ATTACHMENT E
Conventions, Sports &
Leisure International (CSL)
Study
CONVENTION INDUSTRY
FUTURES STUDY
FOR PALM SPRINGS, CALIFORNIA
June 8, 2023
Conventions, Sports & Leisure International
520 Nicollet Mall • Suite 520 • Minneapolis, MN 55402 • 612.294.2000 • www.cslintl.com June 8, 2023
Mr. Rob Hampton
General Manager – ASM Global
Palm Springs Convention Center & Bureau of Tourism
277 N Avenida Caballeros
Palm Springs, CA 92262
Dear Mr. Hampton:
Conventions, Sports & Leisure International (CSL) has completed a draft Future Study executive summary and report summarizing strategic investment opportunities designed to sustain and grow Palm Spring’s place in the regional and national convention industry. The purpose of the analysis is to provide strategic direction for targeted investment in Center space, amenities, trend-forward configurations, outdoor amenities, hotel inventory, connectivity, innovation and long-term industry relevance.
We know that the convention and visitor industry is highly competitive, and that markets throughout the country are continuing to enhance their facilities and amenities to generate visitor-industry economic impact from a changing customer base. To help define future strategic initiatives that can support the Palm Springs convention industry, we have analyzed data provided by Palm Springs Convention Center management, conducted extensive in-market stakeholder outreach, surveyed existing and potential facility users, and analyzed competitive/comparable facilities and communities.
We sincerely appreciate the opportunity to assist you with this project and would be pleased to be of further assistance in the interpretation and application of the study’s findings.
Sincerely,
CSL International
TABLE OF
CONTENTS
Executive Summary 5
1. Historical PSCC Operating Data 20
2. Local & Regional Conditions 25
3. Comparable Facilities 38
4. Industry Trends 49
5. Market Demand 63
6. Recommendations 73
7. Economic & Financial Impacts 82
8. Sales/Marketing Analysis 91
ES
EXECUTIVE
SUMMARY
Strategic Plan for the Palm Springs Convention Centers ● Page 5
ES EXECUTIVE SUMMARY
Introduction & Background
The competition among communities to attract non-local conventions, tradeshows, conferences, meetings and other events is intense – leading many to invest significantly in event facilities, hotels and other aspects of their destinations. Against this backdrop, Palm Springs Convention Center (PSCC) management retained CSL to conduct a Convention Industry Futures Study for Palm Springs. The purpose of the analysis is to assist Palm Springs convention industry stakeholders in navigating this changing landscape, using a trend forward lens to evaluate key market, program, financial, and economic impact aspects associated with investing in improvements to both the PSCC, its surrounding environment, and, more broadly, the Palm Springs destination.
Ultimately, PSCC management and other key stakeholders should use this document to build on a mission to increase room night generation, support businesses and employment, improve quality of life for residents, and create significant economic impact through investment in the convention industry. The Executive Summary below and on the following pages summarizes the findings associated with the analysis. The full report should be reviewed in its entirety to gain an understanding of analysis methods, limitations and implications.
Historical PSCC Operations
The following key findings have been reached concerning the analysis of PSCC’s historical event, attendance, room night, and occupancy levels during the period spanning 2010 through 2022. • CONSISTENT EVENT ACTIVITY: Annual PSCC event activity and attendance levels pre-Covid have remained consistent between 2010 and 2019, with conventions and consumer shows accounting for a substantial portion of facility attendance. As expected, convention events have generated the significant majority of PSCC room nights, attracting significant shares of non- local attendees.
• CONSISTENT OCCUPANCY LEVELS: Pre-Covid occupancy levels for the PSCC’s Oasis Hall ranged between 41 and 50 percent, generally below the desired occupancy range for a convention venue. Taken together, the PSCC’s consistent and somewhat low event and occupancy levels suggest that there are factors limiting increases to event market capture. • LOST BUSINESS: Convention center sales staff track the events and associated room nights lost to the destination during the competitive bid process. Reasons given for not choosing the PSCC relate to destination amenities, desire for more upscale product, hotel shortages and limited PSCC space, each of which are addressed as part of recommendations discussed herein.
In total, more than 275,000 room nights were lost due to one or more of these factors during the period spanning 2010 through 2023.
Local and Regional Conditions
We have conducted a thorough analysis of local and regional conditions that will influence the ability of the Palm Springs Convention Center (PSCC) to maintain and enhance market capture within the convention and meetings sector. Results from this analysis are summarized below and on the following page. • HOTEL INVENTORY: Based on data provided by PSCC staff, the PSCC is supported by approximately 1,725 committable rooms in 15 area hotels. In practice, it is not generally marketable to use a high number of hotel properties to assemble a room block. For example, it may be necessary to use over five hotel properties in the Palm Springs market to assemble a committable room block of 1,000 rooms. Competitive markets with large hotel properties proximate to their centers will offer a more competitive room block in fewer hotel properties. • SEASONALITY: Input provided by representatives of various Palm Springs area hotel properties suggests that committable room numbers can significantly decrease depending on seasonal leisure activity in the destination. • PSCC’S SURROUNDINGDISTRICT: Event planners routinely consider the destination outside of the host facility when selecting sites for their events. There are nearly 2,800 hotel rooms, 150 dining establishments, and ten (10) attractions that total 5,200 reviews on Trip Advisor within one-mile of the PSCC.
• AIRLIFT: From 2015 through 2019 enplanements were consistently growing at approximately 7.2 percent annually at Palm Springs International Airport (PSP). Following the pandemic, the PSP was nearly back to normal levels in 2021 and set a new enplanement record in 2022. PSP management indicates that this growth rate is expected to increase in upcoming years. A planned expansion of the facility will further support growth. This should positively impact the destination’s ability to attract non-local fly-in convention activity.
Strategic Plan for the Palm Springs Convention Centers ● Page 6
ES EXECUTIVE SUMMARY
• REGIONAL AREA COMPETITIVE FACILITIES: Though the PSCC ranks relatively high among the defined set of competitive venues in terms of the size of its event space, its headquarter hotel inventory ranks behind all dedicated convention centers reviewed with the exception of those in Monterey and Pasadena. The ratio of hotel rooms within ½-mile to the total sellable space of a facility for the PSCC ranks 12th among regional competitive facilities. These data suggest that the headquarter and area hotel inventory may represent a competitive disadvantage in attracting large non-local events to the PSCC.
Comparable Facilities
Twelve (12) facilities were identified nationally as comparable to the PSCC based on their market size, geographic positioning, and event space offerings. Key insights from the analysis of these facilities is provided below. • COMPARABLE FACILITY EVENT SPACE: The PSCC’s Oasis Hall ranks eighth (8th) out of 13 among comparable facilities in terms of largest contiguous space, while its ballroom and meetings space inventories each rank tenth (10th). By increasing the quantity and proportion of meeting and ballroom space at the PSCC, the facility could better compete with comparable and competitive facilities nationwide.
• COMPARABLE FACILITY HOTELS: The 410 rooms offered at the Renaissance Hotel of Palm Springs closely approximates the comparison set’s headquarter hotel room average of 406. The 1,243 rooms within ½-mile of the PSCC rank sixth, approximating the average/median range. The challenge for the PSCC lies in the previously referenced committability factor, especially during peak season. Few of the reviewed markets experience the peak and valley room demand cycles common in Palm Springs.
• COMPARABLE DINING/RETAIL DISTRICTS: The environment within a 10-minute walk surrounding the PSCC site generates retail and dining sales far below the median of the comparison set. However, its 20-minute walk capture (which includes much of downtown Palm Springs) approximates the set’s median level of sales. These data reflect disparity of commercial activity between the PSCC's immediate area and the downtown core. • COMPARABLE EXPANSIONS AND REDEVELOPMENTS: Many of the regional and national facilities within the comparison set have been continually improved in recent years, both in terms of facility investments and surrounding district growth. Common themes identified as part of convention-related investment in Long Beach, West Palm Beach, Irving, Spokane, Raleigh, and San Jose include the addition or re-configuration of flexible event spaces, integrating with growing districts, creation of outdoor event space, development of additional headquarter hotel inventory, and adoption of tech-forward infrastructure and design.
Industry Trends
The following key findings have been reached concerning the analysis of industry characteristics and trends that are relevant when evaluating the market opportunity for an improved PSCC. • COVID IMPACTS ON CONVENTION/EVENT ACTIVITY: Given the parallels between GDP changes and changes in various measures of the convention and conference industry, we expect future industry growth to continue to mirror the overall health of the economy. With leading economists noting that the economy is now rebounding from COVID impacts, we can assume a rebound to the convention and conference sector over the next several years. Longer term, potentially by the time improvements are made to the PSCC and/or its hotel product, it is likely that COVID impacts will have largely dissipated, and that standard economy-driven fluctuations in the convention and conference industry will prevail. • CONVENTION FACILITY TRENDS: The convention industry continues to evolve as attendee bases undergo generational shifts, and as planner preferences regarding event spaces, services and technologies continue to change. Event planner feedback suggests that it will be important to prioritize the inclusion of hybrid event technology, dynamic pre-function areas, signature outdoor space, local/authentic food and beverage outlets, and pop-up/temporary food stations as part of potential PSCC improvements.
• CONVENTION DISTRICTS TRENDS: Event planners increasingly consider the appeal of a convention facility’s surrounding destination as part of their host facility selection process. Event planner input highlights the need to include various “district” elements closer to the PSCC, as well as better connect the facility to downtown Palm Springs. District elements that were scored as critically important by surveyed event planners include full-service and other hotel properties, pedestrian lighting, sit- down and fast/casual restaurants, easy to understand pedestrian wayfinding, and shuttle/trolley vehicle service.
Strategic Plan for the Palm Springs Convention Centers ● Page 7
ES EXECUTIVE SUMMARY
Market Demand
CSL collected input from 84 state, regional and national event planners, representing more than 100 annually recurring convention, tradeshow, and other events. In addition, several current and past users of the PSCC were interviewed. Feedback from this analysis is summarized below.
• EVENT PLANNER DEMAND: Eighty-two (82) percent of events organized by the event planners interviewed via telephone would at least “possibly” rotate to the PSCC in the future, assuming it meets their space and hotel requirements. When asked to rate interest in comparable destinations, Palm Springs received a score that is among the highest of any prior CSL destination survey. Additionally, Palm Springs received a significantly low unfamiliarity rate for event planners. • EVENT SPACE NEEDS: Approximately 83 percent of event planner demand for exhibit space is accommodated by the 92,500- square foot Oasis Hall. However, PSCC’s ballroom and meeting space inventories can only meet 55 percent and 73 percent of event planner demand, respectively. Considering these data, continuing to work with the Renaissance to leverage their meeting space to meet larger convention needs will be important going forward. Further, considering trending preferences for non- traditional meeting setups in outdoor and/or pre-function areas, it will be beneficial to identify open areas throughout the PSCC that could offer 4,000 to 6,000 square feet of additional gathering space for larger conventions to somewhat supplement the facility’s existing meeting space inventory.
• HOTEL NEEDS: Considering the previously noted range of committable hotel inventory within one mile of the PSCC, between 60 and 80 percent of events can be accommodated by the facility’s supporting hotel package. If given the choice, virtually all planners would prefer using only one hotel property to house their attendees, and only 28 percent are willing to use four or more properties. Considering these data, it will be important to prioritize the development of additional supporting hotel inventory within proximity of the PSCC.
• CURRENT/PAST CUSTOMER COMMENTS: Past users of the PSCC were interviewed to discuss their thoughts regarding how the PSCC could be improved to provide better experiences for event planners and attendees. Key challenges include the PSCC’s supporting hotel inventory and quality; the building’s technology (larger, centralized digital signage); the dated aesthetic of the facility’s meeting spaces and portions of its pre-function areas; the distance to/from downtown; and the lack of transportation options to frequent this distance.
Building and District Recommendations
Overall, market analysis findings suggest that investment in improving the Palm Springs Convention Center and the surrounding district would materially benefit the ability to attract high impact events to the market. The recommendations presented herein are segmented into the following four areas of focus.
1. Convention Product Improvements
2. District Connectivity
3. Near- and Mid-Term Real Estate Planning
4. Long-Term Planning
Recommendations concerning each of these topics are presented below and on the following pages. Many of the recommendations presented herein cannot be implemented by a single entity or agency. In fact, participation from a variety of public and private sector entities may be necessary to realize the potential of Palm Springs within the convention industry economy.
Strategic Plan for the Palm Springs Convention Centers ● Page 8
ES EXECUTIVE SUMMARY
Convention Product Improvements
Analysis findings suggest an opportunity for the PSCC’s market capture to increase by enhancing the in-facility experience for both the event planner and attendee. Key aspects of a recommended facility program for an improved Palm Springs Convention Center are highlighted below within the floor plan illustration, followed by descriptions of each concept.
Recommended PSCC Improvements
Re-Invention of The West
The PSCC’s western entrance represents a key opportunity to create a convention visitor “launch point” to the downtown Palm Springs destination and could help better link the facility with downtown and other nearby existing and future attractions. At the same time, the area could be further leveraged as unique meeting/gathering space, offering both spacious pre-function and outdoor areas.
• Outdoor Event Space: Jackie Lee Houston Plaza should be reconfigured to be optimized for outdoor event use, including maximizing contiguous event space while maintaining the desired natural elements of the Plaza. • Indoor/Outdoor Social Area: The entrance area into the western side of the facility should be re-imagined as an indoor/outdoor event patio for major conventions.
• Local Food & Beverage: A small space (approximately 500 to 1,000 square feet) could be allotted within the western pre- function area to accommodate a kiosk structure for permanent or rotating food & beverage vendors from the local area. 1 Re-
Use
Improved
Eastern
Entrance
Digital
Public Art
Stations
Conversion
to Ballroom?
Local F&B Kiosk
Outdoor
Event Space
Open Space
Learning
Indoor/Outdoor
Social Area
Strategic Plan for the Palm Springs Convention Centers ● Page 9 • Open Space Learning: Event planners are increasingly using pre-function areas such as lobbies and atriums to host their programming. Efforts should be made to add furniture to the pre-function areas that can host small and mid-sized gatherings. • Digital Public Art Station: LED and digital-based installations could be added throughout the western pre-function and other areas of the building. Installations tied to a theme of sustainability could align well with Coachella Valley community and economic development goals.
Other Building Improvement Opportunities
Opportunities exist beyond the western entrance to enhance the PSCC product. These are summarized by topic below. • Update Primrose and Meeting Space: Investment should be made to update Primrose Ballroom and breakout meeting rooms with modern aesthetics and technology.
• Digital Signage: Large, highly visible LED screens should be added to highly trafficked pre-function areas. • Improvement of The Renaissance: Efforts should be made to encourage investment in the property’s guest rooms and continued improvement in the quality of its service.
• Hotel Incentive Program: The City of Palm Springs offers a hotel incentive program that re-imburses hotel owners for improvements to their properties, but this policy expires at the end of 2023. The program should be renewed, and properties that engage in PSCC room blocks should be encouraged to participate in the near-future. • Improved Eastern Entrance: The addition of public art, landscaping, plaza space and visible digital signage outside the eastern entrance of the PSCC would enhance the visitor experience as attendees approach and enter the facility from Caballeros Lot. • Increase Storage: Opportunities to increase storage space at the PSCC should continue to be evaluated by leadership. Given its limited use, the existing green room just east of Primrose Ballroom could offer additional storage. • Diversify Wi-Fi Options: A three-tier paid Wi-Fi structure should be evaluated that offers highly affordable internet access to attendees (preferably free), a mid-tier option for streaming, and a top-tier option for transactions, 4k streaming, gaming, and other data-intensive uses.
• Conversion of Oasis 4: Potential may exist to enhance Oasis 4 with higher quality carpet, acoustic paneling, ceiling treatment, dynamic lighting and technology to create opportunities to accommodate traditional ballroom/general session functions.
District Connectivity
Opportunity exists to strengthen the pedestrian experience between the PSCC and downtown assets through wayfinding, public art, lighting, technology, landscaping and other elements. Potential corridors for enhancement include E Amado, E Andreas, and E Tahquitz Canyon Way.
Specific recommendations are highlighted within the graphic below and further described on the following pages.
ES EXECUTIVE SUMMARY
2 Strategic Plan for the Palm Springs Convention Centers ● Page 10 PSCC District Connectivity Planning
• Monumental Public Art: One or more large-scale installations could be a defining component of the PSCC’s western entrance, and addition installations could be located along one of the three westward corridors pictured above, serving as directional landmarks to downtown.
• Themed Wayfinding: One or more strategically placed digital, interactive kiosks could be added at highly visible points along one of the westward corridors.
• Street Performances: For some of the PSCC’s largest citywide events, potential may exist for VillageFest leaders, Downtown Palm Springs decisionmakers and the PSCC to organize a “trail” of performers to lead attendees to key areas of downtown. • Convention Center Marquee: A large digital LED board that is potentially based on the façade of the facility and maintains the City’s aesthetic/character standards could serve as both an informational resource that showcases the major events that are in-destination, as well as a placemaking enhancement at night. • Nighttime Installations: A trail of permanent or temporary public art installations that light up at night could partially address the lighting and safety issues raised by stakeholders.
• Pedestrian Lighting: Additional pedestrian-focused lighting along the western façade of PSCC, at Jackie Lee Houston Plaza, along North Calle Alvarado, and along one or more of the westward corridors should be considered. • Electric Microtransit: Monitor opportunities to work with a private partner to provide electric vehicle shuttling services between the PSCC and to/throughout downtown Palm Springs.
• Other Pedestrian Experience Improvements: Other placemaking improvements such as landscaping, planters, shading, and misters could be added along the westward corridors.
Street
Performances
Themed
Wayfinding
Cony. Ctr.
Marquee Nighttime
Installation
s
Pedestrian
Lighting
Electric
MicrotransitMonumental Public
Art
ES EXECUTIVE SUMMARY
Strategic Plan for the Palm Springs Convention Centers ● Page 11 Near- and Mid-Term Real Estate Planning
The PSCC is adjacent to several key parcels that are planned for hospitality-related development. We have prepared the following recommendations for hotel, downtown and other hospitality projects going forward. The illustration below highlights key areas of interest.
PSCC District Real Estate Planning
• Hotel Development Principles: For planned or potential hotel projects identified above, room count and scale/style should be prioritized as part of their development. These are summarized below. • Room Count: As planning progresses on the project sites, the public sector should be pro-active in encouraging the maximization of the room counts. A collective total of 500 to 600 total new rooms should be targeted.
Consideration could be given to offering modest public subsidies to support larger hotel properties. • Scale and Style: New hotels should be full-service or select service “plus” properties that offer trend forward dining, modern and spacious pre-function areas, and unique and tasteful interior décor. • Downtown Development: Initiatives to maintain and enhance the visitor experience in downtown are presented below. • Business Improvement District (BID): City leaders should evaluate the feasibility of again creating a formalized BID for downtown, potentially through enhancement of the existing Main Street Palm Springs organization. With sufficient funding, this organization could lead important, Downtown-focused programs such as storefront improvement grants, beautification efforts, street/sidewalk cleaning, and downtown ambassadors. • Hospitality Businesses to Target: City decisionmakers should prioritize the attraction of non-chain restaurants and retail, club-like performance venues, and unique breweries or distilleries to downtown as part of economic development and Downton-focused plans.
3 ES EXECUTIVE SUMMARY
Future
Hotel?
Planned
Hotel
Brewery/Restaurant
Rec/Entertainment
Lifestyle Hotel
Trending Dining
Downtown Development Principles
Unique and AuthenticFaçade Improvements
Improv Theater
Land
Bank
Planned
Hotel
Downtown
Improvements
Hotel Development Principles
Strategic Plan for the Palm Springs Convention Centers ● Page 12 Long-Term Planning
Several City-owned parcels adjacent to the PSCC offer important opportunities to develop convention and/or hotel product in the future. The illustration on the following page highlights these key parcels and is followed by discussions regarding how each could be best developed in the long-term.
4 ES EXECUTIVE SUMMARY
PSCC District Long-Term Planning
1. Land Bank Opportunity at East Lawn: The City-owned East Lawn should be designated as a future expansion site for PSCC’s Oasis Hall. The parcel is approximately 50,000 square feet, and assuming the inclusion of industry standard support space for added exhibit space, could accommodate an approximate 30,000-square foot contiguous expansion of Oasis Hall.
2. Private-Held Parcels: The approximate 4.5-acre site to the west of the PSCC towards downtown Palm Springs is an ideal location for a large convention hotel and other hospitality/landscaping elements. The other private parcels should be designated as secondary options for a convention-quality headquarter hotel should the site be developed into a hotel with less than 300 rooms.
3. Land Bank Opportunity at Caballeros Lot: Totaling approximately 7.8 acres, the Caballeros Lot could likely accommodate an extension of the PSCC and a parking structure that would replace existing surface parking at the site. The specific programming for the added space could include a variety of multi-use spaces designed to house individual events, and to serve large campus-oriented events that use both the new space and the existing PSCC.
Land Bank & Tertiary
HQ Hotel LocationFuture
Hotel?
Secondary
HQ Hotel
Location
Private Ownership
Public Ownership
Ideal HQ Hotel
Location
Land Bank &
Future Oasis Hall
Expansion
Strategic Plan for the Palm Springs Convention Centers ● Page 13 Recommendation Project Timing
1 PSCC Building-Wide Improvements (aesthetics, internet, digital signage, storage, hotel experience) 1-2 years 2 Re-Invention of PSCC's Western Outdoor Space/Entry/Lobby 1-2 years 3 Hotel Development Adjacent to PSCC 1-3 years
4 Convention District Connectivity Initiatives 1-5 years 5 Enhancement of Oasis 4 into Higher Scale Multipurpose Space 3-5 years 6 PSCC HQ Hotel Development 3-5 years
7 Downtown BID 3-5 years
8 Expansion to Caballeros Lot (Multipurpose Facility and Possible Hotel) 5-10 years 9 Oasis Hall Expansion 10+ years
10 Downtown Targeted Business Recruitment Ongoing
Palm Springs Convention Destination Plan
Schedule of Recommended Initiatives
Implementation Timeline
We have considered the timing of each of the primary recommendations presented previously and have identified the stakeholders that should be involved in their planning and implementation going forward. The images below provides a high-level summary of these elements as they relate to each recommended initiative.
Key Stakeholders Involved in Implementation
ES EXECUTIVE SUMMARY
1 PSCC, Encore, Renaissance
2 PSCC, City, Steelcase, Local Brewery or Restaurant, Local or International Artists 3 City, Developers
4 PSCC, City, Agua Caliente, Local and International Artists, Developers, GPSCVB 5 PSCC
6 PSCC, City, Developers
7 City, Main Street Palm Springs, Local Property Owners, Local Business Owners 8 PSCC, City, Developer
9 PSCC, City
10 City Economic Development, Main Street Palm Springs, Local or Regional Business Owners Key Local Stakeholders
Palm Springs Convention Destination Plan
Key Local Stakeholders
Recommendation
#
Strategic Plan for the Palm Springs Convention Centers ● Page 14 Events Level Forecast
The following presents an analysis of estimated utilization and costs/benefits associated with an improved PSCC and surrounding convention district, focusing on “incremental” costs/benefits relative to the existing convention product. Working with PSCC sales staff, key assumptions were developed to generate estimates related to an improved PSCC. A stabilized year of operation is assumed to occur by the fifth full year of improved facility operations. Further detail regarding assumptions made as part of this exercise is provided within the full report.
The analysis herein presents PSCC usage and attendance levels, associated economic and fiscal/tax impacts, and high-level financial operations analyses for three potential future scenarios. These are described below:
1. Do Nothing: The PSCC product continues to operate as is over the next five years; lack of investment leads to deterioration of market share, as planners of rotating conventions select convention facilities and destinations with more updated amenities, walkable districts, and greater hotel room support.
2. Mid-Term Investments: Previously discussed improvements and advancements are made to the PSCC convention product, including the West Hall transformation, updates to Primrose Ballroom and meeting rooms, the development of a new hotel to the southwest, and the creation of a pedestrian trail to downtown Palm Springs.
3. Long-Term Investments: Transformational projects previously discussed are completed that greatly enhance the desirability of the PSCC convention product and enable the facility to host larger, more economically impactful conventions. These projects include the development of a new 350- to 400-room headquarter hotel at one of the previously identified sites near the PSCC, the expansion of Oasis Hall (adding approximately 25,000 square feet of contiguous exhibit space), the addition of a new 30,000- to 35,000-square foot ballroom.
As noted in the following table, PSCC event data are presented for banquet, civic, consumer show, conventions (small, mid-sized, and large), entertainment, meeting, sports, and other events. A comparative analysis has been prepared that summarizes the incremental gains and losses in event activity associated with each of the three previously identified scenarios relative to “baseline” PSCC event levels. Average event levels during the pre-Pandemic period of 2017 through 2019 have been used as a baseline for PSCC event activity.
Under a Do Nothing scenario, the PSCC is estimated to host four less mid conventions and two less large conventions annually relative to the 2017-19 period. Mid-Term Improvements are estimated to result in a total of seven (7) more conventions per year and an eight (8) percent increase in overall event count. Headquarter hotel development, expansion of Oasis Hall, and the added ballroom associated with Long-Term Improvements are estimated to attract 15 new rotating conventions per year relative to 2017-19, and a 28 percent increase in overall event activity.
It is also important to consider the event day and attendance levels of each of the three convention calendars. During the three years prior to the Pandemic year of 2020, the PSCC averaged 123 convention event days and nearly 37,300 convention attendees. The attraction of more “Mid” and “Large” conventions under the Mid- and Long-Term scenarios would lead to increases of 33 and 58 event days from this baseline, respectively. Likewise, annual convention attendance is estimated to increase by approximately 6,300 with Mid-Term investment, and by 17,500 with Long-Term investment. Under a Do Nothing scenario, annual event days and attendance are estimated to drop by 29 days and 9,700 attendees, respectively.
Small Conventions: Convention/conference events with less than 1,000 total room nights.
Mid Conventions: Convention/conference events with between 1,000 and 2,500 total room nights.
Large Conventions: Convention/conference events with more than 2,500 total room nights.
ES EXECUTIVE SUMMARY
PSCC
2017-2019 Stabilized % Stabilized % Stabilized %
EVENT LEVEL ESTIMATES Avg. Year Incremental Growth Year Incremental Growth Year Incremental Growth
NUMBER OF EVENTS
Banquet 19 16 (3) -16% 23 4 21% 27 8 42%
Civic 1 1 0 0% 1 0 0% 1 0 0%
Consumer Show 10 10 0 0% 10 0 0% 10 0 0%
Small Conventions 7 8 1 14% 10 3 43% 12 5 71%
Mid Conventions 14 10 (4) -29% 18 4 29% 22 8 57%
Large Conventions 6 4 (2) -33% 6 0 0% 8 2 33%
Entertainment 6 6 0 0% 6 0 0% 6 0 0%
Meeting 78 70 (8) -10% 78 0 0% 93 15 19%
Other 23 23 0 1% 28 5 22% 32 9 39%
Sports 3 4 1 22% 4 1 22% 5 2 67%
Total 167 152 (15) -9% 180 17 8% 211 47 28%
Do Nothing Mid-Term Improvements Long-Term Improvements Strategic Plan for the Palm Springs Convention Centers ● Page 15 Economic Impacts
As noted in the exhibit below, events at the PSCC generated approximately $46.3 million per year on average prior to the Pandemic. Should no improvements of the convention product take place, this spending is estimated to lower to $39.1 million (16 percent drop). Improvement of the product in the Mid-Term would lead to a sustained level of the peak spending generated in 2019 (just over $51.3 million), while an expansion and new headquarter hotel in the Long-Term would increase the baseline average by 34 percent to approximately $62.0 million annually.
The net new direct spending generated by events held at the PSCC will circulate throughout the local economy, creating indirect and induced spending. Combined, the direct, indirect and induced spending is termed total output. The total output generated by PSCC events averaged $78.6 million during the 2017-19 period. Modeling suggests that this impact could increase by 11 percent with a new neighboring hotel, PSCC improvements, and various district enhancements that could be implemented in the Mid- Term. Without these investments, output is estimated to drop by 16 percent to $66.3 million annually. Upon development of a headquarter hotel and expansion of PSCC, an increase to $105.2 million in total economic output is estimated.
The total output generated by PSCC events is estimated to result in “net new” employee earnings and job creation. Further detail regarding wage and employment creation is provided within the full report. PSCC-generated earnings averaged $32.3 million during the 2017-19 period. With a new headquarter hotel, PSCC expansion, and various PSCC and convention district enhancements, earnings could increase by 11 percent to $35.9 million. A loss of approximately $5.0 million in annual earning is estimated under a Do Nothing scenario.
Further, under a Do Nothing scenario, PSCC events would support an estimated 461 less jobs relative to the Long-Term scenario and 246 less jobs relative to the Mid-Term scenario, again highlighting the importance to the Palm Springs economy of prioritizing convention-quality hotel development, implementing convention district improvements, and enhancing the PSCC product. $30.0M $27.0M $31.3M $29.4M $24.5M $32.5M $39.1M
$20.1M $17.0M
$22.5M $19.9M $17.0M
$22.2M
$26.8M
$79.9M
$69.6M
$86.4M
$78.6M
$66.3M
$87.2M
$105.2M
$.0M
$15.0M
$30.0M
$45.0M
$60.0M
$75.0M
$90.0M
$105.0M
$120.0M
$135.0M
$150.0M
2017 2018 2019 2017-2019
Avg.
Do Nothing Mid-Term Long-Term
Other
Local transportation
Entertainment
Retail
Restaurant
Hotel
$17.8M $16.0M $18.6M $17.5M $14.6M $19.3M $23.2M
$12.0M $10.1M $13.4M $11.8M $10.1M
$13.2M $15.9M
$47.0M $41.0M
$50.9M $46.3M
$39.1M
$51.3M
$62.0M
$.0M
$10.0M
$20.0M
$30.0M
$40.0M
$50.0M
$60.0M
$70.0M
$80.0M
$90.0M
$100.0M
2017 2018 2019 2017-2019
Avg.
Do Nothing Mid-Term Long-Term
Other
Local transportation
Entertainment
Retail
Restaurant
Hotel
Annual Direct Attendee Spending by Industry
(Historical vs. Future Scenarios)
Annual Economic Output by Industry
(Historical vs. Future Scenarios)
ES EXECUTIVE SUMMARY
Strategic Plan for the Palm Springs Convention Centers ● Page 16 Fiscal Impacts and Hospitality Industry Profit
Direct spending, total output and earnings will all help to support the generation of new tax revenues to various public sector entities. The exhibit below presents estimates of sales and hotel tax revenues associated with historical PSCC event activity and the three investment scenarios. The PSCC event activity generated an estimated $5.8 million in total tax revenues in 2019. With moderate Mid-Term improvements, this would be sustained on an annual basis. Lack of investment will lead to $900,000 less in estimated tax revenue per year relative to the pre-Pandemic average. Significant Long-Term initiatives are estimated to lead to an increase of $1.8 million per year in annual tax revenue, including $800,000 in incremental hotel revenue for the City.
The spending generated by PSCC event attendees, exhibitors and planners that is new to the Palm Springs community also generates profit within various hospitality industry sectors. As these sectors often contribute significantly to the funding, operation and marketing of convention centers, we have generated estimates of the current and potential future hotel and restaurant industry profit garneted by the PSCC. Profit estimates for the hotel sector focus only on the rooms department, assuming a 65 percent margin on room sales. A ten (10) percent margin is assumed on restaurant sales.
As noted in the exhibit below, the combined hotel and restaurant sector profit approximated an average of $12.6 million in estimated profit due to PSCC event activity during the 2017-19 period. This consists of $11.4 million in hotel profit and $1.2 million in restaurant profit. Combined profit is estimated to fall by a substantial $2.1 million per year under a Do Nothing scenario.
Moderate improvements, including a nearby hotel, would enhance this figure by $1.2 million per year, while transformative investments would elevate estimated profits to $16.7 million annually, representing a $4.1 million annual increase relative to the pre-Pandemic average.
$11.6M $10.4M
$12.1M $11.4M
$9.5M
$12.5M
$15.1M
$1.2M $1.0M $1.3M $1.2M $1.0M $1.3M $1.6M
$.0M
$2.0M
$4.0M
$6.0M
$8.0M
$10.0M
$12.0M
$14.0M
$16.0M
2017 2018 2019 2017-2019
Avg.
Do Nothing Mid-Term Long-Term
Profits
Hotel Industry Profit Restaurant Industry Profit
$.5M $.4M $.6M $.5M $.4M $.5M $.7M
$.6M $.5M $.6M $.6M $.5M $.6M $.8M
$2.0M $1.7M
$2.2M $2.0M $1.7M
$2.2M
$2.6M
$2.3M
$2.1M
$2.4M
$2.2M
$1.9M
$2.5M
$3.0M$5.4M
$4.7M
$5.8M
$5.3M
$4.4M
$5.8M
$7.1M
$.0M
$1.0M
$2.0M
$3.0M
$4.0M
$5.0M
$6.0M
$7.0M
$8.0M
$9.0M
$10.0M
2017 2018 2019 2017-2019
Avg.
Do
Nothing
Mid-Term Long-
Term
City Hotel Tax Collections
State Sales Tax
Collections
County Sales Tax
Collections
City Sales Tax Collections
Fiscal/Tax Generation Impacts
(Historical vs. Future Scenarios)
Hospitality Industry Profits
(Historical vs. Future Scenarios)
Tax Rates:
City Hotel Tax: 13.5%
State Sales Tax: 6%
County Sales Tax: 1.75%
City Sales Tax: 1.5%
ES EXECUTIVE SUMMARY
Strategic Plan for the Palm Springs Convention Centers ● Page 17 Financial Operations Analysis
We have prepared a review of PSCC financial operations, focusing on net operating revenue and loss. These data are then compared to similar venues on a square footage of sellable space basis below. The results of this comparison are used to identify areas where PSCC financial operations may align with or outperform the benchmark of comparable projects.
Recommendations are then made with respect to adjusting targets for future PSCC financial operating performance, with consideration given to the three investment scenarios. Further detail regarding line items on the PSCC’s financial operations report are provided within the full report.
We have collected financial operating data from 15 convention centers that are comparable in size to the existing and potentially expanded PSCC. In terms of financial performance, convention facilities operate with an average loss of approximately $686,600, with average revenues at $7.3 million and expenses at $8.0 million. The PSCC’s FY 2022 performance ranks favorably relative to comparable and competitive venues in terms of net operating loss, while its FY 17-19 average falls well below the set’s average and median. As the convention and meeting industry continue to fully rebound from Pandemic conditions, efforts should be made by PSCC management to mitigate a gradual return to FY 2017-19 expense levels. Tactics such as controlled staffing growth and capital improvements that can save costs (such as the recently added solar panels) should be prioritized for near-term implementation.
As shown by comparative financial performances above, an eventual surplus is highly unlikely. The four facilities with net positive performance rely on unusually frequent corporate business with high spend on food & beverage, and/or substantial revenue from paid parking.
Previously discussed improvements and expansions recommended to take place will require significant capital expenditures, and they will likely increase the building’s overhead expenses for staffing, utilities, supplies, etc. However, previously discussed trend forward upgrades, expanded event space, and added hotel room inventory will enable the PSCC to attract a greater number of events and attendees on an annual basis, and many previously recommended investments will provide a more diverse revenue portfolio that will result in greater net operating performance. For example, inclusion of a local/authentic food & beverage provider within the PSCC’s west lobby will spur greater spending by attendees and/or generate tenant revenue, while an improved Jackie Lee Houston Plaza and additional outdoor space at the western entrance will generate net new facility rental revenue.
We estimate that the PSCC will be able to maintain and potentially improve upon its FY 2022 performance with implementation of these improvements. Under a Do Nothing Scenario, it is likely that event levels will deteriorate, which will likely drop the facility’s bottom-line performance back to or below 2017-19 levels.
Sellable Net Net Operating Rev. per Exp. per
Event Space Operating Operating Operating Inc./(Loss) per SF Coverage SF of Tot. SF of Tot.
Facility (Square ft.) Revenue Expense Income/(Loss) Tot. Sel. Space Ratio Sel. Space Sel. Space Facility A 536,800 $18,979,706 $20,239,360 ($1,259,654) (2.35) 93.8% $35.36 $37.70 Facility B 423,500 $7,854,293 $9,952,168 ($2,097,875) (4.95) 78.9% $18.55 $23.50 Facility C 278,000 $11,249,745 $10,713,062 $536,682 1.93 105.0% $40.47 $38.54 Facility D 297,000 $5,856,553 $6,581,671 ($725,118) (2.44) 89.0% $19.72 $22.16 Facility E 366,600 $15,230,241 $16,738,797 ($1,508,556) (4.11) 91.0% $41.54 $45.66 Facility F 318,000 $9,700,022 $9,582,581 $117,441 0.37 101.2% $30.50 $30.13 Facility G 231,300 $7,357,133 $7,546,911 ($189,778) (0.82) 97.5% $35.48 $32.63 Facility H 141,600 $5,317,557 $5,050,498 $267,059 1.89 105.3% $37.55 $35.67 Facility I 143,300 $5,263,435 $6,041,343 ($777,908) (5.43) 87.1% $36.73 $42.16 Facility J 169,200 $4,426,206 $5,215,646 ($789,440) (4.67) 84.9% $26.16 $30.83 Facility K 132,200 $1,940,934 $3,814,200 ($1,873,266) (14.17) 50.9% $14.68 $28.85 Facility L 115,000 $4,440,396 $6,232,657 ($1,792,261) (15.58) 71.2% $38.61 $54.20 Facility M 105,700 $2,756,581 $3,751,441 ($994,860) (9.41) 73.5% $26.08 $35.49 Facility N 97,600 $6,778,369 $5,988,330 $790,039 8.09 113.2% $69.45 $61.36 Facility O 82,300 $2,259,727 $2,261,735 ($2,008) (0.02) 99.9% $27.46 $27.48 Average 229,200 $7,294,100 $7,980,700 ($686,600) (3.45) 89.5% $33.22 $36.42 Median 169,200 $5,856,600 $6,232,700 ($777,900) (2.44) 91.0% $35.36 $35.49 PSCC FY17-FY19 Avg. 128,300 $2,922,925 $4,183,272 ($1,260,347) (9.82) 69.9% $35.48 $32.61 PSCC FY 2022 128,300 $2,790,590 $3,290,654 ($500,064) (3.90) 84.8% $21.75 $25.65 Financial Operations Comparative Analysis
ES EXECUTIVE SUMMARY
Strategic Plan for the Palm Springs Convention Centers ● Page 18 Sales and Marketing Analysis
As a significant convention center in a major international hospitality market, the sales and marketing process/coordination for attracting non-local events to the PSCC must be well resourced, with clear roles, responsibilities, and coordinated among key stakeholders. Today, there are typically three primary entities that engage in various ways in the PSCC group sales effort: the PSCC sales staff, VGPS, and primary hotels used to assemble room blocks.
With two organizations involved in PSCC sales efforts in terms of generating leads, assembling room blocks, maintaining national client relationships, and taking ultimate responsibility for bookings, the sales funneling and booking processes can sometimes be more complex given the unique role(s) each organization plays in the sales process.
There are two broad approaches that should be considered, particularly as improvements to the PSCC, hotel and surrounding district are made.
PSCC & Visit Palm Springs as Primary Sales & Marketing Agency A PSCC sales team would retain primary responsibility for maintaining PSCC client relationships and assembling room blocks.
The sales team would reflect the experience of a destination marketing organization found in similar markets including San Diego, Los Angeles, Phoenix, Denver, Palm Beach County and other significant convention destinations. We recommend a competitive review of sales, marketing and incentive funding to ensure the PSCC team as the appropriate resources to compete for business and retain key staff.
VGPS plays a support role, providing qualified PSCC leads, contributing to bid submittals, and leveraging their own client relationships to benefit the PSCC. This type of Center-based group sales and marketing focus would be similar to the approaches that have been taken in markets as diverse as Boston, San Diego, Boise, and to varying degrees in Las Vegas and Reno. Visit Palm Springs would continue to provide marketing funding for the PSCC group marketing responsibilities, including the initiatives contracted through Digital Edge.
GPSCVB as Primary Sales & Marketing Agency
Another option could also be given to adopting a model that resources the VGPS to be the primary sales and marketing entity for the PSCC. This model would be consistent with approaches taken in most markets whereby a CVB or destination marketing organization is responsible for booking high-impact Center events, and Center management provides highly valued event services, venue maintenance, short-term booking and support sales services. The scope of VGPS services in terms of marketing attractions and other hospitality assets throughout the Valley would be beneficial in framing the full benefits of selecting the PSCC for an event.
As investment takes place in the PSCC and surrounding hospitality district, and in order to maximize high impact non-local event activity, the importance of pursuing options consistent with the concepts described above will increase.
We understand that making this change would require review and approval from the VGPS JPA Executive Committee and Board of Directors. At a minimum, a clear understanding of the roles, responsibilities and financial impact of each entity should be clearly outlined.
ES EXECUTIVE SUMMARY
1 LOCAL & REGIONAL
CONDITIONS
Strategic Plan for the Palm Springs Convention Centers ● Page 20 Historical Operations – Event, Attendance and Room Night Levels Annual PSCC event activity pre-Covid has remained fairly consistent between 2010 and 2019. Meetings and conventions represent the largest share of PSCC events, in addition to a variety of other events including meetings, conferences, consumer shows and occasional sporting, entertainment and other events. The event mix is reflective of many mid-sized convention centers nationally, mixing high impact non-local events, in addition to a variety of events that cater to the local community, helping to enhance quality of life for residents.
Annual attendance levels have shown some variance over the 2010 to 2019 period, with most years registering attendance levels at or above 120,000. Conventions and consumer shows represent the largest share of attendance generation. The rebound in attendance post-Covid has been significant starting in 2022, led by attendance in the convention and consumer show segments.
As expected, convention events have generated the significant majority of PSCC room nights, attracting significant shares of non-local attendees. These attendees typically spend three to five days in-market, spending significantly on hotels, restaurants, retail, attractions, entertainment and local transportation. 1 HISTORICAL PSCC OPERATING DATA
Annual Events by Type
Annual Attendance by Event Type
13 15 16 13 17 13 10
12 10 12
11 10
23 29 26 27
34 28 27 29 23 30 26
12 13
25 33
30 39 29
27 34 44 42 46
14 14
18 23
10 81
100
90 101 100
87 103 109 100
119
37 53
72 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Sports
Other
Meeting
Entertainment
Convention
Consumer Show
Conference
94,034
128,987 135,258
112,376
131,390
98,518
133,506
120,969 120,542
135,869
62,209
37,764
119,640
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Sports
Other
Meeting
Entertainment
Convention
Consumer Show
Conference
38,851
57,051 53,733 53,296
65,650
56,259 62,356
75,581
67,673
82,046
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Sports
Other
Meeting
Entertainment
Convention
Consumer Show
Conference
Annual Generated Hotel Room Nights by Event Type
Source: Palm Springs Convention Center Management, 2022.
Strategic Plan for the Palm Springs Convention Centers ● Page 21 Historical Operations – Exhibit and Ballroom Utilization Understanding the event mix, utilization levels and other such characteristics of the PSCC is important in providing a basis from which to evaluate existing facility performance, possible shortcomings and potential unmet demand for event space in the market.
With this in mind, we have prepared an evaluation of various aspects of historical PSCC occupancy percentages.
Convention center occupancy levels can indicate the degree to which usage of a facility has reached a maximum capacity. The occupancy of space within a facility is determined to be within a practical maximum capacity range when the actual occupied space in a facility reaches a level of 70 percent of total sellable capacity. Above 70 percent occupancy, a facility has exceeded “practical maximum capacity” and may be turning away significant business. Occupancy levels below 50 percent may indicate that a center has not attracted sufficient market share necessary to support existing space levels.
The following exhibit summarizes the annual occupancy levels in the Oasis Hall and Primrose Ballroom for the period 2013 to 2022. As shown, the pre-Covid occupancy levels for the Oasis Hall ranged between 41 and 50 percent, generally below the desired occupancy range for a convention venue. Convention and conference activity represented a significant share of occupancy generation, however, the limited hotel inventory, lack of connectivity to nearby restaurants and attractions, and a limited consumer show and other event base contributed to the somewhat low occupancy levels. A significant rebound in 2022 occupancy, particularly from convention activity, suggests a resilience to the level of Palm Springs convention demand.
Occupancy levels for the Primrose Ballroom followed a similar pattern, with a spike in meeting occupancy in 2017 due to several extended meetings hosted by the City of Palm Springs.
1 Oasis Hall Annual Occupancy by Event Type
4.6% 5.1% 5.4%2.9%4.4% 6.7% 3.9%
5.4% 6.8% 5.3% 5.6%
4.6%
32.4%
32.5%
31.0%
30.9% 30.6%
22.9%
32.0%
5.7% 9.0%
28.1%
3.9%
3.1%
41.8%
3.4%
3.4% 2.9%44.1% 44.6%
41.3%
44.3%
49.0%
41.5%
50.6%
14.1%
53.5%
40.5%
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Sports
Other
Meeting
Entertainment
Convention/Conference
Consumer Show
Civic
Banquet
Primrose Ballroom Annual Occupancy by Event Type
3.5% 3.5% 3.8% 5.1% 6.3% 4.5%3.8%
5.5% 3.6% 4.1%
24.2% 22.1%
29.7% 25.8%
27.5%
21.6% 25.5%
4.5% 11.1%
31.1%
15.1%
6.0% 5.1%
3.1% 3.3%
3.4%
4.9%34.9% 33.3%
41.7%
38.6%
58.7%
43.0% 43.6%
11.4%
14.9%
39.9%
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Sports
Other
Meeting
Entertainment
Convention/Conference
Consumer Show
Civic
Banquet
Source: Palm Springs Convention Center Management, 2022.
HISTORICAL PSCC OPERATING DATA
Strategic Plan for the Palm Springs Convention Centers ● Page 22 38 47 49
70 78 84 93
165
188
Inadequate
Space at
CC
Desire For
More
Upscale
Destination
Amenities
Want to be
Under One
Roof
Rotation Air Access CC Rates Date
Availability
Issues with
Hotels
Lost Business - Lost Events and Room Nights
Convention center sales staff track the events and associated room nights lost to the destination during the competitive bid process. Typically, an association or corporation will issue a request for proposal, with the Center and CVB staff issuing a response that includes Center availability, rates, hotel room blocks and other response items.
The tracked lost events are summarized below with respect to reasons for choosing another destination. Reasons highlighted as “actionable factors” in light blue indicate conditions that could be improved with convention facility or hotel investment. Given the unique nature of the years impacted by the Pandemic, events that were lost due to COVID have been excluded from this analysis.
Issues with hotels, including hotel room availability and hotel quality, is the most common reason for lost business. Date availability is the second most prevalent reason for losing an event. Given the concentration of desirable dates during peak spring and fall months, the lack of desirable dates is somewhat expected. Other routinely cited reasons for lost events include rental rates that don’t match the event’s budget, air access, rotational patterns that don’t include the Palm Springs destination, and a desire for using self-contained hotels.
Hotel issues also resulted in a significant loss of room night generation, as did date availability, air access, and rotational patterns.
These data suggest that many reasons for lost business are “structural”, or not easily addressed by product investment. Other reasons for lost business including destination amenities, desire for more upscale product, hotel shortages and limited PSCC space could be addressed with investment concepts discussed later in this report. 1 Lost Events by Reason (2011 – 2022)
Lost Hotel Room Nights by Reason (2011 – 2022)
Source: Palm Springs Convention Center Management, 2022.
HISTORICAL PSCC OPERATING DATA
17,986
53,106
76,353 94,800
124,644 125,295 143,126
204,675
312,518
CC Rates Desire For
More
Upscale
Destination
Amenities
Inadequate
Space at
CC
Want to be
Under One
Roof
Rotation Air Access Date
Availability
Issues with
Hotels
Uncontrollable Factor
Actionable Factor
Uncontrollable Factor
Actionable Factor
61 58
41 28
Hotel Room
Availability
Hotel
Deficiencies
Hotel
Turned
Down
Hotel
Rates
104,181
94,448
60,876
53,013
Hotel Room
Availability
Hotel
Deficiencies
Hotel
Turned
Down
Hotel
Rates
Strategic Plan for the Palm Springs Convention Centers ● Page 23 Lost Business – Competitive Destinations
We have also reviewed lost business data with respect to destinations to which the PSCC is losing business. As noted below, large regional metropolitan areas such as San Diego, Anaheim, Las Vegas and Los Angeles (particularly large hotels in these destinations) represents a significant share of lost business. Coachella Valley locations such as Indian Wells, Palm Desert, Rancho Mirage and hotels in Palm Springs also represent a large share of recorded lost business.
We note that the large major market hotel product is significantly different from the PSCC/Palm Springs product. Similarly, the hotel/resort properties throughout Coachella Valley are not generally competitive with the PSCC. In other words, event planners that are seeking a high-end resort property or a large metropolitan area hotel would not typically consider the PSCC for their event.
Destinations that represent more direct competition for events that could be held at the PSCC include Long Beach, Ontario, Pasadena and Sacramento.
1 Lost Events by Location (2011 – 2022)
Coachella Valley
State
Regional
National
225
Lost to
In-State
81 Lost to
Regional
93 Lost to
National
113
Lost to
Other
Coachella
Valley Cities
Source: Palm Springs Convention Center Management, 2022.
HISTORICAL PSCC OPERATING DATA
6 7 7 7 8 8 9 9 10 11 13 14 14
21 22 24 24
31 33
42 46
64 113
31 34
48 Rancho
Mirage
Palm
Desert
Indian
Wells
2 LOCAL & REGIONAL
CONDITIONS
Strategic Plan for the Palm Springs Convention Centers ● Page 25 Guest Distance
Rooms to PSCC
Hotel Property (number) (in miles)
18 The Thompson Hotel 168 0.7
19 The Dream Hotel 160 0.1
20 The Orchid Tree Resort & Spa 95 0.9
Planned Hotel Rooms 423 --
Summary of Primary Lodging Facilities Nearby Palm Springs Convention Center 8 2 1
4 5 6
12 7
13 14
15 9
10 16
11 17
2 LOCAL & REGIONAL CONDITIONS
We have conducted a thorough analysis of local and regional conditions that will influence the ability of the Palm Springs Convention Center (PSCC) to maintain and enhance market capture within the convention and meetings sector. The analysis focuses on existing hotel conditions, area attractions and amenities, population and demographic characteristics, Palm Springs International Airport capacity, corporate base, and the inventory of existing area and regional convention and meeting facilities.
Results from this analysis are summarized throughout this section.
Hotel Inventory
The chart and map below summarize existing and planned lodging facilities located in the downtown Palm Springs area. There are 1,243 hotel rooms within ½-mile of the PSCC, distributed across seven hotel properties. The Renaissance Palm Springs serves as the headquarters hotel for the PSCC with a total of 410 guest rooms. The ½-mile lodging room total also includes rooms offered at the Hilton (257 rooms), Hyatt (197 rooms), Hotel Zoso (163), Courtyard (149), Extended Stay America (104) and Marquis Villas Resorts (101). Within a one-mile radius of the PSCC, there are nearly 2,800 existing and planned hotel rooms. This includes the three hotels that are under construction or planned for development in the area. The long-proposed Dream Hotel, located just north of the PSCC, is planned to include 160 hotel rooms and 70 condo units. Other planned properties in the area include the 95-room Orchid Tree Resort & Spa, which has a 2025 opening date, and the 150-room Thompson Hotel (2023).
Committable hotel room inventory is one of the most critical factors influencing the ability to attract conventions. When factoring for rooms occupied by corporate and leisure visitors, area hotels located within ½-mile of a host convention facility typically commit between 40 percent and 70 percent of their hotel room inventory. Using this principle, along with conversations with PSCC sales staff regarding hotels willing to commit rooms to convention business at the PSCC, the hotels within the existing ½-mile radius are estimated to offer between 455 and 796 committable hotel rooms for convention, conference, tradeshow and other activity. Within one mile of the PSCC estimated committable hotel rooms ranges between 675 and 1,182. Committability conditions are further explored on the subsequent page. 19 18
20 Note: Only hotels above 50 rooms are listed.
Total Hotel Rooms on the above tables count hotels that are too small to be listed on the table.
Source: Visit Palm Springs, Hotel Sites, Desert Sun, 2022. 3 Will Commit Rooms to CC
Will Not Commit Rooms to CC
Planned or In Construction
Guest Distance
Rooms to PSCC
Hotel Property (number) (in miles)
1 Renaissance Palm Springs 410 0.1
2 Hilton Palm Springs 257 0.3
3 Hyatt Palm Springs 197 0.5
4 Hotel Zoso 163 0.5
5 Kimpton Rowan Palm Springs Hotel 153 0.6
6 Courtyard Marriott By Palm Springs 149 0.4
7 Palm Mountain Resort & Spa 142 0.6
8 Marquis Villas Resorts 101 0.4
9 Avalon Hotel & Bungalows 71 0.8
10 The Colony Palms Hotel and Bungalows 57 0.5
11 Triada Palm Springs 56 0.6
12 Motel 6 Palm Springs - Downtown 148 0.9
13 Quality Inn 129 0.7
14 Extended Stay America - Airport 104 0.4
15 Best Western Plus Las Brisas Hotel 90 0.5
16 Vista Mirage Resort 56 0.7
17 7 Springs Inn & Suites 50 0.8
Total Hotel Rooms (within 0.5 mile) 1,243 --
Total Hotel Rooms (within 1.0 mile) 2,787 --
Existing Hotels
Planned Hotels
Strategic Plan for the Palm Springs Convention Centers ● Page 26 2 LOCAL & REGIONAL CONDITIONS
As part of the research conducted during this study process, Visit Palm Springs surveyed a selection of hotels that typically offer rooms to support PSCC convention business. Based on the survey results and sales staff experience in assembling hotel room blocks for PSCC events, there are a total of approximately 1,725 committable rooms in 15 area hotels In practice, it is not generally marketable to use a high number of hotel properties to assemble a room block. For example, it may be necessary to use over five hotel properties in the Palm Springs market to assemble a committable room block of 1,000 rooms.
Competitive markets with large hotel properties proximate to their centers will offer a more competitive room block in fewer hotel properties.
We also note that input provided by representatives of various Palm Springs area hotel properties suggests that committable room numbers can significantly decrease depending on seasonal leisure activity in the destination. For example, the Renaissance is likely to offer as few as 150 rooms during peak visitor months. Similarly, the Margaritaville, Saguaro, Ace Hotel and Kimpton Rowan offer increased committable room numbers during hot summer months, and decreased committable room numbers during cooler, high-tourism months.
We note that peak leisure travel seasons can overlap with high demand convention months. Additional analysis with respect to opportunities to accommodate additional convention business in balance with high leisure demand is presented later in this report.
Palm Springs Hotel Performance
Decisions as to the future of any substantial hospitality-related investment such as a convention center expansion or hotel development should consider the overall performance of a given area’s hospitality sector, which is partly defined by overall hotel occupancy and room rates. Markets with substantial leisure, group, and/or corporate transient demand often experience hotel occupancy levels at or exceeding 70 percent. In these cases, additional hotel inventory may be supported. The average daily rate (ADR) is also important to consider as part of any convention-related investment, as event planners typically seek competitive hotel rates when selecting a host destination.
As show below, Palm Springs has retained relatively consistent hotel occupancy since 2016. This occupancy has not achieved the 70 percent threshold nor fallen below 60 percent outside of 2020 and 2021. However, it is important to note that the market’s uniquely high temperatures in the summer months limit its ability to achieve high annual occupancies, and that occupancy rates in the winter, spring and fall months can often greatly exceed 70 percent on a monthly basis. Average daily rate approximated $150 throughout the years of 2016 to 2020. Notably, ADR has increased to more than $200 in 2022. These data suggest a strong seasonal hospitality market, with potential to support added inventory over time.
We also note that in markets throughout the country, there is often a dichotomy between the ability of a local hospitality economy to support added room inventory, and the need for added inventory to support increases in convention business. Local public and private sector decision makers will have to evaluate potential future support for added hotel inventory designed to help retain and attract large non-local convention business to the destination. 62% 62% 63% 63%
41%
56%
61%
$0.00
$50.00
$100.00
$150.00
$200.00
$250.00
0%
10%
20%
30%
40%
50%
60%
70%
2016 2017 2018 2019 2020 2021 2022
Occupancy Yearly Avg ADR Yearly Avg
Yearly Occupancy and ADR Averages
Strategic Plan for the Palm Springs Convention Centers ● Page 27 2 LOCAL & REGIONAL CONDITIONS
An analysis of the occupancy and ADR averages for specific months can provide a clearer indication of the sufficiency of the existing hotel inventory in Palm Springs to support the PSCC. As shown below, occupancy and ADR reach peak levels in February to April, while reaching yearly lows in June through September. During peak months, convention and meeting business may be turned away due to a lack of available hotel inventory.
Palm Springs Lodging Tax Collections
It is also important to consider the growth in tourism-related revenue in Palm Springs to 1) review its growth as a visitor destination and ability to support additional convention-related amenities such as hotels and restaurants, and 2) identify potential funding sources for PSCC improvements discussed later herein.
The exhibit below displays the TOT and Measure J collections in Palm Springs over the past 15 years. The annual collections have steadily increased throughout the period reviewed, with the exception of 2020 and 2021. $14 $14 $13 $13 $16 $18 $19 $22 $25 $26 $29
$34 $36
$25
$35
$54
$48
$0
$10
$20
$30
$40
$50
$60
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022* 2023* Million $
Annual Palm Springs TOT (Fiscal Year)
Note: All numbers reflect Fiscal Year Collections.
*2022 numbers reflect estimated FY collections.
*2023 numbers are budgeted for the year.
Source: City of Palm Springs, 2022.
Monthly Occupancy and ADR Averages (2016-2019)
62%
75%
84% 74%
62%
54% 54% 50% 54% 60% 62%
56%
$0.00
$50.00
$100.00
$150.00
$200.00
$250.00
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
Occupancy ADR
Strategic Plan for the Palm Springs Convention Centers ● Page 28 2 LOCAL & REGIONAL CONDITIONS
Downtown Attractions & Amenities
Event planners routinely consider the destination outside of the host facility when selecting sites for their events. To evaluate the appeal and vibrancy of the area around the PSCC, we have prepared the map below displaying the hotel, attractions, and dining inventory within ½-mile, as well as 1-mile, of the Center. In addition to 1,243 hotel rooms within one-half mile of the PSCC, there are a total of 23 dining establishments and zero TripAdvisor attractions. Within 1-mile of the Convention Center, the number of hotel rooms increases to 2,590, with a significant increase in dining options and attractions, with 150 dining options and 10 attractions garnering 5,199 positive trip advisor reviews.
Considering the attractions with the most reviews on Trip Advisor’s website helps measure the leisure desirability of the area, with attractions garnering more reviews representing the more well known and popular elements of the downtown Palm Springs destination. The most reviewed attractions in the area include VillageFest (1,798), Palm Springs Air Museum (1,730) and Palm Canyon Drive (688). Other attractions include Palm Springs Walk of Star, Ruth Hardy Park, Ruddy’s General Store Museum, Palm Springs Architecture and Design Center, Palm Springs Historical Society and Sunrise Park.
To further evaluate the appeal of the walkable environment around the PSCC to prospective event planners and attendees, these hospitality amenities will be considered as part of comparative analyses with other convention destinations presented later in this report.
Summary of Downtown Palm Springs Attractions & Amenities 101
257 410
163
153 149
148
142
129
104
90 71
57 56
56 50
5 13
3 2
1 1
2 7
1 1
12 12
29 3
4 2
3 1
1 13
11 9
9 2
1 2
1730
688
1798
296
15 93
161
139
131148
93 1,046
23 Attraction Reviews
(number of Trip Advisor
positive reviews)
Hotels
(number of hotel
rooms)
Dining Options
(number of establishments)
Total Count and Attraction Type –
Within ½-mile of the Palm Springs Convention
Center
Total Count and Attraction Type –
Within 1 mile of the Palm Springs Convention
Center
5,199
2,590
150
Attraction Reviews
(number of Trip Advisor
positive reviews)
Hotels
(number of hotel
rooms)
Dining Options
(number of establishments)
Source: Visit Greater Palm Springs, Esri,
Tripadvisor, Yelp, Google, 2022.
101
257 410
163
153 149
148
142
129
104
90 71
57 56
56 50
5 13
3 2
1 1
2 7
1 1
12 12
29 3
4 2
3 1
1 13
11 9
9 2
1 2
1,730
688
1,798
296
15 161
139
131148
0 1,243
23 Attraction Reviews
(number of Trip Advisor
positive reviews)
Hotels
(number of hotel
rooms)
Dining Options
(number of establishments)
Total Count and Attraction Type –
Within ½-mile of the Palm Springs Convention Center
Total Count and Attraction Type –
Within 1 mile of the Palm Springs Convention Center
5,106
2,787
150
Attraction Reviews
(number of Trip Advisor
positive reviews)
Hotels
(number of hotel
rooms)
Dining Options
(number of establishments)
Source: Visit Greater Palm Springs, Esri,
Tripadvisor, Yelp, Google, 2022.
0 Trail Heads
2 Trail Heads
197 160
150
95 Note: Light Red/Pink dots represent planned hotel properties.
Strategic Plan for the Palm Springs Convention Centers ● Page 29 2 LOCAL & REGIONAL CONDITIONS
Summary of Driving Distance To/From the Palm Springs Convention Center & Nearby Major Markets Source: Esri, Google Maps, 2022.
Location & Accessibility
The exhibit below illustrates the proximity of Palm Springs, California to other nearby markets and the population base captured within an estimated 30-, 90- and 180-minute drive of the Palm Springs Convention Center. As shown, Los Angeles and Riverside represent the largest population centers within a 90-minute drive. Association, corporate and other types of event activity at the PSCC and surrounding district will likely draw significantly from these areas.
These driving distances will be utilized on the subsequent page and later in the report for purposes of comparing demographic and socioeconomic variables to competitive and comparable markets. 90 minutes180 minutes
30 minutes
Strategic Plan for the Palm Springs Convention Centers ● Page 30 DEMOGRAPHIC VARIABLE 30-Minutes 90-Minutes 180-Minutes Palm Springs Riverside
County
State of
California
United
States
POPULATION:
2010 Total Population 324,679 4,022,084 20,959,016 44,477 2,189,641 37,253,956 308,745,538 2022 Total Population 347,906 4,409,228 21,992,641 45,935 2,451,199 39,770,476 335,707,897 2027 Total Population 354,056 4,468,043 21,872,890 47,957 2,501,905 39,648,278 339,902,796 Historical Growth (2010-2021) 0.60% 9.63% 4.93% 3.28% 11.95% 6.76% 8.73% Projected Growth (2022-2027) 0.35% 1.33% -0.54% 4.40% 2.07% -0.31% 1.25% AGE:
Median Age 45.4 34.5 36.2 56.1 35.2 36.7 38.9
Population age 25 to 44 22.40% 28.78% 29.20% 18.30% 28.16% 28.66% 26.79% AGE DISTRIBUTION:
Under 15 16.39% 20.93% 18.76% 9.93% 20.87% 18.82% 18.12% 15 to 24 10.82% 13.78% 13.61% 7.35% 13.22% 13.34% 12.78% 25 to 34 12.33% 16.08% 15.91% 9.25% 15.61% 15.43% 13.96% 35 to 44 10.07% 12.70% 13.29% 9.05% 12.55% 13.23% 12.83% 45 to 54 10.41% 11.27% 12.00% 12.61% 11.21% 11.95% 12.03% 55 and over 39.99% 25.22% 26.42% 51.81% 26.52% 27.24% 30.29% HOUSEHOLD INCOME:
Median Household Income $65,424 $79,798 $85,603 $65,530 $80,680 $88,930 $72,414 Per Capita Income $42,274 $33,562 $41,368 $59,651 $34,659 $44,265 $40,363 INCOME DISTRIBUTION:
$0 to $24,999 19.49% 13.29% 13.24% 20.32% 13.62% 12.80% 15.79% $25,000 to $49,999 18.99% 16.70% 15.26% 18.61% 16.05% 14.91% 18.58% $50,000 to $74,999 16.52% 16.53% 15.08% 15.80% 16.45% 14.51% 16.91% $75,000 to $99,999 11.20% 14.35% 13.04% 10.31% 13.75% 12.52% 13.19% $100,000 to $149,999 15.22% 19.84% 19.05% 14.33% 19.94% 18.46% 17.23% $150,000 or more 18.58% 19.30% 24.34% 20.62% 20.20% 26.80% 18.31% POPULATION BY RACE/ETHNICITY:
White/Caucasian 49.68% 37.00% 37.76% 65.79% 40.28% 40.39% 60.99% Black/African American 3.15% 6.83% 6.17% 4.39% 6.46% 5.61% 12.39% American Indian 1.50% 1.86% 1.61% 1.20% 1.85% 1.63% 1.14% Asian 4.07% 8.76% 14.17% 4.82% 7.32% 15.86% 6.12%
Pacific Islander 0.13% 0.31% 0.30% 0.15% 0.34% 0.40% 0.21% Other Race 26.02% 28.01% 24.30% 13.19% 26.66% 21.33% 8.55% Two or More Races 15.44% 17.22% 15.69% 10.46% 17.09% 14.77% 10.59% Hispanic Origin 47.02% 52.42% 44.67% 25.34% 49.96% 39.42% 18.95% Diversity Index 82.9 87.1 87.3 71.1 0 86.4 0 86.5 0 71.6 BUSINESS:
Total Business 2021 15,875 142,493 979,384 3,329 0 75,455 0 1,677,162 0 12,609,070 Total Employees 2021 149,472 1,361,336 9,195,394 29,388 0 673,852 0 16,426,737 0 151,363,907 Employee/Residential Population Ratio 0.43:1 0.31:1 0.42:1 0.64:1 0.27:1 0.41:1 0.45:1 Source: Esri, 2022.
2 LOCAL & REGIONAL CONDITIONS
Palm Springs and its surrounding 30-minute drive ring have median ages that are significantly higher than the national average.
The 90- and 180-minute drivetime areas surrounding the PSCC have high median household incomes relative to national figures; while within 30-minutes of the Center, median household income is well below the national average.
Business inventory is another important socioeconomic characteristic to consider as a part of any convention center and convention planning effort. There are approximately 15,875 businesses within a 30-minute drive of the PSCC, with a total of 149,472 employees. The employee-to-residential ratio for the City of Palm Springs outperforms that of the U.S. Taken with income data above for 90- and 180-minute drive times, these data suggest a strong workforce and surrounding economy that can help support a growing local and regional events industry and quality destination brand that can be leveraged in attracting non-local professional associations and organizations to the Palm Springs destination.
Demographic & SocioeconomicCharacteristics
The exhibit below presents a summary of key demographic metrics associated within the aforementioned driving distances surrounding the Palm Springs Convention Center, along with the City of Palm Springs, Riverside County, State of California, and United States benchmarking data. Approximately 350,000 people live within 30-minutes of the PSCC, a figure that has grown by
0.6 percent since 2010. This growth falls well below the average growth rate throughout the state and the country. More growth has been experienced within the 90-minute drive time range, but still falls below the national average.
Strategic Plan for the Palm Springs Convention Centers ● Page 31 2 LOCAL & REGIONAL CONDITIONS
Palm Springs InternationalAirport
Airlift accessibility to a destination is an important decision criteria for both event planners and event attendees. Planners and attendees prefer fewer layovers, competitive flight costs and flexible flight options. As a smaller regional airport, the Palm Springs International Airport (PSP) generally received positive reviews from stakeholders and event planners that were interviewed as part of the study process. In conversations with staff at the PSP, it was noted that the airport has been experiencing growth in enplanements post COVID. PSP currently offers flights on 13 airlines to over 30 domestic airports. PSP management has indicated that in the coming years, more airport routes and additional airlines will be added.
The exhibit below displays the annual enplaned passengers at the PSP over the past eight years. From 2015 through 2019 enplanements were consistently growing at approximately 7.2 percent annually. Following the pandemic, the PSP was nearly back to normal levels in 2021 and set a new enplanement record in 2022. PSP management indicates that this growth rate is expected to increase in upcoming years and that they do not expect a decrease in the foreseeable future. In addition to expectations for increased passenger throughput, the staff shared that the airport was in the process of developing a master plan for release in 2023. This master plan is expected to include a significant expansion to the PSP to support further increases in its enplanement levels. This should positively impact the destination’s ability to attract non-local fly-in convention activity. 944,625 1,001,971 1,054,766
1,164,307
1,287,474
632,316
1,047,643
1,340,772
0 200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
2015 2016 2017 2018 2019 2020 2021 2022
Enplanements
Strategic Plan for the Palm Springs Convention Centers ● Page 32 Corporate Base
Often, the major employers in a local market are an important source of facility usage with regard to corporate meetings, banquets and other similar uses, all of which are important to maintain the utilization and financial viability of a convention center.
Indirectly, the size of a local corporate base also tends to correlate with the level and breadth of supporting community amenities (i.e., hotels, restaurants, transportation infrastructure, etc.), which are relevant when considering the ability to attract non-local events. Also, attracting events consistent with industry clusters that are prioritized by local economic development organizations can create important community business development synergies.
The chart below provides a listing of the top 27 employers, all of which have over 2,000 employees within the Riverside County region. Of the 20 listed, the entities with the highest employment are the County of Riverside, Amazon, the University of California and the March Air Reserve Base. A significant portion of the employment base is driven by the education industry from the various unified school districts and colleges in the County. Retail companies like Stater Bros and Walmart are also primary employers within the County.
2 LOCAL & REGIONAL CONDITIONS
Source: Riverside County Economic Development Agency, 2022.
Note: Employment numbers reflect 2019 data for Riverside County.
Summary of Top Employers in Riverside County
Estimated
Number of
Business Name Employees Industry / Sector
1 County of Riverside 21,672 Government
2 Amazon 10,500 Retail
3 University of California, Riverside 9,770 Education
4 March Air Reserve Base 9,600 Military
5 Stater Bros 8,304 Retail
6 Kaiser Permanente Riverside Medical Center 5,700 Healthcare 7 Pechanga Resort & Casino 5,078 Resort/Casino
8 Walmart 4,931 Retail
9 Corona-Norco Unified School District 4,903 Education
10 Ross Dress For Less 4,321 Retail
11 Hemet Unified School District 4,046 Education
12 Riverside Unified School District 4,000 Education
13 Eisenhower Medical Center 3,900 Healthcare
14 Moreno Valley Unified School District 3,755 Education 15 Lake Elsinore Unified School District 3,717 Education 16 Desert Sands Unified School District 3,437 Education 17 Jurupa Unified School District 3,250 Education
18 Temecula Valley Unified School District 3,057 Education 19 Palm Springs Unified School District 2,737 Education 20 Murrieta Valley Unified School District 2,500 Education 21 City of Riverside 2,470 Government
22 Riverside Community College District 2,342 Education 23 JW Marriot Desert Springs Resort & Spa 2,304 Resort/Casino 24 Agua Caliente Band of Cahuilla Indians 2,300 Native American Organization 25 Morongo Casino, Resort, & Spa 2,300 Resort/Casino
26 Cal Baptist University 2,285 Education
27 Riverside Community Hospital 2,200 Healthcare
Strategic Plan for the Palm Springs Convention Centers ● Page 33 Coachella Valley Area Convention & Meeting Facilities
The PSCC is the largest convention facility within the Coachella Valley region. The analysis below highlights PSCC space in the context of other primary event facilities.
In addition to the PSCC, there are nine primary event facilities with at least 30,000 square feet of sellable event space in the Valley.
The largest hotel/resort facility, in terms of total sellable space, is the Desert Springs JW Marriott, which offers 60,000 square feet of sellable space and a 24,800 square foot ballroom. The largest facility other than the PSCC in terms of contiguous space is the Empire Polo Event Facility in Indio with 48,000 square feet of total and contiguous space. The Renaissance Esmeralda and Hyatt Regency Indian Wells Resort often package their hotels together to offer 80,400 square feet of total sellable space between the two properties.
The PSCC offers the largest amount of both total sellable space and largest contiguous space. However, the PSCC’s attached headquarter hotel only offers 410 guest rooms. Comparatively, the hotel inventory at most larger hotel/resorts reviewed well exceeds this count.
In practice, event planners will show a preference for either a self-contained hotel/resort, or a more urban public convention center. Rarely would these two product types complete directly for the same event. As a result, we view the PSCC space as complimentary to major hotel/resorts in the Valley.
For further reference, the chart below presents the largest contiguous spaces at each of the venues and hotel/resort properties reviewed.
Total Largest
Sellable Contiguous Headquarter
Space Room Hotel
Facility Name (SF) (SF) Rooms
1 JW Marriott Desert Springs 60,000 24,800 884
2 Palm Springs Air Museum 55,700 20,000 0
3 Westin Rancho Mirage 49,300 17,300 512
4 Fantasy Springs Resort Casino 48,600 44,500 251
5 Renaissance Esmeralda - Indian Wells 48,300 18,400 560 6 Empire Polo Event Facility 48,000 48,000 0
7 La Quinta Resort & Club 42,400 17,200 777
8 Hyatt Regency Indian Wells Resort 32,100 20,000 530
9 Margaritaville Resort Palm Springs 31,900 19,700 398
Average 46,256 25,544 435
Median 48,300 20,000 512
Palm Springs Convention Center 128,300 92,500 410
2 LOCAL & REGIONAL CONDITIONS
Source: CSL research, Visit Greater Palm Springs, facility websites, Google maps, 2022.
Primary Coachella Valley Convention & Meeting Facilities 9 2
3 1
5,8
7 6
4 9
2 3
1 5,8
7 6
4 17,200
17,300
18,400
19,700
20,000
20,000
24,800
44,500
48,000
92,500
La Quinta Resort & Club
Westin Rancho Mirage
Reniassance Esmeralda - Indian…
Margaritaville Resort Palm Springs
Palm Springs Air Museum
Hyatt Regency Indian Wells Resort
JW Marriott Desert Springs
Fantasy Springs Resort Casino
Empire Polo Event Facility
Palm Springs Convention Center
Largest Contiguous Event Spaces in Coachella Valley (sf) Strategic Plan for the Palm Springs Convention Centers ● Page 34 2 LOCAL & REGIONAL CONDITIONS
Regional Area Competitive Facilities
It is important to consider convention center and convention hotel facilities of a similar size or larger than the PSCC in the broader, regional area marketplace. Given the proximity of Palm Springs to several convention and meeting destinations, a review was conducted of facilities that pose some level of competition to the PSCC and surrounding district.
The exhibit below presents a summary of selected competitive facilities throughout southern California, southern Nevada and Arizona. These listed facilities offer total sellable space ranging from 31,700 at the Monterey Conference Center to 348,800 square feet at the Long Beach Convention Center. Additionally, headquarter hotels and hotel rooms within ½-mile of each facility are listed. The PSCC has a headquarter hotel with over 100 rooms less than that of the median and over 500 rooms less than the median total of rooms within ½-mile.
Larger market convention center competitors to the PSCC include venues in Long Beach, San Jose, Sacramento and Santa Clara.
The list below also includes many hotel conference centers in nearby major population centers that, to some degree, can compete with the PSCC for state and large corporate events. Added detailed assessment of these venues is presented on the following pages.
Primary Regional Area Convention Facilities
Source: CSL research, interviews with facility management, facility and visitor bureau websites, Google maps, 2022.
Total Largest
Sellable Contiguous Headquarter 1/2-mile
Space Room Hotel Hotel
Facility Name (SF) (SF) Rooms Rooms
1 Long Beach Convention Center 348,800 224,000 531 2,077 2 San Jose McEnery Convention Center 251,000 143,000 859 2,575 3 SAFE Credit Union Convention Center 179,600 134,000 1,008 2,014 4 Santa Clara Convention Center 157,100 43,700 501 781
5 Ontario Convention Center 115,000 69,300 531 2,077
6 Pasadena Convention Center 114,300 53,400 311 1,524
7 Oakland Marriott City Center 79,200 51,700 489 1,093
8 Monterey Conference Center 31,700 19,200 379 1,273
9 Anaheim Marriott 259,685 25,411 1,030 1,030
10 Manchester Grand Hyatt San Diego 320,000 34,000 1,628 1,628 11 Sheraton Phoenix Downtown 111,961 27,170 1,003 1,003 12 South Point Hotel, Casino & Spa, Las Vegas 140,900 80,000 2,100 2,100 13 Westgate Las Vegas Resort and Casino 156,900 70,000 2,956 2,956 14 The Mirage Hotel & Casino, Las Vegas 171,400 89,400 3,044 3,044 15 MGM Grand Hotel & Casino, Las Vegas 307,500 92,400 6,852 6,852 Average 183,003 77,112 1,548 2,135
Median 136,050 61,350 516 1,769
Palm Springs Convention Center 128,300 92,500 410 1,243 1 6
5 8
7 3
2 4
10 9
11 12 13
14 15
Strategic Plan for the Palm Springs Convention Centers ● Page 35 Regional Area Competitive Facilities
Inventories
As presented in the adjacent exhibit, the PSCC has
the fourth largest contiguous space among regional
venues reviewed at 92,500 square feet. From a
total sellable space, the PSCC ranking drops to 11th
among the venues reviewed.
Dedicated convention centers in Ontario, Pasadena,
Santa Clara and Monterey offer contiguous space
levels lower that the PSCC. These data don’t point
to an obvious, significant space shortage at the
PSCC, however further analysis will explore the
market capture benefits of increases to various
types of space including exhibit, meeting and
ballroom areas.
The headquarter hotel at the PSCC has the 14th
highest number of guest rooms available of the 16
facilities reviewed. Importantly, the PSCC
headquarter hotel inventory ranks behind all
dedicated convention centers reviewed with the
exception of those in Monterey and Pasadena. The
ratio of hotel rooms within ½-mile to the total
sellable space of a facility for the PSCC ranks 12th
among regional competitive facilities. These data
suggest that the headquarter and area hotel
inventory may represent a competitive
disadvantage in attracting large non-local events to
the PSCC.
2 LOCAL & REGIONAL CONDITIONS
311
379
410
489
501
531
531
859
1,003
1,008
1,030
1,628
2,100
2,956
3,044
6,852
Pasadena Convention Center
Monterey Conference Center
PSCC
Oakland Marriott City Center
Santa Clara Convention Center
Long Beach Convention Center
Ontario Convention Center
San Jose McEnery Convention Center
Sheraton Phoenix Downtown
SAFE Credit Union Convention Center
Anaheim Marriott
Manchester Grand Hyatt San Diego
South Point Hotel, Casino & Spa, Las Vegas
Westgate Las Vegas Resort and Casino
The Mirage Hotel & Casino, Las Vegas
MGM Grand Hotel & Casino, Las Vegas
3.97 4.97
5.09 5.95
8.15 8.96
10.26 11.21
13.33 13.80
14.90 17.76
18.06 18.84
22.28 40.16
Anaheim Marriott
Santa Clara Convention Center
Manchester Grand Hyatt San Diego
Long Beach Convention Center
PSCC
Sheraton Phoenix Downtown
San Jose McEnery Convention Center
SAFE Credit Union Convention Center
Pasadena Convention Center
Oakland Marriott City Center
South Point Hotel, Casino & Spa, Las Vegas
The Mirage Hotel & Casino, Las Vegas
Ontario Convention Center
Westgate Las Vegas Resort and Casino
MGM Grand Hotel & Casino, Las Vegas
Monterey Conference Center
Largest Contiguous Space (sf)
Headquarter Hotel Rooms ½-Mile Hotel Rooms to Total Sellable Space Ratio* Note: *Chart results multiplied by 1,000.
Source: Facility Websites, 2022
19,200
25,411
27,170
34,000
43,700
51,700
53,400
69,300
70,000
80,000
89,400
92,400
92,500
134,000
143,000
224,000
Monterey Conference Center
Anaheim Marriott
Sheraton Phoenix Downtown
Manchester Grand Hyatt San Diego
Santa Clara Convention Center
Oakland Marriott City Center
Pasadena Convention Center
Ontario Convention Center
Westgate Las Vegas Resort and Casino
South Point Hotel, Casino & Spa, Las
Vegas
The Mirage Hotel & Casino, Las Vegas
MGM Grand Hotel & Casino, Las Vegas
PSCC
SAFE Credit Union Convention Center
San Jose McEnery Convention Center
Long Beach Convention Center
Strategic Plan for the Palm Springs Convention Centers ● Page 36 2 LOCAL & REGIONAL CONDITIONS
Regional Area Competitive Market Hospitality
Sales Density
Convention facilities with vibrant surrounding districts often have a competitive advantage in retaining event
planner interest. The charts below and to the right provide analysis on the dining sales, entertainment sales and retail sales within 1-mile of regional competitive facilities.
The PSCC is among the bottom three facilities in terms of surrounding dining sales. Similarly, the PSCC ranks
second-to-last in terms of surrounding retail sales. In terms of entertainment sales in the surrounding 1-mile of competitive facilities, the PSCC ranks sixth.
Markets such as Long Beach, Pasadena, Oakland, San
Diego, and others have more active commercial districts surrounding their convention facilities due to their location within the urban cores of larger metropolitan areas.
For Palm Springs, addressing the “gap” between the PSCC and the downtown base of restaurants, retail and
entertainment will significantly benefit the perception of the destination as walkable for convention attendees.
Recommendations presented later in this report highlight opportunities to build on existing development concepts to enhance overall area walkability and connectivity.
$5,857
$29,021
$52,289
$60,577
$66,279
$129,022
$155,275
$206,196
$206,852
$318,116
$329,972
$806,371
Ontario Convention Center
Monterey Conference Center
Oakland Marriott City Center
Long Beach Convention Center
SAFE Credit Union Convention Center
Pasadena Convention Center
PSCC
Sheraton Phoenix Downtown
Santa Clara Convention Center
San Jose McEnery Convention Center
Manchester Grand Hyatt San Diego
Anaheim Marriott
$24,342
$43,185
$135,689
$136,668
$193,680
$196,631
$210,206
$218,098
$252,602
$260,694
$295,790
$481,238
Ontario Convention Center
Santa Clara Convention Center
PSCC
Monterey Conference Center
Sheraton Phoenix Downtown
Oakland Marriott City Center
San Jose McEnery Convention Center
Anaheim Marriott
SAFE Credit Union Convention Center
Long Beach Convention Center
Pasadena Convention Center
Manchester Grand Hyatt San Diego
$193,998
$214,126
$251,953
$253,955
$285,322
$286,111
$340,384
$478,377
$580,553
$648,725
$860,178
$1,192,764
Anaheim Marriott
PSCC
Ontario Convention Center
Santa Clara Convention Center
Monterey Conference Center
Sheraton Phoenix Downtown
Long Beach Convention Center
San Jose McEnery Convention Center
SAFE Credit Union Convention Center
Manchester Grand Hyatt San Diego
Oakland Marriott City Center
Pasadena Convention Center
Note: Las Vegas Hotels Removed from Charts
Source: ESRI, 2022
Dining Sales w/in 1-mile ( in millions)
Entertainment Sales w/in 1-mile (in millions) Retail Sales w/in 1-mile (in millions) 3 COMPARABLE
FACILITIES
Strategic Plan for the Palm Springs Convention Centers ● Page 38 3 COMPARABLE FACILITIES
Overview
Certain inferences can be made by reviewing comparable convention and conference facilities operating in markets throughout the country of a similar size and/or geographic positioning to Palm Springs. These data help place a potential investment into the PSCC within a comparable context with respect to facility offerings, demographics and other related host market features.
Note: Sorted by Largest Contiguous Hall.
Source: CSL research, interviews with facility management, facility websites, Google maps, 2022.
The comparable convention centers reviewed
were selected based on their event space
offerings, hotel inventories, walkable
surrounding environments, and market
population characteristics. The exhibit below
presents a summary of the 12 selected
comparable convention facilities and markets
analyzed. As shown, facilities reviewed range
from the Greater Tacoma Convention & Trade
Center (75,300 square feet of sellable space) to
the nearby Long Beach Convention &
Entertainment Center (which was also included
in the regional competitive analysis). In all, the
facilities reviewed offer an average of 119,000
square feet of exhibit space, 34,200 square feet
of ballroom space, and 26,900 square feet of
meeting space.
1 Summary of Key Characteristics of Selected Comparable Facilities 1 3
511
8 24
6 7
9 10
12 Total Largest Hotel Rms HQ
Exhibit Meeting Ballroom Sellable Contiguous within Hotel Space Space Space Space Space 1/2-mile Rooms
Facility Name City, State (SF) (SF) (SF) (SF) (SF) (number) (number) 1 Long Beach Convention & Entertainment Center Long Beach, CA 224,000 38,800 86,000 348,800 224,000 2,250 528 2 Virginia Beach Convention Center Virginia Beach, VA 150,000 27,100 31,000 208,100 150,000 389 389 3 Raleigh Convention Center Raleigh, NC 145,800 32,600 32,600 211,000 145,800 937 401 4 San Jose McEnery Convention Center San Jose, CA 143,000 50,800 57,200 251,000 143,000 2,575 859 5 Spokane Convention Center Spokane, WA 120,000 27,300 50,700 198,000 120,000 2,342 375 6 Albuquerque Convention Center Albuquerque, NM 166,500 45,800 31,200 243,500 106,200 793 295 7 Palm Beach County Convention Center West Palm Beach, FL 99,300 20,300 22,000 141,600 99,300 1,220 400 8 Savannah International Trade and Convention Center Savannah, GA 97,800 20,500 25,000 143,300 92,500 2,441 403 9 Tucson Convention Center Tucson, AZ 113,900 10,600 15,200 139,700 89,800 787 170 10 Ontario Convention Center Ontario, CA 69,300 26,100 19,600 115,000 69,300 2,077 531 11 Greater Tacoma Convention Center Tacoma, WA 49,500 12,400 13,400 75,300 49,500 645 162 12 Irving Convention Center Irving, TX 48,600 10,600 26,100 85,300 48,600 991 359 Average 119,000 26,900 34,200 180,100 111,500 1,500 400 Median 117,000 26,600 28,600 170,700 102,800 1,100 400
Palm Springs Convention Center 92,500 15,800 20,000 128,300 92,500 1,046 410 Strategic Plan for the Palm Springs Convention Centers ● Page 39 75,300
85,300
115,000
128,300
139,700
141,600
143,300
198,000
208,100
211,000
243,500
251,000
348,800
Tacoma, WA
Irving, TX
Ontario, CA
Palm Springs, CA
Tucson, AZ
West Palm Beach, FL
Savannah, GA
Spokane, WA
Virginia Beach, VA
Raleigh, NC
Albuquerque, NM
San Jose, CA
Long Beach, CA
48,600
49,500
69,300
89,800
92,500
92,500
99,300
106,200
120,000
143,000
145,800
150,000
224,000
Irving, TX
Tacoma, WA
Ontario, CA
Tucson, AZ
Savannah, GA
Palm Springs, CA
West Palm Beach, FL
Albuquerque, NM
Spokane, WA
San Jose, CA
Raleigh, NC
Virginia Beach, VA
Long Beach, CA
Convention Space Comparisons
To provide further context regarding the comparable facilities reviewed on the previous page, we have prepared the charts below to compare their sellable event spaces with those currently offered at the PSCC. As shown, the average facility within the comparison set has a largest contiguous space offering of 111,500 square feet and offers 180,100 square feet of total sellable event space.
The PSCC’s Oasis Hall ranks eighth (8th) out of 13 among comparable facilities in terms of largest contiguous space, and the facility as a whole ranks tenth (10th) in terms of total sellable space offered. Though located in similar markets in terms of population size and corporate base, several listed facilities offer larger contiguous event spaces and more total sellable space. The lower ranking in terms of total sellable space suggests a potential shortage of ancillary ballroom and meeting space. This is further explored on the subsequent pages.These comparable analyses suggest that Palm Springs’s convention product could be moderately undersized.
However, space occupancy data presented previously suggests that the existing PSCC event space has not been fully absorbed from a market demand perspective.
Source: CSL research, interviews with facility management, facility websites, 2022. 3 COMPARABLE FACILITIES
Comparison of Key Convention Space Offerings at Selected Comparable Facilities Average
111,500
Median
102,800
Average
180,100
Median
170,700
Largest Contiguous Space (SF) Total Sellable (SF)
Strategic Plan for the Palm Springs Convention Centers ● Page 40
0.13 0.19
0.21 0.22
0.22 0.22
0.26 0.27
0.28 0.38
0.40 0.42
0.54 Tucson, AZ
Albuquerque, NM
Virginia Beach, VA
Palm Springs, CA
West Palm Beach, FL
Raleigh, NC
Savannah, GA
Tacoma, WA
Ontario, CA
Long Beach, CA
San Jose, CA
Spokane, WA
Irving, TX
13,400
15,200
19,600
20,000
22,000
25,000
26,100
31,000
31,200
32,600
50,700
57,200
86,000
Tacoma, WA
Tucson, AZ
Ontario, CA
Palm Springs, CA
West Palm Beach, FL
Savannah, GA
Irving, TX
Virginia Beach, VA
Albuquerque, NM
Raleigh, NC
Spokane, WA
San Jose, CA
Long Beach, CA
Ballroom Space Comparisons
Ballroom space is an important venue component for meeting and event planners, catering to banquets, displays, general sessions, poster sessions, entertainment and other functions. CSL research suggests that regional and national event planners increasingly prefer large, multipurpose rooms with dynamic lighting, high-quality acoustic treatments and other elements to accommodate their general sessions and food functions.
Further breakdown on the importance of ballroom space is detailed in the subsequent Industry Trends chapter of this report. The charts below demonstrate the level of ballroom space offered at comparable facilities and the ratio of ballroom space relative to the exhibit space offerings at each of the reviewed facilities.
As shown, the PSCC ranks among the bottom (10th) of comparable convention centers in terms of ballroom/exhibit space totals and ratios to exhibit space. Only venues in Virginia Beach, Albuquerque and Tucson offer lower ballroom/exhibit space ratios.
Source: CSL research, interviews with facility management, facility websites, 2022. 3 COMPARABLE FACILITIES
Comparison of Key Convention Space Offerings at Selected Comparable Facilities Average
34,200
Median
28,600
Average
0.29 Median
0.26 Ballroom Space (SF) Ballroom to Exhibit Space Ratio Strategic Plan for the Palm Springs Convention Centers ● Page 41 10,600
10,600
12,400
15,800
20,300
20,500
26,100
27,100
27,300
32,600
38,800
45,800
50,800
Tucson, AZ
Irving, TX
Tacoma, WA
Palm Springs, CA
West Palm Beach, FL
Savannah, GA
Ontario, CA
Virginia Beach, VA
Spokane, WA
Raleigh, NC
Long Beach, CA
Albuquerque, NM
San Jose, CA
0.09 0.17
0.17 0.18
0.20 0.21
0.22 0.22
0.23 0.25
0.28 0.36
0.38 Tucson, AZ
Palm Springs, CA
Long Beach, CA
Virginia Beach, VA
West Palm Beach, FL
Savannah, GA
Irving, TX
Raleigh, NC
Spokane, WA
Tacoma, WA
Albuquerque, NM
San Jose, CA
Ontario, CA
Meeting Space Comparisons
Sufficient modern meeting space is very important in attracting and accommodating events in the convention, conference and meetings industry. Event organizers see it as an important factor in their selection of host cities. Offering an adequate level of meeting space is necessary to attract and win potential events for a convention facility. Further breakdown on the importance of meeting space is detailed in the upcoming Industry Trends chapter of this report. The exhibits below display the level of meeting space offered at comparable facilities and the ratio of meeting space inventories relative to the exhibit space offering at each of the reviewed facilities.
The PSCC offers a total of 15,800 square feet of meeting space, which ranks tenth among the 13 comparable facilities.
Additionally, the PSCC ranks 11th in terms of meeting space relative to total exhibit space offered. By increasing the quantity and proportion of meeting space at the PSCC, the facility could better compete with comparable and competitive facilities nationwide.
Source: CSL research, interviews with facility management, facility websites, 2022. 3 COMPARABLE FACILITIES
Comparison of Key Convention Space Offerings at Selected Comparable Facilities Average
26,900
Median
26,600
Average
0.23 Median
0.22 Meeting Space (SF) Meeting to Exhibit Space Ratio
Strategic Plan for the Palm Springs Convention Centers ● Page 42
1.9 3.3
4.4 5.6
6.5 8.6
8.6 9.7
10.3 11.6
11.8 17.0
18.1 Virginia Beach, VA
Albuquerque, NM
Raleigh, NC
Tucson, AZ
Long Beach, CA
Tacoma, WA
West Palm Beach, FL
Palm Springs, CA
San Jose, CA
Irving, TX
Spokane, WA
Savannah, GA
Ontario, CA
389
645
787
793
937
991
1,220
1,243
2,077
2,250
2,342
2,441
2,575
Virginia Beach, VA
Tacoma, WA
Tucson, AZ
Albuquerque, NM
Raleigh, NC
Irving, TX
West Palm Beach, FL
Palm Springs, CA
Ontario, CA
Long Beach, CA
Spokane, WA
Savannah, GA
San Jose, CA
162
170
295
359
375
389
400
401
403
410
528
531
859
Tacoma, WA
Tucson, AZ
Albuquerque, NM
Irving, TX
Spokane, WA
Virginia Beach, VA
West Palm Beach, FL
Raleigh, NC
Savannah, GA
Palm Springs, CA
Long Beach, CA
Ontario, CA
San Jose, CA
3 COMPARABLE FACILITIES
Hotel Inventory Comparison
The supporting hotel inventory of a convention facility is instrumental in competing for state, regional and national conventions and tradeshows with significant non-local attendee bases. Headquarter and other supporting hotel inventory are often among the first data points sought by event planners when considering a future host site. To evaluate the PSCC’s supporting hotel inventory for both its existing and potentially expanded event space offerings, the charts below provide comparisons with hotel inventory of comparable convention products nationally.
As shown, the 410 rooms offered at the Renaissance Hotel of Palm Springs closely approximates the headquarter hotel room average of 406. The 1,243 rooms within ½-mile of the PSCC rank sixth, approximating the average/median range. The ratio of hotel room inventory to Center space at the PSCC also tracks with the reviewed venue ranges.
The particular challenge for the PSCC lies in the previously referenced committability factor, especially during peak season. Few of the reviewed markets experience the peak and valley room demand cycles common in Palm Springs.
Note: (1) Number is multiplied by 1,000 for readability Source: CSL research, interviews with facility management, facility and CVB websites, Google Maps, 2022.
Comparison of Key Hotel Metrics Related to Selected Comparable Facilities Average
406
Median
395
Average
1,454
Median
1,106
Average
9.0 Median
8.6 ½ Mile Hotel Rooms to Sellable Space Ratio (1)Headquarter Hotel Rooms ½ Mile Hotel Rooms Strategic Plan for the Palm Springs Convention Centers ● Page 43 $0
$1,278
$3,108
$5,270
$20,835
$21,152
$24,370
$26,763
$36,542
$67,745
$70,362
$89,178
$134,347
Savannah, GA
Virginia Beach, VA
Irving, TX
Ontario, CA
Palm Springs, CA
Tacoma, WA
West Palm Beach, FL
Tucson, AZ
Albuquerque, NM
Raleigh, NC
Spokane, WA
San Jose, CA
Long Beach, CA
$0
$4,314
$29,722
$32,557
$50,990
$56,370
$69,657
$71,363
$83,236
$86,285
$98,906
$187,050
$244,568
Savannah, GA
Virginia Beach, VA
Tucson, AZ
Palm Springs, CA
Albuquerque, NM
Tacoma, WA
Raleigh, NC
West Palm Beach, FL
Irving, TX
Ontario, CA
San Jose, CA
Long Beach, CA
Spokane, WA
Dining & Retail Environment Comparison
As previously noted, event planners increasingly consider the commercial vibrancy within walking distance of a host convention facility when selecting future host sites. The exhibits below summarize the retail and dining sales generated on an annual basis within a 10- and 20-minute walk of each of the comparable convention facilities reviewed. For context, the 10-minute walk time typically approximates a ½-mile radius while the 20-minute walk time captures a 1-mile radius. The latter encompasses much of downtown Palm Springs and the concentration of amenities along Palm Canyon Drive.
Using GIS software, we can analyze the level of hospitality spending (food, beverage and retail) on a geographically targeted basis.
As shown below, the environment within a 10-minute walk surrounding the PSCC site generates retail sales far below the median of the comparison set (just over $32.5 million on an annual basis) while its 20-minute walk time capture approximates the median level of sales. Similarly, dining sales within 10 minutes of the facility fall short of the comparison set's median, while the 20-minute area capture significantly outperforms both the median and average.
These data reflect disparity of commercial activity between the PSCC's immediate area and the downtown core. In response, recommendations discussed later herein address both 1) the lack of amenities within the 10-minute walk time, and 2) creating better pedestrian connections between the PSCC and the concentration of amenities located within a 20-minute walk time.
Source: Esri, 2022.
3 COMPARABLE FACILITIES
Comparison of Retail & Dining Spending Nearby Selected Comparable Facilities Average
$78,100
Median
$69,700
Average
$38,500
Median
$24,400
10-Minute Walk-Time Retail Sales (in 000’s) 10-Minute Walk-Time Dining Sales (in 000’s) $10,759
$79,837
$119,653
$134,507
$147,303
$147,362
$150,303
$153,999
$216,306
$311,584
$340,998
$373,726
$741,573
Savannah, GA
Virginia Beach, VA
Tucson, AZ
Ontario, CA
Raleigh, NC
Tacoma, WA
Palm Springs, CA
Albuquerque, NM
Irving, TX
Long Beach, CA
West Palm Beach, FL
San Jose, CA
Spokane, WA
$293
$12,543
$28,425
$28,991
$57,936
$64,552
$69,343
$87,066
$102,511
$115,016
$131,199
$194,569
$253,063
Savannah, GA
Ontario, CA
Virginia Beach, VA
Irving, TX
Tucson, AZ
Albuquerque, NM
Tacoma, WA
West Palm Beach, FL
Palm Springs, CA
Raleigh, NC
Spokane, WA
San Jose, CA
Long Beach, CA
Average
$225,200
Median
$150,300
Average
$88,100
Median
$69,300
20-Minute Walk-Time Retail Sales (in 000’s) 20-Minute Walk-Time Dining Sales (in 000’s) Strategic Plan for the Palm Springs Convention Centers ● Page 44 Comparable Facility Case Studies
The subsequent pages detail convention industry, trend-focused investments and improvements made by various comparable convention center facilities throughout the country.
3 COMPARABLE FACILITIES
Long Beach Convention & EntertainmentCenter and Surrounding District • 13 hotels within ½ mile
• Renovations in 2013 and 2017
• Turnkey event spaces
• Focus on hybrid events
• Artistic design and outdoor spaces
• Highly walkable and connected area
• Green space, art and comfortable space surrounding facility 2,250
½-Mile Hotel
Rooms
30+
Pike Outlet
Tenants
$35m+
District
Investment
2020
Sources: LBCED, Pike Outlets, Visit Long Beach, Company Sites, 2022.
San Jose McEnery Convention Center and Surrounding District • 10 hotels within ½ mile
• Two HQ Hotels
• Large number of nearby attractions
• Nearby food hall (San Pedro Market Square)
• Located in entertainment district (SoFa District)
• Two approved mixed-use districts within ½ mile
2,575
½-Mile Hotel
Rooms
17+
SPS Market
Tenants
$17m
District
Hotel Tax
Generated
2019
Sources: SJMCC, The Registry, Visit San Jose, Company Sites, San Jose Government, 2022.
Strategic Plan for the Palm Springs Convention Centers ● Page 45 Comparable Facility Case Studies
3 COMPARABLE FACILITIES
Palm Beach County Convention Center and Surrounding District • Approximately $18 million on annual building improvements • Added hotels being planned to meet event demand
• Public/private in walkability around center
• Invested in high quality WIFI and cell service
• Announced expansion without details in 2019
• $550 million, 5-year plan for “The Square”, a multi-use entertainment district • Walkable Retail, dining and entertainment district
1,220
½-Mile Hotel
Rooms
60+
The Square
Tenants
$550m
District
Investment
2019
Sources: PBCCC, Related Companies, Company Sites, 2022.
Raleigh Convention Center and Surrounding District
• Located in Raleigh Convention & Performing Arts District • $2.3 billion in downtown development pipeline
• 5 planned hotels within ½ mile with 1 more in hopes of planning • 96 walkability score of downtown
• Within ½ mile of mixed-use public transit station
• Over 110 retailers and 150 restaurants downtown, many within walking distance 937
½-Mile Hotel
Rooms
5 Hotels
Planned
Within ½
Mile
2 Food Halls
Within 1
Mile
Sources: RCC, Visit Raleigh, Raleigh Government, Company Sites, 2022.
Strategic Plan for the Palm Springs Convention Centers ● Page 46 Comparable Facility Case Studies
3 COMPARABLE FACILITIES
Spokane Convention Center Facility
• 15 hotels within ½ mile
• Expanded and renovated in 2016 ($50 million)
• Technological investments to meet industry demand
• Pre-function space enhanced for informal events
• Additional sub-divisible ballrooms for flexible space capabilities • Incorporation of nature and natural light in new design 2,342
½-Mile Hotel
Rooms
45,500
SF Added
Space
$50m
2016
Expansion
Cost
Sources: SCC, Visit Spokane, Spokane City News, 2022.
Irving Convention Center Facility
• Located within 40-acre entertainment district
• Highly aesthetic-focused facility design
• Several outdoor terrace event spaces
• LEED Silver Certification; alignment with sustainable practices • No columns/pillars in exhibit hall
• Floor-to-ceiling windows for natural light and connection to nature • Invested in technology for seamless and turnkey events 991
½-Mile Hotel
Rooms
40 Acre
Entertainment
District
$133m
Construction
Cost
2011
Sources: ICC, Related Companies, Company Sites, 2022.
Strategic Plan for the Palm Springs Convention Centers ● Page 47 3 COMPARABLE FACILITIES
Flexible
Event
Space
Integrating
with Growing
Districts
Outdoor
Event
Space
Hotel
Development
Technology
and Trend
Forward
Design
Summary of Comparable Expansions
As presented, Palm Spring’s peer convention destinations throughout the country have been continually improved in recent years, both in terms of facility investments and surrounding district growth. Each of the case studies feature some mix of the following themes, described further below.
Creating versatile events space throughout an entire convention facility represents a goal for many recent convention center renovations. The Long Beach Convention Center’s conversion of the adjacent arena into a high- tech and unique multipurpose space has enabled the facility to draw a greater number of corporate events, while the addition of two new sub-divisible ballroom spaces within the Spokane Convention Center has helped the market compete for a greater number of regional and national association events. At the same time, the expansion and improvement of Spokane Convention Center’s concourses now allows for event activity in the pre- function area, greatly increasing its sellable event space.
The convention centers in Long Beach, Irving, Spokane, and West Palm Beach have each enhanced facility revenues and marketability by adding outdoor event space venues. The Cove at Long Beach Convention Center, for example, provides lounge furniture, lounge games, and food trucks to create a vibrant and unique event atmosphere, while Spokane Convention Center offers its adjacent plaza and rooftop pavilion for both major conventions and high-paying local users, (i.e., weddings and cultural celebrations).
Convention planners nationally have higher technology demands and expectations than five years ago, with amenities such as digital signage, ample access to fiber internet, free WIFI, interactive kiosks, and onsite virtual meeting technologies now more frequently included at their selected host facilities. In response, the convention facilities in Long Beach, Spokane, West Palm Beach, and Irving are investing in modernizing their buildings for these more sophisticated needs.
Many of the facilities analyzed are situated in or near quickly developing mixed-use districts. Convention centers in San Jose, Raleigh, and Palm Beach each have growing urban populations, which supports their emerging restaurant scenes. The shopping district across from the West Palm Beach Convention Center has added residential, outdoor areas, and unique shopping options, which has greatly enhanced spending among visiting attendees. Leadership is currently discussing a pedestrian bridge that would connect the Center to shopping areas. Similarly, the Long Beach Convention Center added the LED-activated Rainbow Bridge to link pedestrians from the Convention Center to the outlet shopping options nearby.
The ½-mile districts surrounding the convention centers in Raleigh, San Jose, and West Palm Beach each feature quickly growing hotel room inventories. In Raleigh, for instance, five new hotels totaling over 1,300 rooms are being constructed. Advanced discussions are also being held by public leadership in both San Jose and West Palm Beach regarding near-term developments of sizable headquarter hotels (600 or more rooms in San Jose, 350 or more rooms in West Palm Beach).
4 INDUSTRY
TRENDS
Strategic Plan for the Palm Springs Convention Centers ● Page 49 Introduction
The economy of any destination can be influenced by many factors outside the control of community leaders. Economic conditions, corporate relocations, changes in governmental or institutional presence and other factors will influence employment, income, tax revenues and other critical aspects of an economy.
In most communities, the visitor industry also plays an important role in local and regional economic health. Visitors to a market offer an opportunity to inject new dollars into the economy, with relatively limited use of public infrastructure. Visitor spending then generates net new tax revenue, reducing the tax burden on residents.
At the same time, the competition for visitor industry market share is fierce. Communities throughout the country continue to invest in assets and amenities that are designed in part to attract visitors.
Much of this investment involves convention, sports and entertainment facilities.
The market success of convention facility products can be partially attributed to broader industry characteristics and trends. In order to assess the current and future strength of any market with regard to a potential expanded convention product, it is important to evaluate prominent and emerging trends from a national perspective.
Additionally, the “state-of-the-industry” in terms of the physical product aesthetics and functionality of convention facilities has continued to advance year-over-year in cities throughout the country. Event planners and users increasingly prefer, and oftentimes demand, the modern, spacious aesthetics and
optimized, advanced functionality and efficiency of newer facility designs and programs. Beyond attracting higher numbers of groups, visitors and economic impact, modern exhibition facilities often offer significant advancements in operating efficiencies and enhanced revenue generation opportunities, as compared to previous generations of facilities.
Broad industry changes, characterized by—sometimes significant— retraction and expansion in event demand and attendance and participation characteristics have taken place within the industry over the past few decades. Most recently, the COVID-19 pandemic has caused dramatic disruption in all sectors of the global economy, including severe impacts in the convention and tourism industries.
4 INDUSTRY TRENDS
Strategic Plan for the Palm Springs Convention Centers ● Page 50 CONVENTIONCENTER (stand-alone facility):
Typical Facility Model Characteristics
Convention centers typically incorporate exhibit, meeting and ballroom space. Usually located in medium- to large- sized cities, convention centers tend to focus on
attracting non-local economic impact-generating events
such as conventions, tradeshows and conferences. It is
imperative that convention-quality hotel inventory is
located close to the center. Convention centers also tend to host a large number of secondary events, such as
corporate meetings, public shows and banquets.
The exhibit to the right presents a visual representation of how traditional convention center products align with
typical facility requirements and preferences of variety event types.
While convention center products throughout the country vary widely in terms of physical and operational
characteristics, convention center products typically
posses the following attributes:
• Typical Mission/Orientation:
o Tourism & economic impact generation
o Driving new hotel room nights
o Large flat floor events (non-local & local)
• Typical Event Focus:
o Conventions
o Tradeshows
o Conferences
o Public/consumer shows
• Typical Owner/Operator Model:
o Publicly-owned
o Privately-managed via third party
• Typical Space Components:
o Exhibit Space (concrete floor)
o Ballroom Space (carpeted)
o Meeting Space (carpeted)
• Typical Site Factors:
o Attached or adjacent full-service hotel(s)
o Downtown, urban environment
o Walkable visitor amenities, including
ancillary hotels
• Typical Funding Structure:
o Public: 100%
o Private: 0%
4 INDUSTRY TRENDS
Strategic Plan for the Palm Springs Convention Centers ● Page 51 Many indicators, including employment, consumer purchases and wages, suggest that the national economy rebounded sharply from the downturn caused by the Pandemic. Current conditions suggest a plateau in the economy, while hiring remains strong.
A large collection of data suggests that the health of the convention industry, like nearly all industries, has historically been linked to the strength and fluctuations of the overall U.S. economy. This “linkage” is a fundamental premise of any analysis of future convention industry performance. To address the question of future industry trends, it is important to consider how the future performance of the economy and the convention industry will respond in the post COVID period.
The Center for Exhibition Industry Research (CEIR) is a nonprofit organization whose mission is to advance the growth, awareness and value of exhibitions in the United States. The annual CEIR Index Report is developed to provide an objective measure of the annual performance of the exhibition industry.
The CEIR Index Report measures year-over-year changes in three key metrics of industry performance:
• Square Feet of Exhibit Space Sold
• Number of Exhibiting Companies
• Professional Attendance
The industry’s performance within these three metrics was calculated from data provided by more than 13,000 industry conferences, conventions, and tradeshows that utilize more than 3,000 net square feet of exhibit space in off-site public and private event facilities. The CEIR Index Report displays and analyzes actual and projected event-specific data through 2022, though the COVID-19 pandemic has significantly impacted these projections. As such, the analysis on the next page analyzes actual exhibition industry performance through 2019, with a focus on historical exhibition industry rebounds following substantial downturns in the U.S. economy.
4 INDUSTRY TRENDS
Strategic Plan for the Palm Springs Convention Centers ● Page 52 The U.S. economy appeared to be on solid footing prior to the COVID-19 outbreak. An historical perspective focusing on changes to GDP growth relative to the national convention industry may be useful in assessing the longer-term impact of the COVID-19 pandemic. As outlined in the chart below, broad industry changes, characterized by retraction and expansion in exhibition, convention, conference, tradeshow and meeting demand have taken place during the past 37 years, with projections for 2022 to 2024.
Given the parallels between GDP changes and changes in various measures of the convention industry, we would expect future industry growth to continue to mirror the overall health of the economy. In recent pre-Covid years (2010 to 2019), a modest and steady growth pattern was seen with both real GDP and various convention industry metrics. With uncertainty as to the state of the economy over the next 24 months, trends in convention industry demand are also uncertain. However, over the longer term, and as economic growth is established, the magnitude of the convention industry is likely to match pace with overall economic growth.
The pandemic took a significant toll on the U.S. exhibition industry. As U.S. GDP decreased by over three percent in 2020, the exhibition industry’s total attendance, square footage, and revenues decreased by nearly 80 percent due to the COVID-19 pandemic. Beginning in 2021, measures of industry performance increased by 50 to 60 percent from the 2020 lows. Projections for 2022 show an approximate 128 percent in overall convention industry measures, followed by percentage growth in the mid 30’s in 2023, and a return to steady modes growth of two to three percent beginning in 2024.
These growth projections would see overall convention industry measures at approximately four to five percentage points above the pre-Covid levels recorded in 2019.
Source: U.S. Bureau of Economic Analysis, Conference Board, St. Louis Fed, Center for Exhibition Industry Research, CSL research, 2022. 2020:
-79%
2021: +54%
2022: +128%
4 INDUSTRY TRENDS
Strategic Plan for the Palm Springs Convention Centers ● Page 53 Recent survey research conducted by CSL of national convention planners focused on identifying the year in which planners expect the convention industry to largely return to pre-pandemic conditions. Seventy-six percent expect a return to pre-pandemic conditions by 2024, while 92 percent expect a return by 2025 or later.
Beyond external economic trends, the convention and tradeshow industry landscape continues to evolve and expand, with the potential for longer term Pandemic related impacts. The increasing importance placed on the adoption and use of technology, the physical design and flexibility of facility space, and the emphasis on authentic and unique destination experiences, among other elements, are indicative of the future trends within the industry as a whole.
As with any product in any industry, continual investment is required to respond to these trends and to evolving customer and industry demands. Planning a convention center expansion requires a future-focused approach to market-supported design and technology investments in an evolving and highly competitive environment. The remainder of this section summarizes our assessment of future initiatives that should be considered for any future convention development in order to address the constantly evolving convention industry.
Even prior to the COVID-19 pandemic, CSL’s research had shown that the increasing Millennial and Gen-Z convention and tradeshow attendee base was creating new demands and expectations of event facility design and programming. The next generation of event attendees will require greater flexibility in how meetings are conducted, how information is delivered, and how technology is used. Greater emphasis is being placed on the ability of a destination to offer a unique, authentic and productive experience.
At the same time, the COVID-19 pandemic has accelerated the demand for specific convention facility elements, including hybrid event capabilities, space for outdoor functions, and safe and walkable environments in desirable (but not overcrowded) urban locations. It is critical to consider how planner preferences and attendee behavior may be impacted in the short- and long-term as the event industry “returns to normal”.
The image on the following page as well as the discussion presented throughout the remainder of this section detail industry trends that should be addressed as part of PSCC planning, including several initiatives that management has already initiated to respond to these trends.
Source: CSL survey of national convention planners, 2021. 4 INDUSTRY TRENDS
Strategic Plan for the Palm Springs Convention Centers ● Page 54 At the same time, the COVID-19 pandemic has greatly accelerated the demand for specific convention facility elements, including broadcast and hybrid event capabilities, space for outdoor functions, and safe and walkable environments in desirable (but not overcrowded) urban locations. It is critical to consider how planner preferences and attendee behavior may be impacted in the short- and long-term as the event industry “returns to normal”.
Pre- and Post-COVID Convention/ConferenceCenter Trends
Event planners and attendees are increasingly emphasizing the following facility/destination attributes. The following pages summarize the emerging and future trends of various event industries (as outlined below), as well as examples of how facilities around the country have adapted to changing needs of event attendees:
• Virtual/hybrid events – turnkey broadcast and production studios will help in-person events stream to broader virtual audiences. • Outdoor event space – planners increasingly use terraces, rooftops, patios, and pavilions for off-site events and general sessions. • Walkable districts – vibrant, safe and navigable districts around a facility are nearly as important as event space square footage. • Dynamic meeting spaces – larger meeting spaces with modular furniture help support creative and interactive breakout sessions. • Unique and authentic F&B – static food courts are being replaced by locally owned pop-ups and stylish food halls. • Flexible pre-function space – events increasingly utilize lobbies and concourses for presentations and networking events. • Augmented/virtualreality – virtual, shared experiences are increasingly important to science, medical and tech organizations. • On demand meeting space – app-activated breakout spaces support frictionless scheduling for tomorrow’s event attendees. • Other trends – public art, digital signage, natural lighting, and casual furniture each enhance the appeal of any convention product.
As with any product in any industry, continual investment is required to respond to evolving customer and industry demands.
Planning a convention center expansion requires a future-focused approach to market-supported design and technology investments in an evolving and highly competitive environment.
Even prior to the COVID-19 pandemic, CSL’s research had shown that the increasing Millennial and Gen-Z convention attendee base was creating new demands and expectations of event facility design and programming. The next generation of event attendees will require greater flexibility in how meetings are conducted, how information is delivered, and how technology is used. Greater emphasis is being placed on the ability of a destination to offer a unique, authentic and productive experience. 4 INDUSTRY TRENDS
Strategic Plan for the Palm Springs Convention Centers ● Page 55 Sans Expo & Convention Centre
(Singapore)
Virtual/Hybrid Events
Event planners interviewed by CSL in recent months suggest a significant interest in permanent turnkey production and broadcast facilities on-site at event venues to stream and produce content for events in real-time.
Some facilities have already invested in technologies to accommodate virtual attendees. The tcf Center in Detroit includes a 5,000-square foot broadcast studio that offers the technologies and services needed to create programming, live event webcasting, and large-scale program distribution, among other offerings. Centers in Baltimore and Houston are also being outfitted with enhanced broadcast/ production capabilities.
Outdoor Event Space
Even prior to the pandemic, event planners indicated an increasing demand for unique outdoor event space at their host sites. Popular conference/convention facilities throughout the country offer terraces, patios, lawns, and pavilions to events for networking events or general sessions.
Outdoor event space provides attendees with the opportunity to connect with the culture and feeling of a destination in a unique event setting while creating an additional selling point and source of revenue for centers. Further detail regarding best practices in outdoor event space design and programming is presented on the following page. The use of the Jackie Lee Houston Plaza at the PSCC represents a response to the outdoor function space trend.
Continued outreach to customers as to future refinements to the configuration, connectivity, technology and other aspects of the space should be undertaken.
Walkable Destinations
As the competition to attract nationally rotating conferences has become increasingly intense, many facilities have begun to position themselves as “convention districts”. In this way, the value proposition for an event planner broadens beyond traditional event space and hotel criteria to include restaurant, retail, entertainment and transportation within walking distance of a convention facility.
Convention and conference facilities located within vibrant mixed-use districts cater to this emerging event planner demand, and those that integrate with their surrounding dining, retail and entertainment environments are positioned to succeed in the post-COVID convention industry.
Riverside Convention Center
(Riverside, CA)
Planned Mixed-Use District
(New Haven, CT)
Tier 1 Facility Trends – The Most Important Trends Accelerated by COVID-19 Pandemic 4 INDUSTRY TRENDS
Strategic Plan for the Palm Springs Convention Centers ● Page 56 Outdoor Event Space – Additional Concepts Applicable to an Improved PSCC Growing event planner demand for usable outdoor event space at convention facilities highlights the importance of include these types of spaces at an improved PSCC. To better understand specific best practices regarding outdoor event space development, we identified a short list of convention facilities nationally with signature outdoor spaces that are frequently programmed and lauded by interviewed event planners. Details and key takeaways with transferability to an improved PSCC are provided for each of these facilities below.
Other unique and valuable design and/or marketing of outdoor event spaces at convention centers in larger destinations are briefly summarized below.
• Long Beach Convention Center: The Cove, a streetside plaza space covered by a second-story walkway, is a frequently programmed outdoor event space featuring lounge furniture, outdoor games, and an area for food trucks. • Anaheim Convention Center: The Center’s plaza frequently hosts up to 27 food trucks that cater to some of the facility’s larger national conventions throughout the year. To support the “convention environment” the plaza is blocked off with temporary barriers, and seating/resting areas and shading are provided for dining event attendees. • Phoenix Convention Center: 3rd Street, which separates the two halves of Phoenix Convention Center, is occasionally blocked off with bollards for large citywide conventions. In this way, the street can be activated as a “block party” space for special programming.
• Colorado Convention Center: The upcoming expansion of the Colorado Convention Center will feature a rooftop terrace that directly connects to an 80,000-square foot multipurpose hall via operable roll-up doors.
Facets of each of the outdoor spaces above could be considered for potential patio, rooftop, plaza or other such spaces at an improved PSCC.
4 INDUSTRY TRENDS
Boise Center (Boise ID)
Pasadena Convention Center (Pasadena, CA)
Spokane Convention Center (Spokane, WA DLL Convention Center (Pittsburgh, PA) Boise Centre’s outdoor event plaza is centrally located and is an extension of the urban grid, so the pedestrian flow is natural. It is also easily controlled for non-public events, and the plaza is central to the layout of the convention center.
The Pasadena Convention Center’s front plaza area, which is also a public plaza across the street from a popular commercial district, is periodically closed for events at the Center and other community events or festivals. The Center has purchased tent equipment and portable seating to furnish the outdoor space, and is planning to add additional electrical outlets and tent put- ins in the area to make it more “turnkey” for increased use. The SPCC’s plaza is adjacent to Centennial Trail, so public use is encouraged when not being utilized by the center. Space is also easily controlled by the center for non-public events. The Center also features a 7,200 square foot rooftop patio and 9,200 riverside lawn space for weddings, food functions and other events.
The DLLCC is known for its South Terrace Green Roof, a 20,000- square foot outdoor space located just off of the building’s third floor. The space is used as an urban event patio, and features put-ins for tents and kiosks, electrical access, gardens and a walking path. This unique outdoor space has been increasingly used, and has helped the DLLCC compete for regional and national events with facilities in much larger markets.
Strategic Plan for the Palm Springs Convention Centers ● Page 57 Tier 2 Facility Trends – Amenities Increasingly Preferred by Event Planners Cantilever Room at HGBCC
(San Antonio, TX)
Dynamic/Interactive Meeting Spaces
Planners are increasingly using larger, more versatile spaces for breakout sessions. These rooms range anywhere between 3,000 and 10,000 square feet and feature portable and modular furniture to accommodate a variety of programs. The Cantilever Room at the Henry B. Gonzalez Convention Center in San Antonio (TX) is often cited by event planners as an exemplary multipurpose space, and the Room’s built-in A/V, movable furniture, and dual-purpose window/whiteboard help create a flexible and open environment for workshops, brainstorm sessions, and strategy meetings.
Unique and Authentic Food & Beverage
Recent trends in the food and beverage sector are more reflective of changing demographics and how conventions and meetings are being produced. The balance between standard sit-down banquets and more formal food options may be shifting towards the informal, and the ability of a center to offer more convenient “grab & go” or “pop-up” dining opportunities could become much more important in the future. Planners and attendees today are also preferring more trend forward amenities such as food trucks, and locally sourced offerings at pop-ups within the center.
Engaging Pre-Function Areas
The Open Space Learning (OSL) concept challenges the
traditional lecture or seminar-based formats that tend to draw attendees off the main show floor during events and instead provides unique and creative learning environments that can be constructed in lobbies, pre-function areas, atriums, etc. Facilities such as the Renasant Convention Center in Memphis, the
Vancouver Convention Centre, and the Grand Wayne Convention Center in Fort Wayne (IN) have invested in portable and versatile furniture to create environments for small meetings and lectures, podcasts, and informal networking events.
tcf Center
(Detroit, MI)
Waukee Innovation Center
(Waukee, IA)
4 INDUSTRY TRENDS
Strategic Plan for the Palm Springs Convention Centers ● Page 58 Conceptual A/R Meeting
Augmented and Virtual Reality
Augmented reality technologies allow for “shared experiences” among attendees. By using headsets or mobile technologies, attendees can be alerted by the same statistics or
goals/waypoints in the real world while they attempt to complete a shared task.
Beyond A/R, virtual reality enables medical professionals to share experiences in completely simulated environments by wearing headsets or other currently available technologies.
These technologies and their applications are still evolving, but many conference and convention industry leaders envision multipurpose “black box” rooms that will host completely immersive environments rendered as lifelike to its observers.
On Demand Micro Meetings
As Millennials and Gen-Z make up an increasing share of convention and conference attendee bases, event booking technologies have emerged that allow for app-based scheduling of breakout meeting spaces in venues.
ZenSpace has developed private, tech-enabled Smart Pods that can be rented on demand using an integrated mobile app. These spaces are outfitted with comfortable booth seating, tabletops, whiteboards, monitors, HDMI cables and phone charging
stations. This allows planners to schedule their own impromptu, private meeting sessions.
Other Trends
Other conference facility building program and technology trends increasingly noted by event planners during interviews include:
• Public art
• Internet
• Cyber cafes
• Digital signage and monitors throughout venue
• Charging stations
• Natural lighting
• Casual furniture
Zen Space
(San Jose, CA)
Colorado Convention Center
(Denver, CO)
Tier 3 Facility Trends – Other Trends to Monitor
Conceptual
V/R Meeting
4 INDUSTRY TRENDS
Strategic Plan for the Palm Springs Convention Centers ● Page 59 To test the demand for each of the facility feature concepts presented on previous pages, CSL collected survey input from nearly 90 planners of major national and regional conventions and conferences. Participating planners were asked to rate the importance and appeal of several different event facility trends on a scale of “1” to “5”, with “5” being the highest score. Their feedback is summarized in the chart below.
Trends that should be considered a high priority by the convention industry garnered scores of 3.25 or higher. As shown, outdoor event space received the highest rating from planners (score of 3.62 out of 5), followed by using pre-function areas for informal meetings (3.56), streaming and broadcast technologies (3.52), local and authentic food stations (3.45), and pop-up/temporary food stations (3.29). It will be important to consider each of these trends as part of any convention center development.
Trends that scored lower are less of a near-term priority but should still be considered important as part of any convention center development or expansion project. These include unique or local public art installation, augmented and virtual reality capabilities, ‘micro pods’, and podcast recording rooms.
4 INDUSTRY TRENDS
Convention Center Facility Feature Trends by Importance and Appeal (according to surveyed event planners)
Priority
Trends
potentially
requiring
facility
investment
Secondary
Trends
that
should be
monitored
Facility
Factors
Strategic Plan for the Palm Springs Convention Centers ● Page 60 CSL also asked national and regional convention planners to rate the importance and appeal of various surrounding convention district amenities for their events. This questions was similarly scaled from “1” to “5”, with “5” as the highest score. Notably, many amenities received significantly higher levels of importance relative to previously presented convention center facility features.
Convention district trends that should be considered a high priority garnered scores of 4.00 or higher. Access to full-service hotel rooms (score of 4.59) represents the most important convention district amenity among surveyed event planners. This is followed by pedestrian lighting for nighttime activities (4.48), a variety of hotel offerings (4.42), full-service restaurant options (4.30), easily understandable wayfinding for pedestrians (4.23), some form of shuttle/trolley vehicle service (4.20), and access to fast-casual dining options (4.06). Each of these factors will be considered later in this report when defining needed hotel and hospitality connectivity in support of the PSCC.
Trends that scored lower are less important to planners but should still be considered as part of a convention district development.
These amenities include nearby bars, convenience stores and services within walking distance, food halls, access to live entertainment, breweries and/or distilleries, and public art and landscaping design. 4 INDUSTRY TRENDS
Convention District Amenity Trends by Importance and Appeal (according to surveyed event planners)
Priority
Trends
potentially
requiring
district
investment
Secondary
Trends
that
should be
monitored
Destination
Factors
Strategic Plan for the Palm Springs Convention Centers ● Page 61 Has the Pandemic Increased Interest in Small/Mid-Size Markets? Do You Anticipate a Larger Online Presence in the Future? How Influential Are Political Policies in Your Site Selection? Due to significant Pandemic impacts and growing political turbulence since 2020, CSL recently distributed a questionnaire to event planners that inquired them regarding their thoughts of how the industry has changed in recent years and will continue to change moving forward. Several analyses with notable takeaways are presented below.
As shown in the top-left exhibit, CSL asked national meeting and event planners if their interest in small/mid-sized markets has increased due to the pandemic. Of these respondents, 56 percent indicated that they are more interested in smaller and mid- sized destination markets than they were prior to the Pandemic. This aligns with a gradually growing notion within the convention industry that planners are looking for smaller, safer destinations with closer access to outdoor experiences to host their events. Palm Springs offers these and other advantages, and the destination’s convention industry has an opportunity to benefit as a result.
Source: CSL Survey, 2022.
INDUSTRY TRENDS4
44%
56%
No
Yes
12%
44%
26%
7%
11%
Definitely not
Not likely
Possibly
Likely
Definitely
28%
7%
19%
12%
33%
0-20
21-40
41-60
61-80
81-100
53 Average
Score
Planners were also asked to indicate the level of influence that political policies of a state or region have on their site selection process. The average of the aggregate, a score of 53, suggests only moderate concern with a destination’s political policies.
However, it is important to note the polarization of the data. Scores ranging from 81 to 100 (very important) were given by 33 percent of event planners (the highest percentage among the five intervals), while scores ranging from 0 to 20 (not influential at all) were given by 28 percent of planners (the second highest).
Considering that a third of the PSCC’s event marketplace places significant emphasis on an area’s political climate, PSCC and GPSCVB sales should consider strategies to target those groups that may not be open to locating in other regions/states within the country due policy issues.
Planners were also asked whether they anticipate an
increased online attendee base for their events. Fifty-six (56) percent expressed little expectation of increasing online audiences, with 44 percent indicating that it is “not likely” and 12 percent reporting that their online base will “definitely not” grow. Eighteen percent of planners felt that their online event attendee base was at least “likely“ to increase; 11 percent felt it would “definitely” increase.
The combined 44 percent of planners that at least possibly see a future increase in on-line event attendance may suggest modest convention center equipment and operational
changes to facility more convenient capture of event content for on-line use.
5 MARKET
DEMAND
Strategic Plan for the Palm Springs Convention Centers ● Page 63 MARKET DEMAND5
Interviews & Primary Market Research
The purpose of this chapter is to provide an analysis of market demand for an improved Palm Springs Convention Center and surrounding district. The data generated as part of this market analysis have been derived from the following:
• CSL experience gained from over 1,000 convention, conference, exhibition, hospitality and event facility projects throughout North America. • Research and analysis of local market conditions including hotel inventory, walkability, commercial development, hospitality assets, attractions and other components of a successful convention and visitor destination. • Review of the existing Palm Springs Convention Center operations and event space offering.
• Analysis of competitive and comparable facilities and host destinations. • In-depth telephone surveys with current, past users of the Palm Springs Convention Center.
• Email survey of 84 state, regional, and national event planners, representing over 100 annually recurring convention, tradeshow, and other events.
The focus of the remainder of this chapter is on quantified survey data associated with two primary groupings of research completed for this study: 1) rotating conventions and tradeshows at the state, regional, and national level, and 2) current, past and “lost” users of the Palm Springs Convention Center. Quantitative and qualitative data provided by both groups is summarized below and on the following pages.
Rotating Convention Planners1
Likelihood of Using an Improved
Palm Springs Convention Center
2022 Positive = 82%, 2022 Negative = 18%
Top Reasons for Disinterest
As detailed previously, CSL conducted an electronic survey of 84 rotating convention, conference and tradeshow planners. The data presented herein reflect the results from this outreach, with a focus on event planner feedback regarding interest in Palm Springs and an improved PSCC and surrounding district, as well as their event space and hotel needs.
We begin with an overview of event planner interest in a redeveloped Palm Springs Convention Center and the Palm Springs destination. When asked to indicate the likelihood that they would rotate one or more events to an improved PSCC and surrounding district in the future, 82 percent of respondents reported that they would at least “possibly” use the facility. This group includes the 17 percent that noted that they would “likely” use it, and the 14 percent that would “definitely” use it. This positive interest rate is the highest score among ten comparable convention center studies CSL has conducted over the last two years. For example, Palm Springs’s positive interest rate (82 percent) outranked closely comparable markets such as West Palm Beach, FL (69 percent positive score) and Greeneville, SC (66 percent positive score).
The 18 percent of surveyed planners who would “not likely” or “definitely not” use an improved PSCC were asked to describe their reasons for disinterest. These include preferences for smaller conference/meeting facilities, distance from
concentrations of their attendee bases, transportation and travel accessibility, challenges with the PSCC’s headquarter hotel inventory, weather/climate concerns and long-term
commitments with other event facilities.
• Convention Center Too Big for Events (53%)
• Location of Attendee Base (20%)
• Transportation/Travel Accessibility (20%)
• HQ Hotel Quality (7%)
• Weather/Climate Concerns (7%)
• Don’t Rotate Events (7%)
6%
12%
51%
17%
14%
Definitely Not
Not Likely
Possibly
Likely
Definitely
Source: CSL Survey, 2022.
Strategic Plan for the Palm Springs Convention Centers ● Page 64 MARKET DEMAND5
Surveyed planners rated Palm Springs as “above average” relative to peer destinations, and awareness of the market as a convention destination rates near the top of the
comparison set. Results are shown in the exhibit to the right, with ”1” representing the weakest rating and “5” representing the strongest rating.
When asked to rate interest in comparable destinations, Palm Springs received a score that is among the highest of any prior CSL destination survey. Additionally, Palm Springs received a significantly low unfamiliarity rate for event planners.
These results suggest a very positive impression of Palm Springs among convention/event planners who are familiar with Palm Springs.
Destination Ratings Destination Unfamiliarity Rate
Interviewees that responded positively to using an improved PSCC and surrounding district were also asked to explain their scoring of Palm Springs as an event destination. These responses were consolidated to develop the word cloud below that highlights the recurring themes and references made by event planners.
2.62 2.78
2.89 2.91
3.17 3.24
3.53 3.53
3.54 3.80
3.90 4.14
4.29 Ontario, CA
Reno, NV
Pasadena, CA
Los Angeles, CA
Sacramento, CA
Las Vegas, NV
Long Beach, CA
Monterey, CA
Anaheim, CA
Denver, CO
Phoenix, AZ
Palm Springs, CA
San Diego, CA
22%
16%
16%
13%
12%
12%
11%
9%
7%
7%
7%
7%
6%
Ontario, CA
Monterey, CA
Pasadena, CA
Sacramento, CA
Phoenix, AZ
Reno, NV
Denver, CO
Las Vegas, NV
Palm Springs, CA
San Diego, CA
Los Angeles, CA
Anaheim, CA
Long Beach, CA
Source: CSL Survey, 2022.
We note that our survey process relies on planner interest in responding, and planners with an interest and/or familiarity with the destination are more likely to participate. At the same time, we use a similar process for other projects, allowing for a useful comparison among studies.
Descriptors such as weather, beautiful, destination
are reflected prominently. Others that are not
unexpected including resorts, hotel,
accommodations, golf, meetings, excellent, service
and desert.
Several descriptors that more reflect the essence of
the destination could include always, nice, perfect,
people and love.
Strategic Plan for the Palm Springs Convention Centers ● Page 65 3%
5%
12% 11% 10% 11%
9% 4% 7%
18%
8% 3%
51%
83%
71%
47% 46%
22% 27%
24%
53%
64%
48%
32%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
0%
5%
10%
15%
20%
25%
30%
35%
40%
Occupancy Level
Event Seasonality
Demand by Month 2017-2019 Avg. Oasis Occupancy
MARKET DEMAND5
Respondents were asked to outline the month(s) that their represented events take place throughout the year. These figures provide a reference to peak event seasonality for interviewed event planners. The most common month of events for respondents was October with 18 percent of events taking place in that month. From March to July, event activity was notably higher than other months, with August, December, January and February representing low demand periods. September through November (with the peak in October) reflect modest event demand.
The chart below also presents average occupancy data for the Oasis Hall on a monthly basis for years 2017 to 2019. This comparison suggests potential for increasing PSCC event activity in the April to June period, and during several fall months.
Exhibit Space – Positive Respondents
0 50,000
100,000
150,000
200,000
250,000
300,000
350,000
5% 15% 25% 35% 45% 55% 65% 75% 85% 95%
SF of Exhibit Space
PSCC(1)83% market capacity
Note:
(1) – Only Oasis Hall
Source: CSL Survey, 2022.
Seasonality of Events Held
Interviewees indicating positive interest in using an improved PSCC and surrounding district were also asked about their event space requirements and preferences. We begin with a summary of positive respondent exhibit space needs as summarized in the chart below. Data show the share of the interested convention and tradeshow market that can be accommodated at particular exhibit space levels. For example, 83 percent of the market interested in the PSCC can be accommodated in the existing 92,500- square foot Oasis Hall.
A slight increase in exhibit space to slightly over 100,000 square feet would increase the capture percentage to approximately 90 percent. This type of analysis is used later in this report to define near and long-term market-supportable building program targets for the PSCC.
Strategic Plan for the Palm Springs Convention Centers ● Page 66 Similar market capture analyses of attendance, ballroom, meeting and outdoor event space needs are summarized below. Starting with the chart in the top-left, median total attendance of events with positive interest in the PSCC approximates 1,100, which closely approximates the average attendance of PSCC’s convention events in past years. At a market capture of 83 percent (commensurate with current exhibit space capture levels), attendance levels approximate 3,250. The ballroom space area chart (top right) shows that the 20,000 square foot Primrose Ballroom can accommodate the space needs of approximately 55 percent of the target event market. A 30,000-square foot ballroom space could accommodate 75 percent of the target national/regional market for the PSCC.
The PSCC’s breakout meeting space offering of 15,800 square feet better meets identified demand, accommodating approximately 73 percent of event planner needs. An additional, 4,200 square feet of meeting space would enable the facility to accommodate 75 percent of demand and 14,200 square feet of added meeting space would meet 90 percent of demand. In terms of total sellable space, the existing PSCC offering meets the demand of 78 percent of the surveyed market.
Considering these data, continuing to work with the Renaissance to leverage their meeting space to meet larger convention needs will be important going forward. Further, considering trending preferences for non-traditional meeting setups in outdoor and/or pre- function areas, it will be beneficial to identify re areas throughout the PSCC that could offer 4,000 to 6,000 square feet of additional gathering space for larger conventions to somewhat supplement the facility’s existing meeting space inventory.
MARKET DEMAND5
Total Attendance Ballroom Space
0 25,000
50,000
75,000
100,000
125,000
150,000
5% 20% 35% 50% 65% 80% 95%
SF of Exhibit Space
Meeting Space Total Sellable Space
0 14,000
28,000
42,000
56,000
70,000
84,000
5% 20% 35% 50% 65% 80% 95%
SF of Meeting Space
55% market capacity PSCC
73% market capacity PSCC
0 5,000
10,000
15,000
20,000
25,000
30,000
5% 20% 35% 50% 65% 80% 95%
Attendees
0 100,000
200,000
300,000
400,000
500,000
600,000
5% 20% 35% 50% 65% 80% 95%
SF of Sellable Space78% market capacity PSCC
Source: CSL Survey, 2022.
Strategic Plan for the Palm Springs Convention Centers ● Page 67 Positive respondents were also asked to indicate the peak hotel inventory required to accommodate their events, as well as the maximum number of hotel properties they are willing to use, and the number of rooms they prefer to have housed within a headquarter hotel package. Their feedback is summarized in the charts below.
Planner demand suggests a median requirement of approximately 450 hotel rooms on peak to accommodate non-local convention and tradeshow activity. According to PSCC sales personnel, the maximum and minimum Palm Springs committable room inventory (depending on season and day of week) can accommodate 90 percent and 64 percent of market demand, respectively.
However, it is important to consider typical event planner preference for condensed room blocks within close proximity of their host facilities. When excluding those properties that fall outside of 1-mile of the PSCC, the hotel package only accommodates up to 80 percent and as low as 60 percent of demand.
If given the choice, virtually all planners would prefer using only one hotel property to house their attendees, and only 28 percent are willing to use four or more properties. Given this preference for condensed room block packages, it is important to consider the ability for the Renaissance to serve as the primary headquarter hotel property in support of the PSCC Considering these data, it will be important to prioritize the development of additional supporting hotel inventory within close proximity of the PSCC.
MARKET DEMAND5
Maximum Number of Hotel Properties
Total Peak Night Hotel Rooms
0 870
1,740
2,610
3,480
4,350
5,220
6,090
6,960
7,830
8,700
5% 15% 25% 35% 45% 55% 65% 75% 85% 95%
Hotel Rooms
80% market capacity
.
Source: CSL Survey, 2022.
8.1%
18.2%
28.3%
39.4%
72.7%
100.0%
6+
5 4
3 2
1 1-mile Maximum
Committable Rooms*
60% market capacity 1-mile Minimum
Committable Rooms*
Strategic Plan for the Palm Springs Convention Centers ● Page 68 The market capture assessments presented on the previous pages consider exhibit (and other space needs) independently from hotel room needs. For example, the Oasis Hall can accommodate 83 percent of the exhibit space needs of the potential convention and tradeshow market for the PSCC. And 1,200 committable hotel rooms near the PSCC can accommodate 80 percent of the hotel space needs for the target market.
However, it is also important to simultaneously consider exhibit and hotel requirements of surveyed events, and the resulting market capture levels. This assessment is presented in the following chart.
The graphic shows event by event exhibit space needs, with an overlay of the actual room nights by event. There are several events that can be accommodated by the existing PSCC exhibit space but cannot be accommodated with the available hotel inventory.
For example, though the exhibit hall of the PSCC can accommodate 83 percent of the identified market, only 80 percent of these planners’ needs are met by the current maximum committable hotel package within 1-mile of the PSCC.
When adjusting for this limitation, only 66 percent of the target market for the PSCC can be accommodated in both the existing PSCC exhibit and committable hotel room inventory.
These data are used later in this report to help define market-supportable building program and hotel investment scenarios. 0 1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
0 50,000
100,000
150,000
200,000
250,000
300,000
350,000
1%
5%
9%
14%
18%
22%
26%
30%
34%
39%
43%
47%
51%
55%
59%
64%
68%
72%
76%
80%
84%
89%
93%
97%
Hotel Rooms
Exhibit Space (SF)
SF - All Events Hotel Rooms - All Events
Exhibit Space + Hotel Needs
80%
Accommodated by
maximum 1-mile
committable
rooms*PSCC Exhibit Space
53%
Accommodated by
minimum 1-mile
committable
rooms*
MARKET DEMAND5
Note: *70 and 53 percent was attained by cross comparing max and min committable room needs and exhibit space needs.
Source: CSL Survey, 2022.
Strategic Plan for the Palm Springs Convention Centers ● Page 69 Palm Springs Location
Many surveyed event planners referenced the Palm Springs location and its identity as a world-class leisure destination to be a leading driver of their interest in the market as a host destination for their events. -”The Palm Springs location is very hard to beat in terms of weather, beauty and things to do.” -”Our attendees greatly enjoy going to a pristine location such as Palm Springs; it is a beautiful place.” 63% of respondents shared the location to be a major benefit to the Center as an event destination.
To guide market-supported PSCC and surrounding area improvements, it is critical to consider feedback from past and recurring customers. As such, telephone interviews were conducted with eight planners of current and past PSCC conventions. Given their unique familiarity with the existing PSCC, the remainder of this section presents suggestive feedback given by each of these groups regarding improvements that could be included as part of a PSCC redevelopment. We begin with a listing of those events that were represented as part of this outreach effort, followed by summaries of the strengths and challenges of the PSCC.
MARKET DEMAND5
Cu Lost and Current/Past PSCC Events2
PSCC Staff and Services
Each interviewed planner stated that PSCC staff were professional, accommodating, responsive and skilled.
Seven of the eight respondents stated that the staff was the greatest strength of the PSCC by a significant margin.
• “The staff at the Center goes above and beyond in every instance. They seem to greatly overcompensate in order to make every flaw of the destination seem irrelevant.” • “The staff is flexible, friendly and accommodating. They address our problems quickly and carefully.” 100% of respondents listed the PSCC staff as a leading strength of the PSCC.
Downtown Amenities
Respondents commonly highlighted the various amenities downtown as a strength of Palm Springs as an event destination. They often lauded the dining, retail and entertainment offerings of Palm Springs. • “Our attendees love the different restaurants downtown. The retail shops are unique and intriguing to visitors.”
• “The entertainment and attraction offerings are very nice and nearby. The dining and retail options are top notch compared to other markets.”
38% of respondents noted the amenities of downtown to be top-of-the-line.
Strengths of the Palm Springs Convention Center
Interviewed Groups Include:
• Battelle
• Varsity Spirit
• American Indian Science and Engineering Society
• IEEE
• Veritas Association Management
• SciX Conference
• Palm Springs Modernism Show
• Desert Aids Project
Strategic Plan for the Palm Springs Convention Centers ● Page 70 Facility Appearance and Features
Several planners felt that the PSCC facility could benefit from improvements to the look, layout and feel of the Center. Most planners were satisfied with the overall appearance of the Center but felt that it could use improvements in specific areas. Planners referenced a desire for adding a modern feel and aesthetic to the facility, improving the appearance of the outside of the building and/or adding new or increasing the size of meeting rooms at the PSCC.
• “Our event would really benefit from some larger meeting spaces apart from the exhibit hall and ballroom.” • “Improving the look of the backside of the building would really improve the space between the CC and downtown.”
• “The Center is amazing in terms of the building’s design; it just feels outdated and could use a refresh in several areas. ”
50% of respondents commented on the look and layout of the PSCC as a challenge point.
MARKET DEMAND5
Hotel Inventory and Quality
The most frequently listed challenges among respondents were related to the quality and quantity of hotels surrounding the PSCC and in Palm Springs. Staffing issues stemming from the fallout of the Pandemic likely drive many of these issues, but it will still be important to consider pro-active initiatives to maximize the level of hotel customer service at going forward. Similarly, several respondents indicated that the aesthetic of the Renaissance hotel and some surrounding hotels has become somewhat outdated. • “Addressing hotel quality and staff will be necessary for us to considering Palm Springs and the PSCC in the future.”
• “The hotels in Palm Springs feel as if they are cutting services and staff, while concurrently increasing the price of accommodations.”
50% of respondents indicated a need for improved hotel offerings, services and inventory.
Challenges Of and Opportunities For the Palm Springs Convention Center Technology
Some respondents cited PSCC’s dated technology to be a moderate challenge. Most noted items include digital signage and audio-visual capabilities. Multiple planners listed problems with cellular and WIFI connectivity during events with high attendance. Planners also recommended implementing digital signage and more digital displays outside of the building.
• “WIFI during our event tends to become unusable with the number of attendees we have. It’s very important to our attendees that they can access the internet during the event.” • “More digital signage on the outside of the building would look and function great; digital signage on the inside would help us guide our attendees and improve the look and feel of our event.” 63% of respondents referenced technology as a room for improvement at the PSCC.
Other Palm Springs Convention Center and Area Strengths Other commonly referenced strengths of the PSCC and surrounding area include the quality of the catering options, outdoor event space and the walkability of downtown. • “The AV team is perfectly professional, responsive and accommodating.” • “Savoury seemed overpriced at first, but after working with their team and trying their food it is completely worth the price.”
• “The outdoor event spaces is both comfortable and beautiful; I only wish there was more.” • “Once you make it downtown it is very entertaining and easy to get around.” Strategic Plan for the Palm Springs Convention Centers ● Page 71 Airlift and Location Accessibility
Some respondents noted that increased routes and flight capacity at the Palm Springs International Airport would be greatly beneficial for attracting events to Palm Springs. Planners indicated a desire for more routes from the eastern portion of the country and/or increased numbers of flights and seats coming into Palm Springs.
• “We would be able to grow our event and attract more participants from the eastern half of the country if there were more planes coming into Palm Springs from more routes across the country. ” • “We would love if the airport could get more direct flights to Palm Springs from across the country.” 38% of respondents cited a desire for more planes and/or routes to the Palm Springs International Airport.
Additional Opportunities and Suggestions for the PSCC and Palm Springs In their responses, several planners provided additional comments and suggestions that they felt would improve the quality of events and the experience at the Palm Springs Convention Center. These suggestions relate to a variety of categories including technology, appearance, the surrounding district, among others. • “Sound travels through the airwalls far too much and has a negative impact on our event when loud events are going on next to us.”
• “Continuing to develop the Renaissance event staff or having the convention center team work more closely with the Renaissance during events would help us utilize the hotel’s outdoor spaces more; we love those spaces.”
• “Exterior lighting would help walkability. Outdoor events that run into the night can make the venue feel safer for our attendees when they walk at night.”
• “More water bottle filling stations would be really convenient; our guests use these a ton.” • “Nighttime ambiance outside would help us to host some really cool events in the evenings at the PSCC.” • “Make sure that the convention center and hotels are continually invested in to keep the look fresh and up- to-date. The look of both are good now, but they are beginning to fall behind in this regard.” Downtown Accessibility and Transportation
While most respondents see downtown Palm Springs and its amenities as a strength of the destination, many of these respondents felt that getting to downtown Palm Springs from the PSCC is an inconvenience and a challenge point for attendees. Attendees are interested in seeing a more dedicated walk route to downtown and/or a trolley/shuttle to help attendees travel while in-market. We note that the surrounding lots that are under construction will help to begin a process of connectivity between the PSCC and downtown. - “The downtown is great, and our attendees love it, but it is a challenge to get to and the lack of development in the spaces between the PSCC and downtown makes it feel unsafe and unattractive.” - “Our attendees love Palm Springs and would greatly benefit from a shuttle or trolley to help them get around town and to the downtown.”
38% of respondents saw the accessibility of and transportation to downtown as a challenge of the PSCC.
MARKET DEMAND5
6 BUILDING AND
DISTRICT
RECOMMENDATIONS
Strategic Plan for the Palm Springs Convention Centers ● Page 73 RECOMMENDATIONS6
Overall, market analysis findings suggest that investment in improving the Palm Springs Convention Center and the surrounding district would materially benefit the ability to attract high impact events to the market. Based on the in-depth research and insights presented, we have developed a list of initiatives that should be considered by PSCC management and other stakeholders to enhance Palm Springs as a convention destination. The recommendations presented herein are segmented into the following four areas of focus.
1. Convention Product Improvements
2. District Connectivity
3. Near- and Mid-Term Real Estate Planning
4. Long-Term Planning
Recommendations concerning each of these topics are presented below and on the following pages. These recommendations are designed to distinguish and elevate Palm Springs within the convention industry, as well as improve the experience for its visitor base and the quality of life for its resident base.
Many of the recommendations presented herein cannot be implemented by a single entity or agency. In fact, participation from a variety of public and private sector entities may be necessary to realize the potential of Palm Springs within the convention industry economy. To best inform Palm Springs Convention Center management and the other important stakeholders who will be critical in carrying out many of the initiatives herein, an implementation timeline is included at the conclusion of this Chapter that defines key initiatives, necessary stakeholder participation, and project milestones.
Convention Product Improvements
Analysis findings suggest an opportunity for the PSCC’s market capture to increase by enhancing the in-facility experience for both the event planner and attendee. Key aspects of a recommended facility program for an improved Palm Springs Convention Center are highlighted below within the floor plan illustration, followed by descriptions of each concept.
Recommended PSCC Improvements
1 Strategic Plan for the Palm Springs Convention Centers ● Page 74 RECOMMENDATIONS6
Re-Invention of The West
The PSCC’s western entrance represents a key opportunity to create a convention visitor “launch point” to the downtown Palm Springs destination and could help better link the facility with downtown and other nearby existing and future attractions. At the same time, the area could be further leveraged as unique meeting/gathering space, offering both spacious pre-function and outdoor areas. Today, the area seems “under-activated” to many planners and local stakeholders, with some noting that it feels more like the facility back door. Opportunities to re-invent the area for the modern convention industry are detailed below. • Outdoor Event Space: Working with the City, Jackie Lee Houston Plaza should be reconfigured to be optimized for outdoor event use. Natural elements should be transplanted to the periphery of the park area to maximize contiguous space for event activity. Tent footings, in-ground electrical and water could be added to support outdoor vendors. Dynamic lighting, including public art installations, should be added to the space to support evening activity. Shaded areas should also be provided on the periphery of the Plaza.
• Indoor/Outdoor Social Area: The entrance area into the western side of the facility should be re-imagined as an indoor/outdoor event patio for major conventions. Long Beach Convention Center’s “The Cove” (pictured on previous page) is a covered outdoor area featuring lounge seating, lounge games and bar stations. These types of amenities could be added to the covered entrance areas at PSCC, and shading, lighting and public art stations could help add vibrancy to the outdoor side walk area. Further, PSCC leadership should increasingly work with the City to close N Calle Alvarado on a periodic basis for major conventions, and work with convention planners to combine Jackie Lee Houston Plaza and the western entrance as networking into cocktail hour and social gathering space. The western façade could also be further enhanced with LED lighting to support the added activity at night, and, working with the Public Art Commission, murals could be added to the facade of the PSCC or the adjacent Renaissance.
• Local Food & Beverage: A small space (approximately 500 to 1,000 square feet) could be allotted within the western pre- function area to accommodate a kiosk structure for permanent or rotating food & beverage vendors from the local area. For example, La Quinta brewing could serve from the space during major conventions, providing attendees with unique and authentic Palm Springs beer. Revenues could be shared with the vendor, who would benefit from marketing to a highly diverse and nationwide attendee base.
• Open Space Learning: As previously noted within the Industry Trends chapter, event planners are increasingly using pre- function areas such as lobbies and atriums to host their programming. Today’s attendees increasingly enjoy non-traditional meeting formats that encourage freedom of thought and creativity. Working with Steelcase or other furniture suppliers, efforts should be made to add furniture to the pre-function areas that can host small and mid-sized gatherings. Portable desk chairs, portable whiteboards, lounge seating, charging stations, webcams, and Bluetooth-enabled and wall-mounted monitors could help support a dynamic and programmable pre-function environment. • Digital Public Art Station: Palm Springs features a nationally acclaimed inventory of public art installations, and opportunity exist to further embed this trait within the PSCC while also modernizing the building for today’s and tomorrow’s convention attendee. LED and digital-based installations could be added throughout the western pre-function and other areas of the building. Installations tied to a theme of sustainability could align well with Coachella Valley community and economic development goals. These could be potentially developed in partnership with the Public Art Commission and various local technology and sustainability businesses.
Other Building Improvement Opportunities
Opportunities exist beyond the western entrance to enhance the PSCC product. These are summarized by topic below. • Update Primrose and Meeting Space: Many planners and stakeholders commented on the dated nature of Primrose and the PSCC’s breakout meeting rooms. Investment should be made to updated these rooms with modern aesthetics and technology.
• Digital Signage: Large, highly visible LED screens should be added to highly trafficked pre-function areas. Digital signage provides two important benefits: 1) it provides information and wayfinding to attendees and 2) it provides sponsorship opportunities that increase building revenue.
• Improvement of The Renaissance: Many current/past event planners wish to see improvements to the service and space quality at the Renaissance. Over the long-term, continued deficiencies at the property may make it difficult to retain some major conventions at the PSCC. Efforts should be made to encourage investment in the property’s guest rooms and continued improvement in the quality of its service.
Strategic Plan for the Palm Springs Convention Centers ● Page 75 • Hotel Incentive Program: The City of Palm Springs offers a hotel incentive program that re-imburses hotel owners for improvements to their properties, but this policy expires at the end of 2023. The program should be renewed, and properties that engage in PSCC room blocks should be encouraged to participate in the near-future. • Improved Eastern Entrance: Interviewed stakeholders noted that PSCC event attendees who drive in will now primarily park in the Caballeros Lot to the east of the facility due to the planned development of the southwest lot, and that the facility lacks a clear sense of entry on its east side. The addition of public art, landscaping, plaza space and visible digital signage would enhance the visitor experience as they approach and enter the facility from Caballeros Lot. • Increase Storage: Opportunities to increase storage space at the PSCC should continue to be evaluated by leadership, particularly if additional furniture is purchased to address previous recommendations. Given its limited use, the existing green room just east of Primrose Ballroom could offer additional storage. • Diversify Wi-Fi Options: In reviewing event planner and stakeholder comments, the PSCC Wi-Fi offering needs to be more flexible. Working with Encore, a three-tier paid system should be evaluated that offers highly affordable internet access to attendees (preferably free), a mid-tier option for streaming, and a top-tier option for transactions, 4k streaming, gaming, and other data-intensive uses.
• Conversion of Oasis 4: Historical operations analysis indicates that Oasis 4 is utilized approximately 40 percent of days throughout the year, lower than each of the other sub-halls. At the same time, the PSCC is deficient in ballroom space.
Potential may exist to enhance Oasis 4 with higher quality carpet, acoustic paneling, ceiling treatment, dynamic lighting and technology to create opportunities to accommodate traditional ballroom/general session functions.
District Connectivity
The Downtown Palm Springs destination is a unique and appealing visitor industry asset that could be further leveraged as a competitive advantage over peer convention facilities. As previously presented, Palm Springs’s strongest visitor assets (attractions, hotels, restaurants, etc.) are largely concentrated in downtown, but are somewhat lacking within PSCC’s ½-mile radius. Guiding convention attendees to/from the PSCC to the downtown should be a critical goal of the City and PSCC management going forward. Opportunity exists strengthen the pedestrian experience between the PSCC and downtown assets through wayfinding, public art, lighting, technology, landscaping and other elements. Potential corridors for enhancement include E Amado, E Andreas, and E Tahquitz Canyon Way. Specific recommendations are highlighted within the graphic below and further described on the following pages.
PSCC District Connectivity Planning
RECOMMENDATIONS6
2 Strategic Plan for the Palm Springs Convention Centers ● Page 76 RECOMMENDATIONS6
• Monumental Public Art: One or more large-scale installations could be a defining component of the PSCC’s western entrance.
An installation could be located across the street from Jackie Lee Houston Plaza or at the beginning of E Andreas Rd at the PSCC entrance. One or more installations could also be located along one of the three westward corridors pictured above, serving as directional landmarks to downtown. As illustrated above, monumental installations could be large, moving sculptures; multi-story murals with historical or cultural significance; or tech-forward projection lighting onto building surfaces. • Themed Wayfinding: Pedestrian navigability would be enhanced with the development of Convention District-based wayfinding signs. Hotel concierge staff could, for example, direct the visitor to a landmark piece art, at which point the more specific directional signage would be located. The example pictured within the graphic on the previous page reflects elements of simple directional cues that reference the direction of key points of interest. In addition, one ore more strategically placed digital, interactive kiosks could be added at highly visible points along one of the westward corridors. These could be located near new public art elements and placed in settings that make the kiosks easily visible to the pedestrian. These new wayfinding structures should feature Convention District branding, décor or other elements unique to the destination, as well as information regarding the PSCC and attractions in the immediate area. • Street Performances: VillageFest already organizes a myriad of street performances on Thursday nights throughout the year.
For some of the PSCC’s largest citywide events, potential may exist for VillageFest leaders, Downtown Palm Springs decisionmakers and the PSCC to organize a “trail” of performers to lead visitors to key areas of downtown from the Convention Center. A modest budget could be prepared to support these types of periodic performances, particularly during major PSCC evets.
• Convention Center Marquee: Many stakeholders suggested that the PSCC’s activity should be better advertised to the local community. A large digital LED board that is potentially based on the façade of the facility and maintains the City’s aesthetic/character standards could serve as both an informational resource that showcases the major events that are in- destination, as well as a placemaking enhancement at night. However, opportunity may also exist to display information regarding events at the PSCC within LED-activated nighttime installations (described further herein). • Nighttime Installations: A trail of interactive and eye-catching installations could be developed to guide convention visitors from the PSCC to Downtown along one or more of the westward corridors. These could be permanent or temporary public art pieces. Light-up installations could also partially address the lighting and safety issues raised by stakeholders. Minneapolis’s Nicollet Mall, for example, features the adjacent “nighttime beacons” along the avenue to both provide lighting for pedestrians and a unique ambiance. Further, LED signage within/on the installations may also provide an opportunity to display information regarding events at the PSCC for passersby. • Pedestrian Lighting: Stakeholders commented on the lack of lighting along East Andreas Road and other areas surrounding the PSCC. Additional pedestrian-focused lighting along the western façade of PSCC, at Jackie Lee Houston Plaza, along North Calle Alvarado, and along one or more of the westward corridors would address this issue. New lighting could also provide a unique opportunity to serve as a public art and placemaking asset. LED technology could include a vast array of color options, fluctuating lighting patterns and other attraction elements along the connections between Downtown and the PSCC. • Electric Microtransit: App-activated, electronic vehicle fleets have quickly emerged in markets throughout the country. These services specialize in providing one-mile trips in congested urban areas. Finding a private partner to provide this service in Downtown Palm Springs could be particularly beneficial to the convention industry in the long-term as the market matures.
For example, El Paseo in nearby Palm Desert now provides a “Ride Circuit” app to accompany their Courtesy Carts along the roadway, enabling travelers to quickly hail a shuttle vehicle for short one-mile-or-less rides. More recently, autonomous versions of these vehicles have been trialed in markets such as Columbus, Ohio and Grand Rapids, Michigan with successful results. Further, See Plymouth in Massachusetts recently purchased a large fleet of these vehicles (approximately $15,000 per vehicle) to serve as shuttles throughout their popular historic downtown. • Other Pedestrian Experience Improvements: Other placemaking improvements such as landscaping, planters, shading, and misters could be added along the westward corridors to enhance the walking experience to/from the PSCC and Downtown Palm Springs.
For many of the initiatives described above, the City engineering and planning departments will be critical partners, along with the Public Art Commission, Main Street Palm Springs, VillageFest, and others.
Strategic Plan for the Palm Springs Convention Centers ● Page 77 RECOMMENDATIONS6
Near- and Mid-Term Real Estate Planning
The PSCC is adjacent to several key parcels that are planned for hospitality-related development,. These projects represent key opportunities to improve the Palm Springs convention product and could have transformational impacts on the destination’s trajectory in the convention industry. At the same time, the future development and growth of downtown will be paramount to maintaining and improving the convention attendee experience. To provide useful principles for guiding these developments in the best interest of the convention and visitor industries, we have prepared the following recommendations for hotel, downtown and other hospitality projects going forward. The illustration below highlights key areas of interest.
PSCC District Real Estate Planning
• Hotel Development Principles: There are currently two privately owned parcels above that are being planned for future hotel developments. The Dream Hotel site, located just north of the PSCC, includes plans for between 150 and 200 hotel rooms, in addition to an inventory of condos and vacation rentals. The project has been stalled for several years and plans and/or ownership could very well change in upcoming years. To the PSCC’s southwest, a private developer is planning a similar hotel develop atop the existing surface parking lot. Finally, a third privately held site to the southeast of the PSCC, formerly a restaurant, could also become a hotel property. For each project, room count and scale/style should be prioritized as part of their development. These are summarized below.
• Room Count: As shown previously, the PSCC is deficient in ½-mile hotel room inventory. The two proposed projects above could add approximately 350 rooms to the area, though only 40 percent of these are likely to be committable for conventions (based on typical industry standards). Preferably, the combined room inventory between the two properties should total between 500 and 600 rooms, thereby providing 200 to 240 additional rooms for hotel room blocks for events at the PSCC. As planning progresses on the project sites, the public sector should be pro-active in encouraging the maximization of the room counts. Consideration could be given to offering modest public subsidies to support larger hotel properties.
• Scale and Style: With added options such as AirBnb’s and vacation rentals in the market, and the ability to quickly review prospective properties, today’s convention visitor is increasingly selective on where they stay and elements such as service and aesthetic are materially impactful on their decision. To best support the convention industry, these future hotels should be full-service or select service “plus” properties that offer trend forward dining, modern and spacious pre-function areas, and unique and tasteful interior décor. 3 Strategic Plan for the Palm Springs Convention Centers ● Page 78 RECOMMENDATIONS6
• Downtown Development: Many interviewed stakeholders commented on Downtown’s significant progress over the past 20 years. However, some feel that the area has “plateaued” and that strategic investment is needed to continue its evolution.
Initiatives to maintain and enhance the visitor experience in downtown are presented below. • Business Improvement District: Many stakeholders commented on moderate issues with safety, cleanliness and storefront aesthetics along Palm Canyon Drive. These types of issues are normally addressed in similar urban areas by a business improvement district (BID). Main Street Palm Springs serves as a limited version of this for the Downtown area, and spearheads promotions, marketing and the providing of business resources for business and property owners in the area. However, the organization operates with a limited budget, and does not have the resources typically available to BID’s nationally.
BID’s are typically funded by an assessment of property owners in targeted urban areas, and typically are governed by an executive director and board of directors consisting of residents, business owners, and other stakeholders.
Providing ambassadors who clean and ensure safety is typically the most basic and primary services provided by these entities, as well as promoting downtown areas through events, marketing and banner programs. Higher level functions include placemaking and beautification services (providing of planters, landscaping or public art), business recruitment services (façade improvement programs, build out grants, and offering of other incentives), and broader downtown strategic planning (paying for/leading downtown master plans, having a significant voice as part of downtown development, using a revolving loan fund to pay for property acquisition and/or development, etc.) City leaders should evaluate the feasibility of developing such an organization for Downtown Palm Springs and educate property owners in the area regarding the important benefits that it could provide to the visitor experience.
With sufficient funding, this organization could lead important, Downtown-focused programs such as storefront improvement grants, beautification efforts, street/sidewalk cleaning, and downtown ambassadors. • Hospitality Businesses to Target: Downtown currently offers a robust inventory of restaurants and retail, as well as several options for entertainment and recreation. As with any product, it will be important to evolve the Downtown assets and, as appropriate, diversify its offerings to appeal to the visitors of today and tomorrow. In considering feedback provided by event planners for this study effort and past projects, and findings from CSL’s site tours, the area could benefit from additional non-chain restaurants and retail, as well as one or more unique club-like performance venues. Unique breweries or distilleries, wine tasting rooms, bars featuring a variety of live music, location-based entertainment, bookstores, combo coffee shops and bars, more unique art shops or galleries, and other concepts were suggested by many stakeholders. Several also discussed opportunities to add an improv comedy club.
City decisionmakers should prioritize these types of businesses as part of economic development and Downton- focused plans Identifying these businesses and initiating conversations regarding locating downtown will be important first steps. In some cases, modest incentives may be needed to attract and retain them in the downtown area. The waiving of permit fees, build out cost assistance, storefront improvement grants, and other services could be offered. The BID entity discussed above could also potentially offer incentives such as storefront improvement or build-out grants to secure such businesses.
Long-Term Planning
Several City-owned parcels adjacent to the PSCC offer important opportunities to develop convention and/or hotel product in the future. It will be important to retain this real estate and begin planning for how they could be best positioned to enhance Palm Springs as a convention destination. The illustration on the following page highlights these key parcels and is followed by discussions regarding how each could be best developed in the long-term. 4 Strategic Plan for the Palm Springs Convention Centers ● Page 79 RECOMMENDATIONS6
PSCC District Long-Term Planning
1. Land Bank Opportunity at East Lawn: The City-owned East Lawn should be designated as a future expansion site for PSCC’s Oasis Hall. The parcel is approximately 50,000 square feet, and assuming the inclusion of industry standard support space for added exhibit space, could accommodate an approximate 30,000-square foot contiguous expansion of Oasis Hall. This would increase Oasis Hall’s contiguous exhibit space to approximately 122,000 square feet, which would greatly elevate PSCC’s potential market capture. Though East Lawn is occasionally used by PSCC events as outdoor event space, many stakeholders feel that the space is fairly under-activated. A repurposing of the exiting Jackie Lee Houston Plaza as discussed previously in this section could better accommodate outdoor function needs.
2. Private-Held Parcels: As noted previously, the adjacent, privately owned parcels surrounding the PSCC are opportune sites for new hotel development. Ideally, one of these sites would become a full-service headquarter hotel property that could commit an additional 300 rooms to PSCC events. The approximate 4.5-acre site to the west of the PSCC towards downtown Palm Springs is an ideal location for a large convention hotel and other hospitality/landscaping elements that help connect the PSCC to downtown. It is important to note that any significant PSCC expansion would significantly increase the need for committable hotel room inventory at one of these sites.
3. Land Bank Opportunity at Caballeros Lot: Located just east of the PSCC, the City-owned Caballeros Lot could be a future expansion site for the PSCC in the long-term. Totaling approximately 7.8 acres, the Lot could likely accommodate an extension of the PSCC and a parking structure that would replace existing surface parking at the site. To avoid closing N.
Avenida Caballeros, any new PSCC space on the site could be added and connected via skywalk. The specific programming for the added space could include a variety of multi-use spaces designed to house individual events, and to serve large campus-oriented events that use both the new space and the existing PSCC. 1 2 2
2 3
Strategic Plan for the Palm Springs Convention Centers ● Page 80 RECOMMENDATIONS6
Implementation Timeline
We have considered the timing of each of the primary recommendations presented previously and have identified the stakeholders that should be involved in their planning and implementation going forward. The images below provides a high-level summary of these elements as they relate to each recommended initiative.
Key Stakeholders Involved in Implementation
Recommendation Project Timing
1 PSCC Building-Wide Improvements (aesthetics, internet, digital signage, storage, hotel experience) 1-2 years 2 Re-Invention of PSCC's Western Outdoor Space/Entry/Lobby 1-2 years 3 Hotel Development Adjacent to PSCC 1-3 years
4 Convention District Connectivity Initiatives 1-5 years 5 Enhancement of Oasis 4 into Higher Scale Multipurpose Space 3-5 years 6 PSCC HQ Hotel Development 3-5 years
7 Downtown BID 3-5 years
8 Expansion to Caballeros Lot (Multipurpose Facility and Possible Hotel) 5-10 years 9 Oasis Hall Expansion 10+ years
10 Downtown Targeted Business Recruitment Ongoing
Palm Springs Convention Destination Plan
Schedule of Recommended Initiatives
1 PSCC, Encore, Renaissance
2 PSCC, City, Steelcase, Local Brewery or Restaurant, Local or International Artists 3 City, Developers
4 PSCC, City, Agua Caliente, Local and International Artists, Developers, GPSCVB 5 PSCC
6 PSCC, City, Developers
7 City, Main Street Palm Springs, Local Property Owners, Local Business Owners 8 PSCC, City, Developer
9 PSCC, City
10 City Economic Development, Main Street Palm Springs, Local or Regional Business Owners Key Local Stakeholders
Palm Springs Convention Destination Plan
Key Local Stakeholders
Recommendation
#
7 ECONOMIC AND
FINANCIAL IMPACTS
Strategic Plan for the Palm Springs Convention Centers ● Page 82 ECONOMIC AND FINANCIAL IMPACTS7
Overview & Key Assumptions
This chapter presents an analysis of estimated utilization and costs/benefits associated with an improved PSCC and surrounding convention district, focusing on “incremental” costs/benefits relative to the existing convention product. Working with PSCC sales staff, key assumptions were developed to generate estimates related to an improved PSCC. A stabilized year of operation is assumed to occur by the fifth full year of improved facility operations. All dollar figures are represented in terms of constant 2023 dollars. Key assumptions used in the analysis and projection of operating performance associated with an improved PSCC include, but are not limited to the following conditions:
1. This analysis is designed to assist project representatives in assessing the potential utilization, financial and economic impacts associated with an improved PSCC and cannot be considered a presentation of expected future results. The assumptions disclosed herein are not all-inclusive, but are those deemed to be significant. Because events and circumstances frequently do not occur as expected, there usually will be differences between estimated and actual results and these differences may be material.
2. It is assumed that an improved PSCC will be aggressively marketed consistent with the current management structure, providing competitive rental rates and focusing on attracting hotel room night-generating business such as conventions, conferences and tradeshows. It is assumed that there are no significant or material changes in the supply or quality of existing competitive venues in the local and regional marketplace, nor are there any significant or material changes to local and national event industry trends.
3. The projections developed herein relate to opening and annual operations in a post-COVID-19 environment (first full year of operations is currently undetermined). Should the recovery from the pandemic be slower than broadly expected, disruption by new virus variants, or economic conditions and commerce have not substantially recovered in the near-term, the performance projections outlined herein will need to be revised.
4. Stabilization of operations is assumed to occur by the fifth full year of operations. At which time, annual event levels, attendance and operating performance are projected at consistent year-over-year levels. All figures are presented in terms of constant 2023 dollars.
5. For exhibits herein, comparisons to existing PSCC operations are displayed. The “existing PSCC” represents the average of the three most recent calendar years not impacted by the COVID-19 pandemic (2017-2019).
6. The analysis herein presents PSCC usage and attendance levels, associated economic and fiscal/tax impacts, and high-level financial operations analyses for three potential future scenarios. These are described below:
1. Do Nothing: The PSCC product continues to operate as is over the next five years; lack of investment leads to deterioration of market share, as planners of rotating conventions select convention facilities and destinations with more updated amenities, walkable districts, and greater hotel room support.
2. Mid-Term Investments: Previously discussed improvements and advancements are made to the PSCC convention product, including the West Hall transformation, updates to Primrose Ballroom and meeting rooms, the development of a new hotel to the southwest, and the creation of a pedestrian trail to downtown Palm Springs.
3. Long-Term Investments: Transformational projects previously discussed are completed that greatly enhance the desirability of the PSCC convention product and enable the facility to host larger, more economically impactful conventions. These projects include the development of a new 350- to 400-room headquarter hotel at one of the previously identified sites near the PSCC, the expansion of Oasis Hall (adding approximately 25,000 square feet of contiguous exhibit space), the addition of a new 30,000- to 35,000-square foot ballroom.
The remainder of this section presents analysis and takeaways regarding the various economic, fiscal and financial operating impacts associated with each of these three scenarios.
Strategic Plan for the Palm Springs Convention Centers ● Page 83 Events and Attendance
As noted in the following table, PSCC event data are presented for banquet, civic, consumer show, conventions (small, mid-sized, and large), entertainment, meeting, sports, and other events. A comparative analysis has been prepared that summarizes the incremental gains and losses in event activity associated with each of the three previously identified scenarios relative to “baseline” PSCC event levels. Average event levels during the pre-Pandemic period of 2017 through 2019 have been used as a baseline for PSCC event activity.
Under a Do Nothing scenario, the PSCC is estimated to host four less mid conventions and two less large conventions annually relative to the 2017-19 period. Mid-Term Improvements are estimated to result in a total of seven (7) more conventions per year and an eight (8) percent increase in overall event count. Headquarter hotel development, expansion of Oasis Hall, and the added ballroom associated with Long-Term Improvements are estimated to attract 15 new rotating conventions per year relative to 2017-19, and a 28 percent increase in overall event activity.
To further illustrate the difference in event levels and event mix between the three scenarios, the following bar chart presents the event day and attendance levels of their estimated convention calendars. As shown, during the three years prior to the Pandemic year of 2020, the PSCC averaged 123 convention event days and nearly 37,300 convention attendees. The attraction of more “Mid” and “Large” conventions under the Mid- and Long-Term scenarios would lead to increases of 33 and 58 event days from this baseline, respectively. Likewise, annual convention attendance is estimated to increase by approximately 6,300 with Mid- Term investment, and by 17,500 with Long-Term investment. Under a Do Nothing scenario, annual event days and attendance are estimated to drop by 29 days and 9,700 attendees, respectively.
PSCC
2017-2019 Stabilized % Stabilized % Stabilized %
EVENT LEVEL ESTIMATES Avg. Year Incremental Growth Year Incremental Growth Year Incremental Growth
NUMBER OF EVENTS
Banquet 19 16 (3) -16% 23 4 21% 27 8 42%
Civic 1 1 0 0% 1 0 0% 1 0 0%
Consumer Show 10 10 0 0% 10 0 0% 10 0 0%
Small Conventions 7 8 1 14% 10 3 43% 12 5 71%
Mid Conventions 14 10 (4) -29% 18 4 29% 22 8 57%
Large Conventions 6 4 (2) -33% 6 0 0% 8 2 33%
Entertainment 6 6 0 0% 6 0 0% 6 0 0%
Meeting 78 70 (8) -10% 78 0 0% 93 15 19%
Other 23 23 0 1% 28 5 22% 32 9 39%
Sports 3 4 1 22% 4 1 22% 5 2 67%
Total 167 152 (15) -9% 180 17 8% 211 47 28%
Do Nothing Mid-Term Improvements Long-Term Improvements 29 22 18 23 28 35 41
60 38 68 55 39
70 85
51 30
52 44
28 42
56140
90 139
123
94 146
183
39,600
31,600
40,600
37,300
27,600
43,600
54,800
0 10,000
20,000
30,000
40,000
50,000
60,000
0 50
100
150
200
250
300
2017
2018
2019
2017-
2019 Avg.
Do
Nothing
Mid-Term
Long-
Term
Attendance
Convention Event Days
Large Conventions
Mid Conventions
Small Conventions
Attendance
7 Event Days and Attendance Analysis - Conventions
(Historical vs. Future Scenarios)
ECONOMIC AND FINANCIAL IMPACTS
Small Conventions: Convention/conference events with less than 1,000 total room nights.
Mid Conventions: Convention/conference events with between 1,000 and 2,500 total room nights.
Large Conventions: Convention/conference events with more than 2,500 total room nights.
Strategic Plan for the Palm Springs Convention Centers ● Page 84 Utilization and Room Night Generation
Using event and utilization day estimates, we have prepared a comparison of exhibit space occupancy among the three Scenarios and historical PSCC operations. The PSCC’s Oasis Hall operated at an average of 50 percent square footage occupancy during the three full years prior to the Pandemic. Due to the erosion in convention market capture shown on the previous page, occupancy is estimated to drop significantly to 40 percent under a Do Nothing scenario. Conversely, with the Mid- Term improvements, the PSCC’s “typical” annual occupancy could consistently match the peak in 2019, highlighting the need to prioritize these investments in the near-term. With Long-Term investments, an Oasis Hall with approximately 25,000 square feet of added exhibit space is estimated to run at 52 percent square footage occupancy during a stabilized year of operations. The 52 percent occupancy allows for continued demand growth driven by a new headquarter hotel, better connectivity to downtown, improvements to existing PSCC space, and added event space.
The bar chart below presents estimated hotel room night generation associated with historical PSCC event activity and the three investment scenarios. Mid-Term improvements, such as an added ~150-room hotel and a re-invention of PSCC’s western pre- function and outdoor event space, are estimated to lead to a material increase in room nights relative to the pre-Pandemic baseline, with a delta of 10,000 hotel room nights per year. The Long-Term initiatives are estimated to lead to a more considerable jump of 31,600 room nights per year relative to 2017-19. We note that the room night totals under this scenario reflect a long-term horizon and will have to be further analyzed when such an expansion scenario becomes a realistic prospect.
Long-Term initiatives lead to an increase of 49,000 room nights per year relative to a Do Nothing scenario, highlighting the need to continually invest in the Palm Springs convention product. 90,700
81,200
98,500 90,100
72,600
100,100
121,600
-
30,000
60,000
90,000
120,000
150,000
2017 2018 2019 2017-2019
Avg.
Do Nothing Mid-Term Long-Term
51%
43%
56%
50%
40%
56% 52%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2017 2018 2019 2017-2019
Avg.
Do Nothing Mid-Term Long-Term
7 Exhibit Space Square Footage Occupancy
(Historical vs. Future Scenarios)
Practical Maximum Capacity
Hotel Room Nights
(Historical vs. Future Scenarios)
ECONOMIC AND FINANCIAL IMPACTS
* - assuming higher space demand and higher available square footage.
Note:: Room count calculations above include hotel room nights tracked by PSCC as well as an estimated ~17 percent of attendees who book :outside the room block.
Therefore, though 82,000 room nights were tracked in 2019, it is assumed that a total of 98,500 room nights were :generated. *
Strategic Plan for the Palm Springs Convention Centers ● Page 85 Direct Spending and Total Economic Output
CSL has developed models that incorporate PSCC event, attendance, attendee origin and other data in order to measure the amount of direct delegate spending that has been created on a net new basis. As noted in the exhibit below, events at the PSCC generated approximately $46.3 million per year on average prior to the Pandemic. Should no improvements of the convention product take place, this spending is estimated to lower to $39.1 million (16 percent drop). Improvement of the product under in the Mid-Term would lead to a sustained level of the peak spending generated in 2019 (just over $51.3 million), while an expansion and new headquarter hotel in the Long-Term would increase the baseline average by 34 percent to approximately $62.0 million annually.
The net new direct spending generated by events held at the PSCC will circulate throughout the local economy, creating indirect and induced spending. Combined, the direct, indirect and induced spending is termed total output. The total output generated by PSCC events averaged $78.6 million during the 2017-19 period. Modeling suggests that this impact could increase by 11 percent with a new neighboring hotel, PSCC improvements, and various district enhancements that could be implemented in the Mid- Term. Without these investments, output is estimated to drop by 16 percent to $66.3 million annually. Upon development of a headquarter hotel and expansion of PSCC, an increase to $105.2 million in total economic output is estimated. $30.0M $27.0M $31.3M $29.4M $24.5M $32.5M $39.1M
$20.1M $17.0M $22.5M $19.9M $17.0M
$22.2M
$26.8M
$79.9M
$69.6M
$86.4M $78.6M
$66.3M
$87.2M
$105.2M
$.0M
$15.0M
$30.0M
$45.0M
$60.0M
$75.0M
$90.0M
$105.0M
$120.0M
$135.0M
$150.0M
2017
2018
2019
2017-2019 Avg.
Do Nothing
Mid-Term
Long-Term
Other
Local transportation
Entertainment
Retail
Restaurant
Hotel
$17.8M $16.0M $18.6M $17.5M $14.6M $19.3M $23.2M
$12.0M $10.1M $13.4M $11.8M $10.1M
$13.2M
$15.9M
$47.0M
$41.0M
$50.9M $46.3M
$39.1M
$51.3M
$62.0M
$.0M
$10.0M
$20.0M
$30.0M
$40.0M
$50.0M
$60.0M
$70.0M
$80.0M
$90.0M
$100.0M
2017 2018 2019 2017-2019
Avg.
Do Nothing Mid-Term Long-Term
Other
Local transportation
Entertainment
Retail
Restaurant
Hotel
7 Annual Direct Attendee Spending by Industry
(Historical vs. Future Scenarios)
Annual Economic Output by Industry
(Historical vs. Future Scenarios)
ECONOMIC AND FINANCIAL IMPACTS
Strategic Plan for the Palm Springs Convention Centers ● Page 86 Wages and Job Creation
The total output generated by PSCC events includes a component of employee earnings. These earning impacts take place throughout the economy, certainly in the hospitality sector, but also within other sectors. PSCC-generated earnings averaged $32.3 million during the 2017-19 period. With a new headquarter hotel, PSCC expansion, and various PSCC and convention district enhancements, earnings could increase by 11 percent to $35.9 million. A loss of approximately $5.0 million in annual earning is estimated under a Do Nothing scenario.
The economic impact generated by PSCC events also includes a very important employment effect. Jobs are generated within the hospitality sector, creating important opportunities for entry level staff, invaluable training opportunities, and high-wage jobs in various management positions. Employment impacts also flow through the economy in many other sectors, as earnings are spent locally. PSCC event activity supported an average of over 930 jobs per year during the 2017-19 period. With Mid-Term improvements, this is estimated to jump to just over 1,030 annually. With a new headquarter hotel and expansion of exhibit space, an increase to nearly 1,250 is estimated, representing a delta of 316 new jobs supported per year relative to 2017-19.
Under a Do Nothing scenario, PSCC events would support an estimated 461 less jobs relative to the Long-Term scenario and 246 less jobs relative to the Mid-Term scenario, again highlighting the importance to the Palm Springs economy of prioritizing convention-quality hotel development, implementing convention district improvements, and enhancing the PSCC product. 285 257 297 280 233 309 371
305 258 341 302 257
336
407
945
819
1,028
931
786
1,033
1,247
-
300
600
900
1,200
1,500
2017
2018
2019
2017-2019 Avg.
Do Nothing
Mid-Term
Long-Term
Other
Local transportation
Entertainment
Retail
Restaurant
Hotel
$12.1M $10.9M $12.6M $11.9M $9.9M $13.1M $15.7M
$8.8M $7.4M $9.8M $8.7M $7.4M
$9.7M
$11.7M
$32.8M
$28.6M
$35.5M $32.3M
$27.3M
$35.9M
$43.3M
$.0M
$12.0M
$24.0M
$36.0M
$48.0M
$60.0M
2017
2018
2019
2017-2019 Avg.
Do Nothing
Mid-Term
Long-Term
Other
Local transportation
Entertainment
Retail
Restaurant
Hotel
7 Annual Wages/Earnings Impacts
(Historical vs. Future Scenarios)
Annual Full-Time Equivalent Jobs Supported by Industry
(Historical vs. Future Scenarios)
ECONOMIC AND FINANCIAL IMPACTS
Strategic Plan for the Palm Springs Convention Centers ● Page 87 Fiscal Impacts and Hospitality Industry Profit
Direct spending, total output and earnings will all help to support the generation of new tax revenues to various public sector entities. The exhibit below presents estimates of sales and hotel tax revenues associated with historical PSCC event activity and the three investment scenarios. The PSCC event activity generated an estimated $5.8 million in total tax revenues in 2019. With moderate Mid-Term improvements, this would be sustained on an annual basis. Lack of investment will lead to $900,000 less in estimated tax revenue per year relative to the pre-Pandemic average. Significant Long-Term initiatives are estimated to lead to an increase of $1.8 million per year in annual tax revenue, including $800,000 in incremental hotel revenue for the City.
The spending generated by PSCC event attendees, exhibitors and planners that is new to the Palm Springs community also generates profit within various hospitality industry sectors. As these sectors often contribute significantly to the funding, operation and marketing of convention centers, we have generated estimates of the current and potential future hotel and restaurant industry profit garneted by the PSCC. Profit estimates for the hotel sector focus only on the rooms department, assuming a 65 percent margin on room sales. A ten (10) percent margin is assumed on restaurant sales.
As noted in the exhibit below, the combined hotel and restaurant sector profit approximated an average of $12.6 million in estimated profit due to PSCC event activity during the 2017-19 period. This consists of $11.4 million in hotel profit and $1.2 million in restaurant profit. Combined profit is estimated to fall by a substantial $2.1 million per year under a Do Nothing scenario.
Moderate improvements, including a nearby hotel, would enhance this figure by $1.2 million per year, while transformative investments would elevate estimated profits to $16.7 million annually, representing a $4.1 million annual increase relative to the pre-Pandemic average.
$11.6M $10.4M
$12.1M $11.4M
$9.5M
$12.5M
$15.1M
$1.2M $1.0M $1.3M $1.2M $1.0M $1.3M $1.6M
$.0M
$2.0M
$4.0M
$6.0M
$8.0M
$10.0M
$12.0M
$14.0M
$16.0M
2017
2018
2019
2017-2019
Avg.
Do Nothing
Mid-Term
Long-Term
Profits
Hotel Industry Profit Restaurant Industry Profit
$.5M $.4M $.6M $.5M $.4M $.5M $.7M
$.6M $.5M $.6M $.6M $.5M $.6M $.8M
$2.0M $1.7M
$2.2M $2.0M $1.7M
$2.2M
$2.6M
$2.3M
$2.1M
$2.4M $2.2M
$1.9M
$2.5M
$3.0M
$5.4M
$4.7M
$5.8M
$5.3M
$4.4M
$5.8M
$7.1M
$.0M
$1.0M
$2.0M
$3.0M
$4.0M
$5.0M
$6.0M
$7.0M
$8.0M
$9.0M
$10.0M
2017
2018
2019
2017-2019 Avg.
Do Nothing
Mid-Term
Long-Term
City Hotel Tax Collections
State Sales Tax
Collections
County Sales Tax
Collections
City Sales Tax Collections
7 Fiscal/Tax Generation Impacts
(Historical vs. Future Scenarios)
Hospitality Industry Profits
(Historical vs. Future Scenarios)
ECONOMIC AND FINANCIAL IMPACTS
Tax Rates:
City Hotel Tax: 13.5%
State Sales Tax: 6%
County Sales Tax: 1.75%
City Sales Tax: 1.5%
Strategic Plan for the Palm Springs Convention Centers ● Page 88 Financial Operations Analysis
We have prepared a review of PSCC financial operations, focusing on net operating revenue and loss. These data are then compared to similar venues on a square footage of sellable space basis. The results of this comparison are used to identify areas where PSCC financial operations may align with or outperform the benchmark of comparable projects. Recommendations are then made with respect to adjusting targets for future PSCC financial operating performance, with consideration given to the three investment scenarios.
We begin with a summary of PSCC financial operations. It is important to note these data are presented for the PSCC’s fiscal years, which end in June.
As shown, the facility’s net operating deficit improved significantly from its FY 2017-19 average, increasing from a near-$1.3 million loss to a $500,000 annual deficit. According to management, this improvement is primarily due to lowered staffing levels as salaries and benefits decreased by over $600,000 in FY 2022 relative to the FY 2017-19 average. As the industry continues to fully rebound from the Pandemic, it is expected that this figure may increase as PSCC leadership hires additional staff to manage higher event levels.
Management highlighted annual utilities costs as the other key factor in FY 2022’s lower expense figure. Due to the installation of solar panels by the City, the PSCC now saves greatly on electricity and shares these costs with the City. This should be a sustainable cost saving for the PSCC going forward.
Meanwhile, FY 2022 revenue remained relatively proximate to the FY 2017-19 average, decreasing by less than five percent (approximately $132,300).
Considering typical convention facility standards, operating at an annual deficit of less than $1.0 million typically indicates a well- operated venue. It is not uncommon for similarly sized convention facilities to operate at a significant loss of more than $1.0 million, thus requiring substantial tax-backed subsidies to operate.
PSCC’s financial operating performance is presented within a comparative context as part of the exhibit on the following page.
Operating Revenues
FY 2017 - FY
2019 Avg. FY 2022
Facility rent $994,763 $879,421
Food service (net) 1,056,082 1,081,590
Contract service/other 872,080 829,579
Total Operating Revenues $2,922,925 $2,790,590
Operating Expenses
Salaries and benefits $2,316,716 $1,701,908
Contract labor 447,185 407,105
Utilities 419,411 153,860
Repair & maintenance 156,400 274,876
General & administrative 489,479 424,555
Supplies 65,497 56,513
Insurance 43,123 37,774
Other 245,462 234,063
Total Operating Expenses $4,183,272 $3,290,654
Net Operating Deficit ($1,260,347) ($500,064)
7 PSCC Financial Operations Summary
(FY 2017-FY 2019 vs. FY 2022)
ECONOMIC AND FINANCIAL IMPACTS
Strategic Plan for the Palm Springs Convention Centers ● Page 89 Financial Operations Analysis
We have collected financial operating data from 15 convention centers that are comparable in size to the existing and potentially expanded PSCC. In terms of financial performance, convention facilities operate with an average loss of approximately $686,600, with average revenues at $7.3 million and expenses at $8.0 million. The PSCC’s FY 2022 performance ranks favorably relative to comparable and competitive venues in terms of net operating loss, while its FY 17-19 average falls well below the set’s average and median. As the convention and meeting industry continue to fully rebound from Pandemic conditions, efforts should be made by PSCC management to mitigate a gradual return to FY 2017-19 expense levels. Tactics such as controlled staffing growth and capital improvements that can save costs (such as the recently added solar panels) should be prioritized for near-term implementation.
As shown by comparative financial performances above, an eventual surplus is highly unlikely. The four facilities below with net positive performance rely on unusually frequent corporate business with high spend on food & beverage, and/or substantial revenue from paid parking.
Previously discussed improvements and expansions recommended to take place will require significant capital expenditures, and they will likely increase the building’s overhead expenses for staffing, utilities, supplies, etc. However, previously discussed trend forward upgrades, expanded event space, and added hotel room inventory will enable the PSCC to attract a greater number of events and attendees on an annual basis, and many previously recommended investments will provide a more diverse revenue portfolio that will result in greater net operating performance. For example, inclusion of a local/authentic food & beverage provider within the PSCC’s west lobby will spur greater spending by attendees and/or generate tenant revenue, while an improved Jackie Lee Houston Plaza and additional outdoor space at the western entrance will generate net new facility rental revenue.
We estimate that the PSCC will be able to maintain and potentially improve upon its FY 2022 performance with implementation of these improvements. Under a Do Nothing Scenario, it is likely that event levels will deteriorate, which will likely drop the facility’s bottom-line performance back to or below 2017-19 levels.
Sellable Net Net Operating Rev. per Exp. per
Event Space Operating Operating Operating Inc./(Loss) per SF Coverage SF of Tot. SF of Tot.
Facility (Square ft.) Revenue Expense Income/(Loss) Tot. Sel. Space Ratio Sel. Space Sel. Space Facility A 536,800 $18,979,706 $20,239,360 ($1,259,654) (2.35) 93.8% $35.36 $37.70 Facility B 423,500 $7,854,293 $9,952,168 ($2,097,875) (4.95) 78.9% $18.55 $23.50 Facility C 278,000 $11,249,745 $10,713,062 $536,682 1.93 105.0% $40.47 $38.54 Facility D 297,000 $5,856,553 $6,581,671 ($725,118) (2.44) 89.0% $19.72 $22.16 Facility E 366,600 $15,230,241 $16,738,797 ($1,508,556) (4.11) 91.0% $41.54 $45.66 Facility F 318,000 $9,700,022 $9,582,581 $117,441 0.37 101.2% $30.50 $30.13 Facility G 231,300 $7,357,133 $7,546,911 ($189,778) (0.82) 97.5% $35.48 $32.63 Facility H 141,600 $5,317,557 $5,050,498 $267,059 1.89 105.3% $37.55 $35.67 Facility I 143,300 $5,263,435 $6,041,343 ($777,908) (5.43) 87.1% $36.73 $42.16 Facility J 169,200 $4,426,206 $5,215,646 ($789,440) (4.67) 84.9% $26.16 $30.83 Facility K 132,200 $1,940,934 $3,814,200 ($1,873,266) (14.17) 50.9% $14.68 $28.85 Facility L 115,000 $4,440,396 $6,232,657 ($1,792,261) (15.58) 71.2% $38.61 $54.20 Facility M 105,700 $2,756,581 $3,751,441 ($994,860) (9.41) 73.5% $26.08 $35.49 Facility N 97,600 $6,778,369 $5,988,330 $790,039 8.09 113.2% $69.45 $61.36 Facility O 82,300 $2,259,727 $2,261,735 ($2,008) (0.02) 99.9% $27.46 $27.48 Average 229,200 $7,294,100 $7,980,700 ($686,600) (3.45) 89.5% $33.22 $36.42 Median 169,200 $5,856,600 $6,232,700 ($777,900) (2.44) 91.0% $35.36 $35.49 PSCC FY17-FY19 Avg. 128,300 $2,922,925 $4,183,272 ($1,260,347) (9.82) 69.9% $35.48 $32.61 PSCC FY 2022 128,300 $2,790,590 $3,290,654 ($500,064) (3.90) 84.8% $21.75 $25.65 7 Financial Operations Comparative Analysis
ECONOMIC AND FINANCIAL IMPACTS
8 SALES AND
MARKETING
ANALYSIS
Strategic Plan for the Palm Springs Convention Centers ● Page 91 In this section, we review the organizational structures, staffing, and roles and responsibilities associated with generating event activity at the PSCC.
Industry Overview
Communities throughout the country are investing heavily in their convention and destination product in an effort to lure large economic impact-generating events. In order to fully leverage the existing PSCC, and to maximize the benefit of future PSCC and hospitality district investment, it is critical to have the tools needed to generate destination exposure to event planners through aggressive sales and marketing efforts managed by a lead agency with support from other stakeholder groups.
Our assessment presented in this chapter addresses current conditions relative to PSCC sales and marketing initiatives, and presents various recommendations for improving the focus and productivity of these efforts.
Throughout North America, there are standard organizational models used to deliver the sales and marketing function for convention centers. Most often, a destination will contract with a Destination Marketing Organization (DMO) to lead the convention center sales and marketing function, with staff at the convention center providing support.
The DMO will prepare and implement a sales and marketing plan, working towards a set of annual event sales goals. The DMO group sales efforts will include assembling information related not just to the center, but to hotels, attractions, transportation, and other important event production requirements.
A common model might entail a DMO sales staff of 5 to 8 dedicated largely to securing non-local convention, tradeshow and conference business for the convention center, with 1 to 3 staff at the center focusing on events that typically book within 12 to 18 months. This model is summarized in the following graphic.
A Case Study - Palm Beach County, Florida
The staffing and organizational approach used for the Palm Beach Convention Center in West Palm Beach, Florida is reflective of a common model. The destination marketing organization for Palm Beach County (Visit the Palm Beaches), maintains the following group sales positions:
• Chief Sales Officer
• AVP Group Sales - Affinity Market and Legacy Corporate Accounts • Director of Sales - West Coast & Incentive
• Senior Director of Sales - Mid Atlantic
• Director of Sales – Midwest
• Director of Sales – Florida Market
• Director of Sales – Southeast
• Manager – Multicultural Sales
• Director of Sales – Northeast
• Group Sales Manager – North Carolina, South Carolina, Michigan, New Mexico, Iowa, Nebraska, Oregon & Canada Convention Center DMO
Staffing 1 to 3 sales staff dedicated to
group sales. 5 to 8 staff dedicated to group sales
Responsibility
Support DMO during sales
efforts (tradeshows, FAM trips,
bid preparation, etc.)
The lead agency responsible for client
relationships, assembling bids
Event Focus
Focus on events booking dates
that are 12 to 18 months out
and beyond.
Focus on events booking dates that are 12
to 18 months out and beyond
8 SALES AND MARKETING REVIEW
Strategic Plan for the Palm Springs Convention Centers ● Page 92 In addition, the organization includes a Director of Tradeshow, Events & Strategic Sales Partnerships, and three Group/Industry Relations positions. This staffing approach, with 13 total staff, is very similar to the current structure at VGPS, which operates with 10 sales managers/directors and three sales coordinators.
The Palm County Beach Convention Center is staffed with three sales positions, focusing largely on near term bookings, recurring clients, and supporting Visit the Palm Beaches sales efforts. • The focus for the Palm Beach County team is on booking group events throughout the county, including the Convention Center. According to sales leadership, approximately 35 percent of their team effort is dedicated to the Center. For example, 80 percent of the corporate and incentive sales efforts will target hotels, while convention sales managers focusing on the Chicago and Washington D.C. areas will book 40 percent of their room nights into the Center. Key elements of their sales approach include the following.
• Each sales team member will pursue opportunities for both the Center and area hotels/resorts. It is often the case that a particular event lead would be considering a large hotel property, but is looking for lower room rates. A potential booking at the Center might be possible in this case. Dedicating a sales position solely to the Center or to hotel properties would limit flexibility in terms of placing events in locations best suited to their needs. • As an example, the corporate sales manager may focus largely on self-contained hotel events, however a technology users conference may be more price sensitive and is a better fit for the room rates at properties around the Center. Conversely, an event looking at the Center may have a very high-end production or food/beverage expectation that is better suited to one of the area resorts.
• Management notes that their effort to book events at the Center can benefit hotel/resort properties in the County. In some cases, a share of attendees at a Center event will book high end resort properties outside the block. Filling hotels around the Center can also create county-wide compression.
• The sales staff at Visit the Palm Beaches and at the Center share a single room night goal. This helps align the focus of the combined teams on room nights, regardless of where the leads originate. • The Visit the Palm Beaches staff are incentivized by actual room night generation rather than lead generation. This can help focus lead distribution efforts on realistic event candidates.
As noted previously, the typical convention center sales model is largely based on the premise that a convention customer will select a “destination” inclusive of venue, hotels, attractions, transportation and other assets, and a DMO is best suited to represent these assets to the planner. Center staff then play an important support role by serving as the venue expert.
In some cases (including markets as diverse as Pasadena, Las Vegas and Reno) a single organizing entity will oversee both a DMO and convention facility. Even in these cases, there is an internal segmentation of responsibilities that is similar to the model summarized above. In some cases, (Boston, Monterey and Boise, for example) convention center staff, separate from the local DMO, will maintain responsibility for nearly all convention sales and marketing.
A variation of these models is generally in place for the PSCC. ASM Global has a contract with the city to manage the PSCC and oversee Visit Palm Springs (VPS). PCCC staff provide group sales efforts, while VPS is charged with marketing efforts for the PSCC and the Palm Springs destination. (VGPS) provides group sales assistance to venues in the entire Coachella Valley, including hotels, resorts and the PSCC. This assistance, particularly as delivered for the PSCC, primarily consists of lead generation efforts, participation in industry tradeshows, assembling hotel room maintaining industry contacts and relationships.
There are no specific sales goals or sales initiatives that VGPS is contracted or required to provide. 8 SALES AND MARKETING REVIEW
Strategic Plan for the Palm Springs Convention Centers ● Page 93 Current Condition Observations
PSCC & Visit Palm Springs
The PSCC sales staff currently consists of four positions, deployed by generally by region. The department previously operated with seven sales staff, and there is a possibility that post-COVID, additional hires could be made. As a comparison, the Pasadena Convention Center Corporation (which operates the Center), maintains a sales team of 5 staff, 3 focusing on business booking outside 14 months, and two focusing on short term business. Compensation for sales staff at the PSCC does include a minor performance incentive component, however current management initiatives to revise and enhance this program should continue to be pursued.
The current four PSCC sales staff are organized on a geographic market segment basis as described below. • National associations, corporations and SMERF organizations headquartered on the east coast. • National associations, corporations and SMERF organizations in the midwest, including Chicago. • National associations, corporations and SMERF organizations headquartered on the west coast, plus state and regional events.
• Key accounts and locally generated business.
The geographical staff segmentation is common in the industry. We note that a majority of national associations are headquartered in Chicago and Washington D.C., and the current staff allocation reflects this.
Visit Palm Springs contracts with Digital Edge to provide group marketing, particularly for the PSCC. Marketing efforts include social media, web site development and accessing potential client sales lists. Total spend on group PSCC marketing efforts approximates $200,000 annually.
VGPS
The VGPS operates with approximately 10 group sales executives and staff focusing on Coachella Valley properties, generally organized around specific geographical responsibilities for particular staff. Recently, a sales professional was hired to fill the east coast sales position, continuing a focus on associations and corporations based in Washington D.C. and other east coast markets.
VGPS staff provide leads to hotels, resorts and other event venues including the PSCC. Given their valley-wide focus, they do not aggressive sell one property versus another. They do maintain contacts with Palm Springs and other area hotels to assist in their efforts of assembling room blocks for large events considering the PSCC.
Other Observations
From a process perspective, PSCC and VGPS sales staff have both distinct and overlapping responsibilities. PSCC will typically receive leads/RFP’s directly from event planners and from the VGPS. PSCC staff confirm date availability at the PSCC, and work with the VGPS to assemble room blocks for viable leads The VGPS typically maintains strong relationships with event clients, and PSCC staff attend tradeshows such as Destination Showcase and IMEX with VGPSVGPS staff. PSCC staff will typically prepare and submit event bids, oftentimes through the bid portal maintained by CVENT.
Given the significant sizing and amenity differences between a large convention center such as the PSCC and Coachella Valley hotels and resorts, the competition between these venues is limited. VGPS The quality of hotel product, complexity of booking both the convention center and hotel(s) separately, and the additional pricing structures at the PSCC compared to the resort properties is an objection often raised by group clients. This impacts the PSCC’s ability to book self-contained group type business.
There is no dedicated fund to help provide incentives for high-impact events to book the PSCC. Three percent of expected food and beverage spending by an event at the Center can be credited towards a rent reduction. In addition, PSCC sales staff will offer rental discounts on a case-by-case basis, however there is no formal rule or process for this. Through these formal and informal rental discounts in a recent 12-month period was approximately 37 percent off published rental rates. This level of discounting is very common in the industry.
8 SALES AND MARKETING REVIEW
Strategic Plan for the Palm Springs Convention Centers ● Page 94 Regardless of rental rates, the inability of PSCC and GPSCVB sales staff to access sufficient hotel rooms for event room blocks has been a major impediment to booking large city-wide events. In some cases, hotel management will not commit to specific room rates for future years. In other cases, a property will not respond to a request to participate in a room block.
This condition is not totally unexpected. The recent hotel market has supported very high room rates, creating a disincentive to contract group rooms for future years at a rate that may be lower than their current leisure rates. However, this approach does not fully consider the inevitable cyclical downturns in the economy, and hotels that forego participating in a room block today may very well suffer from lack of city-wide group demand in future years.
General Options for Future PSCC Sales Efforts
As a significant convention center in a major international hospitality market, the sales and marketing process/coordination for attracting non-local events must be well resourced, with clear roles, responsibilities, and coordinated among key stakeholders.
Today, there are typically three primary entities that engage in various ways in the PSCC group sales effort: the PSCC sales staff, VGPS, and primary hotels used to assemble room blocks.
With two organizations involved in PSCC sales efforts in terms of generating leads, assembling room blocks, maintaining national client relationships, and taking ultimate responsibility for bookings, the sales funneling and booking processes can sometimes be more complex given the unique role(s) each organization plays in the process.
There are two broad approaches that should be considered, particularly as improvements to the PSCC, hotel and surrounding district are made.
PSCC & Visit Palm Springs as Primary Sales & Marketing Agency (current model) A PSCC sales team would retain primary responsibility for maintaining PSCC client relationships and assembling room blocks.
The sales team would reflect the experience of a destination marketing organization found in similar markets including San Diego, Los Angeles, Phoenix, Denver, Palm Beach County and other significant convention destinations. We recommend a competitive review of sales, marketing and incentive funding to ensure the PSCC team as the appropriate resources to compete for business and retain key staff.
The VGPS would still play a support role, providing qualified PSCC leads, contributing to bid submittals, and leveraging their own client relationships to benefit the PSCC. This type of Center-based group sales and marketing focus would be similar to the approaches that have been taken in markets as diverse as Boston, San Diego, Boise, and to varying degrees in Las Vegas and Reno. Visit Palm Springs would retain group marketing responsibilities, including the initiatives contracted through Digital Edge.
VGPS as Primary Sales & Marketing Agency
Another option could also be given to adopting a model that resources the VGPS to be the primary sales and marketing entity for the PSCC. This model would be consistent with approaches taken in most markets whereby a CVB or destination marketing organization is responsible for booking high-impact Center events, and Center management provides highly valued event services, venue maintenance, short-term booking and support sales services. The scope of VGPS services in terms of marketing attractions and other hospitality assets throughout the Valley would be beneficial in framing the full benefits of selecting the PSCC for an event.
Under either of these two models, a single entity would be assigned the resources, staffing and responsibilities for all aspects of PSCC sales and marketing. As investment takes place in the PSCC and surrounding hospitality district, and in order to maximize high impact non-local event activity, the importance of pursuing options consistent with the concepts described above will increase.
We understand that making this change would require review and approval from the VGPS JPA Executive Committee and Board of Directors. At a minimum, a clear understanding of the roles, responsibilities and financial impact of each entity should be clearly outlined.
Moving forward, extensive conversation as to next steps will be required. We suggest that leadership at the PCSS, city of Palm Springs and VGPS JPA Board of Directors be engaged to see if all parties are interested in a new structure and sales approach. At minimum, a clear understanding of the roles and responsibilities of each entity should be clearly outlined. 8 SALES AND MARKETING REVIEW
Strategic Plan for the Palm Springs Convention Centers ● Page 95 Other Considerations
Regardless of the particular model used, several tactics should be pursued:
• Provide a fund for incentivizing desired groups to book the PSCC. This could be sourced out of an enhanced PSCC sales and marketing budget, or a sperate source of funding, such as dedicated funding allocations from PS Resorts. • Consistent with most convention center sales organization, PSCC sales staff could be incentivized based largely on room night generation, with some incentives also based on PSCC revenue generation. • Efforts to leverage professional relationships with Palm Springs hotel ownership and management in order to secure more significant room blocks should be discussed. VGPS, PSCC, City of Palm Springs, PS Resorts and other entities should be engaged to elevate this issue in order to increase room block participation. In addition, this report recommends development of a new headquarter hotel adjacent to the PSCC in order to increase the desirability of the PSCC and Palm Springs market as a high-impact group destination.
8 SALES AND MARKETING REVIEW