any of those kinds of things, but it was always on the drawing board,” said Heacock.

“And I view it as very consistent to the Central Park model, the kind of ‘Let’s get as many people as we can into it to use this open land and beautiful place.’ I can’t imagine why a pleasant jazz concert in the evening would be inconsistent as a use of the park,” he added.

Delabbio told the Business Journal that he, too, came out of the meeting with a sense that the feasibility study should be done to determine if the site is right for such a venue.

“We are willing to enter into more intensive discussions related to this. It would probably be along the lines of a lease agreement, rather than a sale. It would be a lease agreement that would run about $1 a year or so,” said Delabbio.

“I think there was an openness; certainly on the part of the staff who has been looking at this a little bit, and among the board members that Steve (Heacock) had talked with,” he added. “I think it will be a win-win.”

The site being targeted for the amphitheater lies in the Grand Rapids portion of the park, not too far west of John Ball Park

“Traffic is an issue, and we won’t do it if it inconveniences people living in the area. Noise is an issue, but with the location that I’m thinking about, there isn’t a neighborhood that will hear it. The (I-96) highway is a sound barrier on one side and on the other side, you’ve got all the sand mines and now the golf course,” said Heacock.

Determining whether a summertime concert venue would be a reasonable addition to the CAA’s holdings was one of the items on Heacock’s agenda in 2005, and it was the only one that he wasn’t able to complete that year. The firm he initially contacted to conduct the study wanted $175,000 to do it. Heacock felt that price was too steep and said in February he was negotiating with an unidentified local company that was more than capable of filing a similar report and for much less money.

“It’s still a good idea if it can be built for $15 (million) to $20 million,” he said then.

Where the construction money will come from, should the project go forward, hasn’t been detailed yet, although selling the venue’s naming rights is part of the plan. The CAA also has plans to register as a lobbying organization in Lansing in order to capture some state funding for infrastructure and construction.

John Van Fossen, director of external affairs at Van Andel Research Institute and a CAA Operations Committee member, is directing the lobbying effort for the board.

While Progressive AE will decide whether the site is a good location, Heacock said SMG would likely be selected to decide whether an amphitheater is a good investment.

“The idea here is twofold. One is to drop some more money to the bottom line and, two, to make the CAA more financially viable. And we have already done a lot in the last year or so to do that, because of the changes in contracts,” said Heacock.

Just within the last few months, the CAA has been able to cut $190,000 annually from the basic management fee that SMG gets for operating the arena and DeVos Place. Most of that amount, $140,000, came from the renewal agreement the board approved in January.

The rest came from the arena concessions contract the CAA ratified last month with SMG Food and Beverage LLC, an agreement that also will provide the board with a higher percentage of revenue from those sales than it previously had. In fact, the CAA expects to get about $115,000 more each year from the new three-year concessions contract than it received in past years.

The CAA is also expected to get $350,000 in parking revenue from the DeVos Place underground ramp this year, an income source that didn’t exist a few years ago.

“I really believe that with $300 million in buildings, and with the county and city always having more need than they have resources, it would be irresponsible for us not to make certain that the (CAA) is viable on its own,” said Heacock.

Concert revenue is vital to the board’s bottom line, and extending that source during the warm-weather months — the slow months for indoor shows — would enhance the CAA’s ability to cover operating expenses and make capital improvements without relying on the city or the county for financial assistance.

Concerts were worth $1.4 million to the arena last year, more than half of the $2.6 million the building received in event income. Another $1.4 million was projected for this fiscal year and, again, that figure is more than half of the expected event income to the arena.

As for the amphitheater’s size, the land and financial feasibility studies will play big roles in determining how many seats and parking spaces it will have. Two of the more notable outdoor venues in the state offer an interesting comparison as to how size can range.

The DTE Energy Music Theater, formerly Pine Knob, in Clarkston seats 15,274 — 7,202 in the pavilion and 8,072 in lawn seats — and has parking for 6,000 cars. It offers 70 to 80 events from May to September.

The Meadow Brook Music Festival in Rochester Hills seats 7,701 — 2,819 in the pavilion and 4,882 on the lawn — and has parking for 2,000 cars. It hosts 40 to 50 concerts from May to September.

“I’m not going to spend anyone’s money, even if it is SMG’s, unless it may provide a positive outcome. And I view this as having, potentially, a very positive outcome,” said Heacock of the feasibility study. “We’ve not set a timetable. But once we gauge it, I’ll expect it to move pretty quickly.”   

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