HomeMy WebLinkAbout2000-03-14 Support Documentation Town Council Work Session
VAIL TOWN COUNCIL
WORK SESSION
TUESDAY, March 14, 2000
12:00 P.M. AT TOV COUNCIL CHAMBERS
NOTE: Time of items is approximate, subject to change, and cannot be relied
upon to determine at what time Council will consider an item.
Council will be served lunch
1. Executive Session - Negotiations Regarding a Lease.
Tom Moorhead (30 mins.)
2. PEC Interviews. (30 mins.)
3. PEC Report. (25 mins.)
Brent Wilson Vail Athletic Club Update
George Ruther
4. Alpine Garden Request to Proceed with Expanded Garden Area
Ry Southard Adjacent to Schoolhouse. (30 mins.)
ITEM/TOPIC: The Alpine Garden Foundation, represented by Ry
Southard and Nicola Ripley, is requesting approval from the
Council to begin the process for expanding the current lease area
of the Garden. The request includes the area south of the main
access road from the Nature Center Bridge up to and include the
existing picnic area located along Gore Creek. A letter detailing
the request is attached.
ACTION REQUESTED OF COUNCIL: Discussion of the request
with Alpine Garden Representatives, and Town Staff. Approval or
Denial of the request. If the request is approved the Alpine
Garden will begin the process of procuring a designer, initiating
the Town's development approval process, and creating the
necessary legal documents for the lease expansion.
BACKGROUND RATIONALE: Please refer to the attached letter
from the Alpine Garden Foundation.
STAFF RECOMMENDATION: Staff recommends approval of the
Alpine Garden Foundation's request to expand the lease area of
the garden for the following reasons.
The Vail Alpine Garden is a renowned amenity to the Town and is
rapidly increasing its stature as a world class botanical garden.
The expansion are will allow the garden to expand its horticultural
collection into plant communities it currently does not have space
to represent, including species rare and endangered in Colorado.
The area of Ford Park being requested for expansion is an
underutilized portion of the park. Having the Garden assume
responsibility for the area will improve the overall character of the
park and take nothing away in the process.
The expansion process will include completion of some house
keeping items regarding use of the Schoolhouse and completion
of the Alpine Rock Garden scheduled for completion this summer.
5. Joint Meeting with Vail Recreation District Board to Prioritize
Russell Forrest Community Facilities "Hub" Site Uses. (1:30 mins.)
Piet Pieters
ACTION REQUESTED OF COUNCIL: Review the final
conclusions from the market analysis prepared by Economics
Research Associates. With input from the VRD, begin to discuss
what uses should be further explored in a design process on the
Lionshead hub site.
BACKGROUND RATIONALE: On March 3rd a public open house
was held at the Evergreen Lodge to review the market analysis
and spatial opportunities for the hub site uses. The input from that
meeting indicated strong support for a conference/learning facility
and a 2"d sheet of ice. There was also significant support for
youth recreational activities on the site with some concerns
expressed on how recreational uses will work with a conference
and learning center. There was little support at the March 3`d
meeting for performing arts. On March 7th, a Town Council
hearing occurred to receive additional feedback on the community
facility uses. On March 14th, the final market analysis will be
presented to Council with a summary of economic
benefits/impacts of the proposed facilities. Staff would like to
request that the VRD and the Town Council begin providing staff
with input on the uses they would like to begin further exploring in
a design process on the hub site. Another evening meeting is
scheduled for March 21St to provide additional time for the Town
Council and the VRD to come to a conclusion on the program for
the hub site and to solicit additional public input.
6. Community Facilities - Donovan Park
Dominic Mauriello Review of refined preferred alternative "C" for Donovan Park with
Piet Pieters consultant team. (1 hr.)
ACTION REQUESTED OF COUNCIL: Provide direction on
developing final plan for Donovan Park to be reviewed by the PEC
and DRB through the development review process.
BACKGROUND RATIONALE: See memo in packet.
7. 6 Critical Strategies. (1:30 mins.)
Suzanne Silverthorn Community Collaboration
Bob McLaurin Capital Projects
8. Information Update. (10 mins.)
9. Council Reports. (10 mins.)
10. Other. (10 mins.)
11. Adjournment. (6:25 P.M.)
NOTE UPCOMING MEETING START TIMES BELOW:
(ALL TIMES ARE APPROXIMATE AND SUBJECT TO CHANGE)
THE NEXT VAIL TOWN COUNCIL REGULAR WORK SESSION
WILL BE ON TUESDAY, 3/21/00, BEGINNING AT 2:00 P.M. IN TOV COUNCIL
CHAMBERS.
THE FOLLOWING VAIL TOWN COUNCIL REGULAR WORK SESSION
WILL BE ON TUESDAY, 3/28/00, BEGINNING AT 2:00 P.M. IN TOV COUNCIL
CHAMBERS.
THE NEXT VAIL TOWN COUNCIL REGULAR EVENING MEETING
WILL BE ON TUESDAY, 3/21/00, BEGINNING AT 7:00 P.M. IN TOV COUNCIL
CHAMBERS.
Memorandum
To: Town Council
From Tom Moorhead
Russell Forrest
Nina Timm
Date: March 14, 2000
Subject: Request For Proposals on the Berry Creek 5`h Filing
Attached is a draft copy of the RFP for the Berry Creek 5`h filing housing site. This RFP
is the result of three meetings between County and Town staff. The Board of County
Commissioners will be reviewing the document during the week of March 13-17.
This is being provided to Council for your review. A work session will be scheduled to
discuss this publicly after staff receives comments from the County. The work session is
scheduled for March 28`h.
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Request for Proposals
Designer/Builder/Manager of Affordable Housing Units located in Eagle County
1. Introduction
Eagle County and the Town of Vail are interested in building affordable housing units on
a 16-buildable acre site in Edwards, Colorado. The County recently purchased a 105-
acre parcel from the Eagle County Recreation Authority. In an Intergovernmentmental-
Agreement with the school district, an 16-acre site has been specifically set aside for
rental and for-sale affordable housing. The land will be provided to the developer in order
to ensure affordable housing.
The goal is a viable affordable housing development with the number of for-sale and
rental units being determined by the developer. The developer will need to determine
what the best use of the site would be as well as what mix provides the greatest benefit to
the community at large.
H. Objectives
The objective of Eagle County and the Town of Vail is to ensure affordable housing for
people working within the County. To ensure the long-term affordability of these units,
they will be deed-restricted which will include a requirement for owner occupancy on the
for-sale units and long-term leases to people working full-time and year-round in Eagle
County. The for-sale units will also have a mechanism in place to ensure long-term
affordability.
The goal is to create a mix of for-sale and rental units that are affordable to local
employees. The project must be financially sound from a developer's perspective. The
developer will be responsible for obtaining approval thru the Eagle County review
process. The developer should determine the mix of for-sale and rental units based on the
best use of the site and affordability. The sizes of the units should be varied to provide as
many options as possible. The developer needs to include a management plan for the
rental units. Eagle County and the Town of Vail will find prequalifred purchasers for the
for-sale units.
III. The Site
The site consists of 16-buildable acres immediately south of 1-70, just east of the
Edwards exit. It is part of a 105-acre parcel known as Berry Creek 5th Filing. The
housing site is located to the east of the Equestrian Center and to the west of the Berry
Creek Middle School. East of the middle school is the future home of an elementary
school. The land to the south will be maintained as recreational space. (See attached
map)
Berry Creek Affordable Housing page 1 of 7
Request For Proposals
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The current zoning does not allow housing on the site. The entire 105-acre parcel will be
going through the Eagle County PUD process. The developer will be required to
participate in this process as it relates to the 16-acre housing site. The County is
currently in the process of securing a consultant to facilitate the PUD process for the
entire parcel.
It is anticipated that utilities will be in place on the site and Miller Ranch Road will be
constructed prior to breaking ground on the employee-housing component of the site. A
cost sharing for the utilities and the road construction will need to be factored into the
financial analysis for the housing. The cost sharing may be based on a trip generation
basis, as there may potentially be multiple users of the road and utilities.
IV. Material to be Provided in Proposal
A. Cover Letter
1. Identify team members
2. State roles of each member
3. Highlight strengths of team
B. Qualifications and Experience
1. Describe team's expertise as it pertains to the delivery of
affordable housing. Emphasize residential construction projects of
this scale. Discuss team member's experience in mountain
communities. Describe the team's existing working relationships
with subcontractors who will be available to work on this site and
keep the project on schedule.
2. Provide examples of previous developments
3. Provide examples of rental management experience of the size
proposed
C. Schedule
Identify dates to which the team can commit for the following steps:
1. Development team review of the site and current designs with
modifications as appropriate
2. Conceptual review of design by the appropriate County boards and
the Vail Town Council
It is recognized that creating a specific timeline based on the amount of time needed for
the review process is difficult. For the next items it would be satisfactory to estimate the
amount of time necessary to prepare the required documents rather than specific dates.
Berry Creek Affordable Housing Page 2 of 7
Request For Proposals
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3. Final review by boards and Council
4. Building permit application
5. Building permit issuance
6. Start of construction
7. Completion
D. Project Budget
The project budget should be broken down into three main categories:
total project, per unit and per square foot. The proposed budget must
include at a minimum the following costs that should be broken out:
Architectural fees Engineering fees
Tap fees Building Permits/County fees
Excavation Utilities
Concrete Framing
Interior finishes Paving
Landscaping Eagle County Road Impact Fees
Retainage Contingency
Financing costs Evaluation of costs to increase
environmental "friendliness"
(Additional detail is appreciated)
Prospective developers are asked to provide sufficient information to evaluate the
proposal. The information provided is intended to serve multiple functions:
? To understand the program and site plan proposed;
? The value placed on the land as provided to the development;
? To provide an opportunity to the prospective developer to present background
information regarding your firm's prior experience, the principal participants, and
financial strengths;
? To evidence the total benefits to the community to be derived from the proposed
development scheme.
V. Financial Analysis
The objective of this housing is to provide loner term affordable housing options for
employees within Eagle County. Units should be developed so that they are affordable to
the local employee market. Two-bedroom units should be priced less than $150,000 and
three-bedroom units should be priced less than $225,000. Prices should be established
based on layout and amenities. Rental rates should be established so that they are
affordable to the local employee market. Please note that in the recent Eagle County
Berry Creek Affordable Housing Page 3 of 7
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Housing Needs Assessment garages were ranked as one of the most valuable amenities a
home could have, and people considered them an amenity worth extra cost.
The goal of the County and the Town is to maintain the affordability of these units well
into the future. Different mechanisms to maintain affordability have been used by both
entities. Both deed-restrictions and a land trust have been considered good ways to
ensure long-term affordability. If the developer has other successful mechanisms for
maintaining affordability, the County and the Town are willing to discuss them
Describe your proposed financing, including sources and uses. The submittal should
include a development budget detailing hard and soft costs with developer fees and
financing costs delineated. The package should also include an operating pro forma on
the project covering at least five years. All rental rates and for-sale prices are to be
shown based on unit size. Include vacancy rate estimates. Operating costs are to be
sufficiently itemized to show all management fees and maintenance budgets. Also,
resources are to be allocated to cover the share of the cost for the construction of Miller
Ranch Road and the on-site utilities. It is also important to demonstrate the developer's
understanding of the current area market and market analysis done to create the financial
costs and package being proposed. The proposer will need to demonstrate the market
demand for the product mix being proposed.
Expertise in providing permanent financing packages to the prospective purchasers is
also an important part of the services being sought. Experience with affordable housing
developments revealed that many buyers need programs that cater to entry level buyers
with limited resources. FNMA project approval can prove to be a critical component of
the sales package, as it makes a broader range of loans available to the buyer, without the
cost of additional points or loans at higher rates. The County and the Town will consider
other types of permanent loan packages that enable the target market of entry level buyers
to close loans. These could include FNMA, FDMC, FHA, private-portfolio placement, or
internal placement within a mortgage company. The preference is to have project
approval that makes the mortgages sellable on the secondary market. Another
consideration for project approval is how the rental development and the for-sale
development will be packaged to ensure project approval fiom FNMA or another entity.
The development team must also provide all the necessary services to transfer the
ownership of the constructed units to the future homeowners. The cost for these services
must be provided and included in the purchase price. It is expected that these services
not exceed 2% of the purchase price of the homes. Eagle County and the Town of Vail
will have established the prequalified purchasers of the units. A list of back-up
purchasers will be created. Because the projected sales prices are significantly below
market price it is anticipated that the project will attract buyers without significant
marketing efforts.
Berry Creek Affordable Housing Page 4 of 7
Request For Proposals
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VI. Criteria for Selection
? Quality and successful implementation of comparably sized developments.
Affordable residential development experience of a similar nature and scope will be
viewed favorably, and the commitment to quality as evidenced by previous
developments and their aesthetics will be considered.
Review and discussion of the proposed development plan(s), including project scale
and land use interrelationships. Quality of site planning and treatment of parking,
open space, and livability for residents. Imagination and creativity in land planning
as evidenced by plans for the Berry Creek site and in previous work, an ability to
meet the quality expectations of the Town and the County, and design as evidenced
by previous projects will be evaluated.
? Price and terms disclosed by the developer. The total offer, the structure of that offer,
and the financial capability of the development team to carry out the proposed site
development will be carefully considered. Additionally, the ability to secure
financing, and to complete all negotiations in a timely and expeditious manner will be
considered.
i Discussion of the approach to managing the proposed development. The County and
the Town seek to ensure that the development will remain affordable within the
guidelines proposed.
i Willingness to join in participatory process involving officials and staff, and
neighborhood or community groups as required.
Ability to ensure ongoing management of the proposed development and to maintain
the development in an aesthetic manner, and to continue to house the targeted
population will be evaluated.
i The extent to which the proposal meets the community's need for housing. Site
planning concepts will be evaluated on whether they address the long-term needs of
residents. For example, family units must be designed to be livable with appropriate
amenities and open spaces. Pedestrian/bicycle access through the site should be
sensitive to the residents and the larger needs of the community. These and other
community benefits will be considered in the review process.
Creativity in creating numerous price points based on layout and amenities. A
successful development will be one showing creativity with a broad range of
affordability and amenities.
Berry Creek Affordable Housing page 5 of7
Request For Proposals
e
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VII. Deadline and Contacts
Proposals must be received by 12:00 PM on Tuesday, May 23, 2000.
Proposals should be submitted to:
Mr. Jack Ingstad
Eagle County Administrator
500 Broadway
Post Office Box 850
Eagle, CO 81631
Please include 8 copies of the proposal. (Include one unbound copy, please)
At Eagle County, please contact David Carter, Housing Coordinator at 970/328-
8876. At the Town of Vail, please contact Nina Timm, Housing Coordinator at
970/479-2144 or by e-mail at ntinvnra%ci.vait.co.us.
If necessary, interviews will be conducted the week of June 5th - 9th, 2000.
Both Eagle County and Town of Vail staff will conduct reviews of submittals.
VIII. Other
Fair Housing Act Standards
Proposers should be aware of the requirements for accessibility, per the Fair
Housing Act of 1988 (FHA) and its amendments. Determining which units must
comply with all seven items and which units are exempt will be the responsibility
of the development team. The general areas of compliance are:
1. Accessible entrances
2. Accessible common areas
.3. Usable doors
4. Accessible routes through units
5. Light switches and other controls in accessible locations
6. Reinforced bathroom walls for grab bars
7. Usable kitchens and bathrooms
IX. General Conditions
Limitations and Award: This RFP does not commit Eagle County or the Town of
Vail to award or contract, nor to pay any costs incurred in the preparation and
submission of qualifications in anticipation of a contract. Eagle County and the
Town of Vail reserve the right to accept or reject all or any submittal received as a
result of this request, to negotiate with all qualified sources, or to cancel all or part
Berry Creek Affordable Housing Page 6 of 7
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of the RFP. After a priority listing of the final firms is established the Town and
the County will negotiate a contract with the first priority firm. If negotiations
cannot be successfully completed with the first priority firm, -negotiations will be
formally terminated and will be initiated with the second most qualified firm and,
likewise, with the remaining firms.
Equal Emnlovment Opportunity: The selected consultant will not discriminate
against any employee or applicant for employment because of race, color,
religion, sex or national origin.
X. Attachments,
? Map of Berry Creek 5th Filing
? Soils Surveys
? Survey of Site
? Schedule of Eagle County Board meetings
? Copy of the 1999 Eagle County Housing Needs Assessment
Berry Creek Affordable Housing Page 7 of 7
Request For Proposals
4. -
Gwathmey
Pratt
Schultz
Architects, p.c.
1000 S. Frontage Road Wej
Vail, Colorado 81657
Tel: (970) 476-1147
Fax: (970) 476-1612
March 3, 2000
Ms. Lorelei Donaldson
Town Clerk's Office
Town of Vail
75 South Frontage Road
Vail, CO 81657
Dear Ms. Donaldson and Town Council:
I am submitting this Letter of Interest for a re-appointed position with the Planning and
Environmental, Commission.
I am currently a 5-year resident of the Town of Vail and am employed at Gwathmey Pratt
Schultz Architects. As a graduate of the School of Environmental Science and Forestry, with a
degree in Landscape Architecture, I believe that my professional skills will help to better the
growth of our town for both the citizens of Vail and our guests.
I thank you in advance for accepting my Letter of Interest and look forward to hearing from you
soon.
Sincerely,
C e
Doyon
Brian
Galen A. Aasland
P.O. Box 383, Vail, CO 81658
970-476-0516
March 3, 2000
Town Council
Town of Vail
75 South Frontage Road
Vail, CO 81657
Dear Members of the Town Council,
I would like to apply for reinstatement for a third term on the Vail Planning and
Environmental Commission. I have a continuing and genuine interest in this portion of
civic government and I feel my service contributes positively to the Town.
During the majority of the last 20 years I have lived and worked in Eagle county. Most
of that time in Vail. Currently I own a home in West Vail and I have my office in Vail
Village. I am a resident and a registered voter in Vail. Through my business I have an
in depth knowledge of how Vails' planning process functions. Through my office and
my service on the Planning and Environmental Commission, I have become well aware
of both the opportunities and challenges the Towns' zoning presents. I believe I have
the ability to help grasp what will be a good, appropriate project for the Town and how
zoning applies and becomes a guide to encourage a better community.
As well as being a Life member of the Sierra Club, I am a licensed Architect in
Colorado and Idaho.
I have a deep interest in making Vail one of the best places in the World to live and
visit and I appreciate your consideration of my application.
-Sin \
i
v l
Galen Aasl
Mar-08-00 11:47A p.02
Dear Vail Town Council Members,
This letter is to inform you that I do intend to apply for one more term on the Planning
and Environmental Commission. I have had the privilege to serve on this commission for
the past few years and I feel during this time I have learned a great deal and can
contribute to this committee. Please consider my re-appointment and I look forward to
working with you in the future.
Thank you,
c~
Diane D. Golden
476-2164
PLANNING AND ENVIRONMENTAL COMMISSION
PUBLIC MEETING SCHEDULE
Monday, March 13, 2000
AGENDA
Proiect Orientation / PEC LUNCH - Communitv Development Department 11:00 P.M.
MEMBERS PRESENT MEMBERS ABSENT
Site Visits : 12:30 p.m.
1. Vail Mountain School - 3160 Katsos Ranch Road
2. Pearson - 303 Gore Creek Drive #2-C,,.
3. Vail Athletic Club - 352 East Meadow Drive
4. Gore Creek Promenade
5. Illig - 706 W. Forest Road
6. Donovan Park -South Frontage Road and Matterhorn Circle
7. Lot 4, Ridge at Vail -1452 Buffehr Creek Road
Driver: George
NOTE: If the PEC hearing extends until 6:00 p.m., the board will break for dinner from 6:00 - 6:30 p.m.
Public Hearina - Town Council Chambers 2:00 p.m.
1. A request for a minor subdivision, to allow for an amendment to a previously platted
building envelope and a revised lot access, located at 1452 Buffehr Creek Rd./Lot 4,
Ridge at Vail.
Applicant: Mike Young
Planner: George Ruther
2. A request for variances from Section 12-6D-6, and Section 12-14-6, Town of Vail Code,
to allow for an extended entry, trash enclosure and deck expansion, located at 706 W.
Forest Road/Lot 9, Block 1, Vail Village 6th Filing.
Applicant: Cliff Illig, represented by Beth Levine
Planner: Allison Ochs
3. A request for a variance from Sections 12-61-1-6 and 12-14-6, Town of Vail Code, to allow
for the addition of gross residential floor area and balconies within required setbacks
located at 303 Gore Creek Drive, Vail Townhouse #2-C/Lot 2, Block 5, Vail Village 1 s
Filing.
Applicant: Vicki Pearson, represented by Ron Diehl, Architect
Planner: Ann Kjerulf
TOWNV OF VAILO
i
4. A request for a work session to discuss a proposed major amendment to Special
Development District #4 (Cascade Village), located at 1000 S. Frontage Road West (Glen
Lyon Office Building)/Lot 54, Block K, Glen Lyon Subdivision.
Applicant: Dundee Realty, represented by Segerberg Mayhew Architects
Planner: George Ruther
5. A request for an exterior alteration and a conditional use permit for a fractional fee club
and a parking variance, to allow for the redevelopment of the Vail Athletic Club, located at
352 East Meadow Drive/A part of Tract B, Vail Village 1St Filing.
Applicant: VML, L.L.C.
Planner: George Ruther
6. A work session to discuss a conditional use permit to allow for a proposed expansion at
Vail Mountain School, located at 3160 Katsos Ranch Road/Part of Lot 12, Block 2, Vail
Village 12th Filing.
Applicant: Vail Mountain School, represented by Gwathmey Pratt Schultz Architects
Planner: Brent Wilson
7. A PEC review of proposed modifications to the Gore Creek Flood Plain, located at the
Gore Creek Whitewater Park, Gore Creek Promenade/Tracts I & A, Block 5B, Vail Village
1 st Filing.
Applicant: Vail Valley Tourism and Convention Bureau
Planner: Brent Wilson
8. A request for a conditional use permit, to allow for the conversion of existing hotel rooms
into employee housing units, located at 2211 N. Frontage Rd. (West Vail Lodge)/Lot 1,
Vail das Schone #3.
Applicant: Reaut Corporation
Planner Brent Wilson
9. A final review of the proposed changes to the Town of Vail's parking pay-in-lieu policy and
proposed amendments to Chapter 12-10, Town Code.
Applicant: Town of Vail
Planner: Brent Wilson
10. Final review of the Town of Vail's revised parking generation analysis and proposed
amendments to Chapter 12-10, Town Code.
Applicant: Town of Vail
Planner: Brent Wilson
11. A joint work session with the Design Review Board to discuss the proposed development
plan/master plan and a conditional use permit for a park and recreation facility for an
approximately 12 acre unplatted parcel of land zoned General Use and Residential
Cluster, commonly referred to as the lower bench of Donovan Park, located south of the
South Frontage Road and east and north of Matterhorn Circle.
Applicant: Town of Vail/Vail Recreation District
Planner: Dominic Mauriello
2
14'
12. Information Update
Four, two-year term PEC vacancies - (Galen Aasland, Brian Doyon, Diane Golden and
Tom Weber).
PEC REPRESENTATIVE AT DRB FOR 2000-
Doug Cahill - Jan-Mar '00
- Apr-Jun '00
- Jul-Sep '00
- Oct-Dec `00
13. Approval of February 28, 2000 minutes.
The applications and information about the proposals are available for public inspection during
regular office hours in the project planner's office located at the Town of Vail Community
Development Department, 75 South Frontage Road. Please call 479-2138 for information.
Sign language interpretation available upon request with 24 hour notification. Please call 479-2356, Telephone for the
Hearing Impaired, for information.
Community Development Department
Published March 10, 2000 in the Vail Trail
3
t
MEMORANDUM
TO: Planning and Environmental Commission
FROM: Community Development Department
DATE: March 13, 2000
SUBJECT: A request for a final review of a major exterior alteration and conditional use
permit to allow for the redevelopment of the Vail Athletic Club & Spa, located at
352 East Meadow Drive/a part of Tract B, Vail Village First Filing.
Applicant: Ron Byrne, d.b.a: VML, L.L.C., represented by Tom Braun
Planner: George Ruther
1. DESCRIPTION OF THE REQUEST
The applicant, Ron Byrne, represented by Tom Braun, is requesting a major exterior alteration
and conditional use permit to allow for the redevelopment of the Vail Athletic Club & Spa. The
Vail Athletic Club & Spa is located at 352 East Meadow Drive at the intersection of East Meadow
Drive and Vail Valley Drive.
The proposed redevelopment of the Vail Athletic Club & Spa includes a major renovation and
upgrading of the existing building along with several exterior additions to the existing structure.
The new exterior additions are generally located on the south, west and north sides of the
building. Due to the configuration and design of the existing structure, the majority of the new
square footage being added is atop existing building foundation and is in the form of infill
development. The applicant is proposing to redevelopment the existing hotel in accordance with
the development standards prescribed for the Public Accommodation Zone District. If the
proposal is approved, the existing Special Development District will be abandoned. The major
elements of the redevelopment proposal include:
• The complete renovation of the exterior of the building. The renovation introduces a new
architectural style for the building. The proposed improvements to the exterior include a
combination of stone, wood siding, stucco and timbers. The new architectural style is more
in keeping with the goals of the Vail Village Master Plan and Urban Design Considerations. .
• A complete remodel of the interior of the hotel. The remodel to the interior includes a newly
designed restaurant and bar, lobby, front desk, health club and meeting space.
• Modifications to the existing accommodation units (20) and the creation of 10 new
accommodation units. The average size of the 30 accommodation units is over 500 square
feet per room.
• The creation of a fractional fee club operation. The proposed club will include a total of
seven new fractional fee club units. The size of the club units varying between two and three
bedroom units. Operation of the club will be in accordance with the provisions outlined in
Chapter 16 of the Zoning Regulations.
• The addition of two, new free-market, for-sale condominiums. The new condominiums will
be located on the top floor of the hotel. There are two dwelling units existing in the hotel.
1
TOWN OF PAIL
• The construction of one, new on-site employee housing unit. The new unit will be in addition
to the four units already on-site. As a result of the proposed remodel each of the existing
employee units will be remodeled and upgraded. The on-site units will provide deed-
restricted housing for up to ten employees.
• The implementation of the suggested streetscape improvements along Vail Valley Drive and
East Meadow Drive.
11. STAFF RECOMMENDATION
The Community Development Department recommends approval of the applicant's request for a
major exterior alteration and conditional use permit to allow for the redevelopment of the Vail
Athletic Club & Spa, located at 352 East Meadow Drive. Staff's recommendation of approval is
based upon the review of the criteria outlined in Sections V & VI of this memorandum.
Should the Planning & Environmental Commission choose to approve the major exterior
alteration and conditional use permit request, staff would recommend that the Commission make
the following findings,
`That the major exterior alteration and conditional use permit requests comply with the
criteria as outlined in Sections V & VI of this memorandum. Specifically,- the request for
131 % GRFA, 63% site coverage and the variations from the setback requirements meet
the goals and the intent of the Vail Village Master Plan and Urban Design Considerations"
Should the Planning & Environmental Commission choose to approve the applicant's request,
staff would recommend that the following conditions be made part of the approval:
1. That the developer submits a complete set of engineered plans for the required
streetscape improvements. The plans shall be required to comply with the applicable
Town of Vail Development Standards. The plans shall be reviewed and approved by the
Town of Vail Public Works Department prior to appearing before the Town of Vail Design
Review Board for final review of the streetscape improvements. The plans shall receive
final approval prior to the issuance of a building permit
2. That the developer records a deed-restriction for the new Type III Employee Housing Unit
in the Vail Athletic Club & Spa with the Eagle County Clerk & Recorder's office prior to the
issuance of a building permit.
3. That the developer submits an application to the Town of Vail Community Development
Department for a conditional use permit to allow for the construction of one new Type III
Employee Housing Unit in the Vail Athletic Club & Spa and that the permit be approved by
the Planning & Environmental Commission prior to the issuance of a building permit.
4. That the developer submits a tree preservation plan to the Town of Vail Community
Development Department for review and approval prior to the issuance of a building
permit.
5. That the developer submits a construction staging and access plan to the Town of Vail
Community Development Department for review and approval prior to the issuance of a
building permit. The plan shall include the location of a construction fence and erosion
control fence to preserve and protect the Gore Creek riparian corridor.
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6. That the developer pays the Town of-Vail $13,620, as previously agreed to, for previous
streetscape improvements already completed by the Town of Vail on behalf of the Vail
Athletic Club & Spa.
7. That the developer submits a comprehensive sign and exterior lighting program for the
Vail Athletic Club & Spa to the Town of Vail Community Development Department for
review and approval prior to the issuance of a building permit.
III. BACKGROUND
November 1993 - The Vail Town Council approved Ordinance No. 27, Series of 1993,
establishing Special Development District No. 30, Vail Athletic Club. The establishment of
Special Development District No. 30 allowed for up to 52 accommodation units, 4 dwelling units
and 4 employee housing units. The total allowable GRFA was 32,282 square feet with an
additional 17,000 square feet permitted for restaurant, club, lobby, etc. The underlying zoning for
the property is Public Accommodation
January 1996 - The Vail Town Council approved Ordinance No. 2, Series of 1996, amending the
Approved Development Plan for Special Development District No. 30. The amending ordinance
increased the number of allowable accommodation units to 55 and increased allowable GRFA to
34,505 square feet. There was no change to the number of dwelling units or employee housing
units.
March 1997 -The Planning & Environmental Commission approved a minor amendment to
Special Development District No. 30. The minor amendment allowed for modifications to the
parking garage, restaurant, common areas and the balconies and decks of the accommodation
and dwelling units.
May 4 1999 - The Vail Town Council denied Ordinance No. 12, Series of 1999, amending the
Approved Development Plan for Special Development District No. 30. Had it been approved, the
amending ordinance would have permitted an a reduction in the number of accommodation units
from 54 to 46 and increased the number of dwelling units back to four as originally approved.
October 1999 -The Vail Town Council approved Ordinance No. 23, Series of 1999, amending
the prescribed development standards for the Public Accommodation Zone District and
establishing a revised development review process. The approved amendments, in part,
increased allowable GRFA to 150% of the site area, increased site coverage from 55% to 65%,
eliminated AU's/EHU's/FFU's from the density calculation, and changed the definition of a
"lodge". The building height, landscape and parking requirements remained unchanged.
IV. PROS AND CONS
Benefits
• Provides an increase in the number of short-term accommodations in the Town of Vail
• Improves and redevelops an older building in the Town of Vail
• The project complies with the Town of Vail Land Use Plan
• The recommended streetscape improvements will be implemented
• An increased occupancy potential due to the operation of the fractional fee club
• The construction of up to two new employee beds in the Village
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The redevelopment of an existing building that currently does not comply with many of the
development objectives of the Vail Village Master Plan and Urban Design Considerations
• The elimination of a Special Development District
Negatives
• The loss of meeting room space in Vail
• The loss of health club square footage and other similar amenities
• The loss of several existing trees
V. MAJOR EXTERIOR ALTERATION
The development review process for the proposed redevelopment of the Vail Athletic Club & Spa
is established in the Town of Vail Zoning Regulations. According to Section 12-7A-12,
'The construction of a new building or the alteration of an existing building shall be
reviewed by the Design Review Board in accordance with Chapter 11 of the Zoning
Regulations. However, any project which adds additional dwelling units, accommodation
units, fractional fee club units, any project that adds more than 1, 000 square feet of
commercial floor area or common space, or any project which has substantial off-site
impacts (as determined by the Administrator) shall be reviewed by the Planning &
Environmental Commission as a major exterior alteration in accordance with this Chapter
and Section 12-3-6 of the Town Code."
Staff has determined that this request is a major exterior alteration, since the redevelopment
application includes an increase in the number of dwelling units, accommodation units, fractional
fee club units, and employee housing units to the site.
Vail Village Master Plan
According to the Vail Village Master Plan, Action Plan, the Vail Athletic Club & Spa is located
within the East Meadow Drive Sub-area (5-1). The only recommended action in the sub-area is
the completion of the streamwalk. The streamwalk has long since been completed.. No further
improvements are required.
Pursuant to the other elements of the Master Plan, the Vail Athletic Club & Spa is located in the
periphery area surrounding the Village (Land Use Plan), already exceeds the conceptualized
height (Conceptual Building Height Plan), has no negative impacts on the proposed open space
of Vail Village (Open Space Plan), and fronts upon a street devoted to accommodating both
vehicular and pedestrian traffic (Parking and Circulation Plan).
Goals for Vail Village are summarized in six major goal statements. The goal statements are
designed to establish a framework, or direction, for future development of the Village. The goals,
along with the established objectives and policies. are to be used in evaluating a proposal during
the development review process. The following goals, objectives and policies have been
identified:
Goal #1 Encourage high quality redevelopment while preserving the unique
architectural scale of the Village in order to sustain its sense of
community and identity.
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1.1 Obiective: Implement a consistent Development Review Process to
reinforce the character of the Village.
1.1.1 Policv: Development and improvement projects approved in
the Village shall be consistent with the goals,
objectives, policies and design considerations as
outlined in the Vail Village Master Plan and Urban
Design Guide Plan.
1.2 Obiective: Encourage the upgrading and redevelopment of residential
and commercial facilities.
1.2.1 Policv: Additional development may be allowed as
identified by the action plan as is consistent with the.
Vail Village Master Plan and Urban Design Guide
Plan.
1.3 Obiective: Enhance new development and redevelopment through
public improvements done by private developers working in
cooperation with the Town.
1.3.1 Policv: Public improvements shall be developed with the
participation of the private sector working with the
Town.
Goal #2 To foster a strong tourist industry and promote year-round economic
health and viability for the Village and for the community as a whole.
2.1 Obiective: Recognize the variety of land uses found in the 10 sub-
areas throughout the Village and allow for development that
is compatible with these established land use patterns.
2.1.1 Policv: The zoning code and development review criteria
shall be consistent with the overall goals and
objectives of the Vail Village Master Plan.
2.3 Obiective: Increase the number of residential units available for short-
term, overnight accommodations.
2.3.1 Policv: The development of short-term accommodation
units is strongly encouraged. Residential units that
are developed above existing density levels are
required to be designed or managed in a manner
that makes them available for short-term overnight
rental.
2.4 Obiective: Encourage the development of a variety of new commercial
activity where compatible with existing land uses.
2.4.1 Policv: Commercial infill development consistent with
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established horizontal zoning regulations shall be
encouraged to provide activity generators,
accessible greenspaces, public plazas, and
streetscape improvements to the pedestrian
network throughout the Village.
2.5 Obiective: Encourage the continued upgrading, renovation and
maintenance of existing lodging and commercial facilities to
better serve the needs of our guests.
2.5.1 Policv: Recreation amenities, common areas, meeting
facilities and other amenities shall be preserved and
enhanced as a part of any redevelopment of lodging
properties.
2.5.2 Policv: The Town will use the maximum flexibility possible
in the interpretation of building and fire codes in
order to facilitate building renovations without
compromising life, health and safety considerations.
2.6 Obiective: Encourage the development of affordable housing units
through the efforts of the private sector.
2.6.2 Policv: Employee housing shall be developed with
appropriate restrictions so as to insure their
availability and affordability to the local work force.
2.6.3 Policv: The Town of Vail may facilitate in the development
of affordable housing by providing limited
assistance.
Goal #3 To recognize as a top priority the enhancement of the walking
experience throughout the Village.
3.1 Obiective: Physically improve the existing pedestrian ways by
landscaping and other improvements.
3.1.1 Policv: Private development projects shall incorporate
streetscape improvements (such as paver
treatments, landscaping, lighting and seating
areas), along adjacent pedestrian ways.
3.1.2 Policv: Public art shall be encouraged at appropriate
locations throughout the Town.
3.1.3 Policv: Flowers, trees, water features and other
landscaping shall be encouraged throughout the
Town in locations adjacent to, or visible from,
public areas.
3.2 Obiective: Minimize the amount of vehicular traffic in the Village to the
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greatest extent possible.
3.2.1 Policv: Vehicular traffic will be eliminated or reduced to
absolutely minimal necessary levels in the
pedestrianized areas of the Village.
3.3 Obiective: Encourage a wide variety of activities, events and street
life along pedestrian ways and plazas.
3.3.2 Policv: Outdoor dining is an important streetscape feature
and shall be encouraged in commercial infill or
redevelopment projects.
3.4 Obiective: Develop additional sidewalks, pedestrian-only walkways
and accessible green space areas, including pocket parks
and stream access.
3.4.1 Policv: Physical improvements to property adjacent to
stream tracts shall not further restrict public access.
3.4.2 Policv: Private development projects shall be required to
incorporate new sidewalks along streets adjacent to
the project as designated in the Vail Village Master
Plan and/or Recreation Trails Master Plan.
Goal #4 To preserve existing open space areas and expand green space
opportunities.
4.1 Obiective: Improve existing open space areas and create new plazas
with green space and pocket parks. Recognize the
different roles of each type of open space in forming the
overall fabric of the Village.
4.1.3 Policv: With the exception of ski base-related facilities,
existing natural open space areas at the base of
Vail Mountain and throughout Vail Village shall be
preserved as open space.
Goal #5 Increase and improve the capacity, efficiency and aesthetics of the
transportation and circulation system throughout the Village.
5.1 Obiective: Meet parking demands with public and private parking facilities.
5.1.1 Policv: For new development that is located outside of the
Commercial Core 1 Zone District, on-site parking
shall be provided (rather than paying into the
parking fund) to meet any additional. parking
demand as required by the Zoning Code.
5.1.5 Policv: Redevelopment projects shall be strongly
encouraged to provide underground or visually
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concealed parking.
5.2 Obiective: Encourage the use of public transportation to minimize the
use of private automobiles throughout Vail.
5.2.2 Policv: The Town shall facilitate and'encourage the
operation of private shuttle vans outside of the
pedestrianized core area.
5.3 Obiective: Concentrate the majority of interconnecting transit activity
at the periphery of the Village to minimize vehicular traffic in
pedestrianized areas.
Goal #6 To insure the continued improvement of the vital operational elements
of the Village.
6.1 Obiective: Provide service and delivery facilities for existing and new
development.
6.2 Obiective: Provide for the safe and efficient functions of fire, police
and public utilities within the context of an aesthetically
pleasing resort setting.
6.2.1 Policv: Development projects and other improvements in
Vail Village shall be reviewed by respective Town
departments to identify both the impacts of the
proposal and potential mitigating measures.
6.2.2 Policv: Minor improvements (landscaping, decorative
paving, open dining decks, etc.), may be permitted
on Town of Vail land or right-of-way (with review
and approval by the Town Council and Planning and
Environmental Commission when applicable)
provided that Town operations such as snow
removal, street maintenance and fire department
access and operation are able to be maintained at
current levels. Special design (i.e heated
pavement), maintenance fees, or other
considerations may be required to offset impacts on
Town services.
Public Accommodation Zone District
The following development standards apply to this request:
USES
The only permitted uses in the zone district are "lodges". A lodge is defined as a building
designed for temporary lodging of individuals or families in which the GRFA devoted to
accommodation units or fractional fee club units is equal to or greater than 70% of the total
GRFA.
The existing building is currently non-conforming with regard to the new definition of a lodge. In
the existing building 54% of the total GRFA is devoted to accommodation units. This figure
includes 20 accommodation units and seven "lock-off" units attached to the existing dwelling
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units.
As a result of the proposed redevelopment, 67% of the total GRFA will be devoted to
accommodation units and fractional fee club units. This figure includes a total of 30
accommodation units and seven fractional fee club units. While this figure remains non-
conforming, the proposal represents a significant increase in the amount of total GRFA devoted
to accommodation unit and fractional fee club unit square footage on the property. However, in
accordance with the recently adopted language for the zone district, more than 70% of the "new"
GRFA resulting from this proposal is devoted to accommodation units or fractional fee club units.
Therefore, the proposal complies with the provisions of the Public Accommodation zone district
with regard to uses and GRFA.
SETBACKS
The minimum setback requirements for the property are twenty feet on all sizes. However, at
the discretion of the Planning & Environmental Commission, variations to the setback standards
may be granted, subject to the applicant demonstrating compliance with the following criteria:
1. Proposed building setbacks provide necessary separation between buildings and riparian
areas, geologically sensitive areas and other environmentally sensitive areas.
2. Proposed building setbacks comply with applicable elements of the Vail Village Urban Design
Guide Plan and Design Considerations.
3. Proposed building setbacks will provide adequate availability of light, air and open space.
4. Proposed building setbacks will provide a compatible relationship with buildings and uses on
adjacent properties.
5. Proposed building setbacks will result in creative design solutions or other public benefits that
could not otherwise be achieved by conformance with prescribed setback standards.
The existing building encroaches into the required twenty-foot setbacks on all sides of the
property. The applicant is proposing additional encroachments. The additional encroachments
are requested pursuant to the criteria listed above. The areas of additional encroachment
include the expanded restaurant on the southeast corner of the building, the bay windows on the
south side of the building and the new permanent front entry feature on the north side of the
building. The encroachments are shown on the attached reduced plans.
Staff believes that the proposed encroachments are warranted since they comply with setback
criteria identified in the Zoning Regulations. Specifically, the proposed expansions on the south
side of the building do not encroach into the 50-foot stream setback, nor do they negatively
impact any geologically sensitive areas (floodplain). Furthermore, the expansions will not
negatively impact the residential uses located to the west of the property (Mountain Haus) as the
distance between the buildings continues to adequately provide for light, air and open spaces.
Lastly, the residential uses of the Vail Athletic-Club & Spa do not differ from the residential uses
of the Mountain Haus, and therefore, the use remains compatible with the uses on adjacent
properties. To further insure that the uses remain compatible, the applicant has located the
outdoor pool and restaurant on the east end of the development site where they will be operated
away from the Mountain Haus and the grade change of the site separates them from the Cornice
Building. Staff believes that the proposed setbacks result in a creative design solutions and are
beneficial to the public.
HEIGHT
According to the Zoning Regulations, the building height for a building with a flat roof or mansard
roof shall not exceed forty-five feet (46). For a sloping roof, the height of buildings shall not
exceed forty-eight feet (48'). The existing height of the building currently exceeds 48'. The
overall height of the building will not be increased as a result of the redevelopment proposal.
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DENSITY CONTROL
Pursuant to the Zoning Regulations, up to one hundred and fifty (150) square feet of gross
residential floor area (GRFA) may be permitted for each one hundred (100) square feet of
buildable site area. The final determination of allowable gross residential floor area shall be made
by the Planning & Environmental Commission in accordance with Section 12-7A-12: Exterior
Alterations or Modifications. Specifically, in determining allowable gross residential floor area the
Planning & Environmental Commission shall make a finding that proposed gross residential floor
area is in conformance with applicable elements of the Vail Village Urban Design Guide Plan
and the Urban Design Considerations. Total density shall not exceed twenty five (25) dwelling
units per acre of buildable site area. For the purposes of calculating density, employee housing
units, accommodation units and fractional fee club units shall not be counted towards density.
Staff has reviewed the redevelopment proposal for compliance with the density control
regulations. The overall density of the property will be 5.9 dwelling units per acre (4 du's X 1.46
acres). The maximum allowable density is 25 dwelling units per acre.
There is approximately 21,000 square feet of GRFA (70%) in the existing building. This includes
square footage devoted-to AU's, DU's and EHU's. If approved the GRFA square footage would
increase to 39,935 square feet (131%). The proposed square footage includes the 30
accommodation units, 7 fractional fee club units, 4 dwelling units and 5 employee housing units.
Most importantly, of the additional square footage (18,345 sq. ft.) being added, 70.1% (12,851
sq. ft.) is devoted to accommodation units and fractional fee club units and the remaining 29.9%
(5,494 sq. ft.) is devoted to the 4 dwelling units. The numbers are exclusive of the EHU square
footage in the building.
According to the staff analysis the proposal fully complies with the density control regulations.
SITE COVERAGE
Site coverage shall not exceed sixty-five (65%) of the total site area. Final determination of
allowable site coverage shall be made by the Planning & Environmental Commission and/or the
Design Review Board in accordance with Section 12-7A-12: Exterior Alterations or Modifications.
Specifically, in determining allowable site coverage the Planning & Environmental Commission
and/or the Design Review Board shall make a finding that proposed site coverage is in
conformance with applicable elements of the Vail Village Urban Design Guide Plan and Design
Considerations.
The staff has reviewed the proposal for compliance with the site coverage limitation of
65%(max.). The applicant is proposing to increase the amount of site coverage by 2,082 square
feet. The existing site coverage is approximately 54% or 16,063 square feet and the proposed
site coverage will be 61 % or 18,145 sq. ft. Staff believes that the proposal complies with the Vail
Village Urban Design Guide Plan and Urban Design Considerations since all of the required
parking is enclosed in an existing parking structure and the proposal fully complies with the
landscape area requirement.
LANDSCAPING AND SITE DEVELOPMENT
In accordance with the Zoning Regulations, at least thirty percent (30%) or 8,924 square feet of
the total site area shall be landscaped. The applicant is proposing that approximately 32% or
9,519 square feet of the site will be landscaped area. Staff believes the applicant has complied
with the landscape requirement.
PARKING AND LOADING
Off-street parking and loading shall be provided in accordance with Chapter 10 of the Zoning
Regulations. At least seventy five percent (75%) of the required parking shall be located within
the main building or buildings and hidden from public view. No at grade or above grade surface
parking or loading area shall be located in any required front setback area. Below grade
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underground structured parking and short-term guest loading and drop-off shall be permitted in
the required front setback subject to the approval of the Planning & Environmental Commission
and/or the Design Review Board.
Staff has reviewed the proposed off-street parking and loading for the Vail Athletic Club & Spa to
insure compliance with the prescribed regulations. According to the staff analysis, the
applicant's proposal fully complies with the regulations.
Over the years parking variances have been granted for the Vail Athletic Club & Spa. The
variances were approved by the Town of Vail Planning & Environmental Commission in
accordance with the provisions of the Town Code. Due to the granting of the parking variances a
legal, non-conforming situation has resulted. For purposes of this analysis, the parking
requirement has been evaluated based upon the existing and approved parking situation. There
are 22 valet parking spaces on the site today. As a result of the proposed changes to the
building there would be a net decrease in the parking requirement of 6 parking spaces. The
elimination of 2,548 square feet of meeting room space (-21 spaces) and the conversion of 7
hotel dwelling units (-14 spaces) to accommodation units significantly contributes to the net
reduction. The result is an overall reduction in the parking requirement for the site. However,
since much of the parking requirement has been addressed as a result of the granting of parking
variances in the past, the will be no loss of parking on the site. The applicant has proposed to
provide space for a short-term guest loading and drop-off at the new front entry.
The loading and delivery area will continue to be located at the west of the building. No loading
and delivery will be permitted from Vail Valley Drive.
Overall, staff believes that the applicant's proposal fully complies with the parking and loading
requirements.
MITIGATION OF DEVELOPMENT IMPACTS
According to the Town Code, property owners/developers shall also be responsible for mitigating
direct impacts of their development on public infrastructure and in all cases mitigation shall bear
a reasonable relation to the development impacts. Impacts may be determined based on reports
prepared by qualified consultants. The extent of mitigation and public amenity improvements
shall be balanced with the goals of redevelopment and will be determined by the Planning and
Environmental Commission in review of development projects and conditional use permits.
Substantial off-site impacts may include, but are not limited to, the following: deed restricted
employee housing, roadway improvements, pedestrian walkway improvements, streetscape
improvements, stream tract/bank restoration, loading/delivery, public art improvements, and
similar improvements. The intent of this section is to only require mitigation for large-scale
redevelopment/development projects that produce substantial off-site impacts.
Staff has determined that the redevelopment proposal is a large-scale redevelopment project,
and therefore, the mitigation of development impacts shall apply. The applicant has proposed
various streetscape and employee housing improvements.
The streetscape improvements that shall be required are identified in the Town of Vail
Streetscape Master Plan. The applicant is proposing to construct the required improvements.
The improvements to be constructed by the applicant include the heating of the sidewalk on the
north side of East Meadow Drive from the east parking structure portal to the portal located
immediately to the west of the west property line and the sidewalk from the front entrance to the
hotel to the north end of the bridge on Vail Valley Drive. Also included will be the installation of
Town of Vail street lights, as identified on the site plan. The applicant shall be required to submit
a complete set of civil engineered drawings for the review and approval of the Town of Vail
Design Review Board and Public Works Department, prior to the issuance of a building permit.
Other improvements include the application and continuation of the stone veneer into the east
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portal of the parking structure. The stone veneer shall be reviewed and approved by the Design
Review Board.
The applicant is proposing to provide five deed-restricted employee housing units in the hotel. A
total of 1,479 square feet of GRFA will be used to construct the units. This is an increase of one
unit and 209 square feet of deed-restricted space over what is existing today. In determining
compliance with this criteria staff completed an Employee Housing Generation Analysis to
determine the incremental number of new employees that may be generated as a result of the
hotel redevelopment. The results of our analysis are listed below:
EmDlovee Generation Analvsis
a) Health Club = 18,552 sq. ft. @(1.25/1000 sq. ft.) =23.2 employees
b) Restaurant/Bar = 2,372 sq. ft. @(6.5/1000 sq. ft.) =15.4 employees
c) Lodging = 37 units @(1.00/unit) = 37 employees
d) Multi-Family (DU) = 4 units @(.4/unit) =1.6 employees
Total Employees = 77.2 employees
68 existing employees) = 68 employees
(X 0.30 multiplier) = 3 "new" employees
ComDliance with the Vail Villaae Urban Design Guide Plan
The following summarizes the redevelopment proposal's compliance with the applicable
elements of the Urban Design Considerations of the Vail Village Urban Design Guide Plan:
Pedestrian ization
The Club is located on streets with separated pedestrian walks. As part of the review of previous
SDD proposals, a number of improvements were contemplated for the walkways around the
project. Foremost among these were heating portions of the sidewalk and eliminating the
sidewalk west of the entry to the Club. The idea behind this change was to direct pedestrians to
the sidewalk on the north side of the street. These changes are included as elements of this
development proposal and are depicted on the preliminary landscape plan.
Streetscape Framework
The replacement of the sidewalk west of the entry to the Club will result in increased landscape
and planter area. The restaurant expansion on the south side of the building will create an area
of interest and activity along the street and the Gore Creek trail corridor.
Street Edge
Proposed expansions and cantilevers to the building will break up the mass of the existing
building and add variety, visual interest and greater articulation to the building. These
expansions along the street will maintain the vast majority of the mature trees that currently
surround the building. The proposed expansions will conform with the new offset requirements
recently adopted for the PA zone district (no less than 50% if the building offset at least 5 feet).
VI. CRITERIA AND FINDINGS FOR A CONDITIONAL USE PERMIT
Upon review of Chapter 16 of the Zoning Regulations, the Community Development Department
recommends approval of the request for a conditional use permit to allow for the operation of a
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fractional fee club within the Vail Athletic Club & Spa based upon the following factors:
A. Consideration of Factors:
Before acting on a conditional use permit application, the Planning and Environmental
Commission (PEC) shall consider the factors with respect to the proposed use:
1. Relationship and impact of the use on development objectives of the
Town.
In January of 1997, the Vail Town Council adopted Ordinance No. 22,
Series of 1996. In part, this ordinance amended the Public
Accommodation Zone District allowing fractional fee clubs as a conditional
use and set forth criteria for the Commission to consider when evaluating
such a request. Since that time the Austria Haus Club redevelopment
project has been completed and the Gore Creek Club has been approved
by the Town. The Austria Haus contains 28 fractional fee club units and
the Gore Creek Club has been approved to construct 66 units.
The applicant is requesting the issuance of a conditional use permit to
allow for the operation of a fractional fee club within the Vail Athletic Club
& Spa. The proposed club would be comprised of 7 two and three
bedroom club units. These units would range in size from 1,154 square to
1,873 square feet. The average club unit size is approximately 1,504
square feet in size. According to the applicant, the ownership of the club
units will meet the minimum requirements of fractional fee club units in
terms of intervals
Through the adoption of Ordinance No. 22, Series of 1996, the Town
further recognized the need for lodging alternatives for our guests and
visitors. In passing the ordinance the Town Council found that quality
fractional fee clubs are an appropriate means of increasing occupancy
rates, maintaining and enhancing short-term rental availability and
diversifying the resort lodging market product within the Town of Vail.
Equally as important, the Council believed that fractional fee clubs were
simply another of many forms of public accommodations. It has been a
long held belief that in order for the Town to remain competitive and on the
leading edge of resort development, that alternative lodging opportunities
must be created and creative financing vehicles for hotel redevelopment
must be implemented.
Staff believes that the conditional use permit for a fractional fee club within
the Vail Athletic Club & Spa will be beneficial to the Town and will have a
positive impact on the development objectives of the Community.
2. The effect of the use on light and air, distribution of population,
transportation facilities, utilities, schools, parks and recreation
facilities, and other public facilities needs.
Staff believes that this review criteria has been satisfied as previously
discussed in Section V of this memorandum.
3. Effect upon traffic with particular reference to congestion, automotive
and pedestrian safety and convenience, traffic flow and control,
access, maneuverability, and removal of snow from the street and
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parking areas.
Staff believes that this review criteria has been satisfied as previously
discussed in V of this memorandum.
4. Effect upon the character of the area in which the ,proposed use is to
be located, including the scale and bulk of the proposed use in
relation to surrounding uses.
Staff believes that this review criteria has been satisfied as previously
discussed in Section V of this memorandum.
5. Prior to the approval of a conditional use permit for a time-share
estate, fractional fee, fractional fee club, or time-share license
proposal, the following shall be considered:
a. If the proposal for a fractional fee club is a redevelopment of
an existing facility, the fractional fee club shall maintain an
equivalency of accommodation units as presently existing.
Equivalency shall, be maintained either by an equal number of
units or by square footage. If the proposal is a new
development, it shall provide at least as much accommodation
unit GRFA as fractional fee club unit GRFA.
The Vail Athletic Club & Spa proposal is a redevelopment of an existing
hotel. The proposed hotel shall be required to maintain an equivalency of
the presently existing number of accommodation units. The applicant is
proposing to meet the equivalency requirement by replacing a greater of
accommodation units. According to information on file in the Community
Development Department 20 accommodation units exist today. The
applicant is proposing to replace and/or remodel the existing units with 30
new hotel rooms totaling approximately 12,851 square feet.
b. Lock-off units and lock-off unit square footage shall not be
included in the calculation when determining the equivalency
of existing accommodation units or equivalency of existing
square footage.
No lock-off units are proposed.
C. The ability of the proposed project to create and maintain a
high level of occupancy.
The fractional fee club component of the Vail Athletic Club & Spa proposal
is intended to provide additional hotel and "hotel-type" accommodation
units in the Town of Vail. The applicant is proposing to incorporate 7
member-owned club units (fractional fee club units), with 30 new
accommodation (hotel) rooms. Although not in the present design, staff
believes that lock-off units provide an additional community benefit of
added "pillows". If a fractional fee club unit owner purchases an interest
in a multiple bedroom unit, and does not desire to utilize all the bedrooms,
they can then have the opportunity of returning the unused bedrooms
(lock-offs) to a rental program.
14
Staff feels that by providing lock-off units, and managing the availability of
the lock-off units in a rental program when not in use, a fractional fee club
project can significantly increase the availability of accommodation units in
the Town of Vail. Staff would recommend that the applicant provide "lock-
off" opportunities into the design of the fractional fee club units.
Through our research on the fractional fee issue back in 1996, staff then
identified some potential positive impacts of fractional fee units in the
Town of Vail:
A) Activity during the "shoulder seasons" tends to increase due to an
increase in year-round occupancy;
B) The attraction of revenue-generating tourists;
C) The efficient utilization of resources. This is the "warm beds" concept;
D) More pride of ownership and community buy-in with fractional fee club
units than with accommodation units;
E) Increased levels of occupancy; and
F) Increased resort exposure due to the extensive number of interval
owners.
Staff believes these potential positive impacts are still true today.
d. Employee housing may be required as part of any new or redevelopment
fractional fee club project requesting density over that allowed by
zoning. The number of employee housing units will be consistent with
employee impacts that are expected as a result of the project.
The staff included the fractional fee club units into the calculation of the
employee generation resulting from the proposed major exterior alteration
and conditional use permit requests. Based strictly on the number of club
units, the development will generate a need for 7 "new" employees. When'
the multiplier of 0.30 is factored in, 2.1 of the "new" employees which the
developer must provide deed-restricted housing for, are generated by the
fractional fee club.
e. The applicant shall submit to the Town a list of all owners of
existing units within the project or building; in written
statements from 100% of the owners of existing units
indicating their approval, without condition, of the proposed
fractional fee club. No written approval shall be valid if it is
signed by the owner more than 60 days prior to the date of
filing the application for a conditional use.
The applicant, Ron Bryne, d.b.a. VML, L.L.C., and represented by Tom
Braun, has written legal authority to act on the behalf of the owners of the
property. No other written approval is required.
15
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MEMORANDUM
TO: Planning and Environmental Commission
FROM: Community Development Department
DATE: March 13, 2000
SUBJECT: A request for a conditional use permit, to allow for the conversion of
existing hotel rooms into employee housing units, located at 2211 N.
Frontage Rd. (West Vail Lodge)/Tract C, Vail das Schone #1; Lots 1, 2
and 3, Vail das Schone #3.
Applicant: Reaut Corporation
Planner Brent Wilson
1. BACKGROUND AND DESCRIPTION OF THE REQUEST
March 13th Update-- On February 28tH, the PEC conceptually reviewed the applicant's
proposal and requested the following items:
¦ A pedestrian access and circulation clan - the applicant has submitted a plan
indicating locations of ingress and egress throughout the building exterior and
access to adjacent properties.
¦ A landscar)e plan - per the PEC's request, the applicant has submitted a plan that
demonstrates the placement of additional landscaping along property boundaries
and within the parking areas.
¦ Examples of other mixed use r)roiects - the applicant will be providing a report to the
PEC on March 131H. Staff believes the Town has acknowledged the compatibility of
EHU's with other uses for years. For example, the Lionshead Redevelopment
Master Plan provides specific incentives for the addition of EHU's to existing
commercial and residential projects. Successful examples of this type of project in
Vail include the Vail das Schone building, Vail Commons and the Austria Haus.
Additionally, the applicable Commercial Core III zoning idenitfies EHU's as a
compatible use with other commercial uses, subject to the issuance of a conditional
use permit.
¦ Sample condominium declarations/documents - the applicant's attorney is drafting
these items and they will be-presented to the PEC on March 13rn
The applicant is requesting final review of this request at today's meeting.
Proiect Historv
The West Vail Lodge property, constructed in 1979 under Eagle County jurisdiction,
includes 83 accommodation units (hotel rooms), 19 dwelling units and significant
commercial floor area. In the 1980's, the Town of Vail annexed the property and applied
Commercial Core III zoning. This zoning designation does not allow dwelling units or
1
accommodation units as a use and the property has been rendered non-conforming ever
since its annexation into the town.
In 1991, the Vail Town Council approved a special development district (SDD) at the site
to allow for the addition of a new three-story building containing 37 Type II I employee
housing units. This project was never constructed and the approved SDD became null
and void in 1994.
The applicant's request involves the conversion of the existing 83 hotel rooms into 41
one-bedroom Type III employee housing units (including an on-site manager's unit).
Additionally, the owner proposes to add additional commercial square footage at the
lowest level and provide life-safety improvements to the existing 19 free-market
condominiums at the upper levels. Existing meeting room space would be converted
into 16 covered parking spaces in conjunction with this application. The employee
housing units would range in size from 550-772 square feet with full kitchen and
bathroom facilities. In addition to the walk-in closets provided in each unit, the applicant
proposes 1,720 square feet of common tenant storage space. On-site amenities
proposed include an exercise/sauna facility, ski lockers, a laundry facility and a pool
area.
The PEC is being asked to review the conditional use permit request to allow for the
creation of the employee housing units. The other aspects of this proposal (commercial
expansion and upgrading of dwelling units) are either permitted by right under applicable
zoning or are "grandfathered."
II. REVIEWING BOARD ROLES - CONDITIONAL USE PERMIT
Order of Review. Generally, applications will be reviewed first by the PEC for
acceptability of use and then by the DRB for compliance of proposed buildings and site
planning.
Plannina and Environmental Commission:
Action: The PEC is responsible for final approval/denial of CUP.
The PEC is responsible for evaluating a proposal for:
1. Relationship and impact of the use on development objectives of the Town.
2. Effect of the use on light and air, distribution of population, transportation
facilities, utilities, schools, parks and recreation facilities, and other public
facilities and public facilities needs.
3. Effect upon traffic, with particular reference to congestion, automotive and
pedestrian safety and convenience, traffic flow and control, access,
maneuverability, and removal of snow from the streets and parking areas.
4. Effect upon the character of the area in which the proposed use is to be located,
including the scale and bulk of the proposed use in relation to surrounding uses.
5. Such other factors and criteria as the Commission deems applicable to the
proposed, use.
2
6. The environmental impact report concerning the proposed use, if an
environmental impact report is required by Chapter 12 of this Title.
Conformance with development standards of zone district
- Lot area
- Setbacks
- Building Height
- Density
- GRFA
- Site coverage
- Landscape area
- Parking and loading ,
- Mitigation of development impacts
Desiqn Review Board:
Action: The DRB has NO review authority on a CUP, but must review any
accompanying DRB application.
The DRB is responsible for evaluating the DRB proposal for:
- Architectural compatibility with other structures, the land and surroundings
- Fitting buildings into landscape.
- Configuration of building and grading of a site which respects the topography
- Removal/Preservation of trees and native vegetation
- Adequate provision for snow storage on-site
- Acceptability of building materials and colors
- Acceptability of roof elements, eaves, overhangs, and other building forms
- Provision of landscape and drainage
- Provision of fencing, walls, and accessory structures
- Circulation and access to a site including parking, and site distances
- Location and design of satellite dishes
- Provision of outdoor lighting
- The design of parks
Staff:
The staff is responsible for ensuring that all submittal requirements are provided and
plans conform to the technical requirements of the Zoning Regulations. The staff also
advises the applicant as to compliance with the design guidelines.
Staff provides a staff memo containing background on the property and provides a staff
evaluation of the project with respect to the required criteria and findings, and a
3
recommendation on approval, approval with conditions, or denial. Staff also facilitates
the review process.
Town Council:
Actions of DRB or PEC maybe appealed to the Town Council or by the Town Council.
Town Council evaluates whether or not the PEC or DRB erred with approvals or denials
and can uphold, uphold with modifications, or overturn the board's decision.
Ill. STAFF RECOMMENDATION
The Community Development Department recommends approval of the applicant's
request for a conditional use permit to allow for the conversion of existing hotel rooms
into employee housing units, based on the following findings:
1. That the proposed location of the use is in accordance with the purposes of the
conditional use permit section of the zoning code and the purposes of the district
in which the site is located.
2. That the proposed location of the use and the conditions under which it would be
operated or maintained would not be detrimental to the public health, safety, or
welfare or materially injurious to properties or improvements in the vicinity.
3. That the proposed use would comply with each of the applicable provisions of the
conditional use permit section of the zoning code.
If the Planning and Environmental Commission chooses to approve this request, staff
recommends the following conditions be placed on the approval:
1. The approval will not be valid unless the Vail Town Council approves the pending proposal
to amend Section 13-7 ("Condominiums and Condominium Conversions") of the Town of
Vail Code. This amendment is necessary to allow for the conversion of accommodation
units to condominiumized employee housing units. The applicant shall demonstrate
compliance with all provisions of the Town of Vail Subdivision Regulations.
2. All employee housing units created with this proposal will be deed-restricted in accordance
with the provisions of Section 12-13, Town of Vail Code ("Employee Housing"), prior to the
issuance of a building permit for any improvements on the property.
3. The applicant shall provide the Town of Vail a pedestrian easement for the existing sidewalk
located at the south end of the subject property along North Frontage Road.
4. The applicant shall complete and improve the existing unfinished retaining wall at the north
end of the subject property. This improvement is subject to approval by the Town's Design
Review Board.
5. In accordance with the anticipated impacts generated by the provision of employee housing
units upon the Town's transit system, the applicant shall provide a pedestrian stair
connection between the berm at the north end of the parking lot and the existing Town of
Vail bus stop along Chamonix Lane. This improvement will be contained entirely on both
the subject property and the Town of Vail right-of-way. This improvement is subject to
approval by the Town's Design Review Board.
4
6. Landscaping along the parking area and lot perimeter will be provided in accordance with
the provisions of Section 12-11, Town of Vail Code ("Design Review"). Compliance with
these provisions will be determined by the Town's Design Review Board.
7. The applicant will obtain an encroachment agreement for the placement of any parking
facilities within platted easements. Additionally, the proposed parking plan shall comply with
the town's development standards and will be approved by staff during the design review
.process.
8. The applicant shall complete additional exterior improvements (if applicable) to be
determined by the Town's Design Review Board.
IV. ZONING ANALYSIS
Under the applicable Commercial Core III (CC3) zoning, the following non-conformities
currently exist:
¦ Use (residential dwelling units)
• Use (accommodation units)
¦ Density (units/acre)
¦ Landscaping
¦ Parking located within required setbacks
Since the property was developed under Eagle County jurisdiction, the
existing building has been granted a legal non-conforming ("grandfathered")
status. Type III employee housing units are a conditional use in the
Commercial Core III zone district.
Lot Area: 3.949 acres or 172,018 sq. ft.
Buildable Lot Area: 3.890 acres or 169,448 sq. ft.
Densitv:
Allowed (CC3): 92 EHU's = 46 equivalent d.u.'s
Existing: 19 d.u.'s and 83 a.u.'s = 60.5 equivalent d.u.'s
Proposed: 19 d.u.'s and 41 EHU's = 39.5 equivalent d.u.'s
GRFA:
Allowed (CC3): 50,834 sq. ft.
Existing: 43,532 sq. ft.
Proposed: no change"
Commercial Floor Area:
Allowed (CC3): No limit
Existing: 17,252 sq. ft.
Proposed: 20,826 sq. ft.
Setbacks:
Required (CC3): - 20' on all sides
Existing: 20' on all sides
Proposed: no change
TOW*YAIO
5
Site Coverage:
Allowed (CC3): 40% or 68,807 sq. ft.
Existing: 20.1 % or 34,576 sq. ft.
Proposed: no change
Parking:
Required (CC3): 181 spaces
Existing: 191 spaces
Proposed: 207 spaces
Landscaping:
Required (CC3): 25% (min.) of site area or 48,395 sq. ft.
Proposed: 29% of site area or 49,987 sq. ft.
GRFA associated with Type III EHU's is excluded
Interior landscape requirement for parking lot is not met.
V. REQUIRED CRITERIA AND FINDINGS - CONDITIONAL USE PERMIT
A. CONSIDERATION OF FACTORS:
1. Relationship and impact of the use on the development obiectives of the Town.
The Vail Land Use Plan identifies the subject property as part of the "Community
Commercial" zone. This land use designation is intended to "meet consumer demands
from community residents." The key goals outlined for commercial uses in this zone are
as follows:
1) Commercial strip development should be avoided.
2) Commercial growth should be concentrated primarily in existing commercial
areas to accommodate both local and visitor needs.
3) New hotels should continue to be located primarily in the Village and Lionshead
areas.
Staff believes this proposal would impact the following goals and policies identified in the
Vail Land Use Plan:
1.1 Vail should continue to grow in a controlled environment, maintaining a balance
between residential, commercial and recreational uses to serve both the visitor
and the permanent resident.
1.12 Vail should accommodate most of the additional growth in existing developed
areas (infill areas).
Staff Response
Staff believes the proposed amendment would help facilitate the location of employee
housing units within the Town of Vail (a high Council priority) at an existing infill location.
Staff believes affordable employee housing is essential for the provision of services that
both residents and visitors expect. Staff also believes the benefits of employee housing
may outweigh the need for accommodation units at this location.
3.1 The hotel bed base should be preserved and used more efficiently.
6
3.2 The Village and Lionshead areas are the best location for hotels to serve the
future needs of the destination skiers.
3.3 Hotels are important to the continued success of the Town of Vail, therefore
conversion to condominiums should be discouraged. .
3.4 Commercial growth should be concentrated in existing commercial areas to
accommodate both local and visitor needs.
Staff Response
Although the Land Use Plan identifies lodging unit preservation as a high priority, it also
identifies appropriate locations for accommodation units (the Village and Lionshead).
Staff believes these policies should be used to identify whether a proposed conversion is
consistent with master planning objectives. Although the conversion of any
accommodation unit within Vail's core areas should be highly discouraged, staff believes
the subject property may be an appropriate location for employee housing.
5.1 Additional residential growth should continue to occur primarily in existing, platted
areas and as appropriate in new areas where high hazards do not exist.
5.3 Affordable employee housing should be made available through private efforts,
assisted by limited incentives, provided by the Town of Vail with appropriate
restrictions.
5.4 Residential growth should keep pace with market place demands for a full range
of housing types.
5.5 The existing employee housing base should be preserved and upgraded.
Additional employee housing needs should be accommodated at varied sites
throughout the community.
Staff Response
Staff believes this proposal furthers the above-listed goals by providing additional
opportunities for locals/employee housing within the town limits at an existing infill
location.
6.1 Services should keep pace with increased growth.
Staff Response
Staff believes the provision of employee housing is vital if Vail is to provide services
consistent with the demand created by residents and visitors.
2. The effect of the use on light and air. distribution of population. transportation facilities.
utilities. schools. parks and recreation facilities. and other public facilities needs.
The subject property is located in a developed Infill" area with access to all of the
above-listed facilities and services. Staff believes the reduction in units with this
proposal will have a positive impact on these facilities while in the increase in
commercial floor area (17%) will have a limited incremental impact on the above-listed
facilities.
7
3. Effect upon traffic with Darticular reference to congestion, automotive and pedestrian
safetv and convenience. traffic flow and control, access. maneuverability, and removal of
snow from the street and Darkina areas.
Traffic Flow - "Attachment 1" references ITE's (Institute of Transportation Engineers)
projected traffic impacts for the existing and proposed uses at the site. According to ITE
calculations, we should anticipate a 10% decrease in traffic generation based on
proposed uses. This is due largely to the decrease (over 50%) in the number of
employee housing units proposed compared to existing accommodation units.
Additionally, staff anticipates a higher usage of town transit (West Vail Red and Green
routes) by potential local employees. Staff believes this proposal would have a positive
impact on traffic flow in the area.
-Parking - Based on the proposed land uses, the Town of Vail Code requires'184
parking spaces. The applicant is proposing 207 spaces on site. Snow storage
requirements will be addressed as part of the design review process.
4. Effect upon the character of the area in which the proposed use is to be located,
including the scale and bulk of the Drooosed use in relation to surrounding uses.
The applicant is not proposing any changes to the bulk, mass or location of the existing
building.
B. FINDINGS
The Planning and Environmental Commission shall make the following findings before
grantina a conditional use Dermit:
1. That the proposed location of the use is in accordance with the purposes
of the conditional use permit section of the zoning code and the purposes
of the district in which the site is located.
2. That the proposed location of the use and the conditions under which it
would be operated or maintained would not be detrimental to the public
health, safety, or welfare or materially injurious to properties or
.improvements in the vicinity.
3. That the proposed use would comply with each of the applicable
provisions of the conditional use permit section of the zoning code.
8
ATTACHMENT 1 - TRIP GENERATION
Table 1 - Trips Generated Under Existing West Vail Lodge Conditions
CODE DESCRIPTION TRIPS/DAY IND. VARIABLE FACTOR TRIPS
GENERATED
230 Residential Condominium 5.857 DWELLING UNITS/WEEKDAY 19 111.263
310 Hotel 7.487 ROOMS/SATURDAY 83 621.421
810 Retail - General Merchandise 48.04 1000' GFA 13.66 656.2264
832 High-Turnover (Sit-Down) Restaurant 200.895 1000' GFA 3.592 721.61484
TOTAL 2110.54524
Table 2 - Trips Generated Under Proposed West Vail Lodge Conditions
CODE DESCRIPTIC)N TRIPS/DAY IND. VARIABLE FACTOR TRIPS
GENERATED
230 Residential Condominium 5.857 DWELLING UNITS/WEEKDAY 60 351.42
310 Hotel 7.487 ROOMS/SATURDAY 0 0
810 Retail - General Merchandise 48.04 1000' GFA 17.238 828.11352
832 High-Turnover (Sit-Down) Restaurant 200.895 1000' GFA 3.588 720.81126
TOTAL 1900.34478
Source: Trip Generation Manual, Fourth Edition, Institute of Transportation Engineers
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West Vail Lodge
2211 N. Frontage Road
Lot 1 (Tract K) Vail das Schone #3
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January 31, 2000 F R I TZ L E N
Russell Forest, Dominic Mauriello, Nina Tim P I E R C E
Department of Community Development S M I T H
Town of Vail
75 S. Frontage Road
Vail Colorado
Dear Planners,
A R C H I T E C T S
Following is a summary of PEC Application for the West Vail Lodge Redevelopment.
Current and Proposed Uses
The West Vail Lodge is located at the intersection of the I-70 West Vail exit and the North
Frontage Road. The site currently has 19 dwelling Units and 97 accommodation units that are
rented as hotel rooms to area visitors. The 19 units were platted as separate condominiums prior
to purchase by the current owner. There are also meeting rooms and other commercial uses
within the existing building. The underlying zoning is Commercial Core III.
The hotel operation has continued to decline, losing revenues in the last two years. There are a
number of reasons believed to be the cause.
- The property has been difficult to market to prospective guests as an independent operator due
to the increasing competition from central reservations systems.
- The physical building configuration for hotel use has become obsolescent. The room size,
function and context no longer meet market demands. Guest expectations have changed as new
development adjacent Vail has molded the hotel market. The West Vail Lodge was originally
built to attract short term visitors familiar with a motel experience. Over the past two decades
both Vail's visitors and landscape have changed considerably. It is unlikely that the West Vail
Lodge could be successfully renovated as a hotel given the existing constraints and be
economically viable.
On the other hand the retail operations have continued to be economically viable, probably due to
the continued expansion of commercial properties in the West Vail area.
Given those parameters the owner, Reaut corporation is proposing an adaptive re-use that would
match the current building configuration and meet market demand. Reaut is proposing to
convert the 97 existing hotel rooms into 49 one bedroom EHUs as defined by the Town of Vail
zoning code. They are proposing to sell the existing 19 condominium units with no deed
restrictions and leave the existing retail in its current configuration.
Zoning Status
KA0002 - West Vail Lodge Redevelopment\Project Correspondence\Town of Vail\PEC0127.wpd
Planning • Architecture • Interiors
1650 East Vail Valley Drive Fallridge C-1 9 Vail, CO 81657 • fps@colorado.net • fax (970) 476-4901 • (970) 476-6342
In 1990 The West Vail Lodge had a 37 unit employee housing proposal approved through a
Special Development District (SDD) rezoning. The project was never initiated. The proposed 37
units exceeded the underlying allowed density and square footage for the CCIII zone district and
therefore a zone change was required to add the housing. The Town of Vail found it desirable to
approve the additional density because additional employee housing is a stated political goal of
the town as well as the county.
In 1992 Reaut Corporation became involved in the property and took full ownership in 1994
after the previous owner defaulted on financial obligations. In 1994, the Reaut Corporation again
applied for the employee housing addition that had been approved through the 1990 SDD. As
Paul remembers it, the SDD approvals lapsed and the SDD application had to be reinitiated.
The planner assigned to the project was Jim Curnutte. The SDD was initiated but not completed.
It is our understanding the property at this time does not have an approved SDD and that the
CCIII is the applicable zoning.
Zoning Application Conditional Use
As I understand it Employee Housing is a conditional use allowed in CC3. It is my
understanding that the this would require a separate application and two hearings in front of the
planning commission for approval. The existing retail is clearly defined as an allowed use but I
am unclear on the residential and hotel. Section 12-713-7 adopted by ordinance in 1981 addresses
allowed residential density in CC3 but there is no direct reference to it as an allowed use.
Zoning Application SDD
It appears that there may not be an applicable SDD for this project. If that is so, then there is no
need to make an SDD related application since the proposed change in use is allowed by the
underlay zone district. If there is an existing SDD it may no longer be relevant and more
expedient to rely on the standards defined by the underlay zone district.
Condominium Conversion
In conclusion it is the goal of the Reaut Corporation to revitalize the property with a use that has
been identified by the community as a priority and also has strong market demand. I am
including a site plan and elevation photo for additional clarification We look forward to your
feedback.
Sincerely,
7 YF} itzlen AIA
KA0002 - West Vail Lodge Redevelopment\Project Correspondence\Town of Vail\PEC0127.wpd
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` Mar-08-00 10:01 am From-TOWN OF VAIL PUBLIC WORKS 9704792166 T-834 P 02/02 F-433
TOWN COUNCIL AGENDA REQUEST
(Request form must be given to the Secretary to the Town Manager by 4:00 D.M. Wednesdavs.)
MEETING DATE: 3114/00
(Prepare a separate Agenda Request for each agenda item. If the agenda
item will be discussed at both a Work Session and an Evening Meeting, be
certain to check both boxes in this section and indicate time needed during
each meeting.)
Work Session TIME NEEDED :
Evening Meeting TIME NEEDED :
Site visit TIME NEEDED :
WILL THERE BE A PRESENTATION ON THIS AGENDA ITEM BY NOWTOV STAFF?
_ NO.
_X_ YES. Specifics: Rv Souther and Nicola RiDlev of the Alpine Garden Foundation
WILL THE PRESENTATION OF THIS AGENDA ITEM REQUIRE ANY SPECIAL EQUIPMENT, i.e.
overhead projector, etc.?
X NO.
YES. Specifics:
WILL THERE BE MATERIAL TO BE INCLUDED IN COUNCIL PACKET FOR THIS ITEM?
_ NO.
_X_ YES. If yes, is the material also for public distribution?
X Yes.
No.
ITEM/TOPIC: The Alpine Garden Foundation, represented by Ry Souther and Nichola Ripley, is
requesting approval from the Council to begin the process for expanding the current lease area of
the Garden. The request includes the area south of the main access road from the Nature Center
Bridge up to and include the existing picnic area located along Gore Creek. A letter detailing the
request is attached.
ACTION REQUESTED OF COUNCIL: Discussion of the request with Alpine Garden
Representatives, and Town Staff. Approval or Denial of the request. If the request is approved the
Alpine Garden will begin the process of procuring a designer, initiating the Town's development
approval process, and creating the necessary legal documents for the lease expansion.
BACKGROUND RATIONALE: Please refer to the attached letter from the Alpine Garden
Foundation.
STAFF RECOMMENDATION: Staff recommends approval of the Alpine Garden Foundation's
request to expand the lease area of the garden for the following reasons.
The Vail Alpine Garden is a renown amenity to the Town and is rapidly increasing its stature as a
world class botanical garden. The expansion are will allow the garden to expand its horticultural
collection into plant communities it currently does not have space to represent, including species
rare and endangered in Colorado.
The area of Ford Park being requested for expansion is an underutilized portion of the park. Having
the Garden assume responsibility for the area will improve the overall character of the park and take
nothing away in the process.
The expansion process will include completion of some house keeping items regarding use of the
Schoolhouse and completion of the Alpine Rock Garden scheduled for completion this summer.
Todd Oppenheimer. I,pndscaoe Architect
Employee Signature/Department
C:wGLNDwnEO
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VAIL ALPINE GARDEN FOUNDATION
PROPOSAL TO THE TOWN OF VAIL FOR GARDENS AT THE SCHOOLHOUSE,
FORD PARK
Vail Alpine Garden Foundation has received an $80,000 challenge grant from the Gates
Foundation for development of a new garden and for interpretation throughout the
existing gardens. We intend to raise an additional $150,000, a portion of which would
be used to purchase labels for all plants in the collection. With the balance of the funds
the Foundation. would like to provide additional interpretation and to develop a
woodland garden, riparian garden and a tundra garden (see map). We are asking for
your approval to expand. our existing lease so we can proceed with planning for these
gardens. At the same time we propose to finalize the lease document for the Alpine
Rock garden and the schoolhouse building.
In the coming century, botanic gardens will play an increasingly critical role in
preserving the world's flora. In Vail we have an exceptional opportunity to contribute
towards preservation of the world's mountain flora. Through active plant collection
development, within 3 years we will have the most extensive national collection of high
altitude Rocky Mountain Natives and one of the world's best collections of international
alpine plants.
By botanic gardens standards, the existing gardens are very small. If we are to achieve
our goals of educating and interpreting the high altitude environment and becoming a
premier international botanic facility, we will require additional area, more specifically,
area for additional habitat interpretation. This new area around the schoolhouse,
provides us the opportunity to interpret three new environments, not currently
demonstrated in the gardens, more area for additional plant material, and an
opportunity to implement our goals of preserving Colorado's endangered flora in a
natural setting.
Town of Vail 3114100
Currently the 0.3-acre site between the schoolhouse and the Nature Center Bridge is
disturbed, unattractive and under-used. The 0.2-acre picnic area along Gore Creek west
of the schoolhouse, is unknown to most visitors, has steep, unsafe access and is rarely
used.
The garden would be developed with the following goals in mind:
• Design a tundra garden on the level area adjacent to the main pathway and existing
alpine display garden, with habitats such as limestone rock outcrops and screes, to
expand our alpine plant collection to an international standing.
• Design a high altitude forest garden to transition into the riparian zone and.
demonstrate shade plants of the spruce-fir and lodgepole forests.
• Enhance the existing natural habitat on the slopes above Gore Creek, with
interpretation about woodland and riparian plants and their importance in the
ecosystem. Incorporate an interpretative streamwalk, with overlook points
connecting to the picnic area. (All living and fallen trees will remain and non-native
shrubs and vegetation including noxious weeds will be removed).
• Develop an ex-situ classroom for the study and preservation of Colorado's rare
orchids and other endangered species (See attached photographs). Growing
Colorado's rare plants in a garden setting, not only enables us to study their
individual needs but allows for re-introductions to the wild and the establishment of
seed banks to ensure that they are not lost forever.
• Give visitors an opportunity to view Colorado wildflowers, both rare and common
in an easily accessible natural setting.
• Develop educational opportunities in the schoolhouse gift shop, with books on
Colorado wildflowers, Rocky Mountain ecology and specialized botanical
information.
• By extending the natural habitat garden through the picnic area we will provide a
needed park improvement via an attractive, secluded area for picnicking that will be
ADA accessible from the main Ford Park pathway. By strategic placement of
benches we will provide areas for quiet reflection away from the busy park.
Town of Vail 3114100
Suggested Timeline
March 14 2000 Requested approval from Town Council to proceed with changes
to lease and design/planning for new garden.
March 15 2000 Begin the search for qualified garden designers
Begin raising money for challenge grant (must be raised by
November 2000)
April 2000 Lease finalized
May 2000 Designers shortlisted for design competition
August 2000 Final designer selected
September 2000 Design put forward for Town of Vail approval process
January 2001 Select contractor for installation
May 2001 Begin installation
October 2001 End of installation
May 2002 Plant Garden
Town of Vail 3114100
oq_ o v
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fl\ 'i5- ~9 ALPINE ROCK GARDEN
\ O ? t- Dm-arm.= cliff and water garden, with y
e,: a casesdtng moumian stream, featuring
\ Rocky Mountain natives in d gland, subalpme
-~t \ y`•; ~,d~G aspen woodland, and high fen Imb4ata
V
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MOUNTAIN MEDITATION GARDEN
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lr~ Rocky Mountainplantpaicut,basedun
Asian traditiioon
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MOUNTAIN PERENNIAL GARDEN t~
'Spectacular display of meunwin perennials l~,v f O j
• . illustrating plants from mountain r ~
• • • regions rouad the world. s*'
• f ` `•X ALPINE DISPLAY GARDEN
Entrance garden featuring alpine and
rock garden plants in : J
, t$- ? pt<, different microclimaks
PICNIC AREA - -
TUNDRA GARDEN
Alpine ptants of the high tundra.
QJTERPRETATIVETRAIL
Emphasizing the botany of the Riparian WOODLAND GARDEN O
Ecosystem. Nativeplantsofthe higA [meals, V Q
the spruce-fir xosyskm.
RIPARIAN GARDEN
Native plants of the river corridor, research 99
classroom for preservation of threatened i~
Colorado orchids.
2l291W
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Two Eagle County rare plants, that may be under threat of extinction. Both of these plants
are currently being monitored in our Adopt A Rare Plant Program. With further study of
these plants in the garden setting, we can learn how to propagate them for re-introduction
into the wild, and learn about their ecological requirements.
k..
Cypripe~ium Pubescens
Yellow Lady's Slipper Orchid
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Pensternon liarringtonii
Harrington's Penstemon
i
MEMORANDUM
To: Vail Town Council
From: Donovan Park Team
Date: March 14, 2000
Subject: Community Facility Update -Donovan Park
Attached is a memo to the Planning and Environmental Commission and the Design
Review Board for review of the Donovan Park plan. The consultant has been working to
further refine alternative "C." The consultant will address the issues raised by the Town
Council, the PEC, the DRB, and the public over the past few weeks at the meeting.
The intent of this meeting is to give the Town Council more complete information about
how uses fit on the site and to verify that the design team should move ahead with the
current program on the site. The three major questions that need to be resolved are:
whether to maintain a space for the ABC/Learning tree, a multi-purpose gymnastics
facility, and an adult sized soccer field versus a youth sized field.
Based on input from the public on the Hub Site and our consultants analysis on the Old
Town Shops, Donovan Park appears to be the preferred location for the gymnastics
facility. The VRD Board has recommended that the soccer field be a full-sized adult
field. However, after detailed examination it does not appear that the full-size field fits
well on the site without significant grading.
F:\EVERYONE\COUNCIL\MEMOS\00\DONOVAN2.doc
MEMORANDUM
TO: Planning and Environmental Commission and Design Review Board
FROM: Community Development Department
DATE: March 13, 200.0
SUBJECT: A joint worksession with the Design Review Board to discuss the
proposed development plan/master plan and a conditional use permit for
a park and recreation facility for an approximately 12 acre unplatted
parcel of land zoned General Use and Residential Cluster, commonly
referred to as the lower bench of Donovan Park, located south of the
South Frontage Road and east and north of Matterhorn Circle.
Applicant: Town of Vail/Vail Recreation District
Planner: Dominic Mauriello
1. DESCRIPTION OF THE REQUEST
The Town of Vail is requesting a Conditional Use Permit to construct a park and
recreational facilities as well as pre-school facilities on the approximately 12.3 acre site
known as the lower bench of the John F. Donovan Park. The plan includes:
• a soccer field
• recreation areas, playground equipment, and park shelters
• restroom facilities
• a park pavilion
• a multipurpose recreational facility housing gymnastic, yoga, dance and
other functions
• basketball/ice rink
• children's center housing Camp Vail and other multipurpose activities
• Learning Tree/ABC School
The improvements also include parking; drop-off and loading zones; loading and
delivery; bus stop facilities; improvements to the S. Frontage Road; and a pedestrian
bridge over the creek. A general site plan has been attached. However, the consultant
team will present more detailed plans and overlays at the meeting.
The PEC and the DRB last reviewed this proposal at a joint worksession on February
14, 2000. The Town Council reviewed the proposal on February 15, 2000. Below is a
summary of comments made:
? The PEC and DRB suggested that the design team consider accessing
the site from Matterhorn Circle. The Town Council in consideration of the
comments from the PEC and DRB, decided that accessing the site from
Matterhorn Circle presented problems with respect to neighborhood traffic
congestion and major environmental impacts to Gore Creek and directed
to consultant team to continue with access from the South Frontage
Road.
1 *VAIL~
TOWN0
? Incorporate playgrounds, picnic areas, a basketball court, trail
connections, and other outdoor spaces graphically on the plan. These
have been included in the plan.
? Maintain the trail/riparian areas and the area in the South East corner of
the site referred to as the "preserve."
? Relocate some of the parking to the east end of the site to provide
adequate parking for field uses and playground activities. The parking
layout has been modified to reflect this improvement.
? Improve the soccer field and surrounding areas to improve spectator
needs. This has been modified on the plan. The original plan
contemplated a larger NCAA soccer field. However, the design team.
reduced the field to a size for youth programs (age 16 and under) due to
site constraints. The VRD has expressed a continued desire for the
larger size field. The consultant team will present some alternatives with
respect to field size and related impacts to the site.
? Investigate reducing the size allocated to the community pavilion.
? Continue to investigate other sites in Town for the location of a
gymnastics facility. The consultant team is investigating other locations,
however, a facility remains programmed on this site for planning
purposes.
? Consider the needs for bus circulation on the site. The revised plan
includes access for buses with a dedicated egress on the west end of the
site.
II. STAFF RECOMMENDATION
As this is a worksession to discuss the proposed improvements, no staff
recommendation has been provided. The staff is looking for direction and comments
from the.PEC and DRB in preparation for a final review of the plan.
III. ROLES OF REVIEWING BOARDS
« Conditional Use Permit (CUP)
Order of Review: Generally, applications will be reviewed first by the PEC for
acceptability of use and then by the DRB for compliance of proposed buildings and site
planning.
Planning and Environmental Commission,:
Action: The PEC is responsible for final approval/denial of CUP.
The PEC is responsible for evaluating a proposal for:
1. Relationship and impact of the use on development objectives of the Town.
2
2. Effect of -the use on light and air, distribution of population, transportation facilities,
utilities, schools, parks and recreation facilities, and other public facilities and public
facilities needs.
3. Effect upon traffic, with particular reference to congestion, automotive and pedestrian
safety and convenience, traffic flow and control, access, maneuverability, and removal of
snow from the streets and parking areas.
4. Effect upon the character of the area in which the proposed use is to be located,
including the scale and bulk of the proposed use in relation to surrounding uses.
5. Such other factors and criteria as the Commission deems applicable to the proposed
use.
6. The environmental impact report concerning the proposed use, if an environmental
impact report is required by Chapter 12 of this Title.
Conformance with development standards of zone district or establish standards in the
case of GU zone district
- Lot area
- Setbacks
- Building Height
- Density
- GRFA
- Site coverage
- Landscape area
- Parking and loading
Design Review Board:
Action: The DRB has NO review authority on a CUP, but must review any
accompanying DRB application.
The DRB is responsible for evaluating the DRB proposal for:
- Architectural compatibility with other structures, the land and surroundings
- Fitting buildings into landscape
- Configuration of building and grading of a site which respects the topography
- Removal/Preservation of trees and native vegetation
- Adequate provision for snow storage on-site
- Acceptability of building materials and colors
- Acceptability of roof elements, eaves, overhangs, and other building forms
- Provision of landscape and drainage
- Provision of fencing, walls, and accessory structures
- Circulation and access to a site including parking, and site distances
- Location and design of satellite dishes
- Provision of outdoor lighting
The design of parks
Staff:
The staff is responsible for ensuring that all submittal requirements are provided and
plans conform to the technical requirements of the Zoning Regulations. The staff also
advises the applicant as to compliance with the design guidelines.
Staff provides a staff memo containing background on the property and provides a staff
evaluation of the project with respect to the required criteria and findings, and a
3
io
recommendation on approval, approval with conditions, or denial. Staff also facilitates
the review process.
IV. BACKGROUND
The entire 51 acre parcel known as the John F. Donovan Park was acquired in 1980. A
master plan for development of the site was adopted in 1985 which recommended a
ballfield, play areas, picnic shelters, a basketball court, a skating pond, volleyball courts,
and parking on the lower bench and a cemetery, open space and hiking trails on the
middle and upper benches. That master plan, now 15 years old, was never
implemented.
Community facilities and park development were determined to be two of the top issues
resulting from the Vail Tomorrow and Common Ground processes which have occurred
over the past 3 years. On September 21, 1999, the Town Council decided to move
forward with a process to determine which uses are appropriate and compatible with the
Donovan Park site. The Town Council and the Vail Recreation District Board have
directed staff to move forward with the following uses to be included in the master plan
(generally in order of priority:
Park use and soccer field
« Pavilion
Multi-recreational space (gymnastics, yoga, martial arts, etc.) (may
be considered on other- sites)
Children's Center (day camp, year-round youth enrichment
programs and multi-purpose/generational activity rooms)
Gymnasium
Indoor pool (25 meter by 25 yard)
ABC/Learning Tree Pre-schools
Public Input
On January 5`h and 6`h of this year, public open houses were held at the Red Sandstone
Elementary School. The input received from the public at these meeting indicates the
following levels of support for differing uses by those present at these open houses:
Strong Support:
Outdoor components (play fields, soccer field, picnic areas, shelters, and natural
open space)
Gymnastics Facilities
w Community Pavilion with kitchen
w- Preschool Facility
Indoor pool (strongest support for a smaller 25 meter pool for community and with lap
ability v. a competition level pool)
Mixed Support:
• Gymnasium
« Children's Center (day camp, year-round youth enrichment programs and multi-
purpose/generational activity rooms)
Climbing Wall
4
Limited Support:
or- Employee Housing (on-site)
On February 15, 2000, following input from the public, the PEC and the DRB, the Town
Council directed the consultant team to pursue the plan for alternative "C."
On February 28, 2000, a public open house was conducted at the Library to review more
refinements to the preferred alternative. Additional public comment was taken at that
meeting and is attached to this memorandum.
V. GENERAL USE ZONE DISTRICT REQUIREMENTS - PEC REVIEW
Sections 12-9C-2 & 3 outline the permitted and conditional uses allowed in the General
Use Zone District. The following are listed as conditional uses in the General Use Zone
District:
- Public and private parks and active outdoor recreation areas, facilities, and
uses.
- Public and private schools and educational institutions.
- Public and quasi-public indoor community facility.
- Public buildings and grounds.
- Public theaters, meeting rooms, and convention facilities.
All of the uses proposed for this site fall into one of these categories.
Section 12-9C-5 of the Zoning Regulations outlines the standards for developments in
the General Use Zone District. The Zoning Regulations state:
In the General Use Zone District, development standards in each of the following
categories shall be prescribed by the Planning and Environmental Commission:
1. Lot area and site dimensions
2. Setbacks
3. Building Height
4. Density Control (dwelling units and GRFA)
5. Site Coverage
6. Landscaping and site development
7. Parking and loading
5
VI. CONDITIONAL USE PERMIT CONSIDERATION CRITERIA AND FINDINGS
In accordance with Chapter 16 of the Municipal Code, an application for a conditional
use permit within General Use District, the following development factors shall be
applicable. Staff has not addressed these factors at this time, however, at final review
these criteria will be addressed.
1. Relationship and impact of the use on development objectives of the
Town.
2. Effect of the use on light and air, distribution of population,
transportation facilities, utilities, schools, parks and recreation
facilities, and other public facilities and public facilities needs.
3. Effect upon traffic, with particular reference to congestion,
automotive and pedestrian safety and convenience, traffic flow and
control, access, maneuverability, and removal of snow from the
streets and parking areas.
4. Effect upon the character of the area in which the proposed use is to
be located, including the scale and bulk of the proposed use in
relation to surrounding uses.
The Plannina and Environmental Commission shall make the following findings before
arantina a conditional use permit:
1. That the proposed location of the use is in accordance with the
purposes of the Zoning Regulations and the purposes of the
district in which the site is located.
2. That the proposed location of the use and the conditions under
which it would be operated or maintained would not be detrimental
to the public health, safety, or welfare or materially injurious to
properties or improvements in the vicinity.
3. That the proposed use will comply with each of the applicable
provisions of the Zoning Regulations.
6
c
Donovan Park
FEBRUARY 28, 2000 PUBLIC INPUT
1. Buildings must be first class and maintained!
2. Too bad that "Community Park" has changed to community facility. Move
components back to Hub Site. Overall uses are inappropriate.
3. Concern over traffic.
4. RETT Concerns
5. ABC School and Learning Tree will never leave Mountain Bell site.
6. Can the Community Pavilion be smaller?
7. Youth facilities will be used.
8. Outdoor restrooms are important.
9. What are programmed spaces and how do they relate to other town facilities?
10. Can spaces be overlapped? More efficient?
11. Is park available for public use? Very important.
12. Land cost - propose space for community.
13. Community pavilion is extremely important.
14. No outdoor lighting at enclosed playground.
15. Is open field large enough for kids to throw Frisbee?
16. Pool could be used by everyone - important community element.
17. Internal path is good!
18. Childcare center is not appropriate for a town-wide recreational facility. It takes
away space from the recreation/youth directed facility. ABC school is a private
enterprise. Insurance, parking, rules and regulations will negatively impact the plan.
19. We all need to support the families and young children in Vail. A childcare center is
appropriate, and is needed in this space.
20. There is real concern about the sources of funding for this project: 1) as it no longer
has employee housing; 2) it is geared really for local use - not tourist. Can we
really afford this dream legally?
21. So pleased to see daycare component -similar to affordable housing, if we want it
in Vail we (TOV) must "subsidize" it.
22. It is not being mentioned enough -the intrinsic value of this site as being
undisturbed original condition Vail Valley floor - not recreated, but the pristine
environment which we have eliminated everywhere else. This is a true park if this
element is preserved. What is Webster's Dictionary definition of a park?
Unoraanized play needs precedence on this site.
F:\EVERYONE\PEC\MEMOS\00\Donov313.doc
7
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/'~Vail Recreation \
DISTRICT
l
700 S. Frontaize Road East TO: VAIL TOWN COUNCIL
Vail. CO 81657
970-479-2279 FROM: DIANE JOHNSON, YOUTH SERVICES SUPERVISOR
FAX: 970-479-2197 JOEL RABINOWITZ, CAMP VAIL DIRECTOR
VAIL GOLF CLUB DATE: MARCH 14, 2000
1778 Vail Valley Drive
Vail. Colorado 81657
Fax? -2 6055 RE: CHILDREN'S CENTER
DONOVAN COMMUNITY PARK
GOLF & PARK
MAINTENANCE
1278 Vail Valley Drive The Children's Center, as proposed in the current designs for the lower
479-2262 bench of Donovan Park, would be used by children age 2 - 15 for a large
VAIL TENNIS CENTER variety of programs on a year round basis. The heaviest use would occur
700 S. Frontage Road East during summer when Youth Services operates Cam Vail Pre-Kam Vail
479-2294 P P
Fax 479-2281 and Planet Fun. The location is ideal for children's programs, particularly
JOHN A. DOBSON ARENA a day camp, due to the complimentary uses planned for the park.
321 Lionshead Circle
479-2271 A typical da at Cam Vail has an attendance of approximately 85
Fax: 479-2267 Y P
children ages 5-12, while Pre-Kamp Vail has 20 children ages 2 '/2 -5.
VAIL_ YOUTH SERVICES Over 500 families both residents and guests, use Camp Vail throughout
395 E. Lionshead Circle
479-2292 the summer. The flexible drop off and pick up times of 7:30 - 9:00 AM
Fax: 479-2835 and 4:00 - 5:30 PM, respectively, allow for a steady flow of people
VAIL NATURE CENTER arriving and leaving within these time periods. The connection to the
Vail Vallev Drive outdoor environment is essential to our choice-oriented programming
479-2291 philosophy. Each day campers spend half their day in an activity of their
MARKETING choice, selecting from a group of 6 activities. During the course of the
700 S. Frontage Road East
479-2446 summer there are approximately 60 choices including: archery, climbing
ADULT & YOUTH SPORTS wall, soccer, lacrosse, hiking, biking, baking, roller hockey, swimming,
700 S. Frontage Road East martial arts and more. The Donovan Park design, with its' easy access to
479-2280 the soccer field playground, open space, community pavilion, stream
Fax: 479-2281
tract, and multi-purpose facility allows for easy transitions between
activities as well as an ideal location for a day camp. The soccer field
could be used not only for a variety of sports and games but also the
bermed area could possibly be used for Archery. The heaviest use of the
field would occur during drop-off and pick-up times when children
participate in free play and outdoor games. The multi-purpose facility
could be used for martial arts, dance classes as well as gymnastics for the
older campers and movement/tumbling for Pre-Kampers.
The other half of a camper's day is spent rotating through blocks of Art,
Drama and Discovery (science and environmental education). Obviously
the stream tract and the natural location make this an ideal spot for the
Discovery Specialist to teach hands-on lessons in the outdoors. It also
helps to enhance our ongoing collaboration in programming with the Vail
0
Nature Center. Drama (four times a week/for 3 hours a day) could
potentially be held in the pavilion or perhaps in the multi-purpose facility.
As you can see the program would utilize but not overwhelm all the
surrounding elements of this park setting.
During the school year the Children's Center would host a multitude of
after-school enrichment classes for youth ranging in age of 2 -15. There
is also an opportunity to hold a winter day camp, focusing on our guests
needs by giving the visitor an option for their children besides ski school,
thus enhancing their overall experience in Vail.
Two common questions that have come up various times during the
Community Facilities discussion are: (1) Does a children's center make
more sense to be housed at the "Hub" site? As described above our
program relies heavily on outdoor activity space. The outdoor
environment is essential to operating a quality children's program. More
than 60% of a typical day is spent outside. Unfortunately there is a lack of
open space surrounding the "Hub" site. (2) A children's center would just
be used by children (prioritized use)? Due to State Licensing requirements
as well as the children's safety, only participants could use this space
while a program is in session. However, in the evenings, rooms could be
used for adult art classes, meetings, etc., as long as those desires are
incorporated into the design of the Children's Center.
A quality environment, both indoors and out, is essential to providing
recreational opportunities that promote physical, mental and social growth
for our constituents.
0
The lodge at LionSHead
DATE: March 12, 2000
TO: Vail Town Council
FROM: The Lodge at Lionshead
RE: Community Facilities
Dear Council Members:
Since some council members are new incumbents, we felt that we needed to update our
comments about proposals before the council that would affect our property and
neighborhood. We are attaching our August 2, 1999 letter for your information.
1. It is apparent that the proposal to create a new "Vail Town Center" at the Library-
Dobson-CBL location has been abandoned as such. We would oppose, if
resurrected.
2. Tax Increment Financing - we strongly oppose an "Urban Renewal Authority"
approach as it circumvents approval by Town of Vail citizens. We suggest such
an action by the council will further polarize the community. We strongly
recommend the "incremental" approach to financing the projects - "pay as you
go". If an authority must be created, we favor the Downtown Development
authority as it requires a vote by residents, limits council authority and cannot
condemn property or issue bonds on it's own behalf.
3. We still favor the creation of a "trolley" to replace the bus route.
4. We favor the further development of the Library as long as it does not add height
that would block our condo views (per letter to the council from Phase III Board).
5. Further development of the Dobson Ice Arena in conjunction with the Civic
Center and Library would be an asset.
6. We have no problem with expansion of the Parking Structure by addition to the
height.
7. We would welcome an upgrade of the "Subway" area of the Parking Structure.
This is an eve sore in every respect.
8. We are strongly opposed to creating any "Seasonal Housing" or retail shops along
the South side of the Parking Structure. These elements are not compatible with
the Civic Center concept and would materially change the appearance and
character of our neighborhood, which is protected by the Lionshead Master Plan.
Professionally Managed by Peak Resort Services, Inc.
380 East Lionshead circle vail, Colorado 81657 (970) 476-2700
The creation of a Civic Center, an additional ice surface, the upgrade of Dobson and
expansion of the Library (not height) we support for the good of Vail even though it will
have an impact on our properties and neighborhood. We would expect continued
cooperation from the Town of Vail and staff to consider our positions. Construction will
impact us for a long period adversely - we want to participate in guidelines in this regard.
Item 8 above is critical in gaining our continued support and cooperation.
Sincerely,
Jim Miller, Phase II
Bill Hellegas, Phase I
Marilyn Dyer, Phase-III
Lodge at Lionshead Homeowner's Association Presidents
cc - Phase 11 Board of Managers
The lodge at LionSHead
Date: August 2, 1999
To: Vail Town Council
From: Lodge at Lionshead
Re: Community Facilities Proposals.
Dear Town Council,
At your July 6, 1999 Council meeting, three proposals were presented for consideration.
You and your staff invited comments from affected citizens. These are the comments,
from the Lodge at Lionshead:
1. We believe that the proposals were too ambitious in seeking to create a new Vail
Town Center at the Library-Dobson-Charter Bus Lot location.
2. We would oppose the creation of any jurisdiction (Urban Renewal Authority) with
the power of condemnation, creation of debt and solicitation of private funds (to
build on public land) without the approval of Town of Vail voters.
3. We would favor the development of the wetlands, south of Gore Creek, as a nature
preserve, including an additional bridge(behind the library) and an elevated
boardwalk (including a fishing/viewing platform) leading to the existing bridge
downstream. This would restrict present misuse of the wetlands area.
4. We would favor the development of a tram/trolley system from the Covered Bridge to
E. Lionshead Cr. This to stimulate interest and to eliminate the present bus route.
5. Further development of the Library would be an asset.
6. Further development of Dobson Ice arena in conjunction with a Civic Center on the
Charter Bus lot would be an asset.
7. We would oppose any Civic Center proposal that would materially change our
neighborhood in terms of noise, traffic, appearance etc. Some of the recreational
suggestions appear to be in this category ( especially if outside).
8. We have no problem with adding a deck to the Parking Structure for additional
parking, permanent condominiums etc.
9. We would welcome an upgrade of the "Subway" area of the Parking Structure. The
Council developed and approved the Lionshead Master Plan. It is time for the Town
to do their part in implementing the plan.
10. We strongly favor the "incremental" approach to financing the proposals - "pay as
you go" - as opposed to a massive bond issue etc.
Professionally Managed by Peak Resort services, Inc.
380 East Lionshead circle vail, Colorado 81657 (970) 476-2700
11. We are strongly opposed to creating any "Seasonal Housing" or retail shops along the
south side of the Parking Structure. This would materially change our neighborhood,
which the Lionshead Master Plan protects. Seasonal housing and a Civic Center are not
compatible. There are more appropriate locations for seasonal housing.
12. We would oppose any condemnation proceedings in regard to our property, or any
destruction of our trees, landscaping etc.
Our Association is in support of the Lionshead Master Plan and the creation of
Community Facilities and Civic Center proposals limited by the preceding 12 items. We
agree that Vail needs to polish its identity and create amenities to enhance participation
by locals and guests.
We would hope that continued communication between the Town of Vail Staff, Council
and the Lodge at Lionshead would be encouraged.
Sincerely,
Jim Miller
Bill Hellegas
Dean Morton
Lodge at Lionshead
Homeowners Association Presidents
11
Iy
TOWN OF VAIL
Department of Community Development
75 South Frontage Road
Vail, Colorado 81657
970-479-2138
FAX 970-479-2452
MEMORANDUM
To: Vail Town Council & Vail Recreation District Board
From: Russ Forrest
Date: March 14, 2000
Subject Community Facility Hub Site Process
Please find attached the market analysis on the Lionshead hub site for your review. This
includes an economic analysis of a:
O Conference/learning center
• . Performing Arts -
• 2"d Sheet of Ice, and
• Family Recreation Center
Steve Spichard from Economics Research Associates will review the economic impacts
of each use at the March 14th meeting. Then staff would like to request that.the Council
and the Vail Recreation District begin considering which uses should be further explored
on this site. An additional evening meeting has been scheduled for March 21" to
hopefully conclude the discussion of the program elements that should be evaluated in
the design process scheduled between March 27th and March 30th
RECYCLED PAPER
Economics Research Associates
Draft Report
Community Facilities Market Analysis
Preparedfor
The Town of Vail
Submitted by
Economics Research Associates
March 9, 2000
ERA Project No. 13401
TABLE OF CONTENTS
Section Paae
I INTRODUCTION I- 1
I- 1
General Limiting Conditions
II EXECUTIVE SUMMARY II- 1
Regional Economy, Demographics, and Visitor Market II- 1
Conference and Learning Center II- 2
Performing Arts Center II- 3
Ice Rink Market Analysis II- 5
Family Entertainment Center II- 5
Financial Analysis and Fiscal Impact II- 6
III THE REGIONAL ECONOMY, DEMOGRAPHICS,
AND VISITOR MARKET III- 1
Regional Overview III- 1
Local Market Overview III- 7
Visitation Characteristics of the Vail Valley 111-
IV CONFERENCE AND LEARNING CENTER.." IV- 1
Industry Trends IV- 1
Conference Space in the Town of Vail IV-12
Comparable and Competitive Facilities IV-13
Summary of Interviews with Meeting Planners IV-22
Conference Center Demand Conclusions IV-24
Facility Recommendations IV-26
V PERFORMING ARTS CENTER.........."......" V- 1
Existing Performing Arts Venues V- 1
Motivations For A New Performing Arts Center V- 1
Theater Operations V- 2
Theaters in Resort Locations V- 3
Vail Valley Performing Arts V-24
Vail Market Support for a New Performing Arts Center V-30
Recommendation V-32
VI ICE RINK MARKET ANALYSIS VI- 1
Overview of Typical Ice Rink Economics VI- I
Review of Dobson Arena VI- 3
Review of Other Selected Relevant Ice Rink Facilities VI- 8
Review of Relevant Planned and Proposed Ice Rinks VI-16
Demand Analysis VI-18
i
TABLE OF CONTENTS
(Continued)
VII FAMILY ENTERTAINMENT CENTER AND AQUATIC FACILITY 'VII- 1
Commercial Family-Entertainment Centers VII- l
High Tech Family-Entertainment Centers VII- 6
Sports Based Entertainment Centers VII- 9
Financial Analysis of the Family Entertainment Center VII- 8
Location-Based Entertainment Centers at Ski Resorts VII-12
Market Support for a Family-Entertainment Center VII-14
Location-Based Entertainment Centers at Ski Resorts VII-12
XIII FINANCIAL ANALYSIS AND FISCAL E\dPACT VIII- 1
Proposed Alternatives VIII- 1
Financial Analysis of the Conference Center/Learning Center......... VIII- 2
Financial Analysis of the Dual Ice Sheet Facility VIII-10
Financial Analysis of the Family Entertainment Center VIII-16
Consolidated Operating Pro Forma VIII-17
Financial Analysis of the Performing Arts Center VIII-17
Consolidated Operating Pro Forma VIII-17
Fiscal Impacts of the Proposed Alternatives VIII-23
ii
LIST OF FIGURES
Fisure
III- 1 VAIL VALLEY SEASONAL RENTAL PROPERTY TRENDS IN 1998 AND
AVERAGE ANNUAL OCCUPANCY RATES AND DAILY ROOM RATES IN
THE VAIL VALLEY 1994 TO 1999
LIST OF TABLES
Table
II- 1 OPERATING PROFORMA FOR STABILIZED YEAR OF OPERATION
II- 2 ESTIMAi tD FISCAL IMPACT OF PROPOSED ALTERNATIVES
III- 1 EMPLOYMENT DISTRIBUTION IN EAGLE COUNTY (1995 & 1998)
III- 2 MAJOR EMPLOYERS IN EAGLE COUNTY: 1995
III- 3 ESTIMATED POPULATION BY TOWNSHIP IN EAGLE COUNTY
III- 4 VAIL AVERAGE DAILY CLIMATE STATISTICS
III- 5 KEY DEMOGRAPHIC CHARACTERISTICS OF PERMANENT RESIDENTS
IN THE PRIMARY AND SECONDARY MARKET AREAS
III- 6 OCCUPANCY PARTNERS IN THE VAIL VALLEY: 1998-1999
III- 7 AVERAGE DAILY ROOM RATES IN THE VAIL VALLEY: 1998-1999
III- 8 ESTIMAI rij VISITOR NIGHTS IN THE VAIL VALLEY
III- 9 ESTIMA 1 to NUMBER OF VISITORS
V- 1 CHARACTERISTICS OF SELECTED THEM tKS WITH LESS THAN 700
SEATS
V- 2 CHARACTERISTICS OF SELECTED THEATERS WITH 1,100 TO 2,900
SEATS
V- 3 ESTIMAi tv RESIDENT MARKET PENETRATION RATES FOR
SELECTED THEA i b KS
' iii
LIST OF TABLES
(Continued)
VI- 1 SUMMARY OF KEY CHARACTERISTICS AND ECONOMICS
OF RELEVANT PUBLICLY-OWNED ICE SKATING FACILITIES
VII- 1 SUMMARY OF KEY CHARACTERISTICS AND ECONOMICS
OF RELEVANT PUBLICLY-OWNED ICE SKATING FACILITIES
VIII- 1 TOWN OF VAIL CONFERENCE/LEARNING CENTER ESTIMATED USAGE
ASSUMPTIONS AND REVENUE PROJECTSIONS: ALTERNATIVE 91
VIII- 2 TOWN OF VAIL CONFERENCE/LEARNING CENTER ESTIMATED USAGE
ASSUMPTIONS AND REVENUE PROJECTIONS: ALTERNATIVE 92
VIII- 3 STAFFING PLAN FOR PROPOSED CONFERENCE/LEARNING CENTER:
ALTERNATIVE #I AND ALTERNATIVE #2
VIII- 4 TOWN OF VAIL CONFERENCE/LEARNING CENTER
ESTIMATED REVENUE IN STABILIZED YEAR OF OPERATION
VIII- 5 TOWN OF VAIL NEW ARENA (ALTERNATIVE .91)
ADDITIONAL USAGE ASSUMPTIONS AND REVENUE PROJECTIONS
VIII- 6 TOWN OF VAIL PRACTICE SHEET OF ICE (ALTERNATIVE 92)
ADDITIONAL USAGE ASSUMPTIONS AND REVENUE PROJECTIONS
VIII- 7 TOWN OF VAIL DUAL ICE SHEET FACILITY
ESTIMAtt v NET REVENUE IN A STABILIZED YEAR OF OPERATION
VIII- 8 TOWN OF VAIL PROPOSED ALTERNATIVES CONSOLIDAlt?li
OPERATING PRO FORMA FOR STABILIZED YEAR OF OPERATION
VIII- 9 ESTIMATED USE DAYS - STABLE YEAR - 1,400-SEAT THEAit;K
VIII-10 ASSUMED RENT SCHEDULE
VIII-I 1 ESTIMAito STABLE YEAR OPERATING CASH FLOW
VIII-12 PROJECTED HOUSE TEN-YEAR CASH FLOW -1,400-SEATS
VIII-13 ESTIMA t t u VISITATION FROM NEW NET OUT-OF-COUNTY VISITORS
iv
LIST OF TABLES
(Continued)
VIII-14 ESTIMATED DAILY OFF-SITE CONFERENCE AND ICE RINK VISITOR
SPENDING
VIII-15 ESTIMATED FISCAL IMPACT OF PROPOSED ALTERNATIVES ON TOWN
OF VAIL
v
Section I
INTRODUCTION
The Town of Vail and the Vail Recreation District (VRD) retained Economics
Research Associates (ERA) to evaluate the market and financial feasibility, and fiscal impact,
of a multi-use development for the Hub site located within the Town of Vail. The candidate
uses include a conference/learning center, a performing arts center, a second ice rink, and a
family-entertainment center. The Town of Vail and VRD are considering the development of
these uses to generate economic activity for the local economy, especially during the non-
winter seasons, and to provide a public service to local residents and tourists.
This analysis will provide input to the design team that is evaluating the physical
feasibility of developing the project at the Hub Site, and will influence the development
program. The economic feasibility assessment presented in this report focuses on each use's
market potential and estimated financial performance on an operating basis. This study does
not include an evaluation of the project's potential development costs, which will be
determined at a later time by the design team once further site planning, engineering, and
architectural analysis has been conducted.
This study was prepared by William Anderson, AICP, Vice-President; Steve Spickard,
AICP, Sr. Vice-President; Katherin Klienbaum, Associate; and Anne Wurtz, Associate.
GENERAL LINi11u-iG CONDITIONS
This study is based on estimates, general knowledge of the industry and consultations
with the client and the client's representatives. No responsibility is assumed for inaccuracies
in reporting by'the client, the client's agent and representatives or any other data source used
in preparing or presenting this study. Research was conducted from December, 1999 through
February, 2000, a nd Economics Research Associates has not undertaken any update of its
research effort since such date. No warranty or representation is made by Economics
Research Associates that any of the projected values or results contained in this study will
actually be achieved. This report is,not to be used in conjunction with any public or private
offering of securities or other similar purpose where it may be relied upon to any degree by
any person other than the client without first obtaining the prior written consent of Economics
Research Associates. This study may not be used for purposes other than that for which it is
Economics Research Associates I-1
Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401
prepared. This study is qualified in its entirety by, and should be considered in light of, these
limitations, conditions, and considerations.
Economics Research Associates I-2
Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13 401
Section II
EXECUTIVE SUMMARY
The purpose of this study is to evaluate the economic feasibility and fiscal impact of
developing the following community facilities in the Town of Vail: a conference and learning
center, a performing arts center, a second sheet of ice, and a family entertainment center at the
Vail Hub Site near Lionshead. The economic feasibility assessment focused on market
feasibility and financial feasibility from operations. Capital costs are not addressed in this
study since the design team; under a separate contract and study, has yet to estimate capital
costs. It is clear, however, that the revenue generated by the candidate uses is not sufficient
to amortize capital costs.
This section of the report provides a brief overview of ERA's primary findings. Please
read the body of the report for a detailed discussion of market and financial issues, and
assumptions.
j m L REGIONAL ECONOMY, DEMOGRAPHICS, AND VISITOR MARKET
Because of rapid growth in visitation, strong demand for new second-home properties,
a rapidly growing resident population, and other factors, Eagle County has enjoyed a
prolonged period of rapid economic growth. The primary visitor attraction in Eagle County is
the world-famous Vail ski resort, but the number and variety of other visitor attractions within
the Vail Valley continue to expand each year, with summer-season visitation growing in
importance. The Vail Valley is the primary market area for the proposed facilities. Key
demographic characteristics of the Vail Valley are as follows:
• The population of the Vail Valley is projected to increase by over 20 percent
during the next 5 years.
• The majority of families in Eagle County live outside of the Vail Valley.
• The median income of the Vail Valley is significantly higher than that of Eagle
County and the state of Colorado.
According to the Vail Valley Tourism and Convention Bureau, the Vail Valley
includes about 2,750 hotel rooms, 2,800 condominium units, and 150 rental home properties.
The largest concentration of rooms is located the Town of Vail where there are approximately
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Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401
1,700 hotel rooms and 1,970 condominium units. The average annual occupancy-rate in 1998
was approximately 54 percent for Vail Valley properties as a whole, with hotel properties
experiencing occupancy rates of about 64 percent and condominium properties having annual
average occupancies of about 39 percent. The estimated total visitor-nights in the Vail Valley
are about 3.1 million annually, which translates to about 715,000 individual visitors per year.
ERA estimates that on Friday and Saturday nights, during the peak winter and summer
months (February and July), there may be as many as 14,500 overnight guests staying within
Vail Valley.
CONFERENCE AND LEARNING CENTER
The results of the meeting planner surveys and interviews with competing facilities
indicate that there is strong demand for a conference facility in Vail. The primary market
segments that will potentially use the proposed facility are association groups and large-scale
corporate sales and training groups. Although the majority of business will be based
nationally, the facility should expect a sizeable portion of demand (up to 30 percent) to come
from Colorado-based associations and corporations, especially during the spring and fall
shoulder seasons.
The following recommended configuration for the proposed facility was developed
based on the results of ERA's market research:
• 20,000 square foot ballroom, divisible into 8 to 10 sections;
• 6,500 square feet of flexible breakout rooms in two or more divisible banks with a
total of 10 to 12 rooms,
• 500 square foot boardroom; and
• A minimum of 10,000 square feet in lobby and prefunction space.
All meeting space should be equipped with state of the art technology including fiber
optic capabilities and multiple electrical floor outlets to accommodate exhibitions. The
building design should incorporate clear-span space for the ballroom with ceiling heights of a
minimum of 18 feet. The lobby/prefunction space should feature broad expanses of windows
to accentuate the scenic mountain environment of Vail. Additionally, the Dobson Arena or
the proposed second arena should be considered as adjunct event space, doubling as
secondary exhibit or meeting space for group bookings of over 800 people.
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The Learning Center concept of a high tech training center, as envisioned by the
community, would work well as an adjunct facility to the conference center which would be
available for both community use and conference use. ERA envisions the facility functioning
as a computer lab, with about 40 computers and a few small-meeting rooms with video
conferencing capabilities. These small meeting rooms can either be breakout rooms shared
with the rest of the conference facility or separate rooms that are only accessible from within
the learning center. In total, the learning center should comprise approximately 1,000 square
feet and should be located adjacent to business service offices with a separate entrance that is
accessible from outside of the building.
PERFORMING ARTS CENTER
The Town of Vail directed ERA to evaluate the economic feasibility of a 200-seat
"black box" theater, a 1,100 to 1,200-seat theater, and a 2,200-seat theater. The Town
further directed ERA to consider only scenarios that would not directly compete with the
Vilar Center for the Arts in Beaver Creek.
The review of theaters in resort locations reveals several lessons:
• The small theaters either operate as rental houses for primarily community theater
groups, or are associated with a professional, repertory theater group in order to
generate enough programming.
• The larger theaters operate as rental houses, presenting houses, and production
houses. Several are associated with universities. Civic theaters in resort locations
tend to operate as rental houses. However, there are many examples of civic
theaters that operate as presenting houses in larger urban markets. Private, non-
profit operated theaters tend to operate as presenting houses and incur significant
operating deficits that are covered by contributed income.
• Rental houses experience relatively modest operating deficits, while presenting and
production houses experience significant deficits each year that are covered by
contributed income raised each year.
Despite locations in tourist markets, a large majority .of annual theater patrons
comes from the resident market. Dinner theaters are the exception.
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Given Vail's superior demographic characteristics for supporting performing arts,
specifically high-incomes, high educational achievement, and older age profile, Vail should
achieve higher than average market penetration rates. It is estimated that new center of
1,100+ seats may expect to support approximately 32 to 40 of professional performances per
year, and perhaps more than 50 with special programming. However, to achieve this level of
activity, the performing arts center would have to offer popular artists and a diversified
program, in addition to renowned classical artists. Average ticket prices would also have to
be consistent with the market, with typical average prices in the $30-$35 range.
The 200-seat "black box" theater is not feasible as a commercial venue because of its
small size and limited ticket sales potential. However, the theater could be developed as a
community facility for local arts groups. Given the relatively small number of local arts
groups and their limited capacity to pay rent, and the lack of a professional repertory theater
company to develop in-house productions, the Town would have to identify other community
uses for the theater to warrant its development. These other uses may include community
meetings, local access cable TV programming, lectures and educational programs, etc. Some
of these other uses are compatible with the conference/learning center, or the library. The
theater, however, is not a substitute for dedicated meeting space in the conference center.
A 1,100 to 2,200 seat theater would require a presenting organization to ensure
adequate and diversified programming. The cost of development is too great, and the
potential utilization too limited, to operate simply as a rental house and depend on outside
promoters to book the facility. As a presenting house, however, the annual operating deficit
would probably be substantial, on the order of $800,000 to $1.4 million, or more, based on
the experience of other presenting theaters of this size. While not unusual for presenting
theaters, this annual subsidy burden is probably too great for a town the size of Vail.
It is recommended that the Town of Vail only consider a theater of this larger size
range if it is developed and operated by a private, non-profit organization that can raise the
capital for development costs, and an adequate amount for an operating endowment. If such
an organization emerges and successfully meets its fundraising targets, the Town may consider
offering land or air rights within the Hub Site location for the facility since it would add to
Vail Valley's cultural offerings. The Town, however, should carefully develop a contingency
operating plan should the non-profit organization fail and abandons the facility located on city
property. Since it would probably take an organization, some time to raise the capital for
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Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401
construction and an operating endowment, it is recommended that a theater be considered as a
potential second-phase development for the Hub Site location
Finally, if a performing arts center is pursued in a later phase, a theater of
approximately 1,400-1,600 seats is recommended. An indoor theater of this size would be
too large to compete with the Vilar, and too small to lose acts to an arena/event center. A
theater of this size would provide a quality performance venue, with commercial potential,
that currently is not available in the Vail Valley.
ICE RINK MARKET ANALYSIS
Based on our examination of existing and future demand for ice time in the Vail Valley
and on the rink manager's reports on lost event and hockey business, ERA believes that Vail
could develop a second sheet of ice and enjoy solid operating performance at a two-sheet
facility by:
• Hosting more special events (while keeping one rink open for skating at all times);
• Hosting a larger number of hockey teams,
• Allowing hockey leagues to increase the number of weekly practice sessions;
• Hosting national or regional hockey and figure skating tournaments;
• Increasing the number of public skating and drop-in hockey sessions; and
• Hosting spillover events from the proposed conference center.
FAMILY ENTERTAINMENT CENTER
The interest in a family-entertainment center is the following:
• To provide activities for Vail's family and youth visitors;
• To add to the menu of activities to Vail's visitors in an attempt to extend people's
length-of-stay and expenditures within Vail;
• To provide alternative activities to Vail's seasonal workers;
• To provide family and youth-oriented activities throughout the year to Vail's
residents.
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The primary disadvantage of the Vail market for a commercial family-entertainment
center is its small resident population. Large centers run by major operators depend on a
large resident base and repeat visitation. Even many of the centers located in resort locations
find that the large majority of their visitors are area residents.
Assuming higher than average resident-market penetration rates, and a higher ratio of
tourist versus resident visitors, ERA estimates that total annual paid attendance may reach
over 26,000 by 2005.
With 26,000 visits per year, and a per capita expenditure of $9.00, consistent with
industry standards, a commercial family-entertainment center in Vail may generate revenues of
almost $235,000. Per capita expenditures could be 50 to 100 percent higher if the center was
had full-service food and beverage (including liquor sales), high-tech attractions, or
specialized retail products. Even if revenues were double, it would not be enough to support
commercial rents, operating costs, and an operator's profit requirements.
The primary limitation is the size of Vail's resident market. Based on this analysis, it
appears that a commercial FEC would be risky. Therefore, if the Town of Vail desires to
offer alternative recreation activities at the Hub Site, it would probably have to do so as a
public service whose capital costs and rent is subsidized.
FINANCIAL ANALYSIS AND FISCAL IMPACT
Proposed Alternatives
ERA, the design team (EDAW, Zehren, HGA), and staff from the Town of Vail and
the Vail Recreation District prepared the following alternatives for further design and cost
analysis. The alternatives are based on the results of ERA's recommendations, client input,
and the design team's initial assessment of potential building coverage on the site. The matrix
below presents the individual components of each alternative:
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Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401
ALTERNATIVE 1 ALTERNATIVE 2
• Conference Center/Learning Center • Conference Center/Leaining Center
20,000 square foot ballroom with - 20,000 square foot ballroom (flat floor
retractable raked seating to create a 1,200' only)
to 1,500 seat performance venue
6,500 square foot breakouts (10-12 rooms)
6,500 square foot breakouts (10-12 rooms)
- 500 square foot boardroom
- 500 square foot boardroom
- Minimum of 10,000 square feet of
Minimum of 10,000 square feet of prefunction/lobby space
prefunction/lobby space
- Attached Learning Center
Attached Learning Center
• Second Ice Rink in a Major New Arena Second Sheet of Ice in Practice Rink
50,000 square foot Arena with 30 foot - Regulation size rink with minimal spectator
ceiling areas
- 2,800 seats for hockey/ice events - Dobson Arena (2,200 seats) with some
improvements remains the venue for
4,000 seats for concert events concert events
• Family Recreation Center • Family Recreation Center
- 15,000-20,000 square foot Skateboard Park - . 15,000-20,000 square foot Skateboard Park
5,000-6,000 square foot Arcade - 5,000-6,000 square foot Arcade
- Teen lounge and other amenities - Teen lounge and other amenities
Possible Later Phases: Possible Later Phases:.
• Performing Arts Center • Performing Arts Center
• Expansion of the Conference Center • Expansion of the Conference Center
• Lecture Hall on the Library Roof • Lecture Hall on the Library Roof
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Consolidated Operating Pro Forma
The consolidated operating pro forma for the proposed facilities under each alternative
is shown in Table U-1. ERA believes, based on our utilization projections, that the proposed
conference facility would make a slight profit in either alternative. Given the margin of error
that is present in any projection, the Town should consider the conferencellearring center a
break-even proposition. The conference/learning center is projected to have an estimated net
revenue of about $154,000 under Alternative 1 and about $75,000 under Alternative 2. The
difference in revenues between the two alternatives results from the synergistic effect of the
larger space available in the proposed new arena.
Based on our utilization projections for a two sheet facility, ERA believes that Dobson
Arena and the new facility combined would operate at a slight deficit. The new arena and
Dobson are projected to have a joint net operating loss of about $12,000 while a new practice
sheet of ice and Dobson are projected to have a joint net operating loss of about $41,000.
The family recreation center, operated as a public recreation facility, could generate an
operating surplus of approximately $85,000 per year if the facility and its elements are
designed to keep maintenance costs low, and if the VRD, as operator, does not have to pay
rent.
Fiscal Impact
The direct economic impact of the on-going operations of the proposed facilities can
be divided into following categories.
• Off-site lodging, food and beverage, and retail spending by out-of-County
conference center and ice arena visitors; and
• The resultant sales and lodging tax revenues to the Town of Vail.
Based on our utilization projections for each facility, ERA estimates that Alternative 1
would result in approximately 139,400 additional visitor days and 66,700 room nights in the
Town of Vail. Alternative 2 would result in about 123,400 visitor days and 60,200 room
nights in the Town of Vail. Under Alternative 1, total lodging expenditures would be
approximately $12.7 million, total off-site food and beverage expenditures would be about
$4.5 million, and total off-site retail expenditures would be $4.2 million. This results in a
grand total of $21.4 million in out-of-County visitor spending in the Town of Vail. Under
Alternative 2, total lodging expenditures are estimated to be about $11.4 million, total off-site
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Table U-1
TOWN OF VAIL PROPOSED ALTERNATIVES CONSOLIDATED
OPERATING PRO FORMA FOR STABILIZED YEAR OF OPERATION
Alternative #1 Alternative #2
Conference Center
Operating Revenue $1,898,600 $1,753,000
Operating Costs $1.744.600 $1.678.000
Net Operating Revenue (Loss) $154,000 $75,000
Dual Ice Sheet Facility
Operating Revenue $983,900 $893,900
Operating Costs (1) $995.750 $935.250
Net Operating Revenue (Loss) ($11,850) ($41,350)
Net Operating Revenue (Loss) $142,150 $33,650
Family Recreation Center
Operating Revenue $235,000 $235,000
Operating Costs (1) $150.000 $150.000
Net Operating Revenue (Loss) $85,000 $85,000
Net Operating Revenue (Loss) $227,150 $118,650
Notes:
(1) Assumes no rent or debt service for capital expenses.
Source: Economics Research Associates.
food and beverage expenditures would be about $4.1 million, and total off-site retail
expenditures would be $3.8 million. Combined, the estimated out-of-County visitor spending
in the Town of Vail under Alternative 2 would be about $19.3 million.
A summary of direct expenditures within the Town of Vail and the resulting fiscal
impact of each alternative is presented in Table 11-2. Direct revenues from the estimated
visitor spending would accrue to the Town of Vail in the form of lodging and sales tax
revenues. Based on our estimates of visitor spending, the Town of Vail would expect to
receive approximately $508,000 in lodging tax revenues and $346,000 in sales tax revenues
under Alternative 1 and about $456,000 in lodging tax revenues and $315,000 in sales tax
revenues under Alternative 2.
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Table lI-2
ESTIMATED FISCAL IMPACT OF PROPOSED ALTERNATIVES ON TOWN OF VAIL
Alternative #1 Alternative 02
Annual Impacts from Visitor Spending
Visitor Food and Beverage Spending $4,460,000 $4,067,500
Visitor Retail Spending $4,180,000 $3,817,500
Visitor Lodging Spending $12.699.500 $11.392.960
Total Increase in Spending $21,339,500 $19,277,960
Direct Revenues to VVTCB
Lodging Tax Revenue for Marketing (1.4%) $177,793 $159,501
Direct Revenues to Town of Vail
Lodging Tax Revenues to Town of Vail (4.0%) $507,980 $455,718
Sales Tax Revenues to Town of Vail (4.0%) $345.600 $315.400
Total Direct Revenues to Town of Vail $853,580 $771,118
Source: Economics Research Associates.
Section III
THE REGIONAL ECONOMY, DEMOGRAPHICS,
AND VISITOR MARKET
Demand for the proposed facilities would come from two primary sources: area,
residents and visitors. In order to project potential demand from the two primary user groups,
it is necessary to examine: (1) key regional characteristics and trends (economic trends,
population growth, etc.); (2) the size, geographic distribution, and demographic profile of the
region's resident population; and (3) the size and characteristics of the region's visitor market.
REGIONAL OVERVIEW
Eagle County has changed dramatically over the past three decades. Historically,
Eagle County's economy was based primarily on ranching and mining. Over the last three
decades, however, the region's economy has evolved from a slow-growing cyclical economy
into a fast-growing dynamic economy dominated primarily by the visitor industry and second-
home and resort development. The primary visitor attraction in Eagle County is still the
world-famous Vail ski resort, but the number and variety of other visitor attractions within the
Vail Valley continue to expand each year, with summer-season visitation growing in
importance.
More than half of Eagle County's labor force is employed in the tourist industry,
primarily serving the skiers who come to Vail Mountain, Beaver Creek Resort, and
Arrowhead at Vail during the winter months. ' The ski season typically lasts from late
November through early April. Although visitation drops off notably during the spring and
fall shoulder seasons, the Vail Valley has become a popular summer destination for affluent
visitors, with summer visitation heavily concentrated in the late-June to early-September
period. During the summer months, visitors enjoy a range of activities, including golf, hiking,
fishing, white-water rafting and other outdoor recreational activities.
Because of rapid growth in visitation, strong demand for new second-home properties,
a rapidly growing resident population, and other factors, Eagle County has enjoyed a
prolonged period of economic growth. The following presents the important regional
characteristics that illustrate the regional economy's current strength.
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~rtnvth and Job Distribution
;ounty has enjoyed rapid employment growth in recent- decades, with total
the County increasing from only about 3,600 jobs in 1970, to about 11,000
)out 20,700 jobs in 1990, and about 26,000 jobs in 1998. Employment growth
.ntrated in the service, construction, and retail/wholesale trade sectors, while
;ource production, and manufacturing sectors have become increasingly less
We III-1 shows the breakdown of employment by sector in Eagle County. As
tourism-oriented economy, jobs are now concentrated in retail and service
together account for about 60 percent of the County's total jobs. Table III-2
nty's major employers.
t Rates
:ounty's average annual unemployment rates (as estimated by, the Colorado
Labor) have fallen since the early 1990s, as summarized below:
3 - 5.2 percent.
5 - 3.3 percent.
8 - 3.3 percent.
nployment rate of about 3.3 percent compares favorably with the statewide
ut 3.8 percent. In recent years, Eagle County's low unemployment rate has
ced the County in the bottom quartile (lowest unemployment rates) of counties
k and Distribution
ion to strong employment growth and low unemployment, Eagle County also
capita incomes and median family incomes. Recent estimates from the U.S.
aomic Analysis place Eagle County's median family income at about $64,300
from an estimated $60,900 in 1998. In comparison, the Bureau currently
-ado's 1998 median family income at about $49,300, and the national median
it about $45,300.
;h per capita income and median family income are well above state and
;es, average wages per job are below state and national averages in Eagle
rig the high number of service jobs and part-time positions (refer to Table III-
arch Associates III-2
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Table III-1
EMPLOYMENT DISTRIBUTION IN EAGLE COUNTY (1995 and 1998)
Total Jobs in Countv 1998 Average
% Change % of Jobs Annual
EmDlovment by Sector 1995 1998 (1995-98) by TvDe Waee ('98)
Agriculture 243 401 65% 1.5% $21,333
Mining 38 n/a n/a n/a n/a
Construction 2,905 3,967 37% 15.1% $34,820
Manufacturing 454 447 -2% 1.7% $33,004
Transp., Commun., Utilities 654 886 35% 3.4% $27,266
Wholesale 251 294 17% 1.1% $45,519
Retail 5,456 6,594 21% 25.1% $20,072
Finance, lnsur., Real Estate 1,669 2,077 24% 7.9% $35,804
Service 7,466 9,307 25% 35.4% $26,799
Government 1,936 2,307 19% 8.8% $27,887
Unclassifiable 5 0 -100% 0.0% n.a.
Total: 21,077 26,280 25% 100.0% $25,722
Source: State of Colorado, Department of Labor & Employment
Table III-2
MAJOR EMPLOYERS IN EAGLE COUNTY: 1995
Number of
Firm / Emalover Name Sector EmWovees
Vail Associates / Resorts Recreation services 3,400
Eagle County School District Education 402
Vail Valley Medical Center Health services 400
Town of Vail Government 350
Eagle County Government Government 250
* Denotes peak seasonal employment, not year-round average.
Source: Town of Vail Community Relations Division, The Vail Overview
1
1). According to the U.S. Bureau of Economic Analysis, the average annual wage in Eagle
County increased from about 323,400 in 1995 to about $26,000 in 1997. However, the
County's median wages are still well below state averages (the 1997 Colorado average wage
was about $29,500). Wages in the retail and service industries, the biggest employment
sectors in Eagle County, tend to be somewhat lower than average wages, at $19,492 and
$24,921 respectively (1997 averages). To some extent, these lower figures reflect the part-
time nature of many of these jobs. Many workers hold more than one part-time job.
Population Growth and Distribution
Eagle County is presently home to about 35,000 primary residents. As seen on Table
IH-3, which lists estimated population by area for 1995 and 1998, about 53 percent of the
County's permanent residents live in unincorporated areas, while most others live in Vail,
Avon, or Gypsum. Recently, Eagle and Gypsum have seen the County's most rapid growth in
resident populations.
The following reports the growth in Eagle County's permanent resident population
over the past four decades:
• 1960 - about 4,700 permanent residents
• 1970 - about 7,500 permanent residents
• 1980 -about 13,300 permanent residents
• 1990 - about 21,900 permanent residents
• 1995 - about 28,700 permanent residents
• 1999 - about 35,000 permanent residents
The County's resident population has sustained average growth rates of around five
percent per year since 1960, growing at a slightly faster pace in the 1970s, slowing down
somewhat during the 1980s, and topping five percent once again during the 1990s. The
County's population growth rate is projected to average about four percent per year over the
next five years. Growing at four percent per year, Eagle County's resident population could
reach about 44,300 persons by 2005. Although the rate of population growth in Eagle
County is impressive, the County's total population size will remain rather small.
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Table I1I-3
ESTIMATED POPULATION BY TOWNSHIP IN EAGLE COUNTY
% of County
1995 1998 % Chanee Total in 1998
Avon 2,489 2,921 17% 9%
Basalt 1,362 1,773 30% 5%
Eagle 2,070 2,541 23% 7%
Gypsum 2,215 2,881 30% 9%
Minturn 1,107 1,166 5% 3%
Red Cliff 295 313 6% 1%
Vail 4,354 4,386 1% 13%
Unincorporated 14.788 17,901 21% 53%
Total 28,680 33,882 18% 100%
1/ Draft population estimates subject to change.
Source: Colorado Demographic Information Service.
According to the 1995 Eagle County Master Plan, in addition to the county's 28,700
permanent residents (1995 population), the county included an estimated 19,000 seasonal
residents who spend less than six months in the region each year. According to Eagle County
Planning, the County now attracts approximately 22,000 seasonal residents each year. The
number of seasonal residents spending time in the Vail Valley is expected to increase rapidly
as more residential units are completed at fully-approved communities like Cordillera,
Arrowhead, Bachelor Gulch, Beaver Creek, Homestead, and Riverwalk.
LOCAL MARKET OVERVIEW
The proposed facilities are located in-the Town of Vail, in western Eagle County.
The Town of Vail is primarily a mountain resort community, centered around a pedestrian-
oriented alpine village core. The Town is home to approximately 4,500 permanent residents,
plus another 5,000 part-time residents of vacation properties. The larger Vail Valley, which
runs along Interstate 70, includes the towns of Vail, Beaver Creek, Avon, Minturn, and
Edwards. Over the past three decades, the Vail Valley has evolved into a major tourist
destination with an international reputation. The Valley's most important visitor attractions
are the Vail, Beaver Creek, and Arrowhead ski resorts, which combined typically log more
than two million annual skier-days. The Vail Valley is situated approximately 90 miles west of
Denver and is serviced by the Eagle County Regional Airport.
Local Climate Characteristics
The National Weather Service maintains a weather-recording station in the Town of
Vail. The following climate statistics derive from this recording station. As seen on Table
M4, the Town of Vail receives an average of about 21 inches of precipitation per year,
including about 186 inches of snow. Temperatures in the Town exhibit major seasonal
variation. Average high temperatures range from about 29 to 43 degrees Fahrenheit in the
winter months, to about 51 to 69 degrees in the shoulder seasons, to about 74 to 78 degrees
in the summer months. Average daily lows range from about 4 to 17 degrees in the winter
months, to about 23 to 32 degrees in the shoulder seasons, to about 35 to 39 degrees in the
summer months.
Review of Primary and Secondary Market Areas
In order to gather more detailed data on the demographic profiles of the resident
population bases most likely to become regular users of the subject facilities, ERA identified
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Table III-4
VAIL AVERAGE DAILY CLIMATE STATISTICS '
Davs Below
Dailv Hiah 3 Dailv Low 3 Freezing
January 30 4 31
February 35 8 28
March 43 17 31
April 51 23 29
May 61 31 19
June 74 35 9
July 78 39 2
August 77 39 3
September 69 32 16
October 56 23 28
November 38 13 30
December 29 4 31
Annual Total: 257
Annual PrecipitationZ. 21.17
Annual Snowfall2: 186
1/ Data collected by the National Weather- Service; represents 30 year average from 1961 to 1990.
2/ Expressed in inches.
3/ Expressed in degrees Fahrenheit.
Source: National Climate Data Center, Reno, NV.
two relevant resident market areas on which to perform a detailed GIS-based
(geographic information systems) demographic analyses. The market areas were defined
roughly as follows:
1. A Primary Market Area, roughly corresponding with the Vail Valley;
2. A Secondary Market Area, which includes the remainder of Eagle County.
Actual geographic boundaries were defined based on official United States Census block
groups, the smallest geographical units by which comprehensive demographic data are
published and projected. Data for the State of Colorado was also examined to provide a basis
of comparison for the market areas. Estimates of demographic characteristics for the year
1999 and projections for the year 2004 for the specified block groups and for the State of
Colorado are provided by CACI, a demographics research firm.
Important demographic characteristics of the relevant resident market areas. are
summarized on 'T'able III-5. Key observations include the following:
• There are currently about 17,000 permanent residents living within the Vail Valley,
approximately one-half of the total population of Eagle County.
• By 2004, the population of the Vail Valley is projected to reach about 20,400 and the
population of Eagle County is projected to reach about 42,800, which represents an
astounding 22 percent increase in population. In comparison, the population of
Colorado is only 'projected to increase by about 10 percent during this period.
• A sizeable portion of the population of the Vail Valley (35 percent) is between the
ages of 18 and 24. In comparison, this age group comprises only 24 percent of the
population of the secondary market area and 22 percent of the population of
Colorado.
• The population of the Vail Valley contains a relative low number of children in
comparison to Colorado. However, the secondary market area contains a relatively
high population of children indicating that the majority of families in Eagle County live
outside of the Vail Valley.
• The racial make-up of both the primary and secondary market areas reflect that of
Colorado. Whites make up about 90 percent of the total population, although
approximately 15 percent of the population identify themselves as Hispanic in origin.
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Table III-5
KEY DEMOGRAPHIC CHARACTERISTICS OF PERMANENT
RESIDENTS IN THE PRIMARY AND SECONDARY MARKET AREAS
Remainder of
Vail Valley Eagle County
(Primarv Market) (Secondarv Mkt) Eagle Countv Colorado
Total Population
1999 Estimate 16,777 18,294 35,071 4,049,168
2004 (5-year projection) 20,441 22,382 42,823 4,441,297
Projected 5-year growth 21.8% 22.3% 22.1% 9.7%
Persons by Age (1999 Estimate)
0-5 8.9% 10.9% 9.9% 8.1%
6-17 12.8% 19.2% 16.2% 17.8%
18-24 12.9% 7.9% 10.2% 9.5%
25-34 22.5% 16.5% 19.4% 12.7%
35-44. 22.6% 23.3% - 23.0% 17.7%
45-64 18.2% 17.6%. 17.9% 24.1%
65 & Over 2.6% 4.6% 3.3% 10.0%
Median Age 32.2 32.4 32.3 36.1
Persons by Race (1999 Estimate)
White 87.1% 92.0% 89.7% 87.0%
Black 0.3% 0.1% 0.2% 4.1%
Other 12.6% 7.9% 10.1% 8.9%
Hispanic Origin 17.9% 15.0% 16.4% 14.7%
Total Households
1999 Estimate 6,758 6,705 13,463 1,608,531
2004 (5-year projection) 8,257 8,247 16,504 1,784,161
Projected 5-year growth 22.2% 23.0% 22.6% 10.9%
Owner Occupied Units 1999 60.7% 76.3% 68.5% 72.0%
Renter Occupied Units 1999 39.3% 23.7% 31.5% 28.0%
Household Income (1999 Estimate)
$0-319,999 6.7% 9.8% 8.3% 17.96/o
520,000 - $34,999 15.0% 19.0% 17.0% 20.3%
$35,000 - $49,999 20.2% 22.2% 21.2% 19.0%
$50,000 - $74,999 23.6% 25.1% 24.3% 21.0%
575,000 - $99,999 16.0% 13.1% 14.5% 10.3%
$100,000 - $149,000 11.8% 8.4% 10.1% 8.0%
5150,000 & Over 6.6% 2.5% 4.5% 3.5%
Median Household Income $59,212 $48,979 $52,472 543,823
Median Net Worth $58,292 $52,216 $46,751 548,977
Source: ArcView Business Analyst: CACI, 1999 Estimates and Projections, and Economics Research Associates.
• The population of Eagle County is wealthier on average than the population of
Colorado. The estimated median household income of the county in 1999 (which
includes non-family households) was $52,500 while the median income of the state
was $43,800. The largest concentration of wealth in Eagle County is found in the
Vail Valley where the estimated median income was $59,200 in 1999. In comparison,
the estimated median income of the remainder of Eagle County, the secondary market
area, was only $49,000 in 1999. -
• In both market areas, households earning between $35,000 and. $75,000 annually
make up the largest income segment, representing about 44 percent of the primary
market area population and over 47 percent of the secondary market area. However,
one-third of the population of the primary market area had a household income greater
than $75,000 in comparison to only 24 percent of the population of the secondary
market area and 22 percent in Colorado.
• The Vail Valley has a considerably higher percentage of rental units than the secondary
market area, 39 percent as compared to 24 percent, primarily because of need for
seasonal worker housing in close proximity to the ski resorts.
As discussed above, the population of Eagle County is significantly wealthier than that
of Colorado. Reflecting this trend, there has been a dramatic increase in housing costs in the
County over the past few years. According to the Eagle County planning department, between
1996 and 1997, the latest year for which data is available, the median sales price of housing
units in the county increased by twelve percent. The median price for a single family home
was $318,000 in 1997, representing a 17 percent increase over 1996 prices. Because of
increasing housing prices, there has been a growing concern about providing affordable
housing for service and retail employees, both permanent-and seasonal. As stated previously,
service and retail wages tend to be lower on average than wages in other sectors. In addition,
these wages do not always reflect the high cost of living in the ski resort areas. Because of
this issue, some hotel and resort operators have stated that there has been a shortage of
qualified seasonal labor in recent years that they believe has negatively effected the quality of
service within the Vail Valley.
Tertiary Market Areas
Although the majority of demand for the subject facilities will come from the
previously defined primary and secondary market areas (with the exception of the conference
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center which draws from a national market), the proposed facilities may also expect to attract
some people from the counties adjacent to Eagle County and from the Denver Metropolitan
area for performances or events featuring the most popular artists. The primary
characteristics of the tertiary market areas are summarized below.
Summit County
Summit County is situated just over the continental divide, approximately one and a
half hours west of Denver. The county has approximately 19,000 permanent residents living in
the incorporated towns of Blue River, Breckinridge, Dillon, Frisco, Montezuma, and
Silverthorne and in the unincorporated portions of the county. The median income for the
county was approximately $47,600 in 1999. The county attracts approximately two million
visitors a year to its four major ski areas, including Arapahoe Basin, Breckinridge, Copper
Mountain, and Keystone.
Pitkin County
Pitkin County is located in Roaring Fork Valley, approximately 200 miles north of
Denver. The county has approximately 13,000 permanent residents and contains the Aspen
and Snomass ski resorts. The median income for the county in 1999 was approximately
$52,000. The county hosted approximately 1.2 million skier visits in the winter of 1997/98.
Denver Metropolitan Area
With about 2.2 million residents and over 1.1 million jobs (non-agricultural), the
Denver Metropolitan Area (which includes Adams, Arapahoe, Boulder, Denver, Douglas, and
Jefferson counties) accounts for about 57 percent of Colorado's population and about 54
percent of the state's jobs. The Denver area serves as a regional trade and distribution center
for the Rocky Mountain region; trade and service sectors dominate the local economy,
accounting for about 55 percent of total employment.
The Denver Metropolitan Area enjoys a median household income of about $48,800
according to the U. S. Census Bureau, up from about $33,100 in 1990, and well above the
national average of about $39,000. Additionally, the area has a low unemployment rate of
only about 2.3 percent, relative to the.current national average of about 4.2 percent. Woods
& Poole Economics and American Demographics, Inc. project that the Denver metro area's
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population will increase by about 390,000 persons over the 1995 to 2005 period.- the ninth
largest projected absolute population increase for any metro area in the United States.
Local Political Climate
The Town of Vail has performed numerous surveys and community workshops in
order to identify the needs and concerns of the local population. According to a 1998
community survey performed by RRC Associates, the local residents feel that it is important
to address the improvement of lodge and retail quality and to create additional affordable
seasonal housing for workers. In this survey, residents indicated neutral support for a
performing arts theatre, a family entertainment center, and a conference facility ranking these
facilities a neutral three on a five-point scale of importance ranging from a rating of "not
important" (a score of one) to "very important" (a score of five). Survey respondents
indicated very low levels of support for a second sheet of ice rating it a two on the same five-
point scale.
A 1999 survey of voters from the Town of Vail, performed by Public Opinion
Strategies, specifically addressed the need for a conference center and a performing arts
theatre in the,, Town of Vail. The voters were asked whether they would support using tax
dollars as part of a public-private partnership to pay for constructing the facilities.
Approximately 59 percent of those surveyed supported 't'he proposal for a performing arts
center and' 66 percent supported the proposal of a conference center. However, when asked
whether they would support a potential tax increase to pay for these facilities, only 32 percent
of the voters responded affirmatively.
VISITATION CHARACTERISTICS OF i ti.L VAIL VALLEY
According to the Vail Valley Tourism and Convention Bureau, the Vail Valley
includes about 2,750 hotel rooms, 2,800 condominium units, and 150 rental home properties.
The largest concentration of rooms is located the Town of Vail where there are approximately
1,700 hotel rooms and 1,970 condominium units. The average annual occupancy rate in 1998
was approximately 54 percent for Vail Valley properties as a whole, with hotel properties
experiencing the highest overall occupancy rates of about 64 percent and condominium
properties having somewhat lower annual average occupancies of about 39 percent.
The seasonal nature of visitation to the Vail Valley is illustrated by monthly occupancy
rates at overnight accommodation units in the region. As seen on Table M-6, in 11998,
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Table III-6
OCCUPANCY PATTERNS IN THE VAIL VALLEY: 1998-1999
Vail Vallev Town of Beaver Vail Valley Vail Valley Vail Valley
Region Vail Creek Hotels' Condos' Groun
1998
January 73.0% 79.0% 61.7% 76.6% 66.8% 29.0%
February 81.4% 86.0% 72.5% 86.7% 72.3% 28.9%
March 80.9% 83.5% 76.1% 84.8% 74.4% 23.2%
April 45.3% 48.2% 40.0% 56.1% 28.1% 16.5%
May 20.3% 20.6% 19.6% 29.4% 6.9% 13.4%
June 41.0% 38.2% 46.4% 54.0% 22.5% 29.1%
July 64.1% 65.8% 60.6% 76.2% 48.0% 36.5%
August 67.9% 70.0% 63.7% 81.9% 49.4% 42.1%
September 42.4% 40.8% 45.7% 56.9% 23.2% 28.7%
October 28.5% 27.5% 30.2% 41.5% 12.1% 19.7%
November 27.8% 24.9% 33.0% 34.0% 20.4% 10.5%
December 63.6% 67.1% 56.8% 73.2% 51.7% 15.9%
Annual Average: 53.6% 55.1% 50.7% 63.7% 39.3% 24.7%
1999
January 72.3% 74.0% 69.0% 74.7% 69.3% 35.8%
February 73.1% 74.4% 70.4% 79.6% 64.6% 27.1%
March 79.5% 79.8% 79.1% 85.7% 71.7% 24.2%
April 41.5% 44.6% 35.3% 51.9% 27.4% 17.3%
May 18.6% 18.0% 19.9% 28.2% 4.9% 12.1%
June 42.1% 38.8% 48.3% 53.3% 26.5% 30.2%
July 64.4% 61.4% 70.2% 75.1% 50.4% 39.5%
August 58.1% 57.1% 60.2% 69.5% 43.4% 34.0%
September 47.8% 47.4% 48.5% 63.3% 27.7% 31.1%
Annual Average 3: 55.5% 55.3% 55.7% 64.5% 43.5% 28.0%
1/ Includes hotel units only.
2/ Includes condominium units only.
3/ Estimated by VVTCB.
Source: Vail Valley Tourism & Convention Bureau.
average monthly occupancy rates at overnight accommodation units in the Vail Valley range
from a peak of 81 percent (February through late March) to a low of about 20 percent in May
and less than 30 percent in October and November. During the peak summer visitor season
(June through September), average monthly occupancy rates increase into the 40 percent to
70 percent range, but do not approach levels seen during the ski season. Occupancy levels
during the first three-quarters of 1999 were below 1998 levels due to poor weather conditions
that resulted in significantly reduced snow accumulation.
In addition to maintaining much higher average occupancy rates during the ski season,
average daily room-rates in the Vail Valley are strikingly higher during the ski season. As
seen on Table III-7, in 1998, average daily room rates in the Vail Valley ranged from a peak
of about $288 to $332 per night during the ski season to a low of $87 in May and $97 in
October. During the peak summer season, average daily room-rates in the region ranged from
about $127 to $154. In 1998, the annual average daily room rate for the Vail Valley was
about $223 - up significantly from $178 in 1995. Seasonal and annual trends in occupancy
rates and average daily room-rates are illustrated in Figure III-1. While, annual average daily
room-rates have continued to rise, occupancy rates have fluctuated significantly over the past
few years, primarily because of variations in annual snowfall.
Annual average daily room-rates and occupancy rates also vary considerably by
location and property type. Annual average daily room-rates are higher in Beaver Creek
(about $267 in 1998) and lower in the Town of Vail (about $202 in 1998). Additionally,
annual average daily room rates are much higher for the Vail Valley's condominiums (about
$274 in 1998) than for its hotels (about $201 in 1998). Average occupancy rates are
approximately two to six percent higher in the Town of Vail than in the Vail Valley during the
peak winter and summer seasons. Occupancy rates are also significantly higher in hotel
properties than in condominium units in the Vail Valley. During the peak winter season in
1998, average monthly occupancy-rates in condominium units never exceeded 74 percent
whereas hotel properties enjoyed a peak monthly occupancy-rate of about 87 percent.,
Group business represents an increasingly important aspect of total occupancy in the
Vail Valley. Between 1998 and the partial year 1999, average annual group occupancy
increased from about 25 percent to 28 percent. The summer season is the peak season for
group bookings with average monthly occupancy levels reaching about 40 percent. January;
February and September also have significant group occupancy levels of approximately 30
percent. The remaining months, which are during the spring and fall, have significantly lower
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Table III-7
AVERAGE DAILY ROOM RATES IN ltm VAIL VALLEY: 1998-99
Vail Valley Town of Beaver Vail Vallev Vail Valley Vail Valley
Region Vail Creek Hotels, Condos2 Groun Rate
1988
January $288 $256 $366 $264 $336 $244
February $325 $288 $416 $304 $373 $310
March $332 $285 $428 $307 $379 $280
April $176 $175 $180 $149 $263 $137
May $87 $84 $93 $84 $108 $90
June $135 $127 $148 $125 $167 $141
July $143 $132 $166 $144 $141 $146
August $154 $144 $177 $157 $149 $159
September $127 $114 $149 $125 $131 $130
October $97 $95 $100 $97 $98 $99
November $135 $129 $143 $119 $166 $97
December $316 $272 $419 $261 $413 $185
Annual Average: $223 $202 $267 $201 $274 $177
1999
January $304 $279 $357 $281 $334 $267
February $374 $359 $408 $369 $383 $306
March $361 $323 $438 $332 $406 $318
April $186 $176 $210 $164 $243 $135
May $89 $82 $101 $86 $108 $89
June $133 $118 $155 $132 $133 $135
July $153 $133 $189 $156 $148 $162
August $156 $138 $193 $159 $150 $164
September $134 $123 $153 $135 $131 $139
Annual Average 3: $238 $219 $274 $219 $274 $196
1/ Includes hotel units only.
2/ Includes condominium units only.
3/ Estimated based on 3rd Quarter 1998.
Source: Vail Valley Tourism & Convention Bureau.
Figure III-1
VAIL VALLEY SEASONAL RENTAL PROPERY TRENDS IN 1998
100.0% 5350
u Occupancy $300
80.0%
;t^ tADR - $250
60.0%
A= $200
$150
40.0%
$100
• =34 zi:
20.0% - S50
0.0%$0
N§1 zP1 so
AVERAGE ANNUAL OCCUPANCY RATES AND DAILY ROOM RATES
IN THE VAIL VALLEY 1994 TO 1999
70.0% $275
u~Occupancy $250
65.0% t ADR
60.0% $225
$200
55.0%
1
$175
lam=
50.0% $150
45.0% $125
40.0% _ $100
1994 1995 1996 1997 1998 1999
1/ 1999 Rates are estimated.
Source: Vail Valley Tourism and Convention Bureau.
group occupancy levels primarily due to the unpredictability of weather conditions in the Vail
Valley during these seasons.
Airport Enplanements
Growth in visitation to the Vail Valley has been aided by improved service to the
Eagle County Regional Airport, which is located in the Town of Gypsum. There are five
airlines that serve the airport during the ski season (from mid-December through March)
including American, Delta, Continental, Northwest, and United. Combined, these airlines
provide direct service from 12 cities across the country including key hub cities such as
Chicago, New York, Atlanta, Los Angeles, Houston, and Dallas.
Starting in 1997, the Eagle County Regional Airport added limited off-season service
on United Airlines. Currently, United provides four flights a day to Eagle from Denver year-
round. With the dramatic increase in service levels, total passenger enplanements have grown
roughly as follows:
• 1991 - about 29,000 air passengers
• 1995 - about 85,500 air passengers
i 1998 - about 177,300 air passengers
Visitor Characteristics
Vail Associates commissions frequent visitor intercept surveys from RRC Associates
in order to gather information on the socioeconomic characteristics of the visitors to the Vail
Valley. According the results of a 1996/7 winter and summer season survey and a recent
1999 winter season survey, the following characteristics can be inf,-,, --d:
• The majority of visitors stay overnight (100 percent during the ski season and 84
percent of the visitors during the summer season);
The average length of stay for visitors is six days during the winter season and five
days during the summer season;
• Visitor loyalty in the Vail Valley is high: approximately 45 percent of the visitors in
both the winter an summer seasons are repeat visitors;
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• During the winter season, over 75 percent of the visitors are from out of state. An
additional 15 percent of the visitors are international. In the summer, up to 45
percent of the visitors are from Colorado.
• The majority of visitors to the Vail Valley are extremely wealthy. During the
winter, over 70 percent of the visitors have annual household incomes of over
$100,000 and about 40 percent have household incomes of over $200,000. In the
summer, the visitors are less wealthy on average than during the winter: 47 percent
have annual household incomes of over $100,000 and 25 percent have household
incomes of over $200,000.
• A large portion of the visitors is families-with-children: about 30 percent during
the winter season and 43 percent during the summer. The average number of
children per family is 2.2. About 84 percent of the adult visitors with children
brought their children along on the trip.
• According to a 1999 summer visitor study by RRC, the age distribution of visitors
to Vail during the summer is as follows:
Age Group I Percent
0 to 17 122.5%
l 18 to 24 15.4%
25 to 34 17.4%
35 to 54 29.1%
55 to 64 8.4%
{ 65+ 7.3% l
• According to RRC's 1996 study, during the winter season the population is
considerably older. Only 34 percent of visitors surveyed in the 1996 winter study
were under the age of 30 and the average age of visitors was 45.
Estimated Visitation
There have been no formal studies completed that attempt to estimate total annual
visitation to the Vail Valley. Consequently, ERA has compiled visitation estimates, based on
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room counts, reported occupancy rates, visitor profiles, and typical party size as reported by
the Vail Valley Tourism and Convention Bureau. Based on these figures, it is possible to
estimate monthly and annual visitor nights spent in the Vail Valley. This calculation appears
on Table MA and is summarized in the following points:
• The Vail Valley Tourism and Convention Bureau estimates that during the peak
ski season the average hotel room accommodates 1.6 people and the average
condominium or rental home property accommodates 2.5 people. During the
summer and shoulder seasons, due to the preponderance of family travel, the
average hotel room accommodates 2.1 people and the average condominium or
rental home property accommodates 3.0 -people.
• Based on these figures, ERA estimates that the Valley's hotel, condominium, and
rental home properties accommodate about 2.3 million visitor-nights per year.
While this estimate provides a sense of the number of visitors staying in hotel,
condominium, and rental home units in the Vail Valley, it does not include the following
additional visitors: (1) seasonal residents staying in second homes (single family homes,
condominiums, townhomes, etc.) that are not placed in the rental pool; (2) persons staying
with friends and relatives who live in the area; and (3) campers. In order to estimate visitor
nights in the Vail Valley from these additional visitors, ERA relied on the results of a 1999
RRC Associates survey that provides an estimated distribution of visitors by type of
accommodation during the ski season. RRC Associates' visitor surveys report that only about
73 percent of all visitor nights are spent in hotel, condominium, and rental home properties.
Based on this factor, the estimated total visitor nights in the Vail Valley is about 3.1 million
annually which includes:
• 1.1 million visitor-nights annually in hotel properties;
• 1.2 million visitor-nights annually in condominium and rental home properties; and
• 0.8 million visitor-nights annually in second home and other properties.
Based on the average length of stay estimates derived from RRC Associates' survey of
visitor characteristics, 3.1 million visitor-nights translates to about 715,000 individual visitors
in the Vail Valley a year. Table III-9 shows the total number of visitors per month. Roughly
226,000 visitors visit during the winter season (December through March) and 215,700
visitors come during the summer (June through August).
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Table 111-8
ESTIMATED VISITOR NIGHTS IN THE VAIL VALLEY
BASED ON REPORTED OCCUPANCY AND ESTIMATED NUMBER OF ROOMS / VISITORS PER ROOMt
Ilotel Estimated Estimated Condo Estimated Estimated Estimated Estimated
Total Occupancy in Number of Average Occupancy in Number of Average Total Visitor Total
Days the Vail Valley Ilotel Visitors Per the Vail Valley Condo Visitors Per Nights in Hotel Visitor
2 3
Per Mouth in 1999 Roonrs Ilotel Room in 1999 Units Condo Unit & Condo Units Nights
January 31 74.7% 2,750 1.6 69.3% 2,950 2.5 260,328 356,614
February 28 79.6% 2,750 1.6 64.6% 2,950 2.5 231,466 317,077
March 31 85.7% 2,750 1.6 71.7% 2,950 2.5 280,819 384,683
April 30 51.9% 2,750 1.6 27.4% 2,950 2.5 129,131 176,891
May 31 28.2% 2,750 2.1 4.9% 2,950 3.0 63,928 87,573
June 30 53.3% 2,750 2.1 26.5% 2,950 3.0 162,700 222,876
July 31 75.1% 2,750 2.1 - 50.4% 2,950 3.0 272,720 373,589
August 31 69.5% 2,750 2.1 43.4% 2,950 3.0 243,490 333,548
September 30 63.3% 2,750 2.1 27.7% 2,950 3.0 183,211 250,974
October 31 41.5% 2,750 2.1 12.1% 2,950 3.0 107,492 147,249
November 30 34.0% 2,750 2.1 20.4% 2,950 3.0 113,067 154,886
December 31 73.2% 2.750 1.66 51.7% 2.950 2.5 218,044 298,690
Total/Average: 365 64.5% 2,750 1.9 43.5% 2,950 2.8 2,266,395 3,104,651
I/ Occupancy rates reported to V VTCB for 1999, with the exception of Oct. through Dec. which are from 1998.
2/ Includes privutc homes available for short-tern rental.
3/ Assumes that 27% of total visitors (including second home owners) stay in non-rental units based on
a visitor survey completed by RRC Associates.
Source: Vail Valley Tourism and Convention Bureau; and Economics Research Associates.
Table 1II-9
ESTIMATED NUMBER OF VISITORS
BASED ON ESTIMATED MONTHLY ROOM NIGHTS AND AVERAGE LENGTH OF STAY
Total Average Estimated Estimated Average Estimated
Days Length Total Visitor Total Estimated Total Total Visitors
Per Month of Stav u Nights 2. Visitors Dailv Visitors Per Peak Night 3
January 31 6 356,614 59,436 11,504 13,804
February 28 6 317,077 52,846 11,324 13,589
March 31 6 384,683 64,114 12,409 14,720
April 30 3 176,891 58,964 5,896 7,076
May 31 3 87,573 29,191 2,825 3,390
June 30 3 222,876 74,292 7,429 8,915
July 31 5 373,589 74,718 12,051 14,462
August 31 5 333,548 66,710 10,760 12,912
September 30 3 250,974 83,658 8,366 10,039
October 31 3 147,249 49,083 4,750 5,700
November 30 3 154,886 51,629 5,163 6,195
December 31 6 298.690 49.782 9,635 11.562
Total/Average: 365 4.3 3,104,651 714,421 8,506 11,405
1/ Based on results of RRC Survey of Visitor Characteristics in the winter and summer months. Shoulder
season average length of stay was estimated by ERA.
2/ From Table III-8.
3/ Peak nights are Saturday nights. Model assumes Saturday occupancies are 120% of average monthly
occupancy rates and that 27% of total visitors stay in non-rental units.
Source: RRC Associates and Economics Research Associates.
Additionally, ERA estimated the average number of visitors and the number of visitors
per peak night for each month based on our previous calculation of monthly visitor nights.
According to the Vail Valley Tourism and Convention Bureau, hotel and condominium
occupancy rates are highest on Saturday nights because of weekend travelers from the Denver
area. To derive the total number of visitors per Saturday night, ERA assumed that Saturday
occupancy rates are 20 percent higher than average monthly-occupancy rates. Based on the
above factors, ERA estimates that the average number of visitors in the Vail Valley per peak
night to be approximately 11,400. Monthly average peak-night visitation varies a great deal
based on seasonal visitation patterns as summarized below:
• During the peak ski season, from January to March, the total number of peak night
visitors ranges between approximately 13,600-and 14,700;
During the peak summer season in July and August, the total number of peak night
visitors ranges between approximately 13,900 and 14,500. (It is important to note
that although the hotel occupancy rates during this period are significantly lower
than during the peak winter season, the higher number of visitors per room
accounts for a similar level of total visitors); and
• During the shoulder seasons, annual peak-night visitation ranges from a low of
3,400 in May, to a high of 10,000 in September.
Trends in the Colorado Ski Industry
The information presented in this section is based on RRC Associates' 1999 study of
ski industry indicators. According to RRC, the shifting age demographics of our society,
resulting from the aging of the baby boomer generation has resulted in a stagnation of growth
in the ski industry. Within the industry, competition for skiers has become increasingly
intense. As result, many ski resorts, both in Colorado and nationally, have been upgrading the
quality of their product. At the same time, the cruise industry and warm weather resorts have
captured a larger share of the winter vacation market. Within Colorado, the following ski
resorts are investing in renovations and new attractions: Telluride, Aspen, Snowmass,
Steamboat, Winter Park, Crested Butte, Copper Mountain, Keystone, and Breckenridge.
The Vail Valley ski resorts have enjoyed a "premier status" among other destination
alpine resorts in the past. However, this status has lessened over time because of the
following issues:
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• The lodging inventory has aged and many properties, especially among the
condominium units, are in need of renovations;
• Perception of an erosion of service in terms of overall consistency and
performance;
• General sense that the high prices do not reflect the level of quality and service that
would be expected; and
• Relative inflexibility, in comparison to other ski resorts, in accommodating lengths
of stay of under one week.
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• f
Section IV
CONFERENCE AND LEARNING CENTER
This section presents an industry overview and trend analysis of the public events
.et and a review of the operating characteristics of competitive and comparable facilities
e proposed conference and learning center in Vail. Following this discussion, ERA
;nts our findings on potential market demand and the recommended facility
guration.
USTRY TRENDS
is Meetings Market Definitions
The national market for meeting and exhibition events is broad, incorporating local
)rate meetings, consumer shows, trade shows, , along with state, national, -and
national association convention events. Because the definitions used to describe these
ities and venues have evolved over time, ERA has highlighted some nationally accepted
itions for the different types of events that utilize meeting and/or exhibition facilities and
pecific facility needs of each event. These definitions form the basis for an analysis of a
ble meeting center for the Town of Vail.
National, Regional, or State Meetings
The following events have national, regional, state, and/or local components. National
is draw their base from across the country, bringing people together for annual or semi-
al meetings. Regional events are focused either on associations or trade groups from
fic areas of the country, such as the Denver metropolitan area; or they are sponsored by a
nal association, which has semi-annual regional meetings, in addition to a national
nbly. State events draw from within one state, and local groups draw from within a,
area; these events can also include local chapters of state, regional, or national groups.
.onventions are privately held meetings attended by professional and association groups'
iith the purpose of exchanging ideas, networking, and discussing industry trends. These
ieetings can be for as few as 300 people or as many as 15,000 people. Convention
roups typically require large assembly or plenary space, exhibit space, meeting/breakout
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rooms, and can have substantial food service requirements compared to other events.
Depending on the size and scope of the event, conventions may be held at- convention
centers, conference centers, or hotels with a large amount of meeting/function space.
• Trade Shmvs are exhibit-oriented events sponsored by industry groups and/or
associations. They are organized to bring buyers and sellers of products together in an
efficient manner in order to exchange ideas, view and compare products, and arrange
purchases. Typically, trade show events are sponsored in regions where there is a
concentration of members or related activities.
• Corporate Meetings-are small compared to convention or trade shows, with an average of
approximately 60 attendees per meeting. These types of functions tend 'to focus on
training seminars, management meetings, and professional/technical presentations. More
often than not, these meetings are. held at a full-service downtown hotel, conference
center, or resort, and require meeting rooms, rather than exhibit space. Events of this
nature typically last for one to three days, and can attract out-of-town guests who may fill
up hotel rooms.
• Association Meetings are smaller than conventions, with a reported average of about 100
attendees. An association meeting might involve a seminar for educational purposes or a
briefing for a professional group. These meetings are similar to corporate meetings in
regard to their locational requirements and average length.
Local Events
The following event types are most often driven by local metropolitan area demand as
defined by attendance or ticket sales within a given trade area. Local events are organized by
a host of groups, including corporations, associations, educational institutions, government
groups, the military, and religious/fraternal organizations. In addition, independent private
sector groups also provide meeting planning, operation, and promotion services.
• Consumer Shows are similar to trade shows in that they are exhibit-oriented, but are open
to the public and typically charge admission fees. These shows typically, draw from
communities within the surrounding metropolitan area and therefore generate less of an
economic impact than convention events in terms of hotel, .restaurant, or retail activity.
Consumer events, however, can generate important cash flow for a convention center or
exposition hall facility from space rentals and food and beverage sales.
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• Spectator Events are typically based on live entertainment, and include sporting events,
such as basketball or hockey, as well 'as concerts, and family events, such as the circus or
ice shows. These activities tend to be held in arena venues, which have large fixed-
seating components.
• Social, Military, Educational, Religious, and Fraternal (SMERF) meetings are
generally local in nature and can include weddings, banquets, and other social gatherings.
The size of these events can vary considerably, requiring anything from hotel function
space to a larger convention center or arena facility.
Types of Venues _
The previously described events are typically accommodated by the following types of
venues: convention centers, exposition centers, conference' centers, hotel function space,
arenas and/or civic auditoriums. The nationally accepted definition of each type of facility is
presented below.
• Convention Centers typically include one or more divisible exhibit halls; a series of
meeting and breakout rooms, and possibly a separate ballroom or banquet hall.
Convention centers range in size from 20,000 square feet up to two million square feet.
Large-scale convention centers are typically- located in the center of major cities while
smaller-scale facilities are found in diverse locations across the country including resort
destinations, mid-sized cities, an d small suburban cities within a larger metropolitan area.
While many cities across the country have developed or expanded convention facilities in
order to attract conventions and their beneficial economic impacts, it has become clear
that the success of a convention center is heavily influenced by local amenities and
support facilities, including available quality hotel rooms, air service, high-quality
restaurants, and diverse entertainment options.
• Exposition/Exhibit Halls provide contiguous floor space with clear ceiling heights
ranging between 25 and 35 feet for trade show and exhibit events. They typically have
limited support facilities such as meeting rooms and concessions. Exposition centers are
found in diverse locations including central cities, suburban areas, and on county
fairground properties.
• Conference Centers are designed to provide more specialized meeting -and conference
space for group meetings, training seminars, and presentations. Conference centers
typically have a higher level of finish than convention and exposition facilities. A typical
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conference center has between 15,000 and 75,000 square feet of meeting space in the form
of a divisible ballroom and separate breakout rooms and incorporates kitchen facilities for
in-house catering. Many conference centers have on-site accommodations or special
arrangements with nearby hotels for overnight guests. The majority of these facilities
incorporate high-technology capabilities, including video conferencing, high speed
internet connections, and computer networking.
Convention or Large First-Tier Hotels (hotels with over 300 sleeping rooms and high
levels of service) typically contain between 10,000 to 30,000 square feet of designated
meeting and/or banquet space. Hotel function space caters to small conferences or group
meetings, training seminars, weddings, a nd other social events. These facilities are very
price competitive to other meeting facilities as meeting space is often provided at a
discounted rate to users who fill a significant number of guest rooms or utilize on-site
catering.
• Arena and Civic Auditoriums are designed for spectator events including concerts, dance
performances, circus performances, and sporting events. While the newer and larger arena
facilities still act as multi-purpose venues in concept, these facilities are increasingly being
built to host professional sports teams- Conversely, older arena venues and civic
auditoriums were designed to serve a more diverse range of events and activities,
including banquets, trade shows, conventions, and consumer shows. These older and
generally smaller facilities provide a large flat floor area for trade shows and conventions
along with balcony seating and portable risers for performances and sporting events.
Colorado Market Analysis
The multiple venues described above all have different basic functions. Typically, the
main objective of convention center is to attract state, regional, and national convention
groups to a city. The large-scale convention center market in Colorado is currently being
served by the Colorado Convention Center in Denver. Two small-scale convention facilities
are located in Pueblo and Grand Junction. Colorado contains a host of large-scale conference
facilities which attract both regional and national groups including the Broadmoar in
Colorado Springs and the Keystone conference center. These facilities can be found in the
major urban areas and in resort locations across the state.
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Meetings Market Analysis
The meetings market includes conventions, conferences, and corporate and association
meetings. ERA analyzed trends for this market using a variety of sources including Meetings
and Conventions (M&C) Magazine's biannual survey, which identifies trends in the number
of meetings, attendance, event duration, and exhibit space needs for all types of meetings, and
the International Association of Conference Center's (IACC) annual Trends in the Conference
Industry report, researched by PKF Consulting, which focuses specifically on conference-
style meetings.
National Meeting Industry Trends
The following table identifies changes in the number of meetings held by major
convention, corporate, and association groups between 1991 and 1997, as determined by the
biannual survey of M&C readership. Over that time period, corporate events have generated
approximately 80 percent of the total meeting activity. Association meetings have made up a
smaller share of the surveyed meetings, averaging approximately 19 percent of the total
meetings. Convention events have made up the smallest share of the meetings market,
comprising about one percent of total activity.
.Number of Convention, Association, and Corporate Meetings
Event 1991 1993 1995 19971
Corporate 806,200 801,300 797,100 783,900
Association 215,00 206,500 175,600 189,500
Convention 10,200 11,800 10,900 11,300
Total 1,031,400 11,019,600 983,600 I 984,700
Source: Meetings Market 1982 to 1998
A significant decline occurred in the corporate and association meeting segments
during the period between 1991 and 1995, when a combination of national economic
conditions and international political events conspired to reduce demand for meeting space,
bringing demand down to just above the 1985 level. Corporate meetings continued to decline
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through 1997, although association meetings rebounded to some degree. The number of
conventions varied from year to year with no regular pattern.
Average per event attendance at meetings has fluctuated significantly from year to
year with no regular pattern, with the exception of attendance at conventions which appears to
be on the rise. The table below breaks down average per event attendance for each type of
meeting. The high average attendance for convention events is somewhat misrepresentative as
a result of the large variation in the number of attendees per event. Roughly 62 percent of
reported attendance at conventions was generated by events with less than 500 delegates.
Average per Event Attendance
Event 1991 1993 1995 1997
Corporate 61 69 62 64
Association 105 91 86 95
Convention 847 908 1.191 1,036
Total 78 84 79 i 81
Source: Meetings Market 1982 to 1998, Economics Research Associates
The following table highlights important factors considered by meeting planners when
selecting a site for a convention, association, or corporate event. The most important criteria
can be distilled to these four basic components of a well-run facility: quality, flexibility,
efficiency, and cost. Additionally, meeting planners prefer to utilize facilities with both
lodging and meeting components for meetings requiring out-of-town attendees because of the
opportunity for cost reductions and increased simplicity.
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Facility Selection Criteria Considered "Very Important"
by Corporate Meeting Planners
Percent of
Respondents Factors Quality of Food Service 80%
Negotiable Food, Beverage, and Room Rates 77%
Number, Size and Quality of Meeting Rooms 74%
Cost of Hotel or Meeting Facility 72%
Efficiency of Billing Procedures 64%
Meeting Support Services and Equipment 63%
Efficiency of Check In/Out Procedures 61%
Number, Size, and Quality of Sleeping Rooms 60%
Assignment of one Staff Person to Handle Meetings 53%
Previous Experience with Staff and Facility 43%
Convenience to Other Modes of Transportation 39%
Accessibility of Exhibit Space 34%
Meeting Rooms with Multiple High Speed Phone Lines 23%
Fax Modem Hook-ups in Sleeping Rooms 20%
On-Site Recreational Facilities (Golf, Swimming, Tennis) 17%
Source: Meetings and Conventions Magazine, October 1998
Remaining up-to-date with technology advances is another important requirement for
meeting facilities. Currently, fiber-optics and high-speed computer lines for internet access
and video conferencing are considered necessary by most meeting planners. However,
technology advances at a rapid pace, so facilities that maintain flexibility for future advances
are likely to maintain their success in the long run. Some industry professionals believe that
the technology will soon remove the demand for conference space. Although new technology
is more pervasive than ever, particularly in communications, industry analysts believe there
will always be a need for face-to-face meeting interactions.
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Trends in the Conference Industry
Within the conference industry subset of the meetings market, there are multiple types
of facilities which cater to different types of user groups. The IACC distinguishes between
types of conference facilities based on the following characteristics:
• Executive Conference Centers are typically used by corporations, associations, and other
organizations that emphasize the quality of the facility and its services over price. This
type of facility was developed primarily to satisfy upper-level management meetings and
education or training seminars. Facilities usually include sophisticated equipment and are
staffed with professional conference coordinators. The majority of these facilities have
on-site lodging for conference attendees.
Resort Conference Centers host meetings that are similar to those held at executive
conference center but with a greater emphasis on recreation and social activities for
conference attendees. These facilities are principally located in resort destinations.
o Full Service Hotels and Resort Hotels are primarily lodging. facilities that have additional
meeting space to accommodate a higher percentage of group demand than the typical
commercial hotel, though they still bear more resemblance to commercial hotels than to
conference center properties. These hotels typically have a large number of dedicated
breakout and conference rooms which are typically isolated from the hotel lobby and other
parts of the hotel.
• University Conference Centers are developed by and associated with a major educational
institution and are mainly designed to accommodate executive education and continuing
education programs run by the university. Facilities vary widely in size and level of
service provided.
The following table presents average yearly occupancy rates for conference centers by
type. The occupancy rates listed below are defined by the average number of lodging rooms
filled and not by the amount of meeting space occupied. As a result, these rates do not
accurately reflect expected occupancies at stand-alone conference facilities but are instead
displayed below only to demonstrate relative difference in occupancies levels between types
of conference centers.
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Growth in Occupancy for Conference Centers, 1996-1998
Type of Conference 1996 199 1998 Change
Center
Executive 68.0% 70.1% 71.6% 3.6%
Resort 61.2% 64.5% 68.6% 7.4%
Full-Service Hotel 70.3% 70.2% 69.4% -0.9%
esort Hotel 71.2% 71.0% 70.4% -0.8%
Source: Trends in the Conference Center Industry 1999
Since 1996, overall occupancy for conference center properties has increased, with
the strongest increase occurring in resort properties. Executive conference centers were on
average 72 percent occupied and resort conference centers were on average 69 percent
occupied in 1998. Full service and resort hotels with conference facilities, which historically
have high occupancy rates, experienced a slight decline in average occupancy rates between
1996 and 1998
Occupancy rates among conference centers vary significantly based on location. The
table below presents the average occupancy rates for conference centers broken down by the
characteristics of their location. Airport facilities experience the highest average occupancy
rates of up to 80 percent due to the convenience of access for out of town attendees. Urban
facilities also experience high occupancy rates because of the draw of evening entertainment
options. Not surprisingly, rural conference centers have low average occupancy rates of only
63 Percent.
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Annual Occupancy Rate by Location
Location Occupancy Ratel
Resort 68.4%
Rural 63.2%
Suburban 69.6%
Airport 79.5%
City 73.4%
Source: Trends in the Conference Center Industry 1999
Each type of conference center facility caters to a distinct subset of users. The
following table presents the breakdown of total meetings sponsored by different users for each
type of conference facility. Business organizations sponsor the vast majority of meetings in
all types of facilities with the exception of university conference centers which are equally
used by both business organizations and academic groups. Surprisingly, corporate conference
centers, which can be defined as in-house executive conference centers, are used by outside
business groups more than half of the time.
Total Meetings by Source for Conference Centers
Meeting Type All Conf. Executive Corporate Resort Univ.
Centers
Business Orgs. 46.8% 73.4% 37.1% 60.3% 28.8%
Trade Assoc. 7.1% 3.7% 2.8% 11.1% 8.5%
Academic Inst. 12.8% 11.9% 2.9% 6.3% 29.5% .
Prof. Seminars 5.1% 2.6% 1.4% 2.8% 13.2%
Government Orgs. 4.9% 2.3% 4.5% 5.4% 5.9%
In-House 17.4% 0.1% 47.1% 14.3% 5.0%
Other 6.0% 6.0% 4.3% 0.0% 9.1%
Source: Trends in the Conference Center Industry 1999
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The following table shows the geographic distribution of attendees for each distinct
type of conference center facility. Executive and corporate conference centers are primarily
used by people from within the local market, generally employees of local corporations.
Resort and university facilities tend to draw from a much broader market, attracting
approximately one-half of their attendees from outside the metropolitan area. Only a small
percentage of attendees at conference centers come from international locations.
Scope of Attendance by Type for Conference Centers
Origin of Attendees All Conf. Executive Corporate Resort CoAlUniv.
Centers
Local 60.2% 74.6% 65.3% 45.5% 55.5%
Regional 20.6% 8.0% 17.3% 31.7% 25 A%
National 16.6% 16.6% 15.8% 19.0% 14.8%
International 2.4% 0.9% 1.5% 2.9% 4.3%
Source: Trends in the Conference Center Industry 1999
According to the IACC Trends in the Conference Industry report, the conference
center industry is in what has to be regarded as the longest' period of business growth and
steadily improving financial performance in its brief history. Based on our research, all
available indicators point toward a period of continuing growth in demand and increasing
rates over the next several years as related to the underlying strength of the United States
economy. The expectation for corporate demand also remains strong, as projected corporate
earnings show continued strength over the next one to two years.
Additionally, the prospect of an overbuilt conference center market is not likely in the
short term. The cost of entry into this industry, particularly for executive and resort
conference centers remains high. While full service hotel development has picked-up over
the last couple of years, this increase in development has continued elude the conference
center segment.
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Implications of the Meeting Industry Trends
The national meetings industry is driven by overall economic activity. When business
is profitable, corporations are more likely to sponsor training and educational seminars, sales
meetings, and allow for more incentive trips. Convention and association groups also benefit
from overall economic expansion in a similar fashion, generating greater potential for meeting
activity. The Town of Vail can expect demand for their proposed meeting space to come
from national corporations and associations and local SMERF and community groups. The
actual level of use by corporations and associations for meetings will be determined by
facility design, pricing, and marketing as discussed in the following sections.
CONFERENCE SPACE IN THE TOWN OF VAIL
The Town of Vail has a considerable amount of meeting space contained within hotel
and condominium properties. The largest meeting space, located in the Marriott, has the
capacity to hold receptions for up to 800 people and banquets for up to 600 people. The
largest room at the Vail Cascade has the capacity to accommodate up to 400 people banquet
style. The remainder of the properties typically accommodate groups of 250 people or less.
The following table presents the amount of meeting space and the largest room available for
the properties with the most significant amount of space.
Facility Total Meeting Space Largest Room ,
Marriott's Mountain Resort 23,000 s.f. 8,400 s.f.
Vail Cascade 49,000 s.f. , 5,940 s.f. l
Lodge at Vail 10,000 s.f. 6,000 s.f.
Manor Vail 8,700 s.f. 2,800 s.f.
The Sonnelalp 4,250 s.f. 14,250 s.f. I
Vail Village Inn 10,000 s.f. 17,000 s.f.
(To be Completed in November 2001)
According to the manager's of the conference hotel properties, the existing meeting
spaces at Vail are primarily used for corporate and association meetings of less than 100
attendees. The majority of the meetings take place during the winter and summer seasons but
some properties have had reasonable success booking meetings in the fall and spring shoulder
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seasons. Although there is no singular property in the Vail that can successfully handle
groups of over 600, working in conjunction with each other, hotel properties in Vail have
been able to handle larger groups, of up to 1,000 people, on a few occasions by using the
Dobson Arena for banquets, general session meetings, and exhibit space. However, hotel
managers have found that it is difficult to book space in Dobson Arena due to the lack of
available ice time, especially during the hockey season. Consequently, they have to turn
down a number of large association meetings each year because there are no alternative
venues. As a result, the managers of the existing meeting facilities believe the Town should
develop a large-scale conference center which can hold groups of up to 1,000 or more.
Although this conference center would not solely be used for groups of that size, they view
the potential project as being complimentary and not competitive to their properties.
As noted in the table above, the Vail Cascade contains approximately 49,000 square
feet of meeting space which is a sizeable amount. However, this figure includes a recently
approved 20,000 square foot indoor tennis court which can double as indoor exhibit space for
trade show usage. While this facility will serve as an alternative exhibit venue to Dobson
Arena, the manager of the Vail Cascade does not believe that this space will fill the unmet
demand for a sizeable banquet facility in the Town of Vail_
COMPARABLE AND COMPE t t t VE FACILITIES
This section examines conference facilities which serve as models for the proposed
conference/learning center in the Town of Vail. Included in this section are reviews of
conference day-use facilities (i.e. facilities without specific associated lodging) in mountain
ski resort areas and existing conference facilities within the Vail Valley and neighboring ski
resorts which will potentially compete with the proposed facility.
Comparable Facilities
The following conference and event facilities were identified by ERA as comparable
to the proposed facility in the Town of Vail. The primary criteria used in identifying these
facilities is that they have no on-site lodging facilities, are owned by public authorities or non-
profit organizations, and are located in ski resort areas. It is important to note that although
these facilities are not located in the Vail Valley, many of them view the potential
development of a conference/event center in the Town of Vail as potential competition. The
distinction made in this section between comparable and competitive facilities is based
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entirely on geographical factors. The following matrix lists the facilities interviewed by ERA.
The description of these facilities, presented in the section below, provides useful insights into
potential facility configuration, facility management, utilization patterns, and operating
revenues.
Facility Facility Size Largest Room Ownership
Telluride Conference Center 11,000 s.f. 6,070 s.f. Town
Mountain Village, Colorado
Taos Civic Plaza and Conference Center 23,000 s.f. 16,050 s.f. Town
Taos, New. Mexico
North Lake Tahoe Conference Center 8,100 s.f. 4,840 s.f. Public District
Kings Beach, California
Whistler Conference Center 135,000 s.f. 13,600 s.f. Town
Whistler, British Colombia
Telluride Conference Center v
The Telluride Conference Center is an 23,000 square foot conference facility,
containing 11,000 square feet of net usable meeting space, located in the Town of Mountain
Village, Colorado, in close proximity to the Telluride ski area. The facility features a 6,100
square foot ballroom, divisible into three sections, and three break-out rooms, ranging in size
from 300 to 730 square feet. Additionally, the facility has a 1,200 square foot mezzanine and
a 2,000 square foot lobby which double as both prefunction and exhibit space.
The facility was built in July 1999 by the Metropolitan District of the Town of
Mountain Village in order to jump-start more commercial development in the area and to help
fill existing hotel rooms during the shoulder seasons. The development costs, of about $9.5
million, were financed by a special district bond issue which is being paid off through the
Town's general fund. The special lodging tax in the Town is used to cover marketing costs
and the operating gap of the facility.
In its first six months of operation, the conference facility has booked a total of 40
events, the majority of which were corporate or association meetings. A large portion of the
events booked so far have been for the months of July, August, February, and March. The
facility has been able to attract users from all over the country although they have gotten a
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strong base from the east coast. According to the Executive Director, demand has been
primarily driven by airline accessibility.
The conference center currently hosts a number of live performances, including dance,
theatre, and concerts, on a temporary stage in the ballroom during the evenings in both the
peak and shoulder seasons. The executive director estimates that the facility will probably
host up to 45 event days a year until a performing arts center is completed in the Town, which
will likely occur about five years down the line. Additionally, the facility is used for
community events and fundraisers at a significantly discounted price.
Currently the conference rooms are available on a per room rental basis. Prices range
from $400 for a board room style space to $2,500 for the full ballroom. The executive
director is contemplating moving to a complete meeting package rate in the future. In a
stabilized year of operation, probably within the third year, the executive director estimates
that total revenues from events and food and beverage will be about $700,000 and total
operating costs will be $1.2 million dollars. The facility will require an annual operating
subsidy of about $500,000 dollars, to be paid for from the special hotel tax.
Taos Civic Plaza and Conference Center
The Taos Civic Plaza and Convention Center serves as both a community center and a
conference facility. The facility was built in 1991 by the Town of Taos and contains 23,000
square feet of conference space, consisting of a 7,500 square foot ballroom and smaller
breakout rooms. The on-site community facilities consist of City Council chambers, a
community gym, and a swimming pool. The facility was originally built as meeting rooms
for the community but has been marketed as a conference facility for the past two years.
Since then, Town meetings have been limited to the Council chamber.
Marketing efforts for the conference center are still getting off the ground which has
resulted in low occupancies in the meeting rooms. The facility booked only 13 conference
events in 1999. The primary use for the facility has been weddings and local reception
bookings. Although the facility is located near a destination ski resort, there are no full-
service hotel properties within Taos. As a result, the facility has had difficulties attracting
corporate business. The majority of their bookings come from associations based in the
Southwest.
There is a fixed fee schedule for meeting room rentals which ranges from.$30 for a
boardroom for a half-day up to $600 per day for the largest hall. The facility is staffed by
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four full-time convention staff and four facility superintendents. The annual operating budget
is approximately $400,000, of which approximately one third are covered by operating
revenues. The remaining costs are covered by the local hotel tax.
North Lake Tahoe Conference Center
The North Lake Tahoe Conference Center is located in a remodeled bowling alley
directly adjacent to the Lake Tahoe in the unincorporated community of Kings Beach,
California. The facility is owned and operated by a public district and contains about 8,100
square feet of usable meeting space, with the largest ballroom comprising 4,800 square feet.
The district created the facility in 1988 to fill existing hotel rooms and stimulate the
development of additional shops, restaurants, and hotel properties in the nearby area.
The facility had a great deal of difficulty in attracting business in its first few years of
operations because of its distance from the tourist hub areas of Lake Tahoe. There is no
lodging within walking distance and there are no full-service hotels located within a 5 to 10
minute driving distance of the facility. As a result, it primarily appeals to price-sensitive
groups such as SMERF groups, associations, and non-profits. Additionally, because of its
lakeside location, it has become a popular site for weddings and other social events.
However, in recent years, the conference business has picked up dramatically. The property
now hosts 50 to 60 conference groups a year. Not including marketing costs, which are
covered by a local hotel tax, the facility now makes enough revenues to cover its operating
costs. Operating revenues and costs are both approximately $350,000 per year. Debt service
on the remodeling of the property and any needed operating subsidies are paid for by the
public district.
Whistler Conference Centre
The Whistler Conference Centre is located within the Whistler ski resort in British
Colombia, Canada. The facility contains approximately 22,000 square feet of usable meeting
space including a 13,000 square foot ballroom and a 300-person fixed seat theatre. The
facility was originally built by the Town of Whistler but is currently managed by Tourism
Whistler, the resort company, under a long-term lease. The facility currently has the capacity
to hold groups of up to 1,600 people (seated theatre-styled) but more typically serves groups
ranging in size from 200 to 1,200. Although specific rate information for the facility was not
available, the Whistler Conference Center (and ski resort on the whole) is currently extremely
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price competitive with existing facilities in American ski resort communities given the
enhanced buying power of the American dollar in Canada.
Tourism Whistler is currently working on plans to renovate and expand the conference
center. According to a recent article in the local newspaper, the goal of the expansion is to be
able to accommodate groups of up to 3,000 people. Tourism Whistler is not releasing any
additional information on the planned configuration or timing of the expansion.
Potentially Competitive Facilities
In order to analyze demand for additional meeting space in the Town of Vail, ERA
identified other conference and event facilities that might potentially compete with the
proposed conference and learning center in the Town of Vail. These facilities will compete
in varying degrees depending on their location, size, and featured amenities. The facilities
most likely to serve as competition are identified in the following matrix and described in
detail in the section below.
Facility I Facility Size Largest Room Ownership
Keystone Conference Center 50,000 s.f. 20,000 Resort
Keystone, Colorado
Snowmass Conference Center -38,000 s.f. 11,000 Resort
Snowmass, Colorado
Hyatt Regency Beaver Creek 23,000 s.f. 10,700 Hotel
Beaver Creek, Colorado
Copper Mountain Resort 50,000 s.f. 7,780 Resort
Copper Mountain, Colorado
The Village at Breckenridge 30,000 s.f. 8,400 Hotel
Breckenridge, Colorado
Beaver Run Resort 30,000 s.f. 7,200 I Resort / Home Owners
Breckenridge, Colorado Association
Keystone Conference Center
The Keystone Conference Center is located within the Keystone Resort,
approximately 70 miles west of Denver and about 40 miles east of Vail. The conference
building is located on the opposite side of Highway 6 than the rest of the resort and is
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connected to the lodging properties and the commercial village via either an underground
pedestrian tunnel or a free shuttle. The facility features a 16,000 square foot ballroom and
4,500 square feet of breakout space. An additional 20,000 square foot ballroom is presently
under construction and will be completed by June 2000. The Keystone Resort, including the
conference facility, is owned and managed by Vail Resorts.
The facility is the largest mountain resort conference property in Colorado. The
building design features tall ceilings (of about 18 feet), large windows in the pre-function
areas, and flexible meeting rooms which can be divided into multiple configurations with air
walls. The facility is able to attract large groups, as a result of its flexible design and its
proximity to Denver. It currently has a capacity for up to 1,200 people (seated banquet-style)
and typically accommodates groups of 200 to 300. When the new ballroom is completed, the
facility will be able to accommodate banquets of up to 1,600 people.
The facility currently attracts a large number of corporate groups but the largest
volume of business comes from association groups. The facility also hosts a few trade shows
a year. Conference sales staff is actively trying to attract trade show business because the
peak trade show times occur during the facility's slowest periods (in May and October). The
majority of business is nationally based, but the facility does attract approximately 30 percent
of its business from the Denver metropolitan area.
The annual revenues and costs of operating the facility are not separated from the
operations of the resort as a whole. However, the conference manager estimates that the
facility probably generates some annual profit off of the banquet business but loses money on
room rentals. Often groups are provided with free meeting room rentals if they utilize hotel
rooms and purchase banquet services. A 4.2 percent surcharge on all lodging and food and
beverage purchased within the resort is designated to cover the operating expenses of the
conference facility. Although the facility manager could not estimate an annual occupancy
rate, he stated that they are nearing capacity during the peak seasons which has resulted in
their decision to build a second ballroom.
Snowmass Conference Center
The Snowmass Conference Center was built by the Town of Snowmass in 1986 to
attract large groups to the resort area. It is located approximately 220 miles southwest of
Denver and 120 miles southwest of Vail. The facility is operated by the resort association and
consists of 38,000 square feet of usable meeting space located in two buildings. The main
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meeting building contains a 10,800 square foot ballroom on the bottom level and breakout
rooms on the second floor. The second building features a 4,400 square foot ballroom. The
facility has the capacity for up to 1,200 people (reception-style) and 900 people (seated
banquet-style).
The facility primarily attracts association groups, with a strong emphasis on the
continuing medical education market. In a typical year, the facility books between 75 and
100 conference groups which vary in size from 40 up to 900. The average group size is about
250. The facility is near capacity during the peak winter and summer seasons but does not get
much use during the shoulder seasons. Meeting rooms are rented on a per room basis or a
CMP rate depending on the client's preference. The base meeting room rental cost is $1,500
for the large ballroom. This price is adjusted based on the number of room nights and food
purchases made by the group. Conference revenues are not sufficient to cover operating
costs. The facility receives an annual operating subsidy from a conference center tax on all
local hotel properties.
Hyatt Regency Beaver Creek
The Hyatt Regency is located within the pedestrian village of Beaver Creek,
approximately 15 minutes outside of Vail. The conference space is located both within the
hotel and in the adjacent Village Hall facility which was built by Vail Associates in the early
1980's to function as a multi-purpose building for meetings, real estate offices, and skier
services. The Hyatt manages a total of 23,000 square feet of meeting space which is divided
between 3 ball rooms and a series of smaller breakout rooms. The largest ballroom, located in
Village Hall, comprises 10,300 square feet.
Approximately 50 percent of the Hyatt's business is group oriented. The majority of
the group business is corporate and incentive based but association groups also comprise a
sizeable share of total business. During the peak winter season, the facility is primarily
utilized by financial corporations. During the summer season the majority of business comes
from incentive and association groups. The facility hosts some trade shows from state and
regional associations during the value time periods in May and June. The majority of user
groups are based nationally. Only 10 to 15 percent of total business comes from the Denver
metropolitan area. Since the conference center is operated in conjunction with the hotel,
occupancy rates and operating costs are not calculated separately.
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The conference manager stated that although a conference center development in Vail
will be extremely competitive with the meeting space in the Hyatt Regency, it will
significantly strengthen Vail Valley's position as a national attraction. As a result, he strongly
advocates for the facility to be built.
Copper Mountain Resort
The Copper Mountain Resort is located approximately 75 miles west of Denver and,25
miles east of Vail. The resort contains a total of 50,000 square feet of meeting space divided
between three villages. The meeting facilities are owned and operated by the resort company.
The newest facility is Copper Station facility, located in the East Village of the Copper
Mountain Resort, which serves as a day lodge during the winter ski season and a conference
and event center during the summer season. The facility consists of 32,000 square feet of
usable meeting space in a 40,000 square foot building. The largest room contains about
7,000 square feet and can seat up to 450 in a banquet. Copper Station is not well outfitted
with AV equipment and therefore cannot handle general session meetings very well. As a
result, the facility is primarily used for special events, including weddings and foundation
dinners, and specialty groups such as bike races and golf tournaments.
In the Center Village, the resort company manages a 20,000 square foot year-round
conference center called Copper Commons. This facility features a 7,800 square foot
ballroom which has the capacity for up to 870 people (seated theatre-style) and 550 people
(seated banquet-style). This facility is attracts conference and association business with the
peak seasons occurring in the winter and the summer.
The Village at Breckenridge
Breckenridge is located approximately 75 miles west of Denver and 35 miles
southwest of Vail. The Village at Breckenridge is a privately owned mixed used development
featuring a hotel, conference space, retail, and skier services organized around a central
square, similar to- the Vail Cascade property. The Village development is located near the
central business district of Breckenridge and features 30,000 square feet of meeting space,
spread out among five buildings. The facility contains two ballrooms of about 4,600 square
feet which can hold up to 500 people (theatre-style) and 350 people (banquet-style) each.
The remainder of the meeting rooms are dedicated break-out rooms.
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Beaver Run Resort, Breckenridge
The Beaver Run Resort, located in close proximity to the Village at Breckenridge,
contains about 30,000 square feet of usable meeting space in the commons building, which is
physically connected to the lodging property via an above street covered walkway. The
facility contains a 7,200 square foot ballroom which can seat groups of up to 700 (theatre-
style) and 500 (banquet-style). Additionally, an 8,000 square foot game rooms doubles as
exhibition space when needed. During the winter ski season, a portion of the meeting
facilities are used as a base skier lodge.
During the winter, the facility attracts primarily corporate and high-end association
meetings such as continuing medical education groups. During the summer, regional
association groups represent the primary source of business. The shoulder seasons are booked
by cost-conscious state association meetings. A large share of the facility's business comes
from Colorado based corporations and associations, approximately 30 percent during the
winter and up to 65 percent during the summer season. The majority of groups that use the
facility have between 75 and 200 people.
The meeting space is almost completely booked during the peak summer and winter
seasons while May and November are the slowest months for business. The conference sales
manager estimates that the facility is about 57 percent occupied on an annual basis. Although
operating costs and revenues are not reported separately from lodging revenues, management
believes that the conference space probably comes close to paying for itself. The resort is
currently planning to expand the meeting space by an additional 21,000 square feet. The exact
layout of this expansion is still being decided but the majority of the space will probably be in
one large ballroom with flexible air walls. This expansion is expected to be completed by
2002.
Other Facilities
Colorado contains other resort conference facilities that do not present significant
competition but are worth mentioning in this section. The Aspen Meadows is a 15,000 square
foot conference retreat facility that is owned and operated by the non-profit Aspen Institute.
The facility contains 95 lodging rooms and can house groups of up to 250. The facility is not
available during the summer months when it is occupied by the Aspen Institute's seminar
series. During the remainder of the year the facility attracts corporate and association groups
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to its retreat environment. Users are required to pay a CMP rate ranging between $185 and
$320, depending on the time of year.
The Broadmoar in Colorado Springs is the largest resort conference facility in
Colorado. The Broadmoar consists of 110,000 square feet of usable meeting space. The
largest room comprises 17,500 and has a capacity for up to 3,000 people for a reception and
1,200 people for a banquet. The facility books 1,000 meetings per year from corporate and
association groups. Despite the large capacity of the facility, the average group size is only
20 people. The facility does not charge for meeting space but hotel rooms rates are between
$300 and $400 per room night depending on the season. The peak season in Colorado
Springs is from May to October, the exact opposite from the Colorado ski resort areas. As a
result, the facility would only be considered competitive during the summer season.
Projected Grmvth in Competitive Supply
ERA analyzed potential growth in the competitive supply by interviewing conference
property managers about proposed expansions both on their property and on competitive
properties and by researching proposed ski resort expansions. The following expansions at
competitive facilities were identified by ERA, and are discussed in detail in the previous
section:
• Vail Cascade's recent approval to use 20,000 square foot tennis court as exhibit space;
• Keystone Conference Center's construction of a new 20,000 square foot ballroom in
, June 2000;
• Beaver Run Resort's proposed 21,000 square foot expansion;
• Whistler's proposed expansion (the details have yet to be made public).
SUMMARY OF INTERV iLWS W i t -ti MEETING PLANNERS
Economic Research Associates interviewed a total of 29 meeting planners about the
proposed conference facility in the Town of Vail. In total, 123 meeting planners were
contacted, including 108 contacts provided by the Vail Tourism & Convention Bureau.
Approximately 55 percent of the meeting planners interviewed were from the VVTCB's lost
business list, 25 percent were found using the VVTCB's prospect list and 10 percent were
names ERA found through other sources.
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The meeting planners interviewed plan for diverse types of meetings: 40 percent of the
meeting planners interviewed planned meetings for corporations, 33 percent planned for
associations, 17 percent planned educational meetings, and 10 percent planned government
meetings. The majority of the meeting planners interviewed had never booked meetings in
Vail before while about 31 percent had booked meetings there in the past. A summary of the
meeting planners' responses is provided below.
• When asked if they would ever consider booking meetings at Vail, 28 percent of the
meeting planners said they would definitely consider booking in Vail in the future and
an additional seven percent said they would probably consider booking in Vail. A
total of 31 percent of the meeting planners said they would probably not consider it
and 34 percent were unsure as to whether they would consider booking in Vail in the
future.
• The two most common reasons given for not wanting to book in Vail were the
relatively high expense of holding meetings in Vail and the lack of frequent and
uninterrupted commercial air flights into the Eagle-Vail regional airport.
• A total of 28 percent of the meeting planners interviewed had previously wanted to
book a meeting in Vail but were unsuccessful. Some of the planners have had success
booking in Vail on occasion, but have run into problems other times. Common
problems included: lack of a single hotel and/or meeting facility to hold all attendees
(usually for groups 350 plus), lack of a spacious meeting facility, and the
unavailability of quality hotel rooms during the peak winter months.
• When asked specifically whether they would consider booking at the proposed
facility, 17 percent of the meeting planners surveyed would definately consider
booking there, whereas 55 percent probably would not, and 21 percent were unsure.
• The most common reason given for not wanting to book at the proposed facility was
the lack of on-site lodging. Approximately 40 percent of the meeting planners
surveyed indicated a strong preference for on-site lodging.
• 'The majority of interest for the facility came from groups with 100 to 400 attendees.
Of these groups, 42 percent said they would definitely consider booking at the
proposed facility and 12 percent said they would probably consider booking at the
proposed facility. Of the groups with 700 attendees or more, 18 percent indicated that
they would likely consider booking at the proposed facility. Most of the groups with
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700 plus attendees who would not consider booking at the proposed facility stated a
strong preference for conference centers in urban areas.
Meeting planners indicated little support for a fixed-seat theater within the conference
center. Only one meeting planner interviewed considered a fixed-seat theater very
important for their meetings whereas 69 percent stated that they would be unlikely to
use one if it was available. Of those that said they might potentially use a fixed-seat
theater, almost all required the theater to have the exact same capacity as the size of
their meetings in order to maintain.a feeling of intimacy.
• Common amenities requested by meeting planners for the meeting facility were first-
class dining, on-site security, internet workstations available for attendees, and video-
conferencing capabilities.
The results of these interviews indicate that there is unmet demand for an additional
conference facility in the Town of Vail. The majority of demand originates from large groups
who cannot be accommodated by the existing properties in Vail. ERA received additional
input on large group demand for Vail from Destination Services and Rocky Mountain
connections, two destination management companies that work with meeting planners to
coordinate large group meetings in Colorado. According to these companies, there is no
location in the Vail Valley that can comfortably hold groups of over 500 for sit down
banquets. As a result, they have had to turn away multiple groups a year who request
meetings in the Vail Valley. They believe that if a sizeable facility is built, Vail could
conservatively expect to attract one to two groups of over 700 people per month.
CONFERENCE CENTER DEMAND CONCLUSIONS
Primary Market Segments
The results of the meeting planner surveys and interviews with competing facilities
indicate that the primary market segments that will potentially use the proposed facility are
association groups and large-scale corporate sales and training groups. Although the majority
of business will be based nationally, the facility should expect a sizeable portion of demand
(up to 30 percent) to come from Colorado-based associations and corporations, especially
during the spring and fall shoulder seasons.
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Seasonality of Meetings
Associations meetings occur year-round but the larger-scale meetings tend to be
concentrated in the months of May and September and October, corresponding with the
shoulder seasons in the Town of Vail. These meetings tend to be extremely price sensitive
and would therefore look favorably on the,low lodging rates in Vail during those months,
especially when compared to rates in Denver and other metropolitan areas. Corporate events
are spread out year-round with an expected drop-off during the holiday seasons. Corporate
incentive events occur primarily in the winter and summer, depending on the recreational
interests of the group.
One factor working against Vail during the spring and fall months is the
unpredictability of the weather. Temperatures during these seasons vary from extremely mild
and sunny to full-fledged blizzard conditions. Therefore groups looking to incorporate a lot
of recreational activities into their events would not likely consider Vail during those months.
Additionally, many restaurants and shops within the Town of Vail close during the shoulder
seasons due to the limited number of visitors. This, in conjunction with the limited
availability of flights into Eagle County airport during the off-seasons, reinforces the idea that
the resort is "closed" during these months.. As a result, the proposed conference facility
would likely experience peak occupancies during the winter and summer months and will
have to market extensively to fill the shoulder seasons. However, according to Rocky
Mountain Connections, resistance to shoulder season dates has considerably decreased during
recent years. Demand for meetings during these dates has grown for both in-state and out-of-
state groups.
Lodging Preferences
As stated above in the meeting planner survey summary, meeting planners prefer to
house all of their attendees in a single property. Typically both corporate and association
meeting planners prefer large name-brand full-service hotels. This preference applies for
even the most value-conscious groups who prefer to use these properties during non-peak
seasons. Incentive and high-end corporate meeting planners often prefer to stay at five-star
hotel properties, of which there are none currently located in Vail. The array of lodging
properties available in Vail do not reflect typical meeting planner preferences. The majority
of the properties have under 100 rooms and are not affiliated with national chains. These
preferences will not necessarily undermine the success of the proposed facility but are issues
that should be addressed when marketing the facility.
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FACILITY RECOMMENDATIONS
Conference Center
Based on the conclusions of the market analysis and interviews with hotel managers
and conference sales staff in the Town of Vail, ERA believes that there is strong demand for
a conference facility in Vail. The following recommended configuration for the proposed
facility was developed based on the results of ERA's market research:
• 20,000 square foot ballroom, divisible into 8 to 10 sections;
0 6,500 square feet of flexible breakout rooms in two or more divisible banks with a
total of 10 to 12 rooms;
• 500 square foot boardroom; and
• A minimum of 10,000 square feet in lobby/prefunction space.
All meeting space should be equipped with state of the art technology including fiber
optic capabilities and multiple electrical floor outlets to accommodate exhibitions. The
building design should incorporate clear-span space for the ballroom with ceiling heights of a
minimum of 18 feet. The lobby/prefunction space should feature broad expanses of windows
to accentuate the scenic mountain environment of Vail. Additionally, the Dobson Arena or
the proposed second arena, should be considered as adjunct event space, doubling as
secondary exhibit or meeting space for group bookings of over 800 people.
The Learning Center Concept
The Learning Center concept of a high tech training center, as envisioned by the
community, would work well as an adjunct facility to the conference center which would be
available for both community use and conference use. ERA envisions the facility functioning
as a computer lab, with about 40 computers and a few small meeting rooms with video
conferencing capabilities. These small meeting rooms can either be breakout rooms shared
with the rest of the conference facility or separate rooms that are only accessible from within
the learning center. In total, the learning center should comprise approximately 1,000 square
feet and should be located adjacent to business service offices with a separate entrance that is
accessible from outside of the building.
The computers should be arranged in a classroom format, facing a front screen with
computer projection capabilities so that they can be used for either a training session or
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individual use. Locating the facility adjacent to or within the business services office will
allow it to be used both for conference and community use and to operate with minimum
additional staffing. Since facilities of this sort typically have high operating costs as a result
for the need for advanced technical, support, networking capabilities, and up-to-date
technologies, the facility should be priced to operate on a break-even basis. In order to make
the facility more accessible to the community a dual rate system could be established with
lower rates for community users and higher rates for conference/business users.
ERA's analysis of utilization patterns for the proposed conference facility is presented
in Section VIII along with a projection of operating costs and revenues in a stabilized year of
operation.
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SECTION V
PERFORMING ARTS CENTER
This section presents ERA's analysis of the market potential for a performing arts
facility as part of the development program. The Town of Vail directed ERA to evaluate the
economic feasibility of a 200-seat "black box" theater, a 1,100 to 1,200-seat theater, and a
2,200-seat theater. The Town further directed ERA to only consider scenarios that would not
directly compete with the Vilar Center for the Arts in Beaver Creek.
EXISTING PERFORMING ARTS VENUES
Vail Valley has three major facilities in which professional performances are
presented:
• The Vilar Center for the Arts (527 seats)
• The Ford Amphitheater (965 fixed and 1,600 lawn seats)
• Dobson Arena (2,500+ capacity)
In addition professional concert performances are occasionally presented at the Marriott
ballroom, local nightclubs, individual's homes, and other venues. Also, community amateur
productions are presented at the 460-seat Battle Mountain High School theater.
The Vilar Center for the Arts is a new theater designed specifically for professional
productions, and is used year-round. The Ford Amphitheater is designed for summer outdoor
presentations, and only a portion of its seating capacity (the 965 fixed seats) are covered.
Concert promoters book the Dobson Arena several times each year, primarily for popular
music and rock acts.
MOTIVATIONS FOR A NEW PERFORMING ARTS CENTER
There appears to be three major reasons advocates for a new performing arts center
desire a new facility:
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I. To help develop local performing arts groups and provide a venue where they can
perform and rehearse.
2. To provide nighttime entertainment for Vail Valley tourists and residents, and
generate additional economic benefits for the Town of Vail.
3. To elevate the cultural environment in Vail by providing a year-round venue in
which to present world-renowned artists and productions.
itiLATER OPERATIONS
Theaters operate primarily in three manners: (1) as rental facilities; (2) as presenting
houses; and (3) as producing operations. Rental theaters lease out their performance facilities
and services to non-profit and for-profit groups. They generate earned revenue by charging
fees for facility use and services. Presenting theaters invite and underwrite professional acts
to perform at the facility. They generate earned-revenue from ticket sales and concessions.
Producing theaters develop and produce their own plays, concerts, and shows. They
typically have a resident company who manages operations and has sole or priority use of the
facility. Producing operations generate earned-revenue from ticket sales and concessions.
Rental theaters (also known as road houses) assume that the primary use of the venue
is for outside (non-house) performing arts groups and promoters- Road house operations are
typical in communities where there is a large number of local performing arts organizations
that have indicated a need of a performance venue, but are neither interested in, nor capable
of, sole operation of the facility. They are also are common in regions whose markets are
attractive to for-profit promoters that need a facility on a case-by-case basis. In most cases
the local government develops and owns the theater, although privately owned theaters also
exist. Rental theaters owned by local government are operated either by city staff or by a
board or non-profit organization established for the sole purpose of theater operation. The
advantage of rental theaters is their minimal risk of operating capital that is often associated
with house presentations and productions. Rental theaters typically have the lowest
operating deficits among types of theaters, as low as $100,000 to $300,000 per year.
However, compared to presenting theaters and theaters with resident companies, rental
theaters often are limited in their programming and revenue potential, and are less utilized.
At presenting and producing theaters, the main source of earned-revenue is generated
from ticket sales of in-house presentations or productions. While occasional or even seasonal
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rentals to outside groups are often permitted, the rental nature of the theater is not
emphasized', and the house retains the choice performance dates. In most cases, presenting
and producing theaters are owned and managed by a single private non-profit organization,
or by government. Sometimes, a government agency owns the facility, but a private non-
profit presenting or producing organization runs the facility under a management contract.
Compared to rental facilities, the operating budgets of these theaters are often considerably
higher due to their programming expenses. An advantage of these two types of theater
operations is more intensive use of the facility, complemented by an opportunity for
additional use by the public during non-peak periods. On the other hand, the major
disadvantage of producing and presenting operations is the higher financial risk of in-house
productions. Poor attendance at in-house productions will result in significant financial
losses for the operating organization. Many large theaters of this type incur substantial
operating deficits each year in excess of $1 million that they fund with contributed income
raised each year, which is a major responsibility.
i ri,:ATERS IN RESORT LOCATIONS
ERA identified and selected several theaters in other resort locations to review regarding
their operating structures, utilization, economic performance, and other characteristics. The
theaters were selected according to the following criteria:
• Size: The theaters selected represent the size ranges under consideration - less
than 700-seats, and 1,100-2,900 seats.
• Resident Population Characteristics: Selected theaters are located in small towns
or cities in most cases, although a few are near large metropolitan populations.
Other demographics such as median income were considered.
• Location: The theaters are either located in resort areas with a high volume of
tourism.
• Seasonal Population: Most of the selected theaters are based in areas whose
tourism is seasonal.
' In many cases, priority in production and rehearsal scheduling is given to in-house or house-presented
performance groups. And in several cases, rentals are limited to non-professional performance groups such as
school and local community groups.
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Mountain and Seaside Resorts
The majority of the resort areas that ERA surveyed have a local arts council that
oversees everything from music festivals to playhouse productions in the community. In
mountain resort areas, for instance, nearly every ski village has a summertime, outdoor music
festival that attracts both local residents and visitors.
Some mountain areas have formed collaborations with other artistic groups in an
effort to attract more arts into the community. In Telluride, for instance, the Chicago-based
Joffrey Ballet has formed a partnership with the Telluride Society for the Performing Arts
(TSPA) to bring the company to the city during the summer months over the next five to ten
years. The company rehearses in Telluride and holds public performances twice per week
on Friday and Saturday evenings over a ten-week period. In addition, the Joffrey Ballet, in
conjunction with TSPA, hosts lectures and demonstrations for the public. TSPA has an
extensive membership roster. Members pay between $50 to $7,500 to join the society.
Many mountain and resort communities that do not have a local theater or performing
arts center per se also have local performing arts groups that perform in a variety of locales,
including school auditoriums, galleries and banquet halls. In addition, many of the venues
hold weekly or monthly film series and are often the screening location of independent film
festivals. The annual Sundance Film Festival in Park City, Utah, for instance, occupies
multiple locations throughout the city over the course of a week and a half each year.
Other resort/mountain areas have popular dinner theater venues that attract both
tourists and community residents. In Aspen, the Crystal Palace has often sells out its 215-
person capacity Monday through Saturday evening dinner show at an advance purchase price
of $55 per person (excluding appetizers and drinks) and averages approximately $14,000 per
night during busier times. Their in-house production company regularly performs political
satire routines before a live audience. The Crystal Palace has been a popular nightlife
attraction in Aspen since 1957.
Theaters With Less Than 700-seats
Table V-1 presents the characteristics of theaters surveyed in resort locations that
have fewer than 700-seats. Three of the theaters are located in mountain resort locations.
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Asolo Theater Company (Sarasota, Florida)
The Asolo Theater Company is a 40-year old organization and Florida's oldest non-
profit professional theater. The regional company both presents and produces classical
theater productions. With a resident company performing theater productions in rotating
repertory, the company performs on two stages. The main stage seats a capacity crowd of
500, while the second stage can seat 161 patrons. Roughly seven productions are held-on the
main stage each year, and an additional three are performed on the smaller stage.
Their season runs from November through June of each year, with the months of
January through April, the local tourist season, receiving the highest number of patrons.
Residents and tourists together have transformed this theater into a popular winter attraction.
Asolo has a strong affiliation with the Florida State University/Asolo Conservatory
for Actor Training, which provides the company with well-trained actors and technicians. In
addition, the company provides a community outreach program known as "Our Access to the
Arts," which educates community families about the arts and serves to enlarge broaden the
audience. These programs have expanded in recent years.
The theater's utilization level is an estimated 70 percent, and last year the company
attracted 80,000 paid patrons, over half of which were season subscribers. This attendance
level is achieved in a regional resident market of approximately 571,000 people. Ticket
prices for individual performances vary between $6 and $39.
Since Sarasota is primarily a tourist destination with few local corporations, funding
largely comes from private, individual donations. The theater operates on a budget of
approximately $4.1 million. Earned revenue from ticket sales and concessions cover about
70 percent of operating and production costs, resulting in an annual operating deficit of
approximately $1.23 million, which is funded by donations and grants. Annual full-time
employment consists of approximately 50 staff members and as many as 150 are employed
during the busy winter season.
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Table V-1
CHARACTERISTICS OF SELECTED THEATERS
WITH LESS TITAN 700 SEATS
(in alphabuticul order)
r
4`
d'
4k .4f
r
o
Name/Locution 14t°~ 1kT
Asolu Theater Company 1960 Non-profit Nov. - 2 500 producing 14 n.a. n.a. $4.1 in. 70% Yes n.a. 80% 70% $6-539
Sarasota, FL organization June 161
Big Bear Lakes Perf- March - renting &
forming Arts Center 1988 City Dec. 1 398 producing 20 85 20/80 $250,000 25% No 20,000 99% n.a. $9-$35
Big Bear Lakes. CA
Jackson Hole Playhouse 1978 Individual May- 1 300 producing 1 240 90/10 $175- 10011'o No 50,000 95% 75;0 $10415
Jackson Hole, IVY Sept. - $200K
Laguna Playhouse 1920 Non- Sept. - 1 420 producing 11 112 20/80 $4 in. 85%- No 110,000 100;0 90". $9-$43
Laguna Niguel, C.4 profit June
Lake Placid Center for Non- Year- presenting
the Performing Arts 1975 profit arts round 1 353 & renting n. a. 250 n.a. $500,000 n.a. Yes n.a. n.a. n.a. $10 aver.
Lake Placid Center, NY council
Pacific Conservatory of Non- Year- 145 (indoor) 60/40
the Performing Arts 1964 profit round 3 185 (indoor) producing 10 400 (outdoor $2 in. 50% Yes 100,000 30% n.a. S10420
Santa Alaria. CA 700 (outdoor) only)
Pacific Repertory Non- Feb. - 300 (main) producing
Theatre (Golden Bough) 1982 Profit Oct. 2 99 (back) & renting 8 104 30/70 n.a. n.a. Yes n.a. n.a. n.a. $12-$25
Carmel, CA Organization
Self Family Arts Center 1970 Non- Year- 2 348 producing 46 200- 30/70 $2.3 in. 50% No n. a. 859. n.a. $6434
Hillon Head, SC profit round 225 & renting 250
Aspen Wheeler Opera Year- presenting &
House 1989 City round 1 500 renting 356 20/80 n.a. n.a. No 11.11. n.a. 75% $10440
Aspen, CO (incl.film)
Eslunates provided by duuter management
Source : Individual 't' heater management, Aniusantent Business: Aud Arena 2000 Guide, and Economics Research Associates.
7
Big Bear Performing Arts Center (Big Bear Lakes, California)
Situated in the mountain/ski resort community of Big Bear Lakes in California, this
performing arts center is a 398-seat theater connected to the local City Hall. The theater
operates primarily as a rental facility. Rentals comprise 90 percent of total usage. The
remaining 10 percent of annual productions are those that the theater presents itself.
The annual theater season runs between March and December, and the theater is
closed for maintenance during January and February. Last year the facility hosted 20
productions and 85 performances ranging from concerts, theater dramas and musicals.
Musicals and concerts are their biggest sellers. Ticket prices vary from $9 up to $35
for special events.
The Big Bear Lakes Performing Arts Center operates on a budget of roughly
$250,000 per year and is subsidized by the City of Big Bear to cover any deficit. The
Center's deficit is usually in the amount of $150,000 annually. Total revenue during the
1999 season from ticket sales and concessions (which are contracted out) totaled $60,000.
According to management, the largest users of the facility are community groups
such as high schools and churches. Big Bear Lakes is a year-round resort community with a
high percentage of retirees. Throughout the year, an estimated 20 percent of paid patrons are
tourists.
Jackson Hole Playhouse (Jackson Hole, Wyoming)
The Jacksonhole Playhouse is located in the region's oldest- framed building,
constructed in 1916. The building was later converted into the Pink Garter Theater during
the 1950s and become the Jackson Hole Playhouse in 1978.
This privately owned, 300-seat theater hosts one production, a western musical,
between late May and early September of each year. In the past, the theater attempted to host
several productions during the season. It learned that the production costs were prohibitive,
especially since over 90 percent of patrons come from outside of the area, with the majority
of visitors coming from either Utah or California on their way to Yellowstone National Park.
Actors from throughout the country are recruited for the productions. During the
season, an average of 200 seats are occupied during the nightly performances, for a 66
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percent occupancy rate. The theater's annual budget varies from $175-$200,000. Expenses
for the summer production this past season were approximately $170,000. During the non-
theater times such as the late fall, winter and spring, the theater is rented out or hosts a
variety of special functions. The theatre only employs one full-time person year-round.
The latest addition to the playhouse has been the opening of the attached Saddle Rock
Saloon in May of 1999. This Western style restaurant has a prix fixe menu at a price of
$15.00 for adults and $10 for children. The restaurant is for breakfast, lunch and dinner, but
patrons can also see the performance in the playhouse afterward. The restaurant is often
rented out by large groups of roughly 50 persons for special events and contains a small stage
where actors can perform for a special event. While it is possible to eat in the restaurant
without attending a performance, the theater is marketed as a dinner show and therefore
about 95 percent of the patrons attend the production.
The playhouse will be remodeled in fall of 2000 and anticipates operating year-round,
in connection with the adjacent restaurant, for live theatrical performances by the year 2001.
Laguna Playhouse (Laguna Niguel, California)
The Laguna Playhouse is a non-profit production house, managed by an executive
committee of nine persons, headed by an executive director. It was founded in 1920 and is
the oldest continuously operating theater company on the West Coast. The Laguna Playhouse
operates year round, with its normal season running September through June.
Coincidentally, this is when Laguna Beach's tourist season peaks. According to the
Playhouse's executive director, an estimated twenty- percent of patrons were tourists during
the 1998-99 season, up from 10 percent in 1997.
The company has used the Playhouse stage facility since 1969. Facilities include one
420-seat theater, administrative offices, dressing rooms, one ticket office, and a lobby and
bar area. For extra rehearsal space, the Playhouse also leases a 12,000 square foot warehouse
eight miles away in Laguna Hills. The facility also houses the company's telemarketing
operations and serves as an area for set building.
Laguna Playhouse's program includes six plays on the main stage during the normal
season, four plays during the youth season, and one play during the summer. The program
schedule contains a wide range of contemporary performances, classics, dramas, musicals
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and comedies. Main plays during the 2000 season will have 38 performances (up from 31 in
1997), youth plays will have 10, and the summer play will have 64 (up from 48 in 1997).
Last year the company hosted approximately 11 productions and 265 performances.
Average ticket prices vary, with main stage performances ranging from $20 to $43.
Due to the higher demand for tickets during the summer months, ticket prices tend to be
closer to the higher end. Youth prices are much lower, ranging from $9 to $12. The shows
are generally popular and are often sold out. This past season average occupancy for the
youth programs was an estimated 98 percent and 88 percent for the main stage shows.
Management confirms that last year the company had paid attendance of 110,000 patrons.
Because the Playhouse has such a high occupancy level, it is no longer rented out for
lectures. Although it is in an historical resort location, the Laguna Playhouse is within
Orange County, one of the largest and wealthiest metropolitan areas in the United States.
The metro area population is almost 2.8 million.
Last year, the Laguna Playhouse posted a marginal profit, operating on a budget of $4
million dollars. This is over double the budget of $1.8 million during the 1997 season,
reflecting the increasing popularity and increased funding. Of this amount, the highest
proportion, or 60 percent was used for artistic expenses. Income from contributions
decreased significantly last season to 8 percent, down from 15 percent in 1997. This coming
season, however, it is expected to increase to 15 percent.
While the Playhouse does not have a formal endowment, the Orange County
Community Foundation has been providing approximately $17,000 per year. In 1998, earned
income comprised roughly 95 percent of revenues. Management is currently working to
reduce that amount to 70 percent through increased fund-raising efforts.
The Laguna Playhouse recently acquired an adjacent commercial building with
15,000 square feet of leasable space in August of 1998 for $3.1 million. While no tentative
date has been scheduled, future plans are to tear down the existing structure and create an
additional theater of roughly 250 seats, with the addition of a cabaret and educational wing.
In the interim, however, the space is still occupied by commercial tenants and thereby
provides a source of income for the group.
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Lake Placid Center for the Performing Arts (Lake Placid, New York)
This 25-year old facility is a year-round, multi-purpose, non-profit, presenting &
rental theater that hosts a variety of dance, music, art and theatrical performances. Last year,
the 353-seat facility hosted a total of approximately 250 performances that attracted 25,000
people, for an average of 100 persons per performance. In addition to straight theater,
musicals, and dance performances, the center occasionally screens independent films and
hosts community lectures.
Operating on an annual budget last year of $500,000, the center receives some
funding from the New York State Council of the Arts, but the majority comes from fund-
raising and private donations from community members- Few tourists in the area attend
performances, since the majority of them come from major urban areas such as New York
City where theater is plentiful. Therefore, the Center draws patrons mainly from local and
regional areas. The average ticket price for a performance is $1.0 per person.
Pacific Conservatory of the Performing Arts (Santa Maria California)
The Pacific Conservatory of the Performing Arts (PCPA) is located in Santa Maria,
California in affiliation with Allen Hancock Community College. Built in 1964, the theater
on the college campus has two indoor stages seating 145-185, respectively. An outdoor
theater of 700 seats is located 30 miles away in Solvang, in the Santa Ynez Valley outside
Santa Barbara. Local residents and outsiders can purchase season tickets to these
performances. PCPA utilizes this facility for its performances during the summer months of
June through October.
The two theaters, named the Marian and Severson, are used predominantly by the
college repertory company, as well as the local symphony and college dance department.
The Theater Company presents over 400 performances a year. Last year the group
performed 10 productions with a total of approximately 40 performances each. The theater
operates with a staff of 45 full-time employees, 10 part-time employees and close to 300
volunteers from the community.
The two indoor theaters at the community college and outdoor theater in Solvang
complement each other, by ensuring healthy attendance levels throughout the year. The
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outdoor theater in Solvang is closed during the winter, but is extremely popular during the
spring and summer as a tourist destination. This theater also hosts concerts and fund-raisers
by well-known musicians. Approximately 60 percent of theater patrons at the Solvang
Theater are from outside the area and spend at least one night in the neighboring towns. The
other 40 percent of patrons are considered local patrons who come from areas as far as Paso
Robles (one hour north) to Ventura, California (one and half hours south). These same
"local" patrons frequent the indoor theaters in Santa Maria throughout the year.
While attendance can vary throughout the year, management estimates that during
last year's season the theater group performed for over 100,000 guests. The biggest crowd
draws were musicals such as "Grease." While some productions play to near-full capacity
crowds, the estimated average year-round occupancy for this regional theater group is
between 50 and 60 percent. Tickets average between $10420 and provide the largest source
of revenue for the theater.
The conservatory is actively involved with the community. They have an outreach
program that travels as far as Ventura and Paso Robles, reaching as many as 40,000 children
ages 6 through 12. It is also trains actors and technicians who are enrolled in the community
college.
Operating on a budget of approximately $2 million, the theater depends on 40 percent
of its contributed income from the college, 50 percent from ticket sales, and the remaining 10
percent from grants. Therefore, its annual operating deficit is $1 million, which is funded
with contributed income. The theater does not have to pay for facility maintenance, repairs
or rents and therefore is able to use the money earned from government grants, corporations
and foundations on their production expenses and marketing. Other expenses include
conservatory costs, administration, and scholarships. The Solvang outdoor theater is the
most expensive stage to operate since the building sets and materials must be transported
during the summer months to this location.
Pacific Repertory Theatre, (Carmel, California)
The Pacific Repertory Theatre, formerly the Grovemont Theatre, is a non-profit, tax-
exempt corporation that receives funding from various corporate, municipal, foundation and
private sources. The organization is supported in part by a grant from the Cultural Council of
Monterrey County.
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This theater company was formed in 1982 and has performed over the past six years
in the Golden Bough Playhouse, a historic landmark, is downtown Carmel. Prior to that
time, the company was performing in the Pacific Grove area of Monterrey, and purchased
what was then the Golden Bough Cinema in 1994 with the assistance of a large grant from
the Packard Foundation.
The company's season runs each year from February through October in the Golden
Bough Playhouse and produces an average of 8-9 shows per year. The main stage seats 300
people, and a black box area in the back of the stage can seat an additional 99. The theater
produces a variety of productions ranging from musicals, classics and children's programs.
The company also produces the annual Monterrey County Theaterfest and the Carmel
Shakespeare Festival between August and October of each year.
Between August and October, the company also performs in an outdoor, city-owned
amphitheater which contains over 500 seats. While Carmel is a city with a high
concentration of tourists, management estimates that only 30 percent of patrons who attend
performances in the Golden Bough Playhouse are visiting the area. The outdoor
amphitheater generates a higher concentration of both tourists and locals.
The Self Family Arts Center (Hilton Head, South Carolina)
The Self Family Arts Center is a year-round combination producing and rental
theater. Built in 1970 as the Hilton Head Playhouse, the theater is now home to a resident
theater company, which began in 1996. The theater is run as a non-profit organization with-a
governing board and memberships. The company produces shows for the two theater spaces
for a total of six productions and 200-250 performances per year. This represents a
significant increase from the 1997 season when 100-150 performances were held. In addition
to the performances by the resident theater company, the theaters are rented to community
performing arts services for approximately 40 shows a year.
In order to support the production and administrative needs, 30 full-time and between
300 and 400 volunteers are required annually. Performances are shown seven times a week,
Monday through Saturday, and occasionally for Sunday matinees. Each production has
between 20-35 shows, depending on its complexity and its popularity among the patrons.
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The larger theater accommodates 348 seats, and the smaller theater can seat 225.
Shows are attended regularly at 70 percent capacity, in the larger space and at approximately
60 percent in the smaller theater. Ticket prices differ depending on the theater and
performance with a range between $6434. On a year-round basis, management estimates
that local residents, comprise roughly 70 percent of paid patrons, while the remaining 30
percent consists of visitors vacationing in the area. During the height of the tourist season,
however, attendance can be evenly split between locals and tourists.
The Self Family Arts Center operated on a budget of approximately $3,000,000 in
1997. Almost $140,000 was devoted to fundraising and development costs. The largest
expense for the theater is labor, comprising 84 percent of the budget. To maintain the
building, excluding insurance and other fees, the Self-Family Arts Center pays approximately
$250,000 for physical plant expenses, maintenance supplies and services. The theater's
main source of revenue is from ticket sales. They also derive much of their income from
membership fees and government grants, $240,000 and $270,000 respectively. The Self
Family Center depends on $160,000 generated from fundraising and over $120,000 from
individual donations and foundations. Advertising also provides over $86,000 of operational
revenue.
Aspen Wheeler Opera House, Aspen
The Aspen Wheeler Opera House (AWOH) was built in 1889, during the height of
Aspen's Silver Boom and has been restored twice during the last 100 years. AWOH began
as a performing arts rental facility on its centennial birthday in 1989. The theatre is owned
by the City of Aspen and is managed as a non-profit entity.
The theater accommodates 500 people and provides a venue for a diverse selection of
performing arts, public space, music and movies. AWOH community theater, children's
theater, Broadway shows, opera, concerts, lecture series, and private and community events.
Running all year around, the theater averages 350 events annually, including 110 movie
showings. Movies are shown primarily to fill non-performance days. No movies are shown
from June through August, when the facility is fully booked with performances, and only 5-7
movie showings occur per month during December-February. The Opera House is nm with
a full-time staff of 6 people, and 60-80 part-time employees. Additional 200-250 volunteers
are also needed throughout the year.
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Aspen, with its tourist environment, cultural setting and seasonality, provides a
unique opportunity for community and public performances. The Wheeler Opera House is
the host to many grass root organizations and Aspen schools, as well as highly regarded
touring Broadway shows. Rent per performance run anywhere from $5004600 for a film to
$4,00045,000 for an acclaimed Broadway show. Rehearsals run at an average of $100 a
day, as well as additional fees depending on the complexity of the event.
With the diversity of events hosted at the Opera House, ticket averages and
attendance levels vary greatly- Community and smaller scale productions are attended at
approximately 70 percent capacity and other performances average attendance at 75-85
percent capacity. Ticket prices vary as well, with community performances charging $10-
$25 per ticket and other performances averaging $30440 a ticket. Film series charge $7 for
admission Benefits are also held at the Wheeler Opera House and can charge up to $500 a
ticket, depending on the event or cause.
i t mATERS WITH 1,100 TO 2,900 SEATS
Smaller theaters often have difficulty attracting top-name performers due to the high
cost of talent. ERA surveyed theaters with 1,100 to 2,900 seats, large enough to potentially
generate significant revenue to cover artist fees. The criteria used to select these theaters are
the same as those described at the beginning of this section - namely, theaters located in or
near resort communities.
It should be noted that many of these theaters are situated in municipal facilities.
Many also contain a large theater, hall or auditorium, in addition to a smaller theater or venue
where performances can be held.
Table V-2 presents selected characteristics of the theaters surveyed.
Asheville Civic Center - Thomas Wolfe Auditorium (Asheville, North Carolina)
The Thomas Wolfe Auditorium at the Asheville Civic Center is a 2,431-seat
facility that functions as a rental facility only. Located in the mountains in the western part of
the state of North Carolina, the facility is a municipal operation and consequently cannot
afford the cost of bringing,in well-known talent on a regular basis. Therefore, the facility is
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Tuble V-2
CHARACTERISTICS OFSELECTED THEATERS
WITH 1,100 TO 2,900 SEATS
(in Alphabetical order)
l° O°j
t0 ~
`Z
~
O5 4ry
ae 0
Z' 4~
°°a° o a 11''11 t
Nnmc/Locution tt O < ; 4 11o° W o\ J Q;p
Asheville Civic Center - Sept. -
Thamns Wolfe Audit. 1940s City May 1 2,431 rental only 100 D.A. 5/95 $2.0 in. No D.A. D.A. 759% 515-S50
Asheville, NC
llob I lope Cultural Ctr. Prn,ale Ails Sept.- producing,
McCullunt Theater 1989 Foundation May 1 1,125 presenting& 72 80 25/75 11.A, No 65,000 87% 80% $5495
Putnt Desert, CA renting
Cape Cod Melody Tent South June - 2,300 producing,
Theatre 1950 Show Sept. 1 (in Iho presenting & 32 32 50/50 a. a. No 66,000 100% 85% $20-$65
livannis, ALA Playhouse round) rentinlt
Community Arts Ctr. & PA Sept. - presenting &
Theatre 1993 College MAY 1 2,159 renting 50-55 65-70 20/80 $1.3 Yes 80,000 90:0 50% S5475
Williamsport, PA of Tech.
Eccles Center for the Jan. PC School Year. 1,300 presenting &
Performing Alts, 1998 Dist. & round 2 180 (black renting 25-30 35 15i85 $470,000 D.A. D.A. n.a. 80% $15-SI00
Park Citv, UT Arts Found. box)
Maul Arts & Cultural Private Sept. - 1200 producing, 3,000
Center 1995 Found. July 1 +black presenting& D.A. events n. A. D.A. Yes D.A. n. a. D.A. $5-$75
Kahalui, HI box (300) routing
Oregon Shakespeare Non- Feb.- 1,200 (outdoor)
Festival 1935 profit Oct. 3 600 producing 11 763 88/12 $15.8 Yes 374,000 93% 93% $11-S43
Ashland OR 140
Rushmore Civic Plaza Sept. - producing,
Cir. - Fine Arts Theatre 1977 City May 1 1,799 presenting & D.A. D.A. 5/95 $4.4 m. No D.A. 80:0 45:0 $3-$41
RapidCity, SD renting
Saginuw Civic Center - Sept. -
Iierltuge Theater 1972 City June 1 2,300 rental only D.A. n. a. D.A. $3.5 in. No D.A. D.A. a. 8. $3460
Sa¢inaw, All
Santa Cruz Civic Aud. Sept.- presenting &
Santa Cniz, CA 1939 City May 1 2,000 rental D.A. D.A. n.a. B.&I No D.A. n. 3. 65% B.A.
Sweeney Convention Mr. Year-
Theulre D.A. City round 1 1,500 rental n' a. D.A. n.a. $1.5111 No D.A. D.A. 75;o a. A.
Santa Fe, MAL
Sun Luls Obispo Univ., Sept. - 1,282 + reh.
Performing Arts Ctr. a 1996 city & July 1 pav. (250) rental only D.A. 130 15185 $1.6 m. No 106,000 99% D.A. $15-$65
San Luis Obispo, CA donors & room (180)
Pikes Peak Center - El Paso Year- rental only
Great limit 1981 County round 1 2,061 (fomlerly 150 250 15/85 $1.0 No 165,000 90% 90% $5-$65
Colon,/) Springs, CO Govt. produced)
Telluride Conference July of Towo of 11,000 SF rental
Center 1999 Jean. D.A. 1 ballroom w/ only 15 n.a 11.11 n.a D.A. 11.2 11.11 n.A -
Tillurirle, CO Villago portable stage
t Estimua providad by dleutar nuutagemaru
"rho F cks Ceulcr dnvws pwrons from nearby Sall I,ako Cary, dmmforo, dto Swann County (pop. 26,100) and SLC hletro area, have been combamd
SLOPAC is a rental only facility acid 1101 a Prwnolor, dmrefora uckel rovmtuo doss nut reflect what ilia Comer takes io
Source . Individual Theater lnanageinent, Anrujoi aunt Burinoss: Aud Arino 2000 Guido, and Economies Research Associates.
primarily rented out to community groups such as high school graduations, with usage being
inverse to weather patterns. The local community has a population base of approximately
70,000. The metropolitan area has a population of approximatley 214,000 people.
The annual budget for the civic center, including the arena, banquet hall. and
exhibition areas is $2 million. Expenses generally exceed this level, with the city subsidizing
the deficit. The deficit, however, primarily comes from the arena and not the theater. Last
year the facility counted 321 event days, 100 of which were held in the Thomas Wolfe
auditorium. Ticket prices for commercial events range from $15 to $50.
McCallum Theatre (Palm Desert, California)
Situated in the Bob Hope Cultural Center, this non-profit, 1,125-seat theatre has
operated since 1981. Behind the College of the Desert, this privately-owned, non-profit
theater is strictly a presenting theater, offering a wide range of productions including
musicals, orchestra numbers, theatrical productions, and concerts. Ticket prices can be as
low as $5 up to $95 per performance. The musical acts tend to generate the high-priced
tickets, and almost 90 percent of total revenue comes from ticket sales. The remaining 10
percent comes from rental fees.
The McCallum Theater is also frequently used as a venue for corporate meetings.
Sit-down dinners can accommodate up to 250 guests onstage. Several smaller meeting
rooms can accommodate smaller crowds.
The theater season runs from September to late April of each year and frequently sells
out its performances. Drawing from a resident market that includes almost 290,000
permanent residents in the Coachella Valley, in addition to seasonal residents (Palm Desert
and Palm Springs) and heavy tourism, the theater's average of 75 annual productions
frequently sell out in advance. On occasion, the facility has been converted to an ice rink for
various ice shows.
Information concerning expenses was not available; however, it is reported that the
theater requires a significant amount of contributed income to cover expenses. The theater
receives its funding from ticket revenues, some corporate donations and a yearly fund-raising
campaign. While the facility does not currently receive an endowment, management is
working on obtaining one. The theater employs 40 full-time employees.
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Cape Cod Melody Tent Theater (Hyannis, Massachusetts)
One of the oldest summer tent theaters in the country, Cape Cod Melody Teat was
founded in 1950. The facility functions as a summer theater only from June to September
each year since weather conditions are not viable for performances during the remaining
months. The configuration of the facility contains 2,300 seats in the round.
An estimated 99 percent of the theater group's productions are in-house. The group
both promotes and produces everything from concerts to theater. One exception is the World
Wrestling Federation, which has used the facility to televise a match. Each summer the
theater hosts between 35-40 concerts in Cape Cod during this tourist-intensive period.
Patronage is evenly divided between tourists and local residents, which includes persons
living in the area on a seasonal-only basis. Ticket prices for individual performances range
between $20 to $65 per show.
Financial information for the theater was not available, however, management
confirmed that high attendance and concession sales generally covers all operating costs.
Community Arts Center & Theater (Williamsport, Pennsylvania)
This 2,159-seat theater is located in the woods of northern Pennsylvania. The
Pennsylvania College of Technology owns the theater, but is not affiliated with its
management. The theater both rents out and presents shows. Productions include Broadway
shows, dance, concerts, and other performing arts:
With their annual season running between September and May each year, an
estimated 55 percent of patrons come from within a 5-mile radius, 25 percent within 25-miles
and 20 percent from outside these areas. The theater receives an endowment and other
funding from the college, private donors and local companies. Last year's budget was $1.3
million. In the event that a deficit occurs, the college will subsidize the facility.
During the 1998-99 season, the theater had a total of 90,000 patrons, down 10 percent
from its 1997-98 level. An estimated 90 percent of attendees are paid patrons, and ticket
sales account for approximately 60 percent of total expenses. Theater utilization is
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approximately 50 percent. Last year the theater had between 50 and 55 productions, with a
total of 65-70 performances.
The Eccles Performing Arts Theater (Park City, Utah)
The Eccles Theater in Park City, Utah has been in operation since January of 1998.
The theater's season runs from September through May of each year. The concept for the
theater originated when the Park City School District approached the City about building an
auditorium for their high school. The Park City Performing Arts Foundation, founded by a
group of citizens, also saw the need for a community arts facility. As a result, the Foundation
and the District joined forces and now own and operate the Eccles Performing Arts Theater
together. The Performing Arts Foundation reserves 180 days of the theater space on
weekends, holidays and during the summer months, while the school district uses it on the
remaining school weekdays of the year.
The theater is connected to the high school, which conducts classes and art
performances in the theater regularly. As a result, the District is in charge of maintaining the
building. During the last two weeks of January each year, the theater is used predominantly
as the main venue for the Sundance Film Festival, the most prestigious festival in the U.S. for
independent films. The Festival also uses other smaller area theaters over a ten-day period
such as the Egyptian Theater and the Kimball Art Center. The Park City Performing Arts
Foundation is interested in attracting events of similar size.
The Eccles Performing Arts Theater can accommodate up to 1,300 seats in their main
stage theater and an additional 180 people in their black box theater. The theater also has
two lobbies with a concession area, an extensive scene shop that adjoins to the high school
woodshop, and a number of additional dressing rooms and a green room.
The Eccles Performing Arts Theater is run exclusively as a rental facility. It rents to
outside theatrical and musical shows, both for profit and non-profit groups. These shows run
for approximately three performances. Rental rates range between $1,000 for local non-
profit groups, and $1,500 for non-local and non-profit groups. For commercial groups, the
rates are higher, running at $1,800 for local groups and $2,600 for non-local groups,
including workshops and conferences. The Foundation, which is operated out of the offices
in the theater, has a staff of five full-time employees and three part-time employees. They
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also rely on 100 volunteers. During the most recent 1998-99 season, the theater hosted 20
shows. Last year the theater hosted 25-30 productions, the majority of which lasted one day.
The patrons of the theater fairly represent the residents of Park City, Utah. As a
resort community, residents tend to be slightly older and affluent. Though Park City is a
tourist destination, management estimates that the average year-round percentage of tourist
patronage is approximately 15 percent. During the tourist season, which runs from late
December through April each year, the percentage of tourists for a particular performance,
however, can reach as high as 50 percent during one show, depending on the show's appeal
to the tourist market.
Ticket prices for performances range between $15-$100, depending on the demand
for the individual performance and whether the seating arrangement is reserved or general
seating. In general, the breakdown for most performances is 50 percent reserved and 50
percent general seating. Reserved seating prices are $15, $25, $35 and $50, while general
admission prices are $15 for adults and $5 for students and children. For high demand
performances such as the upcoming Pilobolus, one of the more popular modern dance groups
currently in the U. S., tickets can reach as high as $100 per person for prime seats.
Maui Arts & Cultural Center (Kahului, Hawaii)
The Maui Arts & Cultural Center contains a 1,200-seat theater, a smaller black box
theater that can seat up to 300 persons, and a 5,000-seat outdoor amphitheater with night
lighting. In addition, two meeting rooms, a gallery and two dance studios are located on the
premises, adjacent to Maui Central Park. A privately-owned, non-profit venture, the Center
was founded five years ago and operates almost year-round from September to July.
Last year the Center hosted 3,000 different events ranging from concerts, dance
performances, symphonies and a small percentage of Broadway productions. The theater
produces, presents and rents out its facilities. Every Wednesday evening a film series is held
in one of the rooms. Outdoor concerts in the amphitheater are very popular during the
summer months for both locals and tourists. The facility was recently named one of the
nation's "Hot Spots For the Arts" by the Association of Performing Arts Presenters, an
international association of performing arts venues, presenters, agents and managers. Art
Maui presents its annual display in the Center's Kazuma International Gallery.
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The cost per performance for various events can range from $5 up to $75 per show,
and the Center has a very strong membership base. Since their revenues do not cover the
cost of producing quality events, the Center relies heavily on its annual membership drive.
Oregon Shakespeare Festival (Ashland, Oregon)
Among the oldest and largest professional regional theater companies in the United
States, the Oregon Shakespeare Festival has been a cultural staple in Ashland, Oregon since
1935. The theater features the oldest existing full-scale Elizabethan stage in the Western
Hemisphere. The Festival presents an eight-month season running between February and
October and features 11 productions annually- four by Shakespeare and seven by classic and
contemporary playwrights. The productions are shown in three theaters, one outdoor which
accommodates 1,200 seats and two indoor theaters which seat 600 and 140 seats
respectively. A fourth theater with between 260 and 300+ seats is planned to be built.
The theater is a production theatre and requires a staff of over 350 people. Over half
of the staff members are hired full-time and the other are hired as part-time workers. The
Festival also depends on approximately 450 volunteer staff members who assist in all areas
of production and administration. The Festival runs a complex schedule to allow for
anywhere between 4 to 9 shows to run at any one time. In 1999 the Festival presented 763
performances.
Attendance at the Festival is consistently high, reaching a total attendance of 374,000,
the highest of any non-profit theater in the nation. Approximately 88 percent of its audience.
travels more than 125 miles to attend the Festival and in 1997 attendance averaged 93
percent of total theater capacity.
As a non-profit membership organization, the Oregon Shakespeare Festival is
operating on an annual budget of $15.8 million dollars for the 1999 season. Last year
approximately 77 percent of operating funds came from earned income, resulting in an
annual operating deficit of $3.6 million that is funded by contributed income. The theater's
main source of revenue is ticket sales throughout the season, which last year brought in about
$10.1 million. To supplement the earned income, the Festival is required to fundraise an
additional $3 million to cover operating costs, with memberships, support groups, corporate
sponsors, and government grants. The Festival also receives a $700,000 endowment each
year.
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Other sources of revenue for the annual event include concessions, publications,
education programs, advertising, and endowment income. Production and artistic expenses
account for almost 60 percent of all expenses, with general administration and development
accounting for another 15 percent. Physical Plant expenses are relatively low at 6 percent of
total expenses.
The Festival last year sold approximately 369,000 tickets, at an average of $28 per
ticket. Roughly 7 percent of total admissions are complementary, and ticket prices range
from $11 for students up to $43.
Rushmore Plaza Civic Center - Fine Arts Theatre (Rapids City, South Dakota)
This municipal 1,799-seat theater primarily functions as a rental facility for
community theater performances, speaker series, concert associations, and convention
meetings. About 5 or 6 times per year the facility will present a Broadway production and an
occasional co-production.
The facility is funded by the city. Together with the arena, the annual budget last
year $4.4 million. Over that period the facility 'grossed $2.3 million in ticket sales. Total
event days for both facilities last year was 1,300, and ticket prices ranged between $3 and
$41.
Saginaw Civic Center - Heritage Theater (Saginaw, Michigan)
This municipal facility is located along an interstate corridor north of Flint. The civic
center also contains a sports arena, meeting rooms and amphitheater. While the facility is
situated in an industrial area, it attracts residents and Canadian tourists as far as several
hundred miles. Canadians frequently travel to the area to gamble at nearby casinos. The
German community of Frankenmeuth, which is a 20-minute drive from Saginaw, is a major
tourist attraction and draws between 2-3 million visitors on an annual basis.
The 2,300-seat theater functions as a rental facility working with outside promoters
and local organizations. The majority of performances are held between September and June
of each year. During the remaining months, the theater is often rented out to corporations
and used as a venue for fashion shows. Types of events occurring between September and
June include concerts, a Broadway series that has between 5 and 9 annual productions.
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City-owned and funded, the enter Civic Center has an annual budget of $3.5 million.
The theater receives an annual subsidy of $500,000 and any deficit is absorbed by the city.
The price range for events varies between $3 and $60 per performance.
San Luis Obispo Performing Arts Center (San Luis Obispo, California)
A partnership between the local university and the city owns this 1,282-seat theater.
It's season runs from September through July. It operates as a rental house and presents 130
performances per year, mostly for the resident and university population, and attracts an
annual audience of 106,000, within a relatively small resident market of 245,000 people. It
operates on an annual budget of $1.6 million. Ticket prices range from $15 to $65. This
theater is a good example of a university/city partnership to provide cultural programming
for a region.
Santa Cruz Civic Auditorium, (Santa Cruz, California)
The. Santa Cruz Civic Auditorium is a year-round, multi-use civic facility that was
originally built in 1939. Used as the home of the Santa Cruz Symphony, which performs in
the 2000-seat facility between September and May of each year, the facility is also used for a
variety of events ranging from concerts, community-sponsored events, small convention
meetings, auctions, and clothing sales.
The Auditorium only hosts several smaller community-based theater productions per
year. Overall utilization for all events is approximately 65 percent of the year. An estimated
30 percent of all events are paid performances, with the remainder consisting of rentals and
city-sponsored and/or civic-related events.
Sweeney Convention Center - Theatre (Santa Fe, New Mexico)
The theater inside the city-run Sweeney Convention Center is a multi-purpose room
with 1,500 seats. It functions year-round as a rental theater only, hosting events such as
concerts, dance and children's theater. The annual utilization rate for the theater is an
estimated 75 to 80 percent.
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Very little straight theater is performed here, since the community resident company,
Santa Fe Stages, performs at smaller theaters in the area. -
The City of Santa Fe subsidizes the theater with a lodging tax that covers all
expenses. The Convention Center receives an annual budget of $1.5 million and generally
breaks even.
Telluride Conference Center, Telluride
The Telluride Conference Center, owned by the city of Mountain Village is an
11,000 square foot facility with a 6,000 square foot ballroom. The ballroom has a portable
stage that is occasionally used as a performing arts facility. The Center has only been open
for 6 months but thus far has hosted 15 events including dance, concerts, movies and
theatrical performances. Recent events include the Telluride Jazz and Film Festivals. In
addition, the facility is the performance center for the Chicago-based Joffrey Ballet's summer
program.
- Management estimates that the facility will host 45 performing arts-related events this
year.
Summary of Theaters in Resort Locations
The review of theaters in resort locations reveals several lessons:
• The small theaters either operate as rental houses for primarily community theater
groups, or are associated with a professional repretory theater group in order to
generate enough programming.
o The larger theaters operate as rental houses, presenting houses, and production
houses. Several are associated with universities. Civic theaters in resort locations
tend to operate as rental houses. It should be noted that there are many examples
of civic theaters that operate as presenting houses in larger urban markets.
Private, non-profit operated theaters tend to operate as presenting houses and
incur significant operating deficits that are covered by contributed income.
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Rental houses experience relatively modest operating deficits, while presenting
and production houses experience significant deficits each year which are covered
by contributed income raised each year.
Despite their locations in tourist markets, a large majority of annual patrons come
from the resident market. Dinner theaters are the exception.
VAIL VALLEY PERFORMING ARTS
There are two theaters in Vail Valley that presents professional performances - The
Vilar Center for the Arts and the Ford Amphitheater. While the Dobson Arena presents
popular concerts as part of its special events programming, it is not designed as a performing
arts venue. Special events at Dobson are discussed in Section VI.
The Filar Center for the Arts - Beaver Creek Resort, Vail
This 528-seat theater and art gallery in Vail Valley opened in February, 1998. The
Center was built with an initial cash injection of $22 million from 250 individual donors. The
project was funded with contributions from local residents, both full and part-time, and
businesses. The major donors include Vail Associates, who provided the land and half a
million dollars; Beaver Creek Resort which gave $4.5 million; and Alberto Vilar's gift of
$6.5 million and a pledge for an additional $3.5 million. The cash contribution was raised in
the course of 13 months.
The theater contains 528 seats in a traditional seating arrangement. 413 seats are
located on the orchestra level, 90 in the balcony and 24 box seats are situated on two levels.
Two adjacent 2,200 square foot lobbies (4,400 total) have concession bars. The 2,250 square
foot May Gallery serves as a private patron's lounge and reception area during performances
and is also rented out for special events. In addition, the theater contains an orchestra pit, a
projection and control room and quality dressing rooms for performers. The actual theater is
underground with a 10,000 square foot outdoor ice rink above.
Rental rates are $2,400 per day for for-profit organizations and $1,800 for non-profit
organizations. The Vilar Foundation has a fund to cover the rental costs for eligible
community-based non-profit groups, but still often charges pass-through expenses, such as
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technicians, security, stage management, etc. Some community groups find these pass-
through costs unaffordable and report difficulty in booking the facility for the desired dates
and for rehearsals.
Since opening, the project has hosted a diverse line-up of productions, including live
theater performances, film premiers, international ballet, world-renowned musicians,
children's events, symposiums and lectures. The Vilar Center does not produce its
productions, but rather operates primarily as a presenting house. It also rents out the facility
when time is available. Approximately 95 percent of the programs in the theater are
underwritten and presented by the Vilar Center. Conference and corporate center groups use
the theater approximately 12-20 times per year.
The theater has a winter and summer season running from December through April
and June through early September, respectively. The winter season draws higher attendance,
and the Vilar Center presents more performances. The summer program is less aggressive
since the Vilar Center management has found that is more difficult to attract audiences to an
indoor venue during the summer, especially when the popular Ford Amphitheater is
providing programs. Most productions perform for one night only.
During FY99, the Vilar Center hosted 121 performances, 22,500 paid-patrons, and a
43 percent average paid-occupancy rate per show. The average occupancy rate was below
projections and industry standards, and was attributed to slower than anticipated market
awareness and some inappropriate programming during the first year of operations. The
program was considered too esoteric for the market. In FY99, earned income from ticket
sales, concessions, and rental fees covered 22 percent of total operating and presenting costs,
for an annual operating deficit of approximately $2.1 million, which was funded by
contributed income. The Vilar Center subsidizes approximately two-thirds of the cost of
every performance. Because of these costs, and the theater's seating capacity, the War
Center normally targets artists that command fees of approximately $10,000 per
performance, although they will sometimes underwrite productions that cost $20-25,000 per
performance. Outside corporate sponsors will help underwrite 12-15 shows per year. At
these artist fees and the Vilar Center's willingness to underwrite presenting costs, the Vilar
Center can present the large majority of artists available for the market.
Ticket prices for commercial productions during the winter range from $25 to $55,
and average approximately $30. The summer market is less affluent, and average prices fall
to the $20-$25 range.
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After some adjustments to the marketing and artistic programming that presents more
popular shows, the theater is performing much better in FY2000, averaging 85 percent
occupancy so far. Management anticipates that average occupancy levels should settle
around 60-65 percent by the end of the fiscal year, which would be slightly higher than the
industry standard. According to management, patrons during the first year were primarily
second-homeowners in Beaver Creek. Now, the Vail Valley permanent-resident market
comprises most of the patrons. Although surveys have not yet been conducted, it is
estimated that 10-20 percent of the patrons are ski guests, 20-30 percent are second
homeowners, and the balance are permanent residents of Vail Valley. Typical patrons are
well-educated 35-55 years old, with high-incomes.
The theater has established endowment of $3 million that is matched from the Vilar
Foundation at $3.5 million, which, with additional donations, will build an endowment of
$10 million. This endowment will help cover future presenting costs and operating deficits.
Located in the center of the village in the Beaver Creek Resort and adjacent to the
Hyatt Regency Beaver Creek, the facility is owned and operated by the Beaver Creek Arts
Foundation which employs 15 full-time and 15-part-time employees. Beaver Creek is the
only mountain resort community in the U.S. to include its own planned performing arts
facility with an annual series of events.
Currently, the Vilar Center for the Arts is the only high-quality, indoor, professional
performing arts theater in the Vail Valley. There are smaller auditoriums, banquet halls and
an ice arena, but these are not well suited for hosting certain types of events. The Gerald R.
Ford Amphitheater runs during the summer months only and is used primarily for concert
events. The Dobson Arena is used for large popular music concerts. Therefore, the theater is
the sole venue of its type that is suited for more intimate audiences to see professional
productions. Aside from a lack of competition, management also attributes the success of
theater to a more mainstream programming schedule. Popular shows such as the Broadway
production of Smokey Joe's Cafe, for instance, nearly sold-out for all three performances.
While this production charged $55 per ticket, the average ticket price for a regular production
ranges between $30-$40 per person.
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The Gerald R. Ford Amphitheater
The Ford Amphitheater is a popular summer venue. It offers 965 fixed seats under
cover, 1,600 grass seats, and 18 spaces for disabled persons. The Vail Valley Foundation
owns the facility and uses it for its own summer dance festival, underwrites the rental cost for
Bravo!'s summer concert series, and rents the facility to promoters and community groups.
While the theater has some deficiencies with its stage house and technical facilities, it
offers a popular outdoor setting for viewing performances. The Foundation will soon
undertake a $6 million renovation that will add 150 more seats.
The theater's season runs from May though September. During the 1999 season, the
facility accommodated 53 scheduled performances, 21 rehearsal and load-in days, 11 "hold"
days for outside groups, and 4 weddings.
Repeat users of the facility include the Bravo! Colorado Music Festival, the Vail
International Dance Festival, Battle Mountain High School, Colorado Children's Chorale,
Colorado Shakespeare Festival (University of Colorado), Johnson and Wales University, and
Sprint. Rental rates are $1 per, advanced ticket sold, plus $1,800 for for-profit groups and
$1,000 for non-profit groups.
The average attendance to performances is 87 percent in the fixed-seat pavilion and
72 percent in the lawn area, including free events. Ticket prices for events that charge range
from $10-$35 for Bravo!, $10480 for the International Dance Festival, $16-$20 for the
Shakespeare Festival, and $35-$45 for concerts presented by outside commercial promoters.
The overall average ticket price is $27.80.
The Vail Valley Foundation only underwrites the dance festival. Therefore, its costs
associated with the theater are primarily maintenance, general management and production
management. The Foundation incurs an operating loss of approximately $100,000 per year,
or one-third of its annual budget for the amphitheater, that it covers with contributed income.
The Vail Valley Foundation's International Dance Festival is a unique and special
event that combines education with performance. The Foundation sponsors 50 students,
dance troupes, and professional ballet pairs from around the world to masters workshops that
culminate in performances at the amphitheater.
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Performing Arts Organizations
In addition to the Vilar Center and the Vail Valley Foundation, the Vail Valley has
several organizations that present cultural programming in Vail.
Bravo!
Bravo! is the primary user of the Ford Amphitheater. The Vail Valley Foundation
underwrites its rental cost of the facility. Bravo! presents a summer music festival mostly
associated with classical music." Bravo!, with the Vilar Center and the Vail Valley
Foundations also form the Vail Valley Arts Alliance which present three winter concerts at
the Vilar Center. Bravo!s experience is that classical performances in the winter only
attracted half of the house and did not attract as many patrons as pop artists. They attribute
the success of their summer concert series partly on the ambiance created by the-outdoor
venue and mountain setting.
They have seen their audiences grow in the Vail Valley as their program has grown,
and average of 10 percent per year since 1988 when they began. During the last summer
season, 15 performances were presented in the Ford Amphitheater, where, their facility rental
costs are covered by the Vail Valley Foundation, 6 performances were at the Vilar Center, 4
were at individuals' homes, and 4 were at various lodges. These programs attracted
attendance of over 40,000, including free events. The average attendance for paid events was
1,490 for events that attracted over 800 people, 280 for events that attracted between 100 and
800 people, and 58 for events that attracted less than 100 people.
According to a survey that Bravo! conducted last year, approximately 24 percent of
the audience planned a special trip to the Vail Valley to attend a performance. 92 percent of
all guests were spending the night locally (of which 31 percent were staying in hotels and 69
percent were residents staying at home), and 56 percent planned on patronizing a Vail Valley
restaurant after the concert- Approximately 15 percent were visiting from the Denver metro
area, including Denver, and 30 percent were from outside Colorado.
Approximately 16 percent of Bravo!'s $2.5 million budget in 1998 was covered by
ticket sales revenue, the balance, or almost $2.1 million came from contributed income and
fundraising events.
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Commercial Promoters
ERA interviewed several commercial promoters and booking agents regarding the
need for a performing arts center. All of the promoters felt that the 200-theater "black box" _
is far to small to be acommercial venue, because the limited revenue potential would not
cover the cost of commercial artists.
The promoters and booking agents felt they could book artists and acts that would be
appropriate for a larger facility of 1,100 to 2,200 seats. The larger venue is preferred because
of its revenue potential. However, several noted that given Vail's small resident market,
most of the acts to fill a house of this size would have to be popular artists who are looking
for a quality performance hall. The agents interviewed felt that they would continue to prefer
Dobson Arena for rock acts, despite its inferior acoustics, because of the arena's greater
seating capacity and flat floor, which is suitable for rock concerts and dancing. A new
formal performing arts center would be more suitable for artists who cannot fill a facility the
size of Dobson Arena, artists who require better acoustical quality, renown classical music
performances, and productions that need an appropriate stage house.
A few of the booking agents felt a facility that is closer to 1,100 seats could
conceivably compete with the Vilar Center for those acts that can sell-out the Vilar and who
would rather use the larger venue to take advantage of its greater ticket sale potential.
Agents felt they could find artists to fit a larger theater, artists that currently do not perform
in the Vail Valley and who are too expensive for the Vilar. Center. However, the market's
small, homogeneous, resident population limits the number of performances at a new
performing arts center in Vail. The promoters and booking agents interviewed felt that it
would not be unreasonable to book 15 to 50 performances per year.
Other Organizations
In addition to the main organizations that present professional performing arts in Vail
Valley - the Vilar Center for the Performing Arts, the Vail Valley Foundation, and Bravo! -
there are a few non-profit, community organizations that present amateur programs a few
times each year, including the following:
• The Vail Performing Arts Academy (3 performances per year @ 300-500 paid
attendance per performance)
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• Vail Valley Theater Company (12-24 performances per year @ 100 paid
attendance per performance)
• Friends of Dance
• Eagle. Valley Children's Chorale
• And others
These groups need inexpensive performance and rehearsal space at more popular times that
currently available to them at existing venues. They would be interested in the "Black Box"
theater under consideration.
According to local, performing arts groups, there currently does not exist a
professional repertory theater group in Vail Valley.
VAII, MARKET SUPPORT FOR A NEW PERFORMING ARTS CENTER
Table V-3 presents the estimated penetration rates for some of the profiled theaters
that were able to provide tourist and resident attendance estimates, and that were larger than
1,100-seats. Among the six theaters, the average penetration rate of the resident market was
slightly over 20 percent and ranged from 10 percent to 54 percent. Residents averaged
approximately 70 percent of the resident market.
Given Vail's superior demographic characteristics for supporting performing arts,
specifically high-incomes, high educational achievement, and older age profile, Vail should
achieve higher than average market penetration rates. Assuming a 45 percent resident market
penetration rate, a new performing arts center of greater than 1,100-seats may reasonably
expect to attract over 19,350 visits. Given the large second-home market population, and
based on the experience at the Vilar Performing Arts Center, the resident market may
comprise approximately 60 percent of the total audience count, with the balance coming from
second-home residents and tourists. This would result in a total audience count of
approximately 32,250. At an average audience of 800 to 1,000 persons, a new center of
1,100+ seats may expect to support approximately 32 to 40 performances per year.
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Table V-3
ESTINLATED RESIDENT. ARKET PENETRATION RATES FOR SELECTED THEATERS'
1999
Total Season % of Est Est # of Estimated
Theater Resident Resident Metropolitan Resident Mkt
Theater Attendance Attendance' Attendance Population Penetration
Bob Hope Cultural Ctr.
McCallum Theater 65.000 75% 4&750 290.000 17%
Palm Desert. CA
Pikes Peak Center -
Great Hall 165,000 85% 130,250 495.300 28%
Colorado Springs, CO
San Luis Obispo
Performing Arts Ctr. $ 106,000 85% 90,100 245,200 37%
San Luis Obispo, CA
Cape Cod Melody Tent
Theatre 66,000 50% 31000 209.800 16%
Hvannis..,Q4
Community Arts Ctr. &
Theatre 80.000 80% 64.000 118.300 54%
Williamsport, PA
Pacific Conservatory of
the Performing arts 100,000 40% 40,000 411.800 10%
Santa.Maria. CA
I applies only to those theaters for which attendandance was estimated
Source : Sales and Marketing M-,_,.enC 1999 Survey of Buying Power (Memo and Media Market Totals)
and Economics Research Associates.
This estimate is consistent with the input received from promoters and booking agents
interviewed. However, to achieve this level of activity, the performing arts center would
have to offer popular artists and a diversified program, in addition to world-class classical
artists. Average ticket prices would also have to be consistent with the market, with typical
average prices in the $30-$35 range. Although some artists and productions may be able to
command higher prices, they would be the exception rather than the rule.
RECOMMENDATION
The 200-seat "black box" theater is not feasible as a commercial venue because of its
small size and limited ticket sales potential. However, the theater could be developed as a
community facility for local arts groups. Given the relatively small number of local arts
groups and their limited capacity to pay rent, and the lack of a professional repertory theater
company to develop in-house productions, the Town would have to identify other community
uses for the theater to warrant its development. These other uses may include community
meetings, local access cable TV programming, lectures and educational programs, etc. Some
of these other uses are compatible with the conference/learning center, or the library. The
theater, however, is not a substitute for dedicated meeting space in the conference center.
A 1,100 to 2,200 seat theater would require a presenting organization to ensure
adequate and diversified .programming. The cost of development is too great, and the
potential utilization too limited, to operate simply as a rental house and depend on outside
promoters to book the facility. As a presenting house, however, the annual operating deficit
would probably be substantial, on the order of $800,000 to $1.4 million, or more, based on
the experience of other presenting theaters of this size. This annual subsidy burden is
probably too great for a town the size of Vail.
Therefore, it is recommended that the Town of Vail only consider a theater of this
size range if it is developed and operated by a private, non-profit organization that can raise
the capital for development costs, and an adequate amount for an operating endowment. If
such an organization emerges and successfully meets its fundraising targets, the Town may
consider offering land or air-rights within the Hub Site location for the facility since it would
add to Vail Valley's cultural offerings. The Town, however, should carefully develop a
contingency operating plan should the non-profit organization fail and abandons the facility
located on city property. Since it would probably take an organization some time to raise the
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capital for construction and an operating endowment, it is recommended that a theater be
considered as a potential second-phase development for the Hub Site location
Finally, if a performing arts center is pursued in a later phase, a theater of
approximately 1,400 seats is recommended. An indoor theater of this size would be too large
to compete with the Vilar, and too small to lose acts to the Dobson Arena, and would provide
a quality performance venue, with commercial potential, that currently is not available in the
Vail Valley.
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Section VI
ICE RINK MARKET,ANALYSIS
In this section, ERA reviews: (1) the typical physical and operating characteristics of
ice rink facilities, (2) the key physical and operating characteristics of Dobson Arena; (3) the
key characteristics of selected other relevant ice rink facilities in the Colorado Rockies; and
(4) the status and planned characteristics of relevant proposed new ice rinks in the Vail
Valley. This analysis provides a clear picture of the typical physical and operating
characteristics of comparable ice rink facilities. The section concludes with an indication of
the likely future demand for the proposed second ice sheet in the Town of Vail.
OVERVIEW OF TYPICAL ICE RINK ECONOMICS
Ice rink facilities vary widely in the types of buildings, seating, equipment, and
services offered; all of which greatly influence their cost and revenue structures. For
example, public ice skating facilities range from uncovered fields flooded during winter
months, to modest outdoor rinks, to fully enclosed, regulation-size, refrigerated facilities
operated year-round. Facilities in the broad "middle range" may exhibit numerous
combinations of many variables, including refrigeration, having a roof structure, or being
completely enclosed. Presently, the Vail Valley includes only one regulation-size fully-
enclosed ice rink facility (Dobson Arena).
Despite the wide variation in facilities, however, several physical and operational
characteristics are applicable to most ice rink facilities:
• Most new public ice rinks are designed to accommodate amateur ice hockey league
play. The minimum ice sheet size for amateur hockey league play is 185 feet by 85
feet. Olympic size rinks include ice sheets that measure 200 feet by 100 feet. These
rinks have become more popular in recent years, though most rinks nationally still
offer sheets measuring 200 by 85 feet (regulation National Hockey League rink size).
• Most rinks serve four main skating market segments: public skating, public lessons,
hockey, and private figure skating. When desired ice times conflict, a rink must
balance time slots of the four segments according to revenue generation and target
market preferences.
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• Additional demand for ice rinks comes from ice shows, broomball players, and
special event groups, such as companies, school groups, or community organizations.
Enclosed ice rinks also sometimes provide space for alternative indoor sports, such as
roller-skating, concerts, dances, and exhibitions.
Most new regulation-size, fully enclosed ice rinks are located in densely populated
suburban areas, typically with at least several hundred thousand residents located within a 20
to 30 minute drive. Nevertheless, due to their high capital costs, high maintenance and
operations costs, and limited revenue generating potential, most new ice rinks require
subsidies. New municipal ice facilities - however attractive, popular, or well managed -
seldom generate sufficient cash flow to pay for both operations and debt service. Moreover,
public ice rinks situated in small towns or rural areas typically generate sufficient revenues to
cover only a portion of on-going annual maintenance and operations costs, and both
operating shortfalls and debt service must be covered by general funds or other sources.
Importantly, however, the Town of Vail is unique as an upscale world-class destination resort
area. As a result of its characteristics and status, the Town:
• Attracts a large number of young permanent and seasonal employees, who
represent strong potential demand for hockey league play;
• Could become a very attractive venue for regional or even national hockey league
and figure skating competitions, particularly during the shoulder seasons, when
room rates become more affordable, and
• Is a popular setting for major events, which can (and are currently) hosted by
facilities such as Dobson, and can generate significant additional revenues to help
offset the high costs of maintaining and operating an ice rink.
Annual maintenance and operating expenses at ice rinks are relatively high compared
to many commercial land uses and are very much fixed. For instance, a refrigerated ice sheet
must be cooled whether there are two or 200 persons using it. The use of part-time workers
is critical to matching revenues more, closely with expenses, but many costs remain highly
fixed. Typically, annual maintenance and operations expenses at regulation-size, single-
sheet ice rinks range from about $300,000 to $650,000, depending on the facility type
(enclosed vs. open air, refrigerated vs. non-refrigerated, etc.), location, hours of operation,
and whether the facilities are operated on a year-round or seasonal basis.
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Typically, ice rink revenues are directly tied to, and limited by, the ice times available
and the market demand at the price each market segment is willing to pay. Therefore, the
total revenue a facility can be expected to generate is usually constrained, although very
aggressive marketing and strong programs can make a considerable difference in large
markets, such as major metro areas. Thus, rather than profit-centers, ice rinks more often
function as quality of life enhancements for their communities. As noted, however, given the
unusual and highly desirable characteristics of the Town of Vail, a unique opportunity exists
to generate significant additional revenues by hosting special events on an as-needed basis.
Table V1-1 provides an overview of the typical revenues and maintenance and
operations budgets at Dobson Arena and other selected relevant publicly owned ice skating
facilities included in this report. As shown in the table, reported annual maintenance and
operations budgets for regulation-size, refrigerated and enclosed ice rinks in the local region
range from about $300,000 to about $550,000, with annual gross revenues typically covering
only about 65 to 80 percent of these operating costs and no debt service coverage. Notably,
all of the relevant ice rinks examined in the region require annual operating subsidies of
$60,000 to $100,000 per year before debt service.
In contrast to fully enclosed, refrigerated, regulation-size ice rink facilities, small-
scale outdoor facilities - generally uncovered, unrefrigerated, and with shorter and more
variable operating seasons - require little initial investment and little or no annual operating.
subsidies. Annual maintenance and operations budgets for the simplest "flooded field" ice
skating area can amount to less than $5,000 for a municipality, mostly in labor and
equipment costs. Although such "bare bones" facilities often charge no admissions fees -
and thus generate no annual revenues - they do not require a major up-front capital
investment and the typically require only a fraction of the annual operating subsidies required
at fully enclosed, refrigerated, regulation-size facilities. However, such facilities also lack
the reliable, high quality ice and other benefits of covered, refrigerated ice rinks.
REV>lEW OF DOBSON ARENA
Existing Operations and Utilization Patterns
The Dobson Arena, built in 1978, is centrally located in the Town of Vail and is the
principal ice skating facility. in the Vail Valley. The low-lying complex occupies a central
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Table VI-1
Summary of Key Characteristics and Economics of Relevant Publicly-Owned Ice Skating Facilities
Range of Maintenance Required
Typical Hourly Ice Range of Estimated and Annual
Duration of Time Rental Daily Public Annual Gross Annual Operations Operating
Facility Year Opened Season Rates Skating Fees Attendance Revenues Costs Subsidy
Full-scale Ice Rinks
June - April
Dobson Arena (Vail) 1978 (11 mos.) $85=$145 $245 n.a. -$480,000 $560,000 $80,000
Nov.- April (5
Breckenridge Ice Rink 1996 . mos.) $80-$140 $344 -50,000 $200,000 $300,000 -$100,000
Sept.- May (8
Howelsen Ice Arena (Steamboat Springs 1992 mos.) $100-$150 $2.25-$4.25 50-55,000 $255,000 $315,000 $60,000
June - April
Aspen Ice Garden 1964 (10.5 mos.) $90-$160 $244 n. a. $356,000 $497,000 -$140,000
Unrefrigerated Outdoor Facilities
Nov. - Feb. (4 $8,000-
Vail Outdoor Rink n.a. mos.) $50 Free 6,000 $2,00046,000 $10,000 $4,00046,000
Dec. - March
Adventure Ridge Rink (Vail) n.a. (3 mos.) n.a. Free n.a. n.a. n.a. n.a.
Dec.- March
Eagle-Vail Rink n.a. (3 mos.) Free Free n.a. $0 $30,000 $30,000
Town of Avon Ice Skating Area n.a. Winter mos. Free Free n.a. _$8,800 $10,000 $1,200
Black Family Ice Rink (Beaver Creek) 1997 10 months $700 $2 40,000 n.a. n. a. n. a.
Dec.- Feb. (2 less than less than
Town of Eagle Outdoor Ice Skating Area n.a. mos.) Free Free n.a. $0 $5,000 $5,000
Source: Economics Research Associates.
site, about halfway between Lionshead Village and the Vail Village center and within easy
walking distance of both. The fully enclosed facility features a regulation size, refrigerated
ice sheet housed within a simple but attractive building with a gently sloping, wooden
shingle roof and an intricate ceiling of hardwood beams. Nestled into a sloping site, the
arena's main entrance is at ice level while a side entrance is one level above. A narrow block
of offices, including the admissions desk, skate rental, and staff offices, lines the long side of
the ice sheet, while locker areas and restrooms are situated beyond the far end of the rink.
The Town of Vail owns the Dobson Arena, and the Vail Recreation District' (VRD)
manages it under a long-term lease. A $2.5 million expansion of the facility is scheduled to
begin in May and will add up to 10,000 square feet to the facility in the form of additional
office space, a green room for performers, and an enlarged entryway with loading dock (to
facilitate special events usage), additional restrooms and enlarged locker areas. Phases 11 and
III of the planned renovations call for a new refrigeration system to replace the 20-year-old
system and an additional 800 to 900 seats, respectively.
The Dobson Arena remains open throughout the year. It typically operates for 18
hours a day, from 6 a.m. until midnight. Following a recent fee increase, the ice time rental
rate was raised to $145 per hour, up from $130 per hour last year. Regular admissions for
public sessions cost $5 for adults, $4 for youths (ages 5 to 12), and $2 for kids under four.
Skate rentals are set at $3. Summer Skating School (figure skating) costs $8 per ice time per
session for individuals, or $10 per drop-in session. There is an $8 fee for Drop-In Hockey
sessions. Participation in the Learn to Skate program costs $60. Season skating passes cost
$60 and $75 for VRD youth and adults, respectively, and $85 and $100 for non-resident
youth and adults. Rental of the ice for the entire day costs $1,750. According to the rink
manager, additional rate increases will follow the planned renovations.
Management estimates total attendance for ice-rink use, including hockey, figure
skating, and general public skating, at about 45,000 person days per year. In general, roughly
75 percent of users -are age 18 or younger, while about 25 percent of users are adults.
Approximately 40 percent of the users are from the Town of Vail while the remaining 60
percent consist of down-valley residents and visitors. The overwhelming majority of skating
demand comes from hockey league play, which accounts for more than 80 percent of total
annual skating attendance. From October through April of every year, hockey leagues
dominate the rink's schedule and operations. General public skating now accounts for about
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12 to 15 percent of attendance, but has declined in recent years while hockey attendance and
popularity has increased.
Hockey league participation at Dobson includes six men's and one ladies' hockey
teams, one high school team, and 24 teams that are part of the Vail Junior Hockey League.
The rink manager estimates that a full 85 percent of the roughly 450 junior league hockey
players live down valley. Most adult hockey league players are 18 to 28 years old.
Approximately 60 percent are permanent residents, while about 40 percent are seasonal
employees. About 40 percent live or stay within the Town of Vail, while more than 50
percent live or stay in the Eagle-Vail/Avon/Edwards area, and about ten percent live in the
Eagle/Gypsum area.
According to the rink manager, available ice-time at Dobson is fully scheduled and
the arena is operating a full capacity. Hockey demand currently exceeds available ice time.
As a result, hockey team practice sessions are limited to twice a week and teams typically
must share the ice with another team. Additionally, there is a waiting list of about 150
people wishing to join the adult men's hockey league, which translates to demand for an
additional six to eight teams.
Special Event Usage
Dobson Arena also hosts a variety of special events, including ice shows, concerts,
private gatherings, and corporate events. As an event space, Dobson contains 17,000 square
feet of usable space and has a capacity for up to 2,500 people, seated theatre-style. The rink
manager reports that Dobson now hosts a total of about 20 to 30 major events per year which
comprise approximately 30 to 45 event days per year and have a total combined attendance
of about 75,000 people per year- These events disrupt hockey play, general skating, and
figure skating for one to two days per event, but generate a significant portion of annual
revenues, up to 45 percent of total revenues in some years (about $125,000), while
accounting for only about eight percent of total available ice times. In contrast, ice-related
activities, which absorbed the remaining 85 to 90 percent of days, accounted for a total of
only about $150,000 in total gross revenues. Despite this fact, management has had to turn
down approximately 20 to 25 events per year as a result of scheduling conflicts with hockey.
Special event usage of the arena typically costs users $3,200 per day, including the
use of the floor, a stage, and chairs, but not including house services such as labor, spotlights,
box office, and forklifts, etc. Notably, the rink manager reports that Dobson's costs of
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hosting such events are only about $700 per day, resulting in a $2,500 operating profit per
day of special event use. The manager notes that the Dobson Arena benefits unusually from
special events by being the only 17,000 square foot exhibition space in Vail, and by simply
being located in Vail, which - because of its prestige - lends Dobson Arena much
competitive advantage as an attractive event site. However, a major obstacle to hosting
events is the design of the building itself, which is apparently not tall enough to host most
televised events and has poor acoustics which limit what types of performances can be held
there.
Current Operating Expenses and Revenues
According to the rink manager, total maintenance and operations expenses budgeted
for the facility were about $541,900 in 1999, which broke down roughly as follows:
• Labor costs for nine full-time and four part-time employees: about $342,500.
• Other operating expenses, including maintenance and repair: about $53,000.
• Utilities: about $80,500.
• Special event set-up costs: $20,500.
• Skating school costs (including summer hockey camp): $39,500.
Dobson's total maintenance and operating costs were reported at about $554,000 for 1999,
which is about two percent higher than the amount budgeted.
According to the rink manager, the estimated gross revenues for 1999 were about
$471,000, resulting in a budgeted operating deficit of about $50,800. The major sources of
revenue budgeted included:
• Special events, which can generate about $125,000 or more in a good year (since
single events can generate a large portion of total events revenues, however, this
figure tends to vary greatly from year to year).
• The Vail Junior Hockey League, which brought in about $52,000 for 600 hours of
ice time in 1998.
• Summer hockey camps, which accounted for about $39,000.
• About $22,500 from public session skating.
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• Figure skating, which brought in about $19,000 for 400 hours in 1998.
• Corporate sponsorships-the Dobson Arena regularly receives $18,000 to
$20,000 per year from the Coors Brewing Company alone - are another
important source of revenue, and brought in an additional $33,000 in 1998.
• Men's and ladies' hockey leagues, which paid about $17,000 in fees for 200 hours
in 1998.
In 1999, total revenues were $442,000, which is six present lower than the estimated
revenues (based on 1998 levels)" As a result, the total operating subsidy required in 1999
was $112,000.
REVIEW OF OTHER SELECTED RELEVANT ICE RINK FACILI-rILS
In order to better understand future potential demand for Dobson Arena and for a
second sheet of ice in the Town of Vail, and in order to better understand the typical
operating characteristics of public ice rink facilities in the Colorado Rockies, ERA identified
and examined other relevant existing ice rink facilities in neighboring mountain communities
in Colorado. Presently, the Vail Valley does not include any other fully enclosed regulation-
size ice rink facilities. As a result, although situated outside the Vail Valley, the following
facilities serve as key comparables worthy of analysis:
• Breckenridge Ice Rink, Breckenridge
• Howelsen Ice Arena, Steamboat Springs
• Aspen Ice Garden, Aspen
Comparable Ice Rinks in Neighboring Regions
Breckenridge Ice Rink, Breckenridge
The Breckenridge Ice Rink is an attractive outdoor regulation-size ice rink facility
situated on Boreass Pass Road, immediately south of the Town of Breckenridge. The Town
of Breckenridge is situated in a remote, scenic portion of Summit County, about ten miles
south of Interstate 70, at an elevation of about 9,600 feet. The Town presently includes only
about 2,800 full-time permanent residents, but includes Colorado's second most popular ski
area, behind Vail, which now records about 1.3 to 1A million skier-days per year. In total,
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Breckenridge now attracts approximately one million visitor nights each year. In addition,
the Town attracts a large number of young seasonal residents (typically about 19 to 30 years
old) who come to recreate and to fill jobs at the ski area. The majority of these seasonal
residents come during the winter months and leave by the end of ski season.
The Breckenridge Ice Rink also attracts use from other Summit County residents and
visitors. Remaining portions of Summit County presently include a total of nearly 20,000
permanent residents and attract approximately three million visitor nights per year who stay
in Keystone, Frisco, Dillon and other areas. Neighboring towns also attract a large number
of seasonal residents who also represent a secondary source of demand for the ice rink. "
The Breckenridge Ice Rink is owned and operated by the Town of Breckenridge,
which is presently developing a new regulation-size indoor ice rink on an adjacent site, and
also owns and operates a wide array of other attractive public recreation amenities. The
Breckenridge Ice Rink was completed in 1996, with development costs reportedly totaling
about $1.4 million. It includes a 6,000 square foot clubhouse and maintenance structure
serving an outdoor NHL regulation-size ice rink. The ice rink is not covered, but is sheltered
from direct sunlight by open-air netting and is lighted for nighttime use. The rink is
refrigerated, but is situated at an elevation of approximately 9,600 feet above sea level, so
refrigeration is reportedly rarely needed between early December and early March, which
accounts for the bulk of the regular season of operation.
The'Breckenridge Ice Rink is now utilized on a seasonal basis, extending from early
November through early April. Management previously permitted in-line hockey on the rink
during the summer months, but found that Breckenridge's wet weather combined with the
rink's painted concrete surface resulted in too slick and too dangerous of a surface.
According to the facility's general manager, maintenance and operations costs for the
Breckenridge Ice Rink total about $300,000 per year. This figure includes about $250,000 in
labor costs, about $20,000 in utility costs, about $4,000 in marketing, and about $26,000 in
other costs (services and supplies, undistributed, etc.). The facility is maintained and
operated with two full-time employees who allocate 100 percent of their time to the ice rink
for two-thirds of the year and about 25 part-time staff members, who typically work about 10
to 15 hours per week during the regular winter season.
The Breckenridge Ice Rink is utilized for hockey league play, figure skating practice,
and general public skating. According to the general manager, the rink presently attracts
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about 50,000 paid admissions per year. Management estimates that these skaters are
distributed by origin roughly as follows:
• Town and area residents - 10,000 to 15,000 paid admissions.
• Seasonal residents - 25,000 to 30,000 paid admissions.
• Short-term visitors / tourists - 5,000 to 10,000 paid admissions.
Management believes that total annual attendance on the outdoor rink will reach a stabilized
level of about 80,000 total paid admissions within about two years. This level is viewed as
full practical capacity, given the facility's season of operation.
Management also reports that the overwhelming majority of total annual use comes
from hockey league play. Remarkably, despite the small size of the Town's population,
management reports that the facility typically hosts about 28 adult hockey league teams each
winter. Most hockey teams consist primarily of seasonal employees who live in
Breckenridge or neighboring communities during the winter ski season. In addition, the
facility typically hosts about ten youth hockey teams, consisting primarily of permanent
residents. Due to the importance of hockey league play, most utilization of the Breckenridge
Ice Rink occurs during the peak winter hockey season on weekday evenings and on
weekends. Youth hockey teams typically utilize the rink on weekdays from 5 p.m. to 8 p.m.,
while adult hockey teams utilize the rink from 8 p.m. to.l l p.m. During the winter months,
league play also accounts for most available hours on weekends. In contrast, weekdays are
typically quite slow before 5 p.m., attracting some short-term overnight visitors who elect to
skate during general admission periods as an alternative to skiing, but attracting few area
residents or seasonal residents.
According to management, the Breckenridge, Ice Rink typically generates about
$200,000 in total gross revenues per year, including roughly:
• $30,000 to $35,000 in hockey league fees;
• $30,000 to $40,000 in regular paid admissions;
• $100,000 to $110,000 in ice rentals (primarily associated with hockey league
play);
• $10,000 to $15,000 in skate rentals;
• $5,000 to $10,000 in pro shop sales; and
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About $10,000 to $15,000 in other income.
Thus, with total annual revenues of about $200,000 and total annual maintenance and
operating costs, excluding debt service of about $300,000, the facility typically generates an
annual net operating loss of about $100,000. Thus, the facility does not cover any of its debt
service, and the Town of Breckenridge has to subsidize an annual operating shortfall of about
$100,000 in order to fully cover maintenance and operating costs. According to
management, the Town's ultimate goal is for the facility to fully cover annual costs of
maintenance and operations, but the Town does not expect the facility to ever cover a
significant portion of debt service on the initial development cost.
As noted, the Town is presently developing a new indoor ice rink facility adjacent to
the outdoor rink. This facility is being financed through a bond offering and is scheduled to
be completed by June 2000. The indoor rink will be an upscale, NHL regulation-size facility.
The Town presently projects total development costs at about $5.2 million, and anticipates
total annual maintenance and operations costs of about $600,000. The general manager
believes this rink will eventually attract about 500,000 visits per year, including about
350,000 skater visits and about 150,000 spectator and special event visits. Management also
notes -that ice time at the indoor rink will rent for about $130 to $200 per hour - roughly
twice the rate presently charged for the outdoor rink.
Hmvelsen Ice Arena, Steamboat Springs
The Howelsen Ice Arena is an Olympic size, fully enclosed ice rink located on the
Howelsen Parkway in Steamboat Springs, immediately across the Yampa River from the
main downtown area. The Howelsen Ice Rink is a component of the city-owned Howelsen
Hill Complex, which stretches along the riverfront and includes a nordic and alpine skiing
area, softball fields, and rodeo grounds.
The Town of Steamboat Springs is situated at an elevation of about 6,700 feet and has
a permanent resident population of about 9,000. Best known for its premier skiing area,
known simply as Steamboat, Steamboat Springs attracts roughly 600,000 visitor nights each
year, with about two thirds of them arriving during the winter ski season. Given its remote
location, Steamboat Springs is a true destination resort: about 70 percent of Steamboat's skier
days come from out-of-state visitors.
Owned and operated by the City of Steamboat Springs, the Howelsen Ice Arena was
constructed in phases. The first phase consisted of building an unenclosed refrigerated rink.
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The rink was enclosed in the second phase and presently consists of a very simple, dark
brown, steel-constructed building with a slanted roof and minimal exterior detailing,
including a wainscot trim of painted timber. This building is flanked by two modular units,
which are utilized to house the office area, admissions, skate rental, locker rooms and
restroom facilities until the third and final phase of development is completed. The total cost
for the first two phases was approximately $1.6 million. The third phase, which is currently
pending approval by the City Council will be a major expansion to the existing enclosure,
that would include offices, admissions and rental counters, concession areas, restrooms,
utility and storage rooms, six locker rooms, a refrigeration and a resurfacer room, and a new
refrigeration system. The third phase is estimated to cost between $2.5 to $3' million.
The Howelsen Ice Arena's public skating season lasts eight months, from September
15 to May 15. Throughout the week, the rink opens at 6:00 to 6:30 a.m. for hockey practices,
games, or a figure skating club, and closes around 11:45 p.m., depending on the activities
planned. Public skating sessions generally take place between 10 a.m. and 5 p.m. on
weekdays, with special evening and afternoon sessions on weekends.
In 1998, the Howelsen Ice Arena reported total operations and maintenance expenses
of about $316,000, which broke down as follows:
• Labor costs for two full-time year-round employees, four - full-time seasonal
employees, and six part-time seasonal employees: about $149,000;
• Other maintenance and repair: about $61,000-
• Utilities: about $86,150,-
• Advertising and printing: about $19,850.
The rink manager estimates that about 1,000 of Steamboat Springs' roughly 9,000
community members-or just over ten percent of the local population-are regular users of
the ice skating facility. As far as the arena's general" user base, the rink manager estimates
that about 80 percent of users are full-time residents, 10 percent are seasonal workers and
"ski bums" who fill up the men's hockey league, and tourists and other visitors account for
the remaining ten percent of the facility's users. The average drive time radius for all users is
estimated at about 15 minutes.
Although the Howelsen Ice Arena does not track total annual attendance, based on
reported revenues and discussions with the rink manager, it appears that total annual
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attendance at the facility now ranges from about 50,000 to 60,000 visits. During the 1998-
1999 season, public skating sessions and recreational (non-league) hockey at the Howelsen
Ice Arena attracted about 10,500 individual visits. Throughout the 1998-1999 season, the ice
rink also rented out about 1,000 hours of ice time.
According to the rink manager, the Howelsen Ice Arena recorded about $257,000 in
total gross revenues for 1998, representing an operating loss of roughly $59,000. Based on
reports for the 1998-1999 season, major sources of revenue broke down as follows:
• Public skating sessions, including individual admissions, drop in's, punch cards
and season passes, generated about $66,140;
0 Youth hockey brought in about $65,000,-
0 Adult hockey leagues generated about $21,500;
• Special groups and tournament play generated about $20,000;
• Dasher board advertisements generated about $21,600;
0 Figure skating brought in roughly $15,000,-
0 Skate rental and pro shop revenues totaled about $18,900;
• Women's hockey leagues generated about $10,000.
The rink will occasionally' host special events, although these are not as frequent or
on as large a scale as those hosted in Dobson Arena_ Seasonal events include skating
sessions with Santa and the Easter Bunny. Other events include live radio broadcasts, an
arena open house, equipment rummage sales, an annual ice show in April, and miniature
golf-on-ice. In addition, the rink programs games of broomball, which is similar to ice
hockey, but uses an inflated ball and a special rubber-headed "broom", and learn-to-skate
activities.
Aspen Ice Gardens, Aspen
Aspen Ice Gardens is a regulation-size indoor ice skating facility situated three blocks
from the central square in the Town of Aspen. The Town of Aspen is located at the end of
the Roaring Fork Valley, in scenic Pitkin County, 220 miles west of Denver, at an elevation
of about 8,100 feet. Founded as a silver mining town in the 1800's, the Town has grown into
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a world renowned winter sports resort and year round resort destination center. The Town
has approximately 5,500 full-time residents and attracts about 350,000 skier visits per year.
Aspen Ice Gardens is owned and operated by the Town of Aspen. The rink was
completed in 1964 and includes a 185 by 85 foot refrigerated ice slab within a 24;000 square
foot steel and concrete structure. The building was originally designed to be open sided with
canvas sidewall coverings, however, in 1974 the sides were enclosed with cinderblock walls
and windows. The building includes four heated locker rooms, office space, a 1,000 square
foot meeting room, and a 300-seat bleacher. A portion of the building was renovated in 1994
and the rink's operating equipment, including the refrigeration unit and Zambom machine,
were upgraded on a piecemeal basis throughout the 1990's.
The rink is open 10.5 months per year and is closed from late April to mid-June. The
summer season centers around the Aspen Summer Skating School in June and July and the
Hockey School in August. The fall season is primarily used by locals for figure and hockey
skating. The winter season is the time of the heaviest user load on the rink. Demand for ice-
time during this season typically exceeded the "prime" late afternoon and evening slots.
Even during the high winter tourism season, the rink primarily serves the local resident
population. Management estimates that less than five percent of total usage is by out-of-
town visitors.
Over 65 percent of the total available ice-time at the rink is reserved for hockey.
Public skating sessions make up fewer than 15 percent of total usage. During the winter
hockey season, public skating sessions are limited to 1.5 hours a day, typically in the late
afternoon. According to management, the Aspen Ice Garden generated about $356,000 in
total gross revenues in 1999, including roughly:
• $20,000 in general skating admissions;
• $19,000 in skate and locker rentals;
• $6,500 in merchandise sales;
• $18,000 in special events revenues;
• $43,000 in hourly ice rentals;
• $83,000 in hockey league revenues;
• $91,000 in summer hockey camp revenues;
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• $22,500 in figure skating camp and class revenues; and
• $53,000 from other sources.
The maintenance and operations costs for the Aspen Ice Garden totaled
approximately $497,000 in 1999. This figure includes about $334,000 in labor costs,
$11,000 in utility costs, and $39,000 in building maintenance costs. The rink has a staff of
five to six permanent workers and six to 12 part-time workers, depending on the season.
With annual revenues of about $356,000 and annual operating costs of approximately
$497,000, the rink generated an annual net operating loss of about $141,000 in 1999. The
Town of Aspen provides a yearly operating subsidy to cover the operating gap for the rink.
Other Ice Skating Facilities in the Vail Valley
Town of Vail Outdoor Ice Skating Facility, Vail
The Town of Vail owns and maintains an outdoor skating rink at the Vail Nordic
Center during the winter months, typically from late November through mid-February,
weather permitting. The rink is created each year by compacting snow on the golf driving
range and hand spraying it until it forms an ice crust. The Town places wooden reinforced
batter boards around the sides of the rink so that it can be used for hockey. The temporary
rink is regulation size, measuring 85 by 200 feet, and costs approximately $6,000 to construct
yearly.
The rink is primarily used, by local hockey leagues for practice but it is open
approximately five hours a day for public skating. According to management, there is unmet
demand for additional hockey ice-time that the rink is unable to meet without cutting into
public skating hours. Demand for public skating time, which comes primarily from seasonal
tourists, is currently being met by the available hours.
Management estimates that the rink gets approximately 6,000 visitors per year for the
public skating sessions. The annual revenues for the rink typically vary between $2,000 and
$6,000 depending on the winter weather patterns. Annual operating costs, including the cost
of constructing the rink, range between $8,000 and $10,000. The annual operating gap is
covered by the Town of Vail.
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Adventure Ridge Outdoor Skating Rink
Vail Resorts operates an unrefridgerated outdoor skating rink on the mountain during
the winter season, from late December through March. The rink is primarily used by visiting
families. No hockey play is allowed on the ice. The rink is accessible from the gondola in
Lionshead Village and is open from 12:30pm to lOpm. The gondola ride costs $15 before
2pm and is free thereafter. The rink is accessible free of charge and skate rentals cost $8.
Other Rinks in the Vail Valley
The Vail Valley contains four other seasonal outdoor rinks in Eagle-Vail, Avon,
Beaver Creek and Eagle. All of these rinks, with the exception of the one in Beaver Creek,
are constructed on flooded fields or frozen ponds and are open for only three to four months
a year. The rinks charge no admission fees, and are used for both public skating and hockey
practice. The annual costs of maintaining these outdoor rinks varies between $5,000 and
$30,000 dollars depending on the level of upkeep and staffing provided. The Beaver Creek
rink, which is located on the roof of the Vilar performing arts center, serves primarily as a
public skating rink. It is a featured amenity of the Beaver Creek resort and attracts
approximately 40,000 visitors annually.
REVIEW OF RELEVANT PLANNED AND PROPOSED ICE RINKS
In addition to examining relevant existing ice rinks, it is also critical to consider
potential additions to the local supply of public ice skating facilities in the Vail Valley. ERA
investigated proposed new ice rinks, potential expansions to existing ice rinks, and possible
closures of existing ice skating facilities by contacting a variety of sources, including ice rink
operators, other public recreation facility operators, city and county planning departments,
local developers, and other knowledgeable sources.
Town of Avon Ice Rink, Avon
The Town of Avon has publicly discussed plans to possibly develop an enclosed,
regulation-size ice rink facility within the Village of Avon development. The proposed
development would consist of a recreation center, an outdoor amphitheater, in addition to
housing and commercial development. Recent discussions have called for two regulation-
sized sheets of ice within a single facility. Although plans for the development are still in
initial stages, the Town recently annexed the proposed site. The Town manager estimates
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that the development of the Village will not happen for at least four or five years, depending
on the national economy. If developed, the rink would be owned and operated by the Town
of Avon and open to the general public.
If this rink were to be completed it would provide significant competition to the
Dobson Arena. There is not sufficient demand within the Vail Valley to support two
enclosed ice-rink facilities with two sheets of ice. Therefore if a second sheet.of ice is
developed within the Town of Vail, the likelihood that this project will be developed would
be greatly decreased.
Tmvn of Eagle Ice Rink, Eagle
The Town of Eagle is currently pursuing to plans to develop a new ice rink facility,
possibly in conjunction with a small new community recreation center and/or outdoor
swimming pool. This new ice rink facility would be situated on the Eagle Ranch, a new
master-planned golf residential community situated immediately south of the existing town.
At this point, the Town of Eagle is reviewing options to develop either a fully enclosed rink
or a covered, open-air rink that would be operated on a seasonal basis. Based on anticipated
development costs and anticipated maintenance and operating costs, it appears likely that the
Town will opt to develop the more basic, open air, seasonal facility. At this point, however,
it is uncertain whether the Town will move forward with this project, and if so, when it will
be completed.
Town of Gypsum Ice Rink, Gypsum
Like the Town of Eagle, the nearby Town of Gypsum is also contemplating
developing a permanent outdoor public rink at some point in the near future. The rink would
open-year round and used for roller-skating during the summer months. However, planning
for the facility in Gypsum is still in, the initial stages and the city estimates that the rink will
not be built for at least five years. In the interim, the Town has purchased a temporary
Olympic-sized ice rink for use during the winter season. The temporary rink cost $6,000 to
purchase and will be assembled and managed by existing city staff. The rink will be used
starting in the winter 2000 and is estimated to have a life span of six years.
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City of Glenwood Springs Ice Rink, Glenwood Springs
The City of Glenwood Springs, which is located approximately 60 miles west of Vail,
is moving forward with plans to develop a new community center in Glenwood Springs.
This facility, which was approved by area voters in November 1998, will include a large,
high. quality community recreation center, an NHL-regulation size ice rink; and a performing
arts center (to be added in a later phase). These facilities would all be developed on a single
site and operated in conjunction with. each other. The City plans to start construction on the
rink in May 2000 for a targeted opening date of December 2000.
According to City officials, the new Glenwood Springs ice rink will be a NHL
regulation-size facility. The facility will be an open air, covered, lighted facility, operated
from a small clubhouse including a lobby, a rental counter, bathrooms, and maintenance
storage areas, but no locker rooms for hockey in the first phase. Initially, the facility will not
include refrigeration but it may be added in a later phase. City staff estimate initial
development costs at about $775,000. The facility would likely be operated from December
through early March, charging a regular admission fee of $2 to $4 per skater. City officials
estimate that annual maintenance and operations costs for the ice rink will total about
$57,000 and annual revenues will be on the order. of $28,000, resulting in a necessary annual
operating subsidy of $25,000.
DEMAND ANALYSIS
Hockey Demand
In order to get a sense of current and future demand for ice-time in Vail, ERA
interviewed the managers of the local youth and adult hockey leagues. All of the managers
indicated that they were currently limited in the number of hours that they are allowed to
schedule at Dobson Arena. All of the existing leagues stated demand for significantly more
hours troth to increase the number of weekly practices for their existing teams and to expand
the number of teams in their league. Due to the present popularity of hockey in Colorado, all
of the leagues are under tremendous pressure to expand. In total, the five leagues
interviewed requested approximately 40 additional hours of ice time a week during the
hockey season.
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Hockey Tournament Potential in (jail
Hosting national and regional hockey tournaments present a potential source of
cevenue for an ice rink. Although the hockey season typically lasts from September through
April, and therefore overlaps a great deal with the prime ski season, some tournaments, such
as adult league tournaments take place year-round. ERA talked with national and regional
tournament organizers from USA Hockey, the national governing body for the sport of
hockey in the United States, about the Town of Vail's potential as a regional or national
tournament location. According to USA Hockey, thousands of hockey tournaments take
place in the United States each year, the majority of which are organized and administered by
local ice arenas. USA Hockey as an organization organizes a limited number of regional and
national hockey tournaments for its teams, primarily through its district offices.
According, to the USA Hockey Colorado district manager, the official Rocky
Mountain district tournaments are typically held at facilities with two fully-enclosed sheets.of
ice. The location of these tournaments rotate between the nine states within the district and
therefore only take place in Colorado once every nine years. He sees Vail as a problematic
site for tournaments, even with the addition of a second sheet of ice, because of the high
prices of accommodations in the Vail Valley. Tournament participants typically pay between
$60 to $90 per night for hotel rooms, prices which are hard to come by in the Vail Valley,
even during the shoulder season. Additionally, air flights directly into Vail are limited during
the shoulder seasons and are somewhat price prohibitive to tournament participants.
The current Director of Youth Hockey at USA Hockey stated that there is a potential
for a youth national tournament to occur at Vail if there was a second sheet;,.of ice. These
tournaments are bid on by arenas across the nation two years in advance of the event.
Hosting arenas typically provide ice-time free of charge but make revenue from
merchandising sales and from special arrangements with the hotels who house the
participants and attendees. The director previously organized USA Hockey adult tournaments
which occur 17 times a year, typically at destination resort locations. These tournaments
typically pay $175 per hour for ice time, which is slightly higher than the going rate at
Dobson arena. He stated that he has considered Vail as a tournament site in the past for these
tournaments but there was not enough ice-time available. Instead, he has used Colorado
locations such as Breckenridge and Colorado Springs. He stated that with the addition of a
second sheet of ice, Vail would be a good site for off-season adult tournaments if reasonable
hotel room rates could be obtained.
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Other Sources of Ice Demand
ERA also spoke with the Skating Club of Vail who_ administers the local figure
skating program. The director of the Club indicated that they would like to increase their ice-
time use by almost 70 percent. She also stated that the Learn-to-Skate program, which feeds
youngsters into both figure skating and hockey, has been looking to drastically increase the
number of sessions it holds a week. Lastly, she stated that there are too few public skating
sessions at Dobson (only two a week) in comparison to other ice rinks which reserve 1.5 to 2
hour sessions for public skating every day of the week. She believes that many tourists
would love to use Dobson for public skating, especially on days with inclement weather, but
are turned away by the lack of availability.
Conclusions on Potential Demand
According to the manager of Dobson Arena, Vail could develop a second sheet of ice
and enjoy solid operating performance by:
1. Hosting more special events (while keeping one rink open for skating at all
times);
2. Hosting a larger number of hockey teams;
3. Allowing hockey leagues to increase the number of weekly practice sessions;
4. Hosting a 3 to 5 national or regional hockey and figure skating tournaments; and
5. Increasing the number of public skating and drop-in hockey sessions.
The rink manager believes, based on the above programming, the total combined attendance
in the two rinks would initially jump about 60 percent over current levels at Dobson, and
then gradually grow thereafter, assuming that hockey continues to enjoy strong popularity.
This translates to demand for approximately 15 hours of ice time daily on a second sheet of
ice, representing approximately 80 percent of the current ice use on the existing sheet.
Based on our examination of the existing and future demand for ice time in the Vail
Valley and on the rink manager's reports on lost event and hockey business, ERA finds the
above conclusions to be reasonable and warranted. However, it is important to note that both
ERA and the rink manager believe it is crucial to locate the new sheet of ice in close
proximity to the existing rink in order to make the facility attractive for national and regional
tournaments and other uses. Additional event demand might result from synergies with the
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proposed conference center if both facilities are developed. ERA's detailed demand and
revenue projections are discussed in Section VIII.
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Section VII
FAMILY-ENTERTAINMENT CENTERS
ERA was asked to evaluate the economic feasibility of a commercial, indoor,
family-entertainment center for the Hub site, and whether there would be enough support
to attract bidders to develop and operate the center. The interest in a family-
entertainment center is the following:
• To provide activities for Vail's family and youth visitors;.
• To add to the menu of activities to Vail's visitors in an attempt to extend
people's length-of-stay and expenditures within Vail;
• To provide alternative activities to Vail's seasonal workers,
• To provide family and youth-oriented activities throughout the year to Vail's
residents.
While the focus of this study is on the economic and market criteria for
commercial operators,.the Vail Recreation District (VRD) is also interested in developing
and operating their concept of a family recreation center as a public service. Therefore,
this section also discusses how the economic criteria changes for facilities that are
operated by public agencies.
COMMERCIAL FAMILY-ENTERTAINMENT CENTERS
Family entertainment centers (FECs) are a growing trend in the both the retail and
attractions industries. They can be integrated into shopping centers as indoor facilities, or
operate independently as stand-alone outdoor/indoor destinations. Entertainment centers
can be oriented toward children, or be retail-, sports- or food-based.
The International Family Entertainment Center Association defines these
attractions as a "unique environment of recreational amusements with family appeal that
attract a local base of visitors." Visitation draws primarily from the local resident
community, though larger FECs can draw from a radius of 30 miles or more, depending
on the existing of other attraction surrounding areas. Because of their reliance on the
resident market and repeat visitation, they prefer locations that are accessible to a large
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resident population. In recent years, however, variations of FECs have also appeared in
resort areas. Some of these centers in resort locations operate as independent businesses.
Others are developed and operated by the major resort company, sometimes at a loss,
who can subsidize the operation from revenues earned within the resort company's other
business operations, such as hotel room rentals and gaming.
Components/Activities
Family entertainment centers generally consist of two or more commercial
recreational attractions combined to form a larger facility. They are typically anchored by
a primary recreation activity, such as miniature golf courses or laser tag, and contain a
variety of other participatory activities. Arcades, which can include video and/or
redemption games, are almost universally included as a high-margin revenue generator.
A mix of elements such as Miniature golf, 'batting cages, bumper rides (both boats and
cars), water elements and other rides and attractions from the remainder of the "attraction
mass" needed to produce an economic scale of operations and substantial market impact.
Ownership
Because FECs are still making the transition from a commercial recreation
phenomenon to a well-established and defined industry, standard reporting of operational-
data is not in place. Many centers are also family-owned and operated facilities, although
corporate operators are now entering the field. Independent operators have tended to
dominate the industry.
Setting
Outdoor FECs have been part of the American landscape for many years. The
better, more elaborate family recreation centers are found in sunbelt areas which support
year-round operations. They typically combine miniature golf courses; which have been
the core element of family recreation centers, with other participatory activities such as
bumper cars, batting cages and Go-karts, and indoor activities which prominently feature
video games arcades. These facilities generally need 5 to 10 acres in order to provide a
critical mass of activities to penetrate the local market. They also seek inexpensive land.
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Demographics
Family-entertainment centers are designed to provide something of interest for
each family member, as well as specific activities aimed at particular age segments, such
as video arcades which have the strongest appeal to teenage boys. The population
residing in the local area is responsible for the majority of attendees to family-
entertainment centers.
Length of Stay
In an effort to promote the extremely important repeat visit, the length-of-stay or
per capita spending must be reasonable for the scale of attractions in order to prevent
visitor "burn-out".- Patrons are more apt to return and send friends if the experience is
perceived as affordable.
Throughput
A family entertainment center has a measurable capacity that limits the number of
attendees at any one time, regardless of the market potential. This capacity varies by the
type of activities offered. This is particularly significant in light of the fact that the
majority of weekly attendance at these centers typically occurs over four hour periods on
Friday and Saturday evenings.
Performance
In general, fifty percent of attendance at FECs is generated during the period of
Friday night through the weekend. The more successful centers in major markets can
generate annual revenues in excess of $3 million.
A typical family entertainment center includes several elements that draw patrons
to the facility, but have a fairly high level of site utilization relative to financial
performance. These elements, however, induce a length-of-stay sufficient to induce
participation in other high-margin elements of the attraction where the profits are made.
Arcade and food and beverage operations generally act as strong financial performers,
where particularly high levels of operating revenues can be generated relative to capital
investment requirements. -
Table VIM contains basic industry information taken from a 1996 season survey
of 52 profiled commercial FECs. While the information is several years, old and FECs
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Table VII-1 -
U.S. FAMILY ENTERTAINMENT CENTERS
1996 SEASON
PHYSICAL & OPERATING CHARACTERISTICS
Minimum dean Maximum
Physical Characteristics
Interior Facility Size (SF) 320 12,600 150.000
Exterior Facility Size (acres) 0.5 10.6 44.0
Operating Characteristics
Total Annual Attendance 15,000 207,700 1,500,000
Operating Days per Year 100 265 365
Number of Full-time Employees 0 13 102
REVENUESOURCES -
Mean Annual Mean Percentage
(Revenue Sources Gross Sales of Total Revenue
Batting Cages $54,000 8.3%
Bumper Boats $79,000 6.1%
Driving Range $58,000 30.0%
Go-karts $650,000 32.6%
Hard Rides $125,000 17.0%
Laser Tag $319,000 32.8%
Midway Games N/A
Redemption Games $215,000 16.9%
Roller Skating N/A
"Soft" Modular Play $42,500 5.3%
Video Games $134,000- 9.6%
Other
Food & Beverage $74,000, 10.0%
Merchandise $2.262 1.8%
EXPENSES
(as a percentage of facility's revenue)
Minimum Mean Maximum
Hourly Employee Wages & Benefits 4.0% 19.8% 60.0%
Salaried Employees W & B 0.0% 10.1% 45.0%
Repair & Maintenance 0.0% 6.8% 23.0%
Operating Supplies 0.2% 8.0% 30.0%
Advertising 0.8% 5.8% 21.0%
Utilities 0.5% 4.8% 20.0%
Insurance 0.8% 4.5% 20.0%
General Office & Administrative 0.0% 2.6% 16.0%
Lease/Rent 0.0% 11.4% 40.0%
Taxes & Government Fees 0.0% 4.0% 13.0%
Interest 0.0% 9.0% 45.0%
Other 0.0% 7.7%. 69.0%
Operating Margin 2.0% 17.6% 41.0%
Based on a 1996 survey of 52 family entertainment centers
All numbers are rounded
Source : International Association of Amusement Parks & Attractions - 1996 Survey
have become larger and more technologically advanced, _it provides an overall measure of
the percentage of revenue sources and expenses as a percentage of revenue.
As shown, driving ranges, Laser Tag and Go-karts are high revenue producers for
FECs. Food and beverage is lower since most FECs have either concession stands or
small food kiosks which sell inexpensive items. In terms of expenses, hourly and salaried
employees constitute approximately 30 percent of expenses as a percentage of revenue,
the largest overall expense, with standard rent being slightly over 11 percent of revenue.
Pricing
Pricing at FECs is generally on a pay-as-you-go basis, with some attractions,
particularly hi-tech ones, more expensive. Pricing is very flexible and can take the form
of target segment prices, coupons, multi-use and promotional discounts, etc. Premium
pricing would be applied during capacity-constrained peak hours to maximize revenue
and moderate attendance variance.
Market Penetration
Typical, independently operated outdoor family-entertainment centers, with an
indoor arcade, attract 20-56 percent of the 5-mile market, and a 7-24 percent penetration
of the 5-10 mile population, and 1-16 percent of the 10-15 mile population.
Trends
Family entertainment centers have been generally oriented toward serving the
local resident markets, though various types or elements of FECs have started appearing
in resort areas. In recent years outdoor FECs have been adapted to indoor locations,
either in retail malls or in freestanding locations and represent an increasing development
trend in the U. S. and internationally.
Another recent phenomenon is the emergence of major players into the market,
such as Blockbuster, Sega and Gameworks (backed by Universal), who possess financial
strength. Combined with their financial backing and improved technology, high-tech
software has become increasingly important. The design and quality of centers will
improve as the larger companies move into the market. With the arrival of many new
national competitors who are willing and able to commit a large amount of capital toward
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the development of a new entertainment center, both entry and renovation costs have also
escalated.
HIGH-TECH ENTERTAINMENT CENTERS
High-tech entertainment centers generally- are located in areas with high
pedestrian traffic and/or tourist-oriented areas. Their ability to Qenerate visitation
throughout both- the day and night has made them a very popular and desired anchor
within leading retail entertainment centers. Unlike traditional family=entertainment
centers, high-tech centers are indoor facilities.
High-tech entertainment centers originated in the United States, with Dave &
Buster's being one of the first forms of this concept. As the Dave & Buster's concept
grew more popular, leading entertainment companies entered the market with their own
brands. - The latest national operators include GameWorks developed by Sega
Enterprises, DreamWorks SKG, and Universal Studios, and DisneyQuest, The Disney
a _
Company's high-tech entertainment concept.
Hi-Tech entertainment centers range in size from 25,000 to 100,000 square feet
depending upon their location and are often multi-level venues with separate zones.
Entrance to restaurant/entertainment centers is typically free of charge, with payment for
games made on a per-game-basis with coins or smartcards that can be charged with
credits. In addition to the latest games and simulators, venues, often provide traditional
games such as pool, darts and redemption games.
High-tech entertainment centers have the ability to appeal to a variety of target
markets, because of the range of elements within the concept. The arcades, simulators
and rides attract the youth and family market during the daytime, and the inclusion of
bars and restaurant areas appeal to young adults during the evenings. The combination of
elements allow for a longer length of stay, typically between two and three hours, and
also a greater level of spending per person ranging from between $12 and $25 at leading
centers.
Below is an overview of two selected entertainment centers, Dave Buster's and
Gameworks to illustrate how different models of the high-tech family entertainment
center.
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Dave & Buster's Inc-
Dave & Buster's is one of the leading adult-orientated entertainment centers. The
concept started in the late 1970's on the outskirts of downtown Little Rock in Arkansas.
The company now has 17 locations within the US and two within the UK. Southern
California venues include those at Ontario Mills, the Irvine Spectrum, and the Block at
Orange. The company planned to open six more US locations in 1999, and have a target
of seven new locations in 2000.
Dave & Buster's typically operates two unit types. The large format complex
occupies a space of some 50,000 to 60,000 square feet, and requires a resident market in
excess of one million people within 20-miles. The smaller format occupies an area of
approximately 25,000 square foot and targets a resident market of approximately 600,000
visits.
The typical cost of opening a Dave & Buster's ranges from $150 to $250 per
square foot, excluding pre-opening expenses and developer allowances, depending upon
the location and condition of the premises, and the format of the complex.
The concept is based on a combination of dining, bar service and entertainment
merged into one offering. While children are allowed into Dave & Buster's, the centers
are primarily adult-orientated, and strict guidelines are enforced ensuring that customers
under the age of 21 are accompanied by an adult and are not allowed in a Dave &
Buster's after lOpm.
Food and beverage offerings include a full menu and bar service available from
early lunch until late at night in each restaurant and throughout almost all of the
entertainment areas. The facilities are designed to promote easy access to, and maximize
cross-over between, the multiple dining areas within each complex.
Entertainment options are categorized into two main sections: traditional
entertainment and "million dollar midway games." The traditional 'entertainment
includes games such as "world class" pocket billiards, "championship-style" shuffleboard
tables, and D&B Lanes, which is bowling the Dave & Buster's style. These traditional
entertainment center games can be rented on an hourly basis..
The million-dollar midway games section occupies the largest area in any Dave &
Buster's complex. This part of the concept is designed to provide high-energy, escapism
entertainment through a broad selection of electronic, skill and sports-orientated games.
I
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Several games offer coupons that can be redeemed at the Winners Circle for branded
Dave & Buster's merchandise or other small electronic and miscellaneous items.
The high-technology games include simulators such as formula race cars,
Daytona multi-player games, Galaxian Theatre where up to six participants take part in a
mock battle-with Aliens in an enclosed simulation theatre, Virtual World - a fantasy
environment attraction, and other various 3-D/virtual reality games. In addition, larger
Dave & Buster complexes offer an Iwerks Turbo Ride Theatre seating 18 persons in a
simulation ride and "The 19th Hole" - a large enclosed state-of-the-art golf simulator.
Charges for the electronic games and simulators are by standard coin payment or through
the use of a Dave & Buster's power card. The power card enables customers to purchase
game credits before playing, which can then be re-charged with credits throughout the
evening.
Average annual visitation to Dave & Buster's is approximately 500,000 to
750,000. The concept has a broad demographic appeal, although the majority of
customers are between ages 21 and 30. In the US, around 60 percent of customers are
male, though couples make up 32 percent, groups of friends 36 percent, singles 20
percent, and the remainder are families. Dave & Buster's complexes are also popular
destinations for corporate entertainment, and private parties, held in separate rooms or
zoned-off areas. The average per capita spending at Dave & Buster's is in the region of
$15 to $25. Approximately 50 percent of revenues are generated from food and beverage
operations.
GameWorks
GameWorks was conceived by Steven Spielberg who founded DreamWorks in
1994. Two years later, a parent company, Sega GameWorks was formed, creating a joint
entertainment venture between SEGA Enterprises, Universal Studios Inc, and
DreamWorks S.K.G.
Sega GameWorks launched the first GameWorks venue in early 1997 in Seattle.
To date, GameWorks has 12 venues throughout the States, with a new venue scheduled to
be open later this year in Rio de Janeiro, Brazil. Locations include Ontario Mills and The
Block at Orange. GameWorks are adjusting their concept to operate in new markets. A
smaller 20,000 to 25,000 square, foot venue, incorporating the GameWorks Grill and
Studio will be opened in Asia and Latin America in the next few years. There are no
plans to expand into Europe at the current time.
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Venues typically cover an area of some 25,000 to 35,000 square feet. All
GameWorks centers are based around the same format and are typically split onto three
levels. The Loading Dock is the first main area where visitors can get a, look at and play
the latest games. The second area is the Arena, which contains the GameWorks signature
and multiplayer games, and the third is the Loft, containing classic video games,
traditional games and internet activities as well as food and drink offerings.
The signature games at GameWorks include Indy 500 (a multiplayer race game
for up to 8 people), Jurassic Park: The Lost World (simulated arcade game based on the
Jurassic Park movie), Virtual Arena (a virtual reality combat simulator), Vertical Reality
(a shooting game where players ascend or descend on seats that climb up to 24 feet) and
Max Flight VR2002 Roller Coaster (a programmable roller coaster motion simulator
capsule). Other games offered include various arcades and sporting games such as
Alpine Surfer, Wave Runner and Harley Davidson, and more traditional games such as
pool tables, darts and air hockey tables. All games carry a charge which is paid using an
electronic payment card called a Play Card.
Food and beverage offerings at GameWorks venues typically include The Grill, a
sit down restaurant offering both lunchtime and dinner menus, snack bars offering light
meals and beverages, and bars offering alcoholic beverages.
Corporate and other special events are a strong part of GameWorks target
markets. Areas within the venues can be zoned off and used for team-building activities
or straight forward competitive events.
GameWorks branded merchandise is sold at the venues, and typically includes
hats, T-shirts, jackets and other small electronic goods. Venues are typically open
between loam until lam from Mondays to Saturdays, and close at around midnight on
Sundays. The target market audience of GameWorks are adults between the ages of 18
and 35. All children have to be accompanied by an adult, and have to leave the premises
by lOpm. Annual attendance levels are estimated to be in approximately 500,000.
SPORTS-BASED ENTERTAINMENT CENTERS
Sports entertainment centers are a new genre of family-entertainment centers.
Typically anchored by one major sporting attraction such as an ice rink, a sports
entertainment center or "sports-plex" represents one type of diversifying retail industry
that targets the preferences of distinct consumer groups. Similar to the multiplexing
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phenomenon in movie theaters, ordinary sporting attractions such as ice-skating rinks are
combined with other sporting, games and retail activities under one roof. The
developer's goal for these themed centers is to encourage people to pursue several
activities during a single visit, which can lead to a four to five hour stay.
Below is a profile of three sports-based entertainment centers, the first of which is
a "break-out" product.
Gotcha Glacier, Anaheim, CA
Gotcha Glacier is a unique $75 million product that is being built at Edison
International Field in Anaheim. It will be integrated into an overall development known
as Sportstown. The City of Anaheim is attempting to create a critical mass of sports
entertainment venues at Sportstown including the existing sports and location-based
entertainment activities.
Ogden Entertainment has contracted to manage the park. The company ran the
failed Tinseltown Studios, an interactive dinner theater based on the Academy Awards
show in the same complex, now called Sun Theatre.
Key components of Gotcha Glacier will include snowboarding, skiing on a 165-
foot artificial mountain, sledding, skateboarding, ice skating, an indoor surf park, sky
diving simulator, event rooms, retail and a range of food and beverage facilities.
The site is considered to be an excellent location, given its proximity to related
facilities, including Disneyland and Disney's new California Adventure theme park (a
$1.4 billion expansion which will include a 300,000-square-foot retail, dining and
entertainment complex), as well as the Arrowhead Pond arena which hostsa myriad of
sporting activity totaling an estimated 2.3 million attendees.
The complex is expected to draw from the whole Southern California market for
snowboarders and action sports,- as well as a share of the millions of pleasure and
business travelers who come to the area primarily for Disneyland or conventions at the
Anaheim Convention Center, which is currently undergoing a $177 million expansion
that will be completed in December 2000. Another nearby development is
Pointe*Anaheim, a $500 million music and entertainment venue.
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Van's Skatepark - 17te Block at Orange
Primarily as a marketing tool, and secondarily as a revenue attraction, Van's-Inc.,
a youth-oriented footwear company, recently opened Van's Skatepark at The Block at
Orange. The Block is'a new retail/entertainment center in the City of Orange in Orange
County, California. The center opened to the public in December 1998.
The 46,000-square-foot facility has 34-foot ceilings, 6,000 square feet of outdoor
space, an 80-foot vertical ramp, a large mezzanine area for viewers, a 20,000-square foot-
street course and two cement skate "pools" built into the ground. The designers have
incorporated feedback from skateboarders on the layout, materials, and park features.
The site includes approximately 8,000 square feet of retail, rental and video games. The
center is being touted as the nation's largest and most technically-advanced skate park in
the nation, and is the first of a proposed chain of facilities throughout the country. There
are plans for up to five centers in other Mills Corp. entertainment malls.
The centers incorporate a session pricing mechanism where, for a fee, a guest can
enter and use the skatepark until the end of the session. There are six sessions daily,
including .a Tuesday session dedicated to BMX bikes. Nominal capacity is 150 skaters
per session. The facility also uses a membership pricing mechanism. For the $50
membership, a guest receives $4 off normal session pricing, which is $14 in prime time,
and $11 in off time.
Van's Skatepark has been successfully competing against free public skating and
municipal and local skateparks. It is believed that the facility, which generates estimated
attendance of 150,000 annual visitors is successful for the following reasons:
• It is located in a highly visible, highly-trafficked entertainment facility
• It has unique features not offered in other skateparks
• The Van's name is a legitimate brand name
The Block facility generated $800,000 in revenue and attracted 30,000
participants during its first nine weeks of operation. Projected gross revenues during the
first year are $4 million with net income of $1 million.
The company recently opened a larger, 60,000-square-foot park at the. Ontario
Mills retail/entertainment center east of Los Angeles. This is the company's third
operation and one of five future -parks set to open in the San Francisco Bay area, Orlando,
Florida, a suburb of Washington, D.C. in Virginia, Denver and Atlanta.
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LOCATION-BASED ENTERTAINMENT CENTERS AT SKI RESORTS
Standard, indoor-entertainment centers generally do not exist at ski resorts for
several reasons:
(1) ski resorts focus on outdoor versus indoor activities;
(2) the availability of skiing and skiing-related activities on mountain slopes
occupies visitor time throughout the day and competes with the indoor
facility;
(3) major ski resort hotels often offer a variety of entertainment options such as
retail and restaurants available for guests during non-skiing hours, some of
which include recreational activities like billiards and arcades;
(4) several ski resorts are developing- outdoor/indoor non-ski recreation activity
centers on the mountain (such as Vail Resort's Adventure Ridge and Squaw
Valley's High Camp Bath), which would compete with an independent
family-entertainment center for the winter tourist market;
(5) many visitors at mountain resorts prefer relaxing and passive activities such as
dining during non-ski hours; and
(6) many ski resorts are located in markets with a relatively small resident
population.
The combination of such factors limits the potential for indoor FECs on a
commercial basis.
Several ski resorts have one or two components of a FEC, though not necessarily
at the same location. Vail Mountain, for instance, has an outdoor ice rink and Laser Tag
area at a mid-mountain location, and an outdoor mini-golf area at the base of the
mountain near the gondola. In terms of indoor sporting activities, however, most ski
resorts have health club/spa and public recreation center components the primarily serves
the local resident community but is sometimes used by the visitors.
ERA was unable to identify many family-entertainment centers in ski resort
locations. However, a few examples were found and interviewed.
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Alpen Rock House, Whistler, British Columbia
Alpen Rock is an indoor 38,000 square foot entertainment center situated in
Whistler Village beneath the Holiday Inn Hotel. The facility opened in July of 1999 and
contains a European style restaurant, live entertainment, 16 lanes of bowling, 33 pool
tables, 3 bars, video games, live entertainment with a state-of-the-art sound system, dance
and nightclub area and private meeting rooms for groups and parties. This concept is
more similar to a Dave & Buster's, location-based entertainment center, "which caters to
the adult population more than to youth.
High Camp Bath & Tennis Club. Squaw Valley, CA
Situated at the top of a mountain with views of Lake Tahoe, High Camp has an
ice pavilion, museum, swimming pool, spa, restaurants, Bungee Jumping, and Snow
Tubing. The facility is located at 8,200 feet.
Headwall Cafe and Climbing Wall, Squaw Valley, California
Headwall has a cafe and indoor, 30-foot climbing wall that is open from noon
until 5:00 PM during weekdays, with extended hours on weekends and holidays. The
facility is located in the Cable Car Building. The facility recently built a 45-foot outdoor
wall that is open during the summer months only. Unlimited climbing is $12 per person
and an additional $4 for shoe rental.
Mountain World, Whistler, British Columbia
Mountain World is a family entertainment center that opened in November of
1997. The facility closed down during the summer of 1999 due to lack of attendance.
Located adjacent to the Whistler Convention Center and a multi-plex theater, the 15,000
square foot building was in a prime location with high visibility. Owned by the Whistler
Resort Association, the facility featured virtual reality sports simulators, an indoor
climbing wall, pool tables, an arcade; a full-service restaurant and gift shop. Prior to
closing, it was a year-round facility. Admission was on a pay-as-you-go basis using a
Funcard debit system. Prior to closing, the company employed 9 full-time and 45
seasonal employees.
While ERA was unable to obtain detailed information regarding the financial
performance of the center prior to closing, the study team learned through other sources
that facility closed due to lack of attendance. The activities offered at Mountain Zone
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were targeted toward the 8-12, year-old crowd and thereby excluded teenagers and
younger children. The operator tried to obtain a liquor license to attract a more broad
demographic, but the operating expenses were too high.
MARKET SUPPORT FOR A FACILITY IN VAIL
The primary disadvantage of the Vail market for a commercial family
entertainment center is its small resident population. Large centers run by major
operators depend on a large resident base and repeat visitation. Even many of the centers
located in resort locations find that the large majority of their visitors are area residents.
Assuming a market penetration rate of 55 percent of the Vail Valley resident
population, and 20 percent of the balance of the Eagle County population, which would
place Vail among the high-end of industry standards, a family-entertainment center in
Vail may attract approximately 15,800 resident visits per year. Assuming the resident
population comprises 60 percent of total visits (with the balance tourists, non-resident
seasonal workers, and second home residents), which is a low ratio compared to other
FECs, total annual attendance may reach over 26,000 by 2005.
With 26,000 visits per year, and a per capita expenditure of $9.00, consistent with
industry standards, a commercial family-entertainment center in Vail may generate
revenues of almost $235,000. Per capita expenditures could be 50 to 100 percent higher
if the center was had full-service food and beverage (including liquor sales), high-tech
attractions, or specialized retail products. Even if revenues were double, it would not be
enough to support commercial rents, operating costs, and an operator's profit
requirements.
The primary limitation is the size of Vail's resident market. Based on this
analysis, it appears that a commercial FEC would be risky. Therefore, if the Town of
Vail desires to offer alternative recreation activities at the Hub Site, it would probably
have to do so as a public service whose capital costs and rent is subsidized.
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Section VIII
FINANCIAL ANALYSIS AND FISCAL IMPACT
PROPOSED ALTERNATIVES
ERA, the design team (EDAW, Zehren, HGA), and staff from the Town of Vail and
the Vail Recreation District prepared the following alternatives for further design and cost
analysis. The alternatives are based on the results of ERA's recommendations, client input,
and the design team's initial assessment of potential building coverage on the site. The
matrix below presents the individual components of each alternative:
ALTERNATIVE 1 ALTERNATIVE 2
• Conference Center/Learning Center Conference Center/Learning Center
- 20,000 square foot ballroom with - 20,000 square foot ballroom (flat floor
retractable raked seating to create a only)
1,200 to 1,500 seat performance venue
- 6,500 square foot breakouts (10-12
- 6,500 square foot breakouts (10-12 rooms)
rooms)
- 500 square foot boardroom
- 500 square foot boardroom
- Minimum of 10,000 square feet of
Minimum of 10,000 square feet of prefunction/lobby space
prefunction/lobby space
- Attached Learning Center
Attached Learning Center
• Second Ice Rink in a Major New Arena Second Sheet of Ice in Practice Rink
50,000 square foot Arena with 30 foot - Regulation size rink with minimal
ceiling spectator areas
- 2,800 seats for hockey/ice events - Dobson Arena (2,200 seats) with some
improvements remains the venue for
4,000 seats for concert events concert events
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• Family Recreation Center • Family Recreation Center
- 15,000-20,000 square foot Skateboard - 15,000-20,000 square foot Skateboard
Park Park
- 5,000-6,000 square foot Arcade - 5,0006,000 square foot Arcade
- Teen lounge and other amenities - Teen lounge and other amenities
Possible Later Phases: Possible Later Phases:
• Performing Arts Center • Performing Arts Center
• Expansion of the Conference Center • Expansion of the Conference Center
• Lecture Hall on the Library Roof • Lecture Hall on the Library Roof
The primary difference between the two alternatives is the design of the structure
housing the proposed second sheet of ice. In Alternative 1, the second sheet of ice is housed
in a 50,000 square foot arena building that is designed to have suitable acoustics, lighting,
and support facilities for certain types of performance events. The, new arena would have
seating capacities for up to 2,800 for ice events and up to 4,000 for concert-style performance
events, representing a significant increase over Dobson Arena's current capacity of 2,200.
Under this alternative, special events would be hosted at the new arena. Dobson Arena
would be primarily used as a practice sheet of ice and for event overflow. In Alternative 2,
Dobson would remain the main event arena, undergoing some design improvements to
improve the acoustics, and the second sheet of ice would be developed in a much more
modest space to function as a practice sheet.
The other important difference between the two alternatives is that in Alternative 1,
the conference center ballroom is designed to include retractable raked seating which allows
it to function as a 1,200 to 1,500 seat performance venue for certain types of events. Under
Alternative 2, the ballroom of the conference center could still function as a performance
venue, but with flat-floor seating that may be less desirable for some performance events.
FINANCIAL ANALYSIS OF i tit; CONFERENCE CENTERILEARNING CENTER
This section presents the results of ERA's research into the likely utilization patterns
and operating characteristics of the conference center/learning center in the Town of Vail
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under each of the two proposed alternatives. Based upon our previous analysis of industry
trends, comparable and competitive facilities, and surveys of potential user groups, ERA
estimated utilization, revenues, expenses, and net operating income for each proposed
alternative.
Methodology
ERA's utilization projections for the conference center under both alternatives were
determined based on the following factors:
• The volume, seasonality, and size distribution of meeting groups at the
comparable and competitive mountain resort locations;
• Room occupancies and seasonality patterns of current visitation to the Town of
Vail;
• The total available supply of rental lodging units in the Town of Vail;
• Industry trends of typical meeting lengths for different types of group sizes and
types (from the International Association of Convention and Visitors Bureaus
(IACVB) 1998 study of delegate spending); and
• Industry trends for per delegate spending for conference meetings for different
group types (from the International Association of Conference Centers' (IACC)
1999 study of conference operating trends).
Additionally, ERA assumed the marketing efforts for the facility would primarily
target large meeting groups (with 400 or more attendees) in order to not compete with the
existing meeting facilities in Vail. However, our market research indicates that groups with
between 200 and 300 attendees comprise a large portion of total demand for meeting space in
ski resort locations. Although these meetings can be accommodated at a few existing
properties within the Town of Vail, the conference center can still expect to get a 'sizeable
number of these as a result of overflow business from these properties. Groups with less than
100 attendees also present a sizeable source of meeting demand in the Town of Vail but can
be easily accommodated in a large number of existing meeting facilities.. Therefore, ERA
assumed that the proposed conference center would not host any of these meetings.
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Pricing
A pricing structure for meetings at the conference center was estimated using a per-
person Complete Meeting Package (CMP) rate broken down into two components:
conference services and food and beverage. The conference services portion of the CMP rate
includes meeting room rental, basic AN equipment rental, and the services of an on-site
meeting planner. ERA recommends charging -a sliding scale per-person conference services
rate which decreases as the size of the meeting increases, reflecting the economies of scale of
providing services to large groups. The conference services rates used in our analysis varies
from $20 per person for groups with 100 to 400 attendees up to $12 per person for groups of
over 1,000.
The food and beverage portion of the_CMP is set at a constant rate of $35 per person
regardless of the number of attendees. This rate represents the average per person food
expenditures at day-use conference facilities according to the 1999 IACC's "Trends in the
Conference Industry" study. Based on food packages at comparable conference properties, a
$35 per person rate would typically include two meals and two snack services. For the
purpose of this analysis, ERA assumed that an outside vendor using in-house kitchen
facilities will provide food and beverage management and services. Outside vendors manage
their own operating costs and staffing separate from the conference center- As a result, the
conference center would have no direct operating costs resulting from food and beverage
services and would receive a conference lease payment of 15 percent on all food and
beverage revenues.
Other sources of revenue for the conference center include: performance bookings in
the ballroom (based on a flat fee rental rate), equipment rentals and other advanced AN
services, business services, and the learning center computer rental revenues. - These
revenues are not directly linked to the total volume of groups using the facility. ERA
estimated revenues for these items based on the operating budgets of comparable facilities,
with the exception of the performance bookings that were estimated based on projected
demand.
Projected Operating Income: Alternative 1
ERA projected annual operating income based on the utilization projections for the
conference center under the design proposed in Alternative 1. The utilization pattern,
outlined in Table .VIII-1, was determined based on the factors discussed previously. ERA
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Table VIII-1
TOWN OF VAIL CONFERENCE/LEARNING CENTER ESTIMATED USAGE ASSUMPTIONS AND REVENUE PROJECTIONS: ALTERNATIV
Group Size Total
Conference
Less than 100 I 100 to 400 400 to 700 700 to 1,000 1,000 to 1,300 Center
Conference Bookings
Projected Group Bookings Per Year 0 20 15 9 3 47
Average Length of Meeting 2.5 3 3.5 3.5 3.5 n/a
Projected Event Days Per Year 0 60 52.5 31.5 10.5 154.5
Average Attendance Per Event Day 60 250 500 800 1,100 500
Annual Visitor Days/Nights 0 15,000 26,250 25,200 11,550 78,000
Average Conference Services Rate Per Person $25.00 $20.00 $18.00 $15.00 $12.00 n/a
Estimated Revenue from Conference Services $0 $300,000 $472,500 $378,000 $138,600 $1,289,100
Food & Beveraim
Per Capita Food Expenditure $35 $35 $35 $35 $35 n/a
Total Food & Beverage Gross Expenditures $0 $525,000 $918,750 $882,000 $404,250 $2,325,750
% of Food & Beverage Received 15% 15% 15% 15% 15% 15%
Estimated Conference F&B Revenue $0 $78,750 $137,810 $132,300 $60,640 $409,500
Performance Bookings in Ballroom
Rental Rate per Event n/a n/a n/a n/a n/a $3,000
Projected Event Days Per Year n/a »/a n/a n/a n/a 20
Estimated Revenue from Performance Bookings n/a n/a n/a n/a n/a $60,000
Miscellaneous
Equipment Rentals/AV Services n/a n/a n/a n/a n/a $75,000
Business Services n/a n/a »/a Iva n/a $15,000
Learning Center n/a n/a n/a n/a n/a $50,000
Estimated Miscellaneous Revenue n/a Iva n/a Iva n/a $140,000
Total Estimated Revenue $1,898,600
Assumes that a CMP rate is charged.
Source: Economics Research Associates.
estimates that under Alternative 1, the conference center would host a total of 47 events,
ranging in size from 100 to 1,300 attendees, with an average group size of 500. This
translates to 78,000 visitor days per year. Additionally, ERA estimates that the conference
center would host a total of 20 performance events in the ballroom. Given the availability of
raked seating, ERA believes that these a flat fee of $3,000 per event day could be charged for
rental of the ballroom. In total, ERA estimates the total revenue from the conference center
under Alternative 1 to be approximately $1.90 million.
Projected Operating Income: Alternative 2
The - operating revenues of the conference center under Alternative 2 are not
significantly different than those under Alternative 1. The utilization pattern, outlined in
Table VIII=2, includes slightly : fewer large-scale meetings which would result from the
difference in the quantity and quality of space available in the new arena proposed in
Alternative 1 as compared to Dobson Arena. ERA estimates that under Alternative 2, the
conference center would host a total of 45 events, ranging in size from 100 to 1,300
attendees, with an average group size of 500. This translates to 71,350 visitor days per year.
Additionally, ERA estimates that without the availability of raked seating, the conference
center,would host slightly fewer performance events in the ballroom at a flat fee of $2,500
per event day. In total, ERA estimates the total revenue from the conference center under
Alternative 2 to be approximately $1.75 million.
Estimated Operating Costs
In order to estimate operating costs for the proposed conference/learning center
facility, ERA created a sample staffing plan for each proposed alternative, shown in Table
VIII-3. The staffing plans for both alternatives are identical with the exception that
Alternative 1 requires one additional full-time equivalent maintenance staff person to manage
the logistics of the retractable raked seating in the ballroom and the extra business volume.
Both alternatives include two full-time equivalent staff people assigned exclusively to the
learning center. Alternative 1 requires a total staff of 17 full-time equivalents which results
in total labor costs of $899,600, including.all fringe benefits. Alternative 2 requires a total
staff of 16 full-time equivalents which results in total labor costs of $858,000, including all
fringe benefits.
ERA estimated the remainder of the operating expenses, outlined in Table VIII4,
based upon current operating budgets of comparable facilities. The operating costs under
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Table VIII-2
TOWN OF VAIL CONFERENCE/LEARNING CENTER ESTIMATED USAGE ASSUMPTIONS AND REVENUE PROJECTIONS: ALTERNATIVE #2
Group Size Total .
Conference
Less than 100 100 to 400 400 to 700 700 to 1,000 1,000 to 1,300 Center
Conference Bookings
Projected Group Bookings Per Year 0 20 15 8 2 45
Average Length of Meeting 2.5 3 3.5 3.5 3.5 n/a
Projected Event Days Per Year 0 60 52.5 28 7 147.5
Average Attendance Per Event Day 60 250 500 800 1,100 500
Annual Visitor Days/Nights 0 15,000 26,250 22,400 7,700 71,350
Average Conference Services Rate Per Person' $25.00 $20.00 $18.00 $15.00 $12.00 n/a
Estimated Revenue from Conference Services $0 $300,000 $472,500 $336,000 $92,400 $1,200,900
Food & Beverage
Per Capita Food Expenditure' $35 $35 $35 $35 $35 n/a
Food & Beverage Gross Revenue $0 $525,000 $918,750 $784,000 $269,500 $2,227,750
%of Food & Beverage Received 15% 15% 15% 15% 15% 15%
Estimated Conference F&B Revenue $0 $78,750 $137,810 $117,600 $40,430 $374,590
Performance Bookings
Rental Rate per Event n/a iVa n/a n/a il/a $2,500
Projected Event Days Per Year n/a n/a n/a 11/a n/a 15
Estimated Revenue from Performance Bookings n/a n/a n/a n/a n/a $37,500
Miscellaneous
Equipment Rentals/AV Services n/a n/a n/a n/a n/a $75,000
Business Services n/a n/a n/a n/a n/a $15,000
Learning Center Revenues n/a n/a n/a n/a n/a $50,000 `
Estimated Miscellaneous Revenue n/a n/a n/a n/a n/a $140,000
Total Estimated Revenue $1,752,990
' Assumes that a CMP rate is charged and that conference services goes to room rental and basic AV.
Source: Economics Research Associates.
Table VIII-3
STAFFING PLAN FOR PROPOSED CONFERENCE/LEARNING CENTER: ALTERNATIVE 91
# Full-Time Fully Loaded
Position Equivalents Salary Total Salary Salary Cost I
General Manager 1 $85,000 $85,000 $110,500
Assistant Manager 1 $60,000 $60,000 $78,000
Sales and Marketing 1 $50,000 '$50,000 $65,000
Conference Planners 3 $40,000 $120,000 $156,000
Support Staff/Administration 3 $35,000. $105,000 $136,500
Learning Center Staff/Tech Support 2 $40,000 $80,000 $104,000
Operations and Maintenance 6 $32,000 $192,000 $249,600
Total 17 - $692,000 $899,600
Average Salary - - $40,706 $52,918
STAFFING PLAN FOR PROPOSED CONFERENCE/LEARNING CENTER: ALTERNATIVE #2
# Full-Time Fully Loaded
Position Equivalents Salary Total Salaries Salary Cost l
General Manager 1 $85,000 $85,000 $110,500
Assistant Manager 1 $60,000 $60,000 $78,000
Sales and Marketing 1 $50,000 $50,000 $65,000
Conference Planners 3 $40,000 $120,000 $156,000
Support Staff/Administration 3 $35,000 $105,000 $136,500
Learning Center Staff/Tech Support 2 $40,000 $80,000 $104,000
Operations and Maintenance 5 $32,000 $160,000 $208,000
Total 16 - $660,000 $858,000
Average Salary - - $41,250 $53,625
I/ Fringe benefit portion of fillly loaded salary is 30 percent over base salary levels.
Source: Economics Research Associates.
Soc8dinancials stalling Plan
Table VIII-4
TOWN OF VAIL CONFERENCE/LEARNING CENTER
ESTIMATED NET REVENUE IN STABILIZED YEAR OF OPERATION
Alternative #1 Alternative #2
Revenues
Conference Services $1,289,100 $1,200,900
Food and Beverage $409,500 $374,600
Performance Booking $60,000 $37,500
Miscellaneous $140.000 $140.000
Total Revenue $1,898,600 $1,753,000
Expenses
Salaries/Benefits $899,600 $858,000
Marketing 1 $0 $0
Operations/Equip./Supplies $725,000 $700,000
Utilities $120.000 $120.000
Total Operations $1,744,600 $1,678,000
Net Operating Revenue (Loss) $154,000 $75,000
1 Assumes marketing costs will be covered by the VVTCB under 1.4% marketing hotel tax.
Source: Economics Research Associates.
both alternatives are very similar, with the exception of the retractable raked seating in
Alternative 1, which would cost approximately $25,000 more to operate. ERA excluded
marketing costs from the annual budget under the assumption that all marketing will be done
through the VVTCB under the recently approved 1.4 percent lodge tax increase for
marketing the Town of Vail. In sum, ERA estimates the total operating costs to be about
$1.74 million for Alternative 1 and $1.68 million for Alternative 2.
Net Operating Income
It is extremely rare for a conference center without associated lodging to make a
significant operating profit. Some conferences centers come close to breaking even (either
with slightly positive or slightly negative net revenues), while the remainder run a deficit
depending on conditions in their local market. ERA believes that the Rocky Mountain
conference market is strong based on the fact that most of competitive properties analyzed
were not operating at a deficit. Based on our utilization projections, ERA's analysis shows
that the proposed conference facility would make a slight profit in either alternative. Given
the margin of error that is present in any projection, the facility should essentially be
considered to break even. The conference center is projected to have a net revenue of about
$154,000 under Alternative 1 and about $75,000 under Alternative 2 (shown in Table VIII-
4). The difference in revenues between the two alternatives results from the synergistic
effect of the larger space available in the proposed new arena.
FINANCIAL ANALYSIS OF THE DUAL ICE SHEET FACILITY
This section presents the results of ERA's research into the likely utilization patterns
and operating characteristics of the second sheet of ice in the Town of Vail under each of the
two proposed alternatives. Based upon our analysis of the ice rink market, comparable
facilities, and interviews with existing user groups, ERA estimated utilization, revenues,
expenses, and net operating income for the dual sheet facility for each proposed alternative
design.
Methodology
ERA's utilization projections for the dual ice sheet facility under both alternatives
were determined based on the following factors:
• Current utilization patterns of Dobson Arena,
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• Interviews with primary users regarding future-demand for ice-time;
• Interviews with Dobson Arena staff regarding ice-time scheduling conflicts;
• Lost event business for Dobson Arena; and
• Interviews with performance event promoters.
Pricing
According to the manger of the Dobson Arena, following the scheduled $2.5 million
dollar renovation, a new rate system will be applied. ERA applied utilized these new rates in
order to estimate the operating revenues of a dual sheet facility. Under Alternative 1, ERA
assumed that the larger arena, with the increased seating capacity and improved acoustics,
could charge a slightly higher rate for non-ice related special event use than Dobson Arena.
Therefore, ERA set the special event rate at $4,000 per day which is $500 higher than the
proposed rental rate for Dobson Arena under Alternative 2. Hourly ice-time rental rates are
assumed to be the same under either alternative.
Projected Operating Income: Alternative I
ERA estimated total operating income for Alternative 1 based on the utilization
projections shown in Table VIII-5. In total, the new ice arena would bring in an additional
$393,600 in revenue over the operations of Dobson Arena. Approximately half of the
additional revenue is from new event demand. ERA estimates that the new arena can attract
up to 30 new concert and sport events and 15 meeting oriented events (spill-over event days
from large groups at the conference center). In addition, having a second sheet of ice would
allow the facility to host three national and regional hockey and figure skating tournaments.
Additional hockey ice-time demand accounts for about one-third of the projected revenue
and increased demand for figure skating and public skating comprises the remainder of the
projected revenue.
Projected Operating Income: Alternative 2
The estimated operating income for Alternative 2 is based on the utilization
projections shown in Table VIII-6. ERA estimates that a second sheet of ice in the form of
a practice sheet would bring in an additional $318,600 in revenue -over the operations of
Dobson Arena. ERA estimates that additional utilization from hockey leagues and other
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Table VIII-5
TOWN OF VAIL NEW ARENA (ALTERNATIVE #1)
ADDITIONAL USAGE ASSUMPTIONS AND REVENUE PROJECTIONS
# of Hours per Week/Event Days Additional Revenue 2
User Group Rates 1 Period Dobson Current With New Arena Per Week Per Year
flockev Leagues
AAA Hockey Leagues $130 hour 15 25 $1,300 $39,000
Junior Hockey Leagues $130 hour 22 30 $1,040 $31,200
Men's Hockey $150 hour 4.5 9 $675 $20,250
Ladies Hockey $150 hour 3.5 4.5 $150 $4,500
Girl's Hockey $130 hour 3 8 $650 $19,500
Evening Drop-In Hockey Sessions $600 week - - $600 $18.000
Total Additional Hockey Revenue $4,415 $132,450
Other Skating
Skating Club of Vail (Figure Skating) $130 hour 7 10 $390 $11,700
Public Skating (Admission and rentals) $200 hour 4.5 10 $1,100 $33,000
Learn-to-Skate $165 hour 2 6 $660 $19.800
Total Add. Other Skating Revenue $2,150 $64,500
Special Events
Concerts and Other Sports $4,000 day 30 60 - $120,000
Hockey and Skating Tournaments 3 $1,850 day 0 9 - $16,650
Conference Event Spillover $4,000 day 0 15 - $60.000
Total Add. Special Event Revenue $196,650
Total Additional Revenue $393,600
I/ Rates represent management's planned rate increase following the currently budgeted renovations.
2/ Calculated during hockey season only (mid-September through March), approximately 30 weeks total.
3/ Assumes each tournament event spans 3 event days.
Source: Economics Research Associates.
SceB-financials Ice "ik Revenucs-Alll
Table VIII-6
TOWN OF VAIL PRACTICE SHEET OF ICE (ALTERNATIVE 42)
ADDITIONAL USAGE ASSUMPTIONS AND REVENUE PROJECTIONS
# of Hours per Week/Event Days Additional Revenue2
User Group Rates 1 Period Dobson Current' With Practice Sheet Per Week Per Year
Hockev Leaeues
AAA Hockey Leagues $130 hour 15 25 $1,300 $39,000
Junior Hockey Leagues $130 hour 22 30 $1,040 $31,200
Men's Hockey $150 hour 4.5 9 $675 $20,250 ,
Ladies Hockey $150 hour 3.5 4.5 $150 $4,500
Girl's Hockey $130 hour 3 8 $650 $19,500
Evening Drop-In Hockey Sessions $600 week - - $600 $18000
Total Additional Hockey Revenue $4,415 $132,450
Other Skating
Skating Club of Vail (Figure Skating) $130 hour 7 10 $390 $11,700
Public Skating (Admission and rentals) $200 hour 4.5 10 $1,100 $33,000
Learn-to-Skate $165 hour 2 6 $660 $19.800
Total Add. Other Skating Revenue $2,150 $64,500
Special Events
Concerts and Other Sports $3,500 day 30 50 - $70,000
Hockey and Skating Tournaments 3 $1,850 day 0 9 - $16,650
Conference Event Spillover $3,500 day 0 10 - $35.000
Total Add. Special Event Revenue $121,650
Total Additional Revenue $318,600
I/ Rates represent management's planned rate increase following the currently budgeted renovations.
2/ Calculated during hockey season only (mid-September through March), approximately 30 weeks total.
3/ Assumes each tournament event spans 3 event days.
Source: Economics Research Associates.
Scc8-fwancials Ice Rink Ruvenuas•AIU
skating users would be identical to that in Alternative 1. Additionally, ERA believes the
facility would attract the same number of tournaments as the new arena. However, ERA
estimates that Dobson as an event arena would only attract 20 additional concert and sporting
events a year (10 less than the proposed new arena) and 10 conference spill-over event days
(5 less than the proposed new arena), both at a lower rental rate. The resulting decrease in
special event revenue over Alternative 1 would be approximately $75,000 a year.
Estimated Operating Costs
The estimated operating costs of the dual sheet facility under both alternatives is
outlined in Table VIII-7. According to the Vail Recreation District's budget for the year
2000, Dobson Arena currently has an annual operating costs of about $560,000. Based on
our analysis of the existing operations of Dobson and the proposed operating budget of an
existing two-rink facility, ERA projects that the primary increase in operating costs would
come from utilities, maintenance, labor, and overhead. Due to economies of scale, labor and
overhead costs would only increase by about 60 percent over current Dobson Arena levels
for both alternatives. For Alternative 1, the size of the new arena would result in a 150
percent increase in utility costs whereas the practice sheet in Alternative 2 is projected to
have a 100 percent increase in utility costs. The remaining difference in operating costs for
the two alternatives results from variations in the number of non-ice related special events
hosted by each facility. Expenses from hosting special events run approximately $700 for set
up and breakdown costs.
The dual sheet arena would cost approximately $996,000 to operate under Alternative
1 and $935,000 to operate under Alternative 2. In sum, ERA estimates the increase in annual
operating costs to be about $436,000 for the new arena and $375,000 for the practice sheet of
ice.
Net Operating Income
Similar to conference centers, it is extremely rare for an ice arena to make an
operating profit. As discussed in Section VI, the full-scale ice rinks in neighboring
communities are currently running annual deficits of between $60,000 and $140,000.
Through hosting special events, Dobson Arena has managed to significantly reduce its gap
between operating revenues and operating costs but has not yet managed to completely and
consistently eliminate its annual deficit. As shown in Table VIII-7, Dobson will be able to
make a slight operating" profit under its current utilization levels when the new rate system is
Economics Research Associates VIII-14
Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401
Table VIII-7
TOWN OF VAIL DUAL ICE SHEET FACILITY
ESTIMATED NET REVENUE IN A STABILIZED YEAR OF OPERATION
Dobson 2000 Dobson Under With New Arena With Practice
Budget New Rates (Alt. # 1) Sheet (Alt. # 2)
Revenues
Hockey $103,800 $198,000 $330,450 $330,450
Figure Skating $16,750 $27,300 $39,000 $39,000
Special Events .$114,950 $105,000 $300,000 $210,000
Tournaments $0 $0 $16,650 $16,650
Summer Programming $89,200 $89,200 $89,200 $89,200
Public Skating Admissions and Rentals $26,800 $27,000 $60,000 $60,000
Learn-to-Skate $10,000 $9,900 $29,700 $29,700
Other Sources $118.900 $118.900 $118.900 $118.900
Total Revenues $480,400 $575,300 $983,900 $893,900
Expenses
Labor/Overhead $372,550 $372,550 $600,000 $600,000
Maintenance/Utilities $111,450 $111,450 $275,000 $225,000
Other Operating Expenses $6,700 $6,700 $20,000 $20,000
Special Events $22,560 $21,000 $52,500 $42,000
Figure Skating Programs $13,600 $13,600 $13,600 $13,600
Summer Programming $32,150 $32,150 $32,150 $32,150
Other Expenses $2.500 $2-500 $2-500 $2-500
Total Expenses $561,510 $559,950 $995,750 $935,250
Net Operating Revenue (Loss) ($81,110) .$15,350 ($11,850) ($41,350)
Source: Vail Recreation District and Economics Research Associates.
Scc8- inancials Icc Pro Forma
in place. However, based on our utilization projections for a two sheet facility, the addition
of a second sheet of ice would result in a slight operating deficit. The new arena is projected
to have a net operating loss of about $12,000 while a new practice sheet of ice is projected to
have a net operating loss of about $41,000.
FINANCIAL ANALYSIS OF i ti.L FAMILY RECREATION CENTER
In both scenarios, the Vail Recreation District would develop and operate the family
recreation center as a public recreation service. As such, the VRD would pay a nominal $1
per year rent to the Town of Vail and would be responsible for the facility's maintenance and
operations. Therefore, the family recreation center would not affect the Town of Vail's
operating pro-forma.
It is important, however, to consider the potential operating cash flow to VRD. As
discussed in Section )GI, it is estimated that a family recreation center could generate
revenues of approximately $235,000 under higher than average market penetration rates and
moderate per capita expenditure assumptions. The amount would be lower under average
market penetration rates.
This amount of revenue would probably have to come from more sources than just
the proposed indoor skate-park. For example, the City of Escondido, California, which has
one of the more successful city-owned skate-parks in Southern California, has-annual 25,533
visits to its skate-park. The City skate-park generates annual revenue of $140,000, or $5.50
per capita.
Operating expenses,- including rent, at successful family-entertainment centers
typically ranges from 45 to 60 percent of revenue. Assuming that food and beverage sales
comprise 10 percent of total revenue (a typical ratio for small centers without a major food
and beverage component), operating expenses would be approximately 4 percentage points
higher to account for the cost-of-goods sold. Since these commercial centers generate more
revenue than is projected for the Vail facility, VRD should anticipate operating ratios that are
on the high end of this range.
Unlike commercial centers, however, VRD would not have to pay rent. Rent
typically comprises 20 percent of operating expenses. Since VRD would not have to pay
rent, its operating expenses, including cost-of-goods sold, could range from 40 to 55 percent
of revenue, or $94,000 to $129,000 per year. This amount may be enough to cover the direct
Economics Research Associates VIII-16
Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401
marginal expense of operating the skate program. For example, Escondido's annual direct
expense for -operating its outdoor skate-park alone is $42,000 (excluding overhead costs),
which is 30 percent of its revenues. VRD's costs, however, should be higher than
Escondido's costs because of the expense of -maintaining an indoor facility, and the cost of
the additional activities that VRD plans. VRD should probably count on applying its rent
savings to facility maintenance and programming.
At an operating expense ratio of 64 percent, including cost-of-goods sold, VRD
should budget $150,000 to operate the program and maintain the facility. This annual budget
would be enough for a full-time manager and two full-time equivalent assistants, and a
modest maintenance and marketing budget. It. is assumed that VRD's insurance cost
exposure could be absorbed by its current policy. This budget, however, probably is not
sufficient to cover the cost of maintaining complex facility systems, attractions, and
equipment. While it is possible .that VRD could generate an annual operating surplus, as
does Escondido from its skate-park, the revenue projections are uncertain. They are based on
assumptions that the Vail Valley population will generate higher than average demand given
the recreational enthusiasm of Vail Valley residents and the limited alternative indoor
recreation activities. Because of this risk, VRD should use surplus revenue to support not
bonds to cover development costs. Any surplus operating revenue achieved should be
applied to VRD's recreational programs.
CONSOLIDATED OPERATING PRO FORMA
A consolidated operating pro forma for a two ice-sheet facility is shown in Table
VIII-8. The combined net operating revenue of the conference/learning center and the dual
ice facility, is $142,000 under Alternative 1 and almost $34,000 under Alternative 2. The
addition of the family recreation center increases the net operating revenue to $227,000 and
$119,000, respectively. These estimates assume that VRD pays a nominal $1 rent, and that
no debt service costs for capital expenses are incurred.
FINANCIAL ANALYSIS OF t ttL PERFORMING ARTS CENTER
Tables VIII-9 through VM-12 present a hypothetical pro-forma for a 1,400-seat
performing arts theater, operated as a presenting/rental house. The number of performances
assumed is consistent with the market analysis estimates. As shown, the estimated stable
year operating deficit is almost <$1.1 million>. Most of this deficit is attributable to the
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Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401
Table VIII-8
TOWN OF VAIL PROPOSED ALTERNATIVES CONSOLIDATED
OPERATING PRO -FORMA FOR STABILIZED YEAR OF OPERATION
Alternative #1 Alternative #2
Conference Center
Operating Revenue $1,898,600 $1,753,000
Operating Costs $1.744.600 $1.678.000
Net Operating Revenue (Loss) $154,000 $75,000
Dual Ice Sheet Facility
Operating Revenue $983,900 $893,900
Operating Costs (1) $995.750 $935.250
Net Operating Revenue (Loss) ($11,850) ($41,350)
Net Operating Revenue (Loss) $142,150 $33,650
Family Recreation Center
Operating Revenue $235,000 $235,000
Operating Costs (1) $150.000 $150.000
Net Operating Revenue (Loss) $85,000 $85,000
Net Operating Revenue (Loss) $227,150 $118,650
Notes:
(1) Assumes no rent or debt service for capital expenses.
Source: Economics Research Associates.
Table VIII-9: ESTIMATED USE DAYS - STABLE YEAR -.1,400 SEAT THEATER
Use-Days
Proscenium Rental
(1,400 seats) Income % of Total
ESTIMATED USE DAYS
Events
Festival Events 2 $ 5,000 3%
Local Arts Groups 2 $ 3,000 2%
Conunercial Performances . 20 $ 70,000 49%
House Presented Performances 20 $ 50,000 35%
Conferences 2 $ 3,000 2%
Sub-total 46 $ 131,000 91%
Other Organizations/Events @ 10% 5 $ 7,500 5%
Total Evcnis/Yr. 51 $ 138,500 97%
Rehearsals % of Perf. '
Festival Events 100% 2 $ 200 0%
Local Arts Groups 200% 4 $ 200 0%
Conunercial Performances 0% 0 $ - 0%
House Presented Performances 100% 20 $ 4,000 3%
Conferences 50% 1 $ 200 0%
Sub-total 27 $ 4,600 3%
Other Organizations/Events @ 50% 3 $ 250 0%
Total Rehearsals/Yr. 30 $ 4,850 3%
Total Use Days Including Rehearsals 81 $ 143,350 100%
Source: Econonucs Research Associates
Table VIII-10: ASSUMED RENT SCHEDULE
(in 2000 dollars)
Proscenium
(1,400 seats)
ASSUMED RENTAL RATES/USE
Performances
Festival Events $ 2,500
Local Arts Groups 1,500
Commercial Performances 3,500
House Presented Performances 2,500
Conferences 1,500
Other Organizations/Events 1,500
Rehearsals
Festival Events $ 1,000
Local Arts Groups 500
Commercial Performances 1,500
House Presented Performances 1,000
Conferences 500
Other Organizations/Events 500
Source: Economics Research Associates
Table VIII-11: ESTIMATED STABLE YEAR OPERATING CASH FLOW
(in 2000 dollars)
Proscenium
(1,300 seats)
ESTIMATED RENTAL INCOME
Performances
Festival Events $ 5,000
Local Arts Groups 3;000
Reno Arts Groups - -
Commercial Performances 70.000
House Presented Performances 50,000
Conferences 3,000 -
Summer Residency Group -
Other Orgar izations/Events 7,500
Sub-total $ 138,500
Rehearsals
Festival Events $ 2,000
Local Arts Groups 2,000
Reno Arts Groups -
Commercial Performances -
House Presented Performances 20,000
Conferences 500
Summer Residency Group -
Other Organizations/Events 1,250
Sub-total $ 25,750
Total Rental Income $ 164,250
ESTIMATED CONCESSION INCOME
Estimated Audience Per Year
Total Events 51
Total Number of Seats 1,400
Average Occupancy Rate 60%
Estimated Audience Per Year 42,840
Estimated Concession Income
Assumed Per Capita Expenditures $ 3.50
Estimated Total Sales $ 149,940
Percentage to House 7%
Estimated Concession Income $ 10,496
TOTAL 'EARNED INCOME $ 174,746
Source: Economics Research Associates
Table Y(I1.12: PROJECTED HOUSE TEN-YEAR CASH FLOW - 1,400 SEAT THEATER
(in constant 2000 dollars)
Stable Yr.
Yr.I Yr.2 Yr.3 Yr.4 Yr.5 Yr.6 Yr.7 Yr.8 Yr.9 Yr. 10
HOUSE PRESENTATIONS
Revenue
Ticket Sales Avg. $32 main
thcatcr@60% occupancy
$ 322,560 $ 430,080 $ 537,600 $ 537,600 S 537,600 $ 542,976 S 548,406 $ 553,890 $ 559,429 $ 565,023
Net Revenue From Food 8c Beverage $3.50/cap; 60% ocepency;
20% profit 7,056 9,408 11,760 11,760 11,760 11,878 11,996 12,116 12,238 12,360
Total Earned Revenue $ 329,616 S 439,488 $ 549,360 S 549,360 S 549,360 $ 554,854 $ 560,402 $ 566,006 S 571,666 S 577,383
Ernenses
Artists $35,000 main theater
$ 420,000 $ 560,000 $ 700,000 $ 700,000 $ 700,000 $ 707,000 $ 714,070 $ 71_1,211 $ 728,423 $ 735,707
Pass-Through crusts (2) $600/pcrformance 7,200 9,600 12,000 12,000 12,000 12,120 12,241 12,364 12,487 12,612
Advertising/Promotiyn 53,000/show in 1,400-seat
theater 36,000 48,000 60,000 60,000 60,000 60,600 61,206 61,818 62,436 63,061
$ 463,200 S 617,600 $ 772,000 $ 772,000 $ 772,000 $ 779,720 $ 787,517 S 795,392 $ 803,346 S 811,380
Net Income <Deficit> From House
Presentatlons $ (133,584) $ (178,112) $ (222,640) $ (222,640) $ (222,640) $ (224,866) $ (227,115) $ (229,386) S (231,680) $ (233,997)
Net Income <Deficit> After Ilouse
~Preaentuflonn S (1,085,036) S (1,084,925) $ (1,084,814) $ (1,084,814) $ (1,084,814) $ (1,084,808) S (1,084,803) $ (1,084,797) S (1,084,791) S (1,084,786)
Nate: (1) Before depreciation
(2) Tcchniciem, box office, security, 9c maintenance time
Source: licunomics Research Associates
overhead costs and staff associated with maintaining and operating a high quality performing
arts center, and underwriting costs.
The deficit would be much lower if the theater was operated strictly as- a rental
facility, but the Center could not ensure the quality and frequency of the artistic program.
While a larger theater would potentially generate more revenue per show if the act can attract
a larger audience, the number of performances for larger audiences would probably be fewer.
Also, artists that can attract audiences large enough to fill a larger house also command
higher fees. The net result is that the annual operating deficit would not necessarily improve
with a larger theater, which is also more expensive to maintain.
The operating deficit projected is not unusual; in fact, quite common in the theater
industry. Civic facilities typically cover the deficit with the government's general fund,
while private non-profit facilities typically cover the deficit with contributed income and
grants raised each year, and funds from an operating endowment. The cities that use general
fund monies to cover the operating deficit of a large performing arts center typically are
larger cities with an annual budget that is much larger than the Town of Vail's.
FISCAL IMPACTS OF i tit, PROPOSED ALTERNATIVES
This section discusses the fiscal impacts of the proposed alternative development
scenarios on the Town of Vail. This analysis considers the recurring annual impact of
revenues from visitation resulting from the operations of the proposed facilities (based upon
our operating projections). This is a preliminary analysis of the economic impacts of the
facilities. These figures should be considered provisional and subject to change as the
planning and implementation process progresses. It should also be noted that the proposed
facilities could provide many other quality-of-life benefits to community and civic groups
that use the new facilities that cannot be quantified as part of a fiscal impact analysis.
A conference center and arena contribute to the local economy by attracting visitors
from outside the local region who spend money in the local economy. The money visitors
spend has a "direct impact" on the Vail economy. It is new money in the City that would not
have been there without the conference center; it supports jobs in the local restaurant, retail,
and hotel industry in addition to jobs at the new conference center. The initial spending by
these visitors, as it is re-circulated, has a multiplied effect on expanding the local economy.
For the sake of this analysis, ERA analyzed only the direct spending impacts of net new
visitation in the Town of Vail for each development scenario. Only visitors from out-of-
Economics Research Associates -VIH-23
Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401
county were included as part of the economic impact analysis. Expenditures by local
residents do not typically represent new money to the local economy; they are treated as
transfers.
The direct economic impact of the on-going operations of the proposed facilities can
be divided into following categories:
• Off-site lodging, food and beverage, and retail spending by out-of-County
conference center and ice arena visitors; and
• The resultant sales and lodging tax revenues to the Town of Vail.
Projected }Tsitation
In order to estimate the off-site expenditures of out-of-County conference and ice
arena attendees; ERA estimated total annual visitation for each alternative, outlined in Table
VIII-13, based on our utilization projections for each facility. Included in this analysis are
the following assumptions:
• Since many meeting attendees choose to bring their families along to meetings
held at resort locations, ERA estimated that there is 0.5 family members present
for every conference center attendee.
• For performance events at the ice arena or in the conference ballroom, ERA
estimated that 15 percent of the attendees would be out-of-County visitors.
Additionally, ERA estimated that on average, about 75 percent of the available
seats for a given performance would be filled.
• Only new out-of-County visitors to the ice arena that result from the development
of a practice sheet of ice or a new arena were included in this analysis. This
includes national or regional tournament event attendees (including both
participants and spectators) and performance event attendees.
ERA translated the total number of visitors into total annual visitor days based on our
event length assumptions, discussed previously. In total, ERA estimates that meetings at the
conference center would generate about 78,000 visitor days from meeting attendees and
39,000 additional family visitor days under Alternative 1 and about 71,350 visitor days from
meeting attendees and 35,675 additional family visitor days under Alternative 2. Out-of-
County visitor days from performance events in the ice arena or in the conference center
Economics Research Associates VIII-24
Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401
Table VIII-13
ESTIMATED VISITATION FROM NEW NET OUT-OF-COUNTY VISITORS
Alternative #1 Alternative #2
Estimated number of visitors
Conference Center Attendees 23,000 21,100.
Family of Conference Attendees 11,500 10,550
Performance Events Attendees" 14,000 8,000
Ice Rink Tournaments Attendees z 2.800 2.800
Total Visitors 51,300 42,450
Estimated number of visitor days/nights
Conference Center 78,000 71,350
Family of Conference Attendees 39,000 35,675
Performance Events Attendees 14,000 8,000
Ice Rink Tournaments Attendees 8.400 8.400
Total Visitor Days/Nights 139,400 123,425
Estimated number of room-nights
Gross Conference Center Attendees 78,000 71,350
Conf. Center Attendees Net of Displacement 3 58,500 53,510
Family of Conference Attendees 0 0
Performance Events Attendees 3,500 2,000
Ice Rink Tournaments Attendees 4.670 4.670
Total Room-nights 66,670 60,180
1/ Includes out-of-county visitors attending performances at both the ice arena and the
conference center ballroom.
2/ Tournament attendees include both participants and spectators.
3/ Assumes conference events will result in a net displacement of 25 percent of other visitor
roomnights in Vail.
Source: Economics Research Associates.
ballroom would total approximately 14,000 under Alternative 1 and 8,000 under Alternative
2. Finally, hockey and figure skating tournaments are estimated to generate 8,400 visitor days
under either alternative.
To analyze the total number of room-nights spent in lodging properties within the
Town of Vail, ERA adjusted the total number of visitor days by the following assumptions-
• Each conference attendee occupies one rental lodging unit per visitor day.
Associated family members are assumed to stay in the same lodging unit as the
conference attendee.
• Estimated room demand from conference attendees is not an accurate depiction of
the total increase in room demand. Meetings that fill a large number of lodging
rooms displace a percentage of other business, especially during the peak winter
season. To compensate for this displacement of business, ERA reduced the total
number of room-nights generated by conference attendees by 25 percent.
• Of the total out-of-County visitors attending performances, ERA estimates that 25
percent spend the night in Vail in a rental lodging unit.
• National and regional tournament event attendees (which includes participants,
their families, and other spectators) are estimated to share lodging rooms at a ratio
of 1.8 persons per room.
Based on the above assumptions; ERA estimates that meetings at the conference
center would generate about 78,000 room-nights under Alternative 1 and about 71,350 room-
nights under Alternative 2. However, net of the estimated displacement factor, room-nights
from conference attendees would total about 58,500 under Alternative 1 and 53,510 under
Alternative 2. Out-of-County room-nights from performance events in the ice arena or in the
conference center ballroom would total approximately 3,500 under Alternative 1 and 2,000
under Alternative 2. Finally, hockey and figure skating tournaments are estimated to generate
approximately 4,670 room-nights under either alternative.
Visitor Spending
Per capita off-site spending in Vail for conference attendees was estimated based on a
study of national meeting attendee spending patterns published by the International
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Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401
Association of Convention and Visitors Bureaus (IACVB). Daily per-capita spending for
families of conference attendees and tournament attendees was estimated based on a 1996
study by RRC Associates of Vail Valley visitor spending patterns. Spending by performance
attendees was estimated based on ERA's knowledge of their typical spending patterns.
Average per-capita spending estimates are shown in Table VIII-14 and include the following
assumptions:
• For overnight visitors, ERA estimated average daily lodging expenditures based
on the reported 1999 average daily group rates for conference attendees and the
annual average free and independent traveler rates for performance attendees. For
tournament attendees,
• the average daily room rate is estimated to be $100, a typical shoulder season
group rate, because tournaments are only likely to be held in Vail during the value
seasons.
• ERA estimates daily per-capita food and beverage expenditures to be $25 for
conference attendees. Tournament attendees and families of conference attendees
are estimated to spend $50 per day on food. Special event attendees from out-of-
County are estimated to spend an average of $10 per capita on food, which
incorporates a portion of attendees enjoying a meal within Vail and the remainder
eating elsewhere.
• Average daily per-capita retail expenditures per capita are estimated to be $25 for
conference attendees, $50 for families of conference attendees, $25 for
tournament attendees, and $5 for out-of-County performance attendees.
Based on the above assumptions, ERA estimates that under Alternative 1, total
lodging expenditures would be approximately $12.7 million, total off-site food and beverage
expenditures would be about $4.5 million, and total off-site retail expenditures would be $4.2
million. This results in a grand total of $21.4 million in out-of-County visitor spending in the
Town of Vail. Under Alternative 2, total lodging expenditures are estimated to be about
$11.4 million, total off-site food and beverage expenditures would be about $4.1 million, and
total off-site retail expenditures would be $3.8 million. Combined, the estimated out-of-
County visitor spending in the Town of Vail under Alternative 2 would be about $19.3
million.
Economics Research Associates VIII-27
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Table VIII-14
ESTIMATED DAILY OFF-SITE CONFERENCE AND ICE RINK VISITOR SPENDING
Alternative #1 Alternative 02
Avg. per capita off-site lodging expenditures
Conference Center Attendees $196.00 $196.00
Performance Event Attendees $219.00 $219.00
Ice Rink Tournaments Attendees $100.00 $100.00
Total Lodging Expenditures $12,699,500 $11,392,960
Avg. per capita off-site food and beverage expenditures
Conference Center Attendees $25.00 $25.00
Families of Conference Attendees $50.00 $50.00
Performance Event Attendees $10.00 $10.00
Ice Rink Tournaments Attendees $50.00 $50.00
Total food and beverage expenditures $4,460,000 $4,067,500
Avg. per capita off-site retail expenditures
Conference Center Attendees $25.00 $25.00
Families of Conference Attendees $50.00 $50.00
Performance Events Attendees $5.00 $5.00
Ice Rink Tournaments Attendees $25.00 $25.00
Total retail expenditures $4,180,000 $3,817,500
GRAND TOTAL VISITOR OFF-SITE SPENDING $21,339,500 $19,277,960
Source: Economics Research Associates.
A summary of direct expenditures within the Town of Vail and the resulting fiscal
impact of each alternative is presented in Table VIII-15. Direct revenues from the estimated
visitor spending would accrue to the Town of Vail in the form of lodging and sales tax
revenues. The Town receives four percent of both lodging revenues and retail sales
(including food and beverage sales). Based on our estimates of visitor spending, the Town of
Vail would expect to receive approximately $508,000 in lodging tax revenues and $346,000
in sales tax revenues under Alternative 1 and about $456,000 in lodging tax revenues and
$315,000 in sales tax revenues under Alternative 2. Although the capital costs differences
between the two alternatives will likely be large, ERA projects that Alternative 1 would only
produce about $82,500 more in direct tax revenues to the Town of Vail.
Additionally, the VVTCB would receive 1.4 percent of the total lodging revenues,
which amounts to $178,000 under Alternative 1 and $160,000 under Alternative 2. This
additional marketing revenue should be specifically targeted towards marketing the proposed
conference facility.
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Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401
Table VIII-15
ESTIMATED FISCAL IMPACT OF PROPOSED ALTERNATIVES ON TOWN OF VAIL
Alternative #1 Alternative #2
Annual Impacts from Visitor Spending
Visitor Food and Beverage Spending $4,460,000 $4,067,500
Visitor Retail Spending $4,180,000 $3,817,500
Visitor Lodging Spending $12.699.500 $11.392.960
Total Increase in Spending $21,339,500 $19,277,960
Direct Revenues to VVTCB
Lodging Tax Revenue for Marketing (1.4%) $177,793 $159,501
Direct Revenues to Town of Vail
Lodging Tax Revenues to Town of Vail (4.0%) $507,980 $455,718
Sales Tax Revenues to Town of Vail (4.0%) $345.600 $315.400
Total Direct Revenues to Town of Vail $853,580 $771,118
Source: Economics Research Associates.