Arena projected to have net income of more than 1 million
The Convention and Arena Authority recently adopted the 2013 fiscal year budgets for DeVos Place and Van Andel Arena. The city’s convention center is projected to lose $602,618 over the next year, while the arena is expected to have a surplus of slightly more than $1 million.
The adjusted gross revenue to DeVos Place is expected to decline by 2.3 percent next year from this year and total $4.84 million in 2013. At the same time, the building’s operating expenditures are forecast to dip by 1 percent to $5.44 million.
At the arena, the adjusted gross income for 2013 is expected to rise by 12.8 percent from this year to almost $5 million. Total operating expenses at Van Andel are projected to fall by 6 percent to $3.98 million. Key to the arena’s success over the next fiscal year will be revenue from concerts. Twenty-one are forecast, with event income from those shows reaching $1.6 million, or $410,000 more than is expected this year.
“We’ve got some pretty good stuff on the books,” said SMG General Manager Rich MacKeigan, also executive director of the CAA.
“I’m hopeful in what I’m seeing is a very good year for country. Classic rock continues to be strong, but I think the country market should be good for us this year. I’m feeling optimistic,” said MacKeigan.
In addition to the shows at the arena, MacKeigan said DeVos Performance Hall would continue to play host to a good number of concerts next year because some well-known artists are downsizing their appearances to fit smaller venues. Twenty shows worth $210,000 are projected in 2013, and those don’t include the building’s tenants, who have 116 events scheduled that are expected to produce revenue of $726,500.
“We continue to see very good activity at the theater, and I think that will continue, as well,” said MacKeigan.
“The facilities we have here in Grand Rapids provide us with some flexibility in working with the current concert scene,” said CAA board member Lew Chamberlin.
The CAA, which oversees operations at both buildings, is projected to lose $1.1 million in 2013, largely because the board is expected to spend $1.8 million on capital improvements over the year that begins July 1.
“I’m a firm believer that financials tell the story of an organization,” said CAA Chairman Steven Heacock.
Ten months through the current fiscal year, DeVos Place was only $172,600 in the red.
“Overall, the fourth quarter is going to be a bit down. We’re still looking for a very good fiscal year,” said SMG Director of Finance Chris Machuta.
At the same point in time, the arena had a surplus of $878,217, and three more concerts are scheduled in the building for the remainder of the fiscal year.
SMG will report the preliminary 2012 fiscal year financials in early August.