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HomeMy WebLinkAbout2001-05-15 Support Documentation Town Council Work Session VAIL TOWN COUNCIL TUESDAY, May 15, 2001 WORK SESSION 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 CHAMBERS 2:00 P.M. 1. Local Licensing Authority Interviews - 3 vacancies. (10 min.) Robert Rothenberg Mary Zarba David Chapin and Kathy Vieth will be out of town and unable to be present for interviews. 2. Brent Wilson ITEM/TOPIC: A request for a Town Council work session to discuss the proposed Vail Plaza Hotel West Special Development District - a new conference facility/hotel/fractional fee unit club proposal at 13 Vail Road / Lot A, B, C, Block 2, Vail Village Filing 2. (1 Hour) Applicant: Doramar Hotels, represented by the Daymer Corporation Planner: Brent Wilson ACTION REQUESTED OF COUNCIL: Provide feedback to the applicant and staff regarding next steps for the SDD proposal. BACKGROUND RATIONALE: The Vail Plaza Hotel West is a mixed-use development proposal. Uses within the hotel include residential, commercial and recreation. The proposed plan currently includes a 116-room hotel, 15 condominiums, 40 fractional fee units, 14 (on site) employee housing units, a restaurant/bar, retail space, conference space (including a 10,000 s.f. ballroom), and a spa/health club. The current (and proposed underlying) zoning for the property is "Public Accommodation." Please refer to the staff memorandum for complete details. RECOMMENDATION: The Design Review Board voted to recommend approval of this application to the Vail Town Council on April 18th. The Planning and Environmental Commission will review the proposal on May 14th and provide a recommendation to the Vail Town Council. Staff will forward a recommendation to the council prior to final council review of this item. A detailed summary of the DRB and PEC motions will be provided at the May 15th work session. 3. ITEM/TOPIC: Vail Center 20000 square foot Russ Forrest room/performing arts update. (1 hr.) BACKGROUND RATIONALE: On Tuesday May 8th, Council asked staff and the design team to remove the 300 seat theatre and to add a fly (stage and back stage) to the 20,000 square foot meeting room space. Staff wanted to take the opportunity to review the physical and financial implications of this direction to ensure the design team is moving in the appropriate direction. The design team will be working through Friday the 11th on this issue and staff and the design team would like to review the physical opportunities with Council on May 15th. 4. PEC Report. (5 min.) Allison Ochs 5. Review Council Critical Strategies. (15 min.) 6. Information Update. (10 min.) 7. Council Reports. (10 min.) 8. Other. (10 min.) 9. Executive Session - Personnel Matters (30 min.) 10. Adjournment. (5:30 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, 5/22/01, BEGINNING AT 2:00 P.M. IN TOV COUNCIL CHAMBERS. THE NEXT VAIL TOWN COUNCIL REGULAR EVENING MEETING WILL BE ON TUESDAY, 5/22/01, BEGINNING AT 7:00 P.M. IN TOV COUNCIL CHAMBERS THE NEXT VAIL TOWN COUNCIL REGULAR WORK SESSION WILL BE ON TUESDAY, 6/05/01, BEGINNING AT 2:00 P.M. IN TOV COUNCIL CHAMBERS. THE NEXT VAIL TOWN COUNCIL REGULAR EVENING MEETING WILL BE ON TUESDAY, 6/05/01, BEGINNING AT 7:00 P.M. IN TOV COUNCIL CHAMBERS Sign language interpretation available upon request with 24-hour notification. Please call 479-2332 voice or 479-2356 TDD for information. PLANNING AND ENVIRONMENTAL COMMISSION PUBLIC MEETING SCHEDULE Monday, May 14, 2001 PROJECT ORIENTATION / - Community Development Dept. PUBLIC WELCOME 11:30 am MEMBERS PRESENT MEMBERS ABSENT Site Visits : 12:45 pm 1. Vail Plaza Hotel West - 13 Vail Road Vail Valley Medical Center - 181 West Meadow Drive Strauss Subdivision - 1916 & 1936 West Gore Creek Drive Mentlik residence - 2437 Garmisch Drive Vail Racquet Club - 4695 Vail Racquet Club Drive Driver: George NOTE: If the PEC hearing extends until 6:00 p.m., the board may break for dinner from 6:00 - 6:30 p.m. Public Hearina - Town Council Chambers 2:00 pm 1. A request for a variance from Section 12-6D-10 of the Town Code, to allow for a reduction in the landscaping and site development requirements, located at 383 Beaver Dam Road/Lot 3, Block 3, Vail Village 3rd Filing. Applicant: A2Z Holdings, LLC Planner: Bill Gibson 2. A request for a final review of a proposed special development district, to allow for the construction of a new conference facility/hotel; and a final review of a conditional use permit, to allow for Type III employee housing units and fractional fee club units, located at 13 Vail Road/ Lots A, B, C, Block 2, Vail Village Filing 2. Applicant: Doramar Hotels, represented by the Daymer Corporation Planner: Brent Wilson 3. A request for a final review of a conditional use permit, to allow for the construction of Phase I of Donovan Park improvements, generally located southeast of the intersection of Matterhorn Circle and the South Frontage Road. Applicant: Town of Vail Planner: George Ruther 4. A request for a variance from Title 14 (Development Standards), Vail Town Code, to allow for snow storage and parking within the public right-of-way, located at 2437 Garmisch Drive / Lot 12, Block H, Vail das Schone 2nd Filing. Applicant: William H. Mentlik, represented by John Martin, AIA Planner: Ann Kjerulf 5. A request for a minor subdivision and a variance from Section 12-6D-5 of the Town Code to allow for the resubdivision of Lot 1, Strauss Subdivision, a resubdivision of Lots 46 & 47, Vail Village West Filing No. 2, re-creating Lots 46 & 47, located at 1916 & 1936 West Gore Creek Drive. Applicant: Pat Dauphinais, representing Richard Strauss Planner: Allison Ochs 6. A request for a conditional use permit, to allow for an addition to the Vail Valley Medical Center, located at 181 West Meadow Drive/Lots E & F, Vail Village 2nd Filing. Applicant: Vail Valley Medical Center, represented by Braun Associates Planner: George Ruther 7. A request for a worksession to discuss a new special development district, to allow for the redevelopment of the Vail Racquet Club, located at 4695 Vail Racquet Club Drive/Vail Racquet Club Condominiums, Bighorn 5th Addition. Applicant: Racquet Club Owners Association, represented by Fritzlen Pierce Architects. Planner: Brent Wilson 8. A request for a work session to discuss amending certain residential zone districts in the Town of Vail to allow home day care facilities subject to the issuance of a conditional use permit and a home occupation permit. Applicant: Town of Vail Planner: George Ruther 9. A request for the review of a proposed text amendment to Chapter 11, Design Review, of the Zoning Regulations to allow for procedural changes to the performance bond process as prescribed in the Vail Town Code. Applicant: Town of Vail Planner: George Ruther 10. A request for a conditional use permit, to allow for the construction of a soccer field, located at 610 N. Frontage Rd. West/ A portion of Tract C, Vail Potato Patch. A full metes & bounds legal description is available at the Department of Community Development. Applicant: Town of Vail Planner: Allison Ochs TABLED TO JUNE 11, 2001 11. A request for a variance from Section 12-6D-6 (Setbacks), Vail Town Code, to allow for the construction of a garage within the required front setback, located at 1956 Gore Creek Drive / Lot 45, Vail Village West Filing #2. Applicant: David Irwin Planner: Ann Kjerulf TABLED TO JUNE 11, 2001 12. A request for a variance from Section 12-71-1-10 of the Vail Town Code, to allow for a proposed addition in the rear setback, located at 660 West Lionshead Place/Lot 1, Vail Lionshead 1 st Filing. Applicant: Lions Square Condo Association Planner: Bill Gibson WITHDRAWN 13. Approval of April 23, 2001 minutes 14. Information Update 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 May 11, 2001 in the Vail Trail. MEMORANDUM TO: Vail Town Council FROM: Bob McLaurin, Town Manager RE: Town Manager's Report DATE: May 15, 2001 PARKING TASK FORCE At the last meeting of the Vail Town Council and Vail Resorts (April 10th) the group agreed that parking issues needed to be broken into three tiers in order to effectively address this issue. These include the long term strategies (i.e., new parking structures), mid-term strategies and short-term strategies (i.e., next ski season). The group also agreed that a new parking task force should be established to address these short term parking issues. Since the April 10th meeting, we have concluded that the best approach in dealing with this issue is to establish a parking task force as suggested on April 10th. This task force would consist of representatives of the Vail town staff, Vail town council, Vail Resorts, the business community, and the community. This task force will be charged with identifying the policy objectives that these parking strategies should achieve (begin with the end in mind). It is our recommendation the Council appoint two members from the Town Council to sit on this task force, two members from Vail Resorts, two members from the Vail Chamber and Business Community and two citizens at large. As indicated, the mission of this task force is to identify the appropriate policy objectives that our parking strategies should seek to achieve. A second group will be established which will generate alternatives for Council's consideration. Obviously, these alternatives will be aimed to achieving the policy directives articulated by the parking task force. This group will consist of representatives from the Town of Vail and Vail Resorts and will include operational personnel who will be charged with actual "on the ground" implementation of these parking policies. We hope to pull the parking task force together in the next week or so and again, identifying policy objectives. UPCOMING ITEMS: Mav 22, 2001 Work Session Neighborhood walk-about - Stephens Park DRB Report Bright Horizons final decision Vail Valley Exchange Update Noise Policy Discussion Fire Services Update Village Parking Structure (retail) Review Uniform Building and Fire Code May 29, 2001 - 5t" Tuesday - No Meetinq June 5. 2001 Work Session Review Council Contribution Requests Interviews with Mountain Bell development candidates Discussion of Ordinance #2, Exemption Plats June 5, 2001 Evenina Meetina Meadow Drive Streetscape Update 2nd reading of Ordinance #10, 770 Potato Patch First reading of Ordinance #2, Exemption Plats June 12, 2001 Work Session Vail Local Marketing District quarterly meeting Housing Authority RFP Housing Authority Interviews Housing Authority Appointments Occupancy of EHU's UPdate of 208 Plan DRB/PEC Report COUNCIL FOLLOW-UP TOPIC QUESTIONS _ FOLLOWUP F2001 J 1/23101 PEDESTRIAN BRIDGE (TO THE GREG H.: The load capacity continues to be an issue; Staff will supply estimate for replacement. EAST OF THE INTERNATIONAL BRIDGE) is it time to remove the bridge altogether, continue to monitor and control "load", or take steps to buoy up the foundation/support? 4-24-01 DONOVAN PARK FRONTAGE BOB/GREG H.: What is the status of the access permit ROAD ACCESS PERMIT from CDOT for Donovan Park? Diana Donovan 4-24-01 HOUSING LOTTERY POLICY NINA: Provide Council with memo for review of Nina has spoken with the owner of those three lots and they want OBJECTIVES AND TOOLS housing lottery policy objectives and tools with which to basically a million dollars for them. They are zoned for three Greg Moffet execute those objectives, as well as a copy of the duplexes and are not part of the Town of Vail. Nina recommends actual application. speaking with David Carter about some sort of cluster zoning that would allow building 6 or 8 (maybe 12) small apartments. The town may be willing to be part of the development in some way at that point in time. A large problem on the lots is the creek setback. At $1,000,000 Nina believes the HA would have a difficult time making something work financially. If you would like her to follow up with something official she would be happy to do so. 5/8/01 CREEKSIDE APARTMENTS RUSS: Consider purchase of the 3 lots adjacent to the Chuck Ogilby Creekside Apartments through the Housing Authority. 5/8/01 PLANTERS ACROSS FROM PEPI'S LARRY: Three dead trees in planters across from Diana Donovan Pepi's should be removed. 5/8/01 ROAD REPAIR FROM GREG HALL: A sloppy job was done and needs to be NORTHWOODS TO THE NATURE cleaned up, repatched, whatever. CENTER Diana Donovan F:lmcasterlbsalterlagendalfollowupl5-15-01 du May 15, 2001 - Page 1 To: Vail Town Council Re: Local Licensing Board Vacancy Att: Lorelei Donaldson I am applying for the vacant position on the local Licensing Authority Board. I have served as Chairman for the past four years and have sat and the board in prior years. I believe that my past work experience strengthens my application and knowledge for this position. I have worked within the bar and restaurant industry for the past two decades in both management and bar staff. Furthermore, I have a Bachelor of Science degree in Hotel Management. I believe that my background provides insight and experience necessary for the decisions regarding the liquor code in a world class resort. I embrace the opportunity to serve the Vail community and return a token of appreciation the town that I consider the best in the world. Thank You David Chapin I 5- 4-01;10=03AM;MOUNTAIN HAUS ;9704763007 # 2/ 3 May 3, 2001 Lorelei Donaldson Town of Vail Lorelei, 1 am writing you to express my interest in s....:-g on the Town of Vail Liquor Board. The Vail Valley has been my home since the summer of 1994;1 have owned a Vail Commons unit since December 1996 and am currently serving a two year term on the Condo Association Board of Directors. I also volunteer for various activities such as Octoberfest, the Big Wheel ChiliFest and for ABC school fundraisers. My work experience and education will be valuable assets to the Liquor Board, as well as a good working knowledge of the local business establishments and issues facing the Town of Vail. Too many Vail residents are quick to complain and point fingers, but when the time comes to be part of the solution they are nowhere to be found. I would like to contribute to the Town by helping out as a member of the Liquor Board. Thank you in advance for the consideration and I look forward to serving on the Town of Vail Liquor Board. Please contact me if you have any questions. Sincerely, Robert Rothenberg PO Box 1488 Vail, CO 81658 970-479-2988 home 970-390-6624 cell 5- 4-01;10=08AM;MOUNTAIN HAUS ;9704763007 # 3/ 3 Robert Rothenberg PO Box 1488 Vail, CO 81658 970-479-2988 970-390-6624 robrna,mountainmax.net EXPERIENCE: VAIL'S MOUNTAIN HAUS Vail, CO October 1999 - Present Financial Controller reporting directly to the Association's Board of Directors. Supervise all aspects of the accounting department including the y.oyaration of monthly income statements, budget preparation and annual financial analysis. Maintain homeowner records, A/P, A/R and capital project cost allocation. Involved in the annual insurance policy reviews, cost benefit analysis and legal liabilities. Responsible for upholding the rules, declaration and bylaws of the Mountain Haus Condominium Association. CHARTER SPORTS INC., Vail, CO August 1995 - S:.,V ~_...ber 1999 Supervised all facets of a 5 store, 2 million dollar ski rental business and was directly responsible to the owner involving decisions regarding Sales & Marketing, Legal, Budgeting, Finance, Purchasing, Scheduling, and Human Resources. Performed accounting functions including A/P, A/R, bank reconciliation, payroll calculations, credit card matters and preparation of monthly financial statements. Established repeat hotel business with homeowners on a personnel level in the Charter Hotel, Vail Cascade Hotel & Spa and Lion Square Lodge. Designed, implemented, and maintained a website to make advance ski rental reservations. Created a database to help in the analysis of ski rental trends, retail spending and customer profiles. Involved in the negotiations of retail store acquisitions, lease renewals and extensions. CHARTER SPORTS INC., Vail CO October 1994 - May 1995 Worked as a ski rental technician, tuner and retail sales clerk in Lion Square Lodge. Assisted the manager with various duties such as cashing out, scheduling and inventory control. CITIBANK New York, NY January 1994 - September 1994 Worked as an accountant in the Accounting Unit of the Global Finance Loan Processing Department. Responsibilities included analysis of daily ledger activity to assure proper accounting and application of funds utilizing sub-ledgers created on sr.;,«dsheets, 1,.,.Yaration of work papers for Citibank's independent auditors, identification of`,;...,,.., and communication of corrective action to be taken by field offices, and preparation of monthly account analysis for City Heads. EDUCATION: Binghamton University, State University of New York Bachelor of Science in Management, emphasis Marketing May 1993 THE KLEIN GROUP April 11, 2001 Vail Town Council Lorelei Donaldson, Town Clerk 75 South Frontage Road Vail CO 81657 Dear Lorelei: Please accept this letter as my intention to reapply for a position on the Town of Vail Liquor Board. Being a member of the Board for the last five years has allowed me to contribute some of my time to the community which I feel is important as a full time resident of Vail. I have attended a majority of all the meetings, with the exception of when I was out of town, and have been very supportive of the Police Department initiatives. I remain very interested in how our local establishments conduct their liquor business, because these venues are the way in which Vail is viewed by many of our visitors. We need to ensure that the environment is conducive to a positive experience for all involved. I believe that I have been active in initiating new ways for the Board to conduct its business, specifically, the personal reviews for the license renewals. I believe these reviews have been positively received by the License holders, as well as, the Board. I also believe that I have the ability to bring clarity to the issues and reach a consensus of opinion that works for all sides whenever possible. I look forward to continuing my tenure on the Liquor Board. If you have any further questions, please do not hesitate to call me. Thanks in advance for your help. Best regards, hv~~ M. Kathy Vieth A PROFESSIONAL FIRM OF MORTGAGE BANKERS AND FINANCIAL CONSULTANTS VAIL OFFICE: 108 SOUTH FRONTAGE ROAD WEST # SUITE 306 ? VAIL, CO 81657 ? 970.477.2100 ? FAx: 970.477.2101 ? ToLL FREE: 877.480.2100 MEMBERS OF THE MORTGAGE BANKERS ASSOCIATION OF AMERICA AN EQUAL HOUSING OPPORTUNITY LENDER OFFICES IN 4 VAIL 4 EDWARDS 4 STEAMBOAT SPRINGS ENGLEWOOD I CHARLomvILLE, VA 4 HARRISONBURG, VA 04-11-01 12:06PM FROM SUMMIT ORTHOPAEDICS POI Vail Town Council Attn: Lorelei Donaldson 75 S. Frontage Road Vail, Colorado 91657 To whom it may 1 have been a member of the Town of Vag Liquor Licensing Authority since May 1996. 1 have resided m the Town of Vail for over ten years and have no direct financial in any license to sell alcoholic beverages or any location having any such license. My term of office with the Licensing Authority Wires May 2001. At this time I would like to be considered for an additional term of office so that I may continue to serve the Town of Vail in this capacity. Thank you for your c....Jeration. Sincerely, ~ Mary C. Zarba MEMORANDUM TO: Planning and Environmental Commission FROM: Department of Community Development DATE: May 14, 2001 SUBJECT: A request for a final review and recommendation of a proposed special development district (SDD) to allow for the construction of a new conference hotel; and a final review of conditional use permits to allow for the construction of a fractional fee club and Type III employee housing units at 13 Vail Road / Lots A, B, C, Block 2, Vail Village Filing 2. Applicant: Doramar Hotels, represented by the Daymer Corporation Planner: Brent Wilson 1. INTRODUCTION AND DESCRIPTION OF THE REQUEST Special Development District Reauest This proposal is a revision to the applicant's original SDD proposals following the Planning and Environmental Commission's (PEC) direction regarding a number of issues involving building height, massing, loading/delivery, off-street parking, employee housing provisions and traffic circulation. The applicant is proposing the Vail Plaza Hotel West Special Development District (SDD) where the Chateau at Vail is currently located. The current (and proposed underlying) zoning for the property is "Public Accommodation." The Vail Plaza Hotel West is a mixed-use development proposal. Uses within the hotel include residential, commercial and recreation. The proposed plan includes 116 hotel rooms (395 s.f. each), 15 condominiums, 40 fractional fee units, 14 employee housing units, a restaurant and bar, limited retail space, 21,000 square feet of conference and meeting space, and a spa/health club. The existing "Chateau at Vail" hotel contains 120 hotel rooms at 280 square feet each. The applicant and staff have identified what are believed to be the public benefits that would be realized by the Town as a result of the Vail Plaza Hotel West redevelopment. The public benefits associated with the hotel proposal are: ¦ An increase in the annual occupancy rate through the redevelopment of an older existing hotel. ¦ The creation of approximately 21,000 square feet of new conference and meeting room facilities. This includes a 10,000 square foot ballroom and 11,000 square feet of breako ut/p reconvene space. TOWN OF VA& 1 ¦ The implementation of a portion of the recommended Town of Vail Streetscape Master Plan improvements along South Frontage Road and West Meadow Drive. ¦ The re-investment and redevelopment of resort property in the Town of Vail. ¦ The implementation of many of the development goals, objectives and policies adopted by the Town for Public Accommodation properties. • An increase to the Town's supply of short-term, overnight accommodations (hotel rooms and fractional fee units) to serve our guests and visitors. ¦ The construction of an "anchor" hotel providing a high-level of guest services and amenities. ¦ A potentially sizeable annual contribution to the Town's sales tax revenue. ¦ The creation of new deed-restricted employee housing to offset the housing impacts associated with the hotel. ¦ The removal of existing loading/delivery and guest traffic from West Meadow Drive. A sauare footaae breakdown of the arooosal is provided below: ¦ 60,649 sq. ft. - fractional fee club units ¦ 45,381 sq. ft. -condominiums ¦ 45,666 sq. ft. - accommodation units ¦ 2,835 sq. ft. - restaurant/retail ¦ 20,624 sq. ft. - conference/meeting rooms ¦ 13,836 sq. ft. - spa/health club In reviewing the proposal, staff identified a number of pros and cons that we believe are associated with the hotel proposal. The list includes, but is not limited to, the following: PROS • The presence of economic redevelopment in Vail. ¦ An increased level of quality to the Town's of hotel bed base. ¦ The implementation of certain development goals, objectives, and policies. ¦ The creation of new deed-restricted employee housing to offset the housing impacts associated with the hotel. • The elimination of an unsightly surface parking lot. ¦ The construction of new conference and meeting room facilities within the Town. • The construction of public improvements funded with private dollars. ¦ The potential increase in sales tax revenue (economic development). 2 ¦ The removal of existing loading/delivery and guest traffic from West Meadow Drive. CONS • Deviations from the underlying zoning development standards are required. • There are increased impacts of shading on public areas. • Additional views of Vail Mountain from public areas will be impacted. • Additional loading/delivery truck traffic on Town streets. • A significant period of building construction (noise, construction traffic, etc) and the anticipated impacts to public streets and adjacent properties. Conditional Use Permit Reauests In association with the application for a special development district, the applicant is requesting conditional use permits to allow for the establishment of a 40 fractional fee unit club and the construction of 14 Type III employee housing units. Because the development plan has changed significantly for the previously approved (2/12/01) fractional fee units, an additional PEC review is necessary. Please refer to Sections VIII & IX of this memorandum for a detailed review of these requests. II. STAFF RECOMMENDATIONS Special Development District The Community Development Department recommends that the Planning and Environmental Commission recommend approval (to the Vail Town Council) of the applicant's request for a proposed special development district to allow for the construction of a new conference facility/hotel, based upon the following finding: That the proposed special development district, the Vail Plaza Hotel West, complies with the nine design criteria outlined in Section 12-9A-8 of the Vail Town Code. The applicant has demonstrated that any adverse effects of the requested deviations from the development standards of the underlying zoning are outweighed by the public benefits provided. Should the Planning & Environmental Commission choose to recommend approval of the requested special development district to the Vail Town Council, staff would recommend that the Commission make the following finding: That the proposed special development district, Vail Plaza Hotel West, complies with the nine design criteria outlined in Section 12-9A-8 of the Town of Vail Municipal Code. The applicant has demonstrated to the satisfaction of the Commission that any adverse effects of the requested deviations from the development standards of the underlying zoning are outweighed by the public benefits provided. Further, the Commission finds that the requested conditional use permits to allow for the operation of a fractional fee club and the construction of Type l// employee housing units comply with the applicable criteria and are consistent with the development goals and objectives of the Town. 3 Should the Planning & Environmental Commission choose to recommend approval of the applicant's request, staff recommends that the approval carry with it the following conditions: 1. That the developer submits the following plans to the Department of Community Development for review and approval as a part of the building permit application for the hotel: a. An Erosion Control and Sedimentation Plan; b. A Construction Staging and Phasing Plan; C. A Stormwater Management Plan; d. A Site Dewatering Plan; and e. A Traffic Control Plan. 2. That the developer provides deed-restricted housing that complies with the Town of Vail Employee Housing requirements (Chapter 12-13) for a minimum of 28 employees, and that said deed-restricted housing be made available for occupancy, and that the deed restrictions are recorded with the Eagle County Clerk & Recorder, prior to requesting a Temporary Certificate of Occupancy for the Vail Plaza Hotel West. 3. That the developer submits a final detailed landscape plan to the Community Development Department for Design Review Board review and approval prior to making an application for a building permit. This plan will involve the removal of the obsolete delivery bay asphalt for the Chateau Vail on the Nine Vail Road property. 4. That the developer submits a complete set of civil engineer drawings for all off- site improvements, including the improvements to the South Frontage Road and West Meadow Drive for review and Town approval prior to application for a building permit. 5. That the developer submits a complete set of plans to the Colorado Department of Transportation for review and approval of a revised access permit, prior to application for a building permit. 6. That the developer meets with the Town staff to prepare a memorandum of understanding outlining the responsibilities and requirements of the required off- site improvements, prior to first reading of an ordinance approving the special development district. This includes streetscaping improvements along South Frontage Road and West Meadow Drive in accordance with the Town of Vail Streetscape Master Plan, as amended. 7. That the developer records an easement for Spraddle Creek. The easement shall be prepared by the developer and submitted for review and approval of the Town Attorney. The easement shall be recorded with the Eagle County Clerk & Recorder's Office prior to the issuance of a Temporary Certificate of Occupancy. 8. That the developer submits a final exterior building materials list, a typical wall section and complete color renderings for review and approval of the Design Review Board, prior to making an application for a building permit. 4 9. That the developer submits a comprehensive sign program proposal for the Vail Plaza Hotel West for review and approval of the Design Review Board, prior to the issuance of a Temporary Certificate of Occupancy. 10. That the developer submits a rooftop mechanical equipment plan for review and approval of the Design Review Board prior to the issuance of a building permit. All rooftop mechanical equipment shall be incorporated into the overall design of the hotel and enclosed and screened from public view. 11. That the developer posts a bond to provide financial security for the 150% of the total cost of the required off-site public improvements. The bond shall be in place with the Town prior to the issuance of a building permit. 12. That the developer either receives approval from the neighboring owner's associations to allow for construction activities on neighboring properties or submits a construction staging and limits of disturbance plan that indicates all of these activities will occur on the applicant's property. 13. That the developer provides access (via a permanent, legally binding easement agreement) for the Nine Vail Road Association and guests to enter the subject property from Vail Road and exit across the subject property from the location of Nine Vail Road's surface parking area to South Frontage Road. This is necessary to facilitate the applicant's proposed traffic circulation plan. 14. That the applicant submits civil drawings to determine compliance with all Town of Vail engineering requirements prior to final Design Review Board approval. 15. Pursuant to Section 12-7A-14, Town of Vail Code, the applicant shall pay road impact fees in an amount that is directly proportionate to the anticipated new road impacts generated by this development ($5000 per peak hour trip end). A specific amount for road impact fees will be declared (and adopted via a memorandum of understanding), based upon the anticipated new road impacts outlined in the applicant's traffic study. This dollar amount will be put in escrow once a building permit is issued. Any actual improvements constructed to the frontage road will be credited against the total. The escrowed dollars will be held for a period of 10 years from time of permit issuance. If and when any sort of funding mechanism is put in place (such as a special district which this development participates in) any dollars generated from the development will be offset by the amount owed. If there is an excess it will be refunded. Any shortfall will be made up by the escrowed dollars. 16. That the applicant complies with all fire department staging and access requirements pursuant to Title 14 (Development Standards), Vail Town Code. This will be demonstrated on a set of revised plans for town review and approval prior to building permit submittal. 17. That the required Type III deed-restricted employee housing units shall not be eligible for resale and that the units be owned and operated by the hotel and that said ownership transfer with the deed to the hotel property. 18. That the developer coordinates the relocation of the existing electric transformers on the property with local utility providers. The revised location of the transformers will be part of the final landscape plan to be submitted for review 5 and approval by the Design Review Board. 19. Prior to first reading of an ordinance adopting a special development district for the property, the developer shall resolve the guest exit drive alignment to the satisfaction of the town engineer. Conditional Use Permit - Fractional Fee Club The Community Development Department recommends approval of the applicant's request for a conditional use permit to allow for the construction of 40 fractional fee units within the Vail Plaza Hotel West based upon 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: 1. The approval of this conditional use permit is not valid unless an ordinance approving the associated special development district request is approved on second reading. Conditional Use Permit - Emglovee Housina Units The Community Development Department recommends approval of the applicant's request for a conditional use permit to allow for the construction of 14 Type I I I employee housing units within the Vail Plaza Hotel West based upon 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. The proposal complies with the minimum requirements outlined for employee housing units outlined in Section 12-13-3 of the Vail Town Code. 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. 6 If the Planning and Environmental Commission chooses to approve this request, the Department of Community Development recommends the following conditions be placed on the approval. 1. That the applicant records applicable deed restrictions for all employee housing units with the Eagle County Clerk & Recorder prior to the issuance of a Temporary Certificate of Occupancy for the Vail Plaza Hotel West. III. ROLES OF REVIEWING BOARDS Soecial Develooment District Order of Review. Generally, applications will be reviewed first by the PEC for impacts of use/development, then by the DRB for compliance of proposed buildings and site planning, and final approval by the Town Council. Plannina and Environmental Commission: Action: The PEC is advisorv to the Town Council. The PEC shall review the proposal for and make a recommendation to the Town Council on the following: • Permitted, accessory, and conditional uses ¦ Evaluation of design criteria as follows (as applicable): A. Compatibility: Design compatibility and sensitivity to the immediate environment, neighborhood and adjacent properties relative to architectural design, scale, bulk, building height, buffer zones, identity, character, visual integrity and orientation. B. Relationship: Uses, activity and density which provide a compatible, efficient and workable relationship with surrounding uses and activity. C. Parking And Loading: Compliance with parking and loading requirements as outlined in Chapter 10 of this Title. D. Comprehensive Plan: Conformity with applicable elements of the Vail Comprehensive Plan, Town policies and urban design plans. E. Natural and/or Geologic Hazard: Identification and mitigation of natural and/or geologic hazards that affect the property on which the special development district is proposed. F. Design Features: Site plan, building design and location and open space provisions designed to produce a functional development responsive and sensitive to natural features, vegetation and overall aesthetic quality of the community. G. Traffic: A circulation system designed for both vehicles and pedestrians addressing on and off-site traffic circulation. H. Landscaping: Functional and aesthetic landscaping and open space in order to optimize and preserve natural features, recreation, views and function. 7 I. Workable Plan: Phasing plan or subdivision plan that will maintain a workable, functional and efficient relationship throughout the development of the special development district. Recommendation on development standards including, lot area, site dimensions, setbacks, height, density control, site coverages, landscaping and parking. Design Review Board: Action: The DRB has NO review authoritv on a SDD orooosal. but must review anv accomoanvina DRB anolication The DRB review of an SDD prior to Town Council approval is ourely advisorv in nature. The DRB is responsible for evaluating the DRB proposal: - 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 - Compliance with the architectural design guidelines of applicable master plans. 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 recommendation on approval, approval with conditions, or denial. Staff also facilitates the review process. Town Council: Action: The Town Council is resoonsible for final aooroval/denial of an SDD. The Town Council shall review the proposal for the following: Permitted, accessory, and conditional uses Evaluation of design criteria as follows (as applicable): A. Compatibility: Design compatibility and sensitivity to the immediate environment, neighborhood and adjacent properties relative to architectural design, scale, bulk, building height, buffer zones, identity, character, visual integrity and orientation. B. Relationship: Uses, activity and density which provide a compatible, efficient and workable relationship with surrounding uses and activity. C. Parking And Loading: Compliance with parking and loading requirements as outlined 8 in Chapter 10 of this Title. D. Comprehensive Plan: Conformity with applicable elements of the Vail Comprehensive Plan, Town policies and urban design plans. E. Natural and/or Geologic Hazard: Identification and mitigation of natural and/or geologic hazards that affect the property on which the special development district is proposed. F. Design Features: Site plan, building design and location and open space provisions designed to produce a functional development responsive and sensitive to natural features, vegetation and overall aesthetic quality of the community. G. Traffic: A circulation system designed for both vehicles and pedestrians addressing on and off-site traffic circulation. H. Landscaping: Functional and aesthetic landscaping and open space in order to optimize and preserve natural features, recreation, views and function. 1. Workable Plan: Phasing plan or subdivision plan that will maintain a workable, functional and efficient relationship throughout the development of the special development district. Approval of development standards including, lot area, site dimensions, setbacks, height, density control, site coverages, landscaping and parking. CONDITIONAL USE PERMITS (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. Plannina and Environmental Commission: Action: The PEC is responsible for final aooroval/denial of a CUP. The PEC is responsible for evaluatina a CUP 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. 6. The environmental impact report concerning the proposed use, if an environmental 9 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 Desian Review Board: Action: The DRB has NO review authoritv on a CUP. but must review anv accomoanvina 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 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. 10 IV. DEVIATIONS FROM THE UNDERLYING ZONING The Vail Plaza Hotel West Special Development District proposal contains the following deviations from the underlying Public Accommodation (PA) zoning: 1. Heiaht- the proposed hotel is 25 feet (52%) taller than the 48' allowed under PA zoning. The proposed building is 73 feet tall at its highest ridge (adjacent to South Frontage Road). The building stands 47.5' tall at its primary ridge along West Meadow Drive. 2. Site Coveraae (below arade) - although the proposal complies with site coverage requirements above grade, it deviates by 11.7% below grade. V. "PUBLIC ACCOMMODATION ZONE DISTRICT" According to the Official Town of Vail Zoning Map, the applicant's property is zoned Public Accommodation. Pursuant to the Town of Vail Municipal Code, the Public Accommodation Zone district is intended, to provide sites for lodges and residential accommodations for visitors, together with such public and semi-public facilities and limited professional offices, medical facilities, private recreation, and related visitor oriented uses as may appropriately be located in the same district. The Public Accommodation District is intended to ensure adequate light, air, open space, and other amenities commensurate with lodge uses, and to maintain the desirable resort qualities of the District by establishing appropriate site development standards. Additional nonresidential uses are permitted as conditional uses which enhance the nature of Vail as a winter and summer recreation and vacation community, and where permitted are intended to function compatibly with the high density lodging character of the District. The Public Accommodation Zone District is intended to provide sites for lodging units with densities not to exceed 25 dwelling units per acre. The Public Accommodation Zone District, prior to January 21, 1997, did not permit interval ownership. On January 21, 1997, the Town Council adopted regulations allowing interval ownership subject to the issuance of a conditional use permit. Previously, interval ownership was only allowed as a conditional use in the High Density Multi-family Zone District. On October 5, 1999, the Vail Town Council approved Ordinance No. 23, Series of 1999, amending the development standards prescribed in the Public Accommodation Zone District. The amendments included an increase in allowable GRFA up to 150%, an increase in site coverage, the elimination of AU's and FFU's in the calculation of density, revised setback requirements, and other various aspects in the development of properties zoned Public Accommodation. The allowable building height, landscape area and limitation on commercial square footage remained unchanged. 11 VI. ZONING ANALYSIS The development standards for a Special Development District shall be proposed by the applicant. Development standards including lot area, site dimensions, setbacks, height, density control, site coverage, landscaping and parking and loading shall be determined by the Town Council as part of the approved development plan, with consideration of the recommendations of the Planning and Environmental Commission. Before the Town Council approves development standards that deviate from the underlying zone district, it shall be determined that such deviations provide benefits to the Town that outweigh the effects of such deviations. This determination is to be made based upon the evaluation of the proposed Special Development District's compliance with the Review Criteria outlined in the following section of this memorandum. The Community Development Department staff has prepared a zoning analysis for the proposed Vail Plaza Hotel West. The Vail Plaza Hotel West Zoning Analysis compares the development standards outlined by the underlying zoning of Public Accommodation (revised 10/99) to the Vail Plaza Hotel West proposal from February of 2001 and the current proposal. A copy of the Vail Plaza Hotel West Zonina Analvsis has been attached for reference (Exhibit B). VII. THE SPECIAL DEVELOPMENT DISTRICT ESTABLISHMENT AND REVIEW PROCESS Chapter 12-9 of the Town Code provides for the amendment of existing Special Development Districts in the Town of Vail. According to Section 12-9A-1, the purpose of a Special Development District is, "To encourage flexibility and creativity in the development of land, in order to promote its most appropriate use; to improve the design character and quality of the new development within the Town; to facilitate the adequate and economical provision of streets and utilities; to preserve the natural and scenic features of open space areas; and to further the overall goals of the community as stated in the Vail Comprehensive Plan. An approved development plan for a Special Development District, in conjunction with the properties underlying zone district, shall establish the requirements for guiding development and uses of property included in the Special Development District." An approved development plan is the principal document in guiding the development, uses, and activities of the Special Development District. The development plan shall contain all relevant material and information necessary to establish the parameters with which the Special Development District shall adhere. The development plan may consist of, but not be limited to: the approved site plan; floor plans, building sections, and elevations: vicinity-plan; parking plan; preliminary open space/landscape plan; densities; and permitted, conditional, and accessory uses. The determination of permitted, conditional and accessory uses shall be made by the Planning and Environmental Commission and Town Council as part of the formal review of the proposed development plan. Unless further restricted through the review of the proposed Special Development District, permitted, conditional and accessory uses shall 12 be limited to those permitted, conditional and accessory uses in the property's underlying zone district. The Town Code provides nine design criteria which shall be used as the principal criteria in evaluating the merits of the proposed Special Development District. It shall be the burden of the applicant to demonstrate that submittal material and the proposed development plan comply with each of the following standards, or demonstrate that one or more of them is not applicable, or that a practical solution consistent with the public interest has been achieved. The following is a staff analysis of the project's compliance with the nine SDD review criteria: CRITERIA FOR REVIEW: A. Design compatibility and sensitivity to the immediate environment, neighborhood and adjacent properties relative to architectural design, scale, bulk, building height, buffer zones, identity, character, visual integrity and orientation. The following is a synopsis of comments from the town's appointed and elected boards since October 24, 2000 on the issues shown in bold, underlined type. A staff response follows each set of comments: Bulk and Mass "The overall scale of the current proposal is inconsistent with the established character of the area. A "breaking up" of the primary roof ridges would help scale down the mass. The project should read as an assemblage of buildings rather than one large structure" (Joint Board Meeting, 10/24/00). "The building should be turned outward towards the public and opened up to allow greater public access. The proposed atrium area should be opened more to the south to take advantage of the sun exposure and pedestrian traffic" (PEC, 11/27/00). "The project should read as a fragmented assemblage of structures. The linear, unbroken wall planes along the South Frontage Road and West Meadow Drive are too massive and should be broken up to help reduce the apparent mass of the project. There should be points in the project where light and air penetrate through to allow for more transparency. The current proposal is not sympathetic to the design and scale of adjacent buildings" (DRB, 12/8/00). Staff Resaonse - The applicant has succeeded in breaking up the roof massing along West Meadow Drive while the primary ridge along South Frontage Road continues to present a linear, unbroken mass along the entire frontage. The revised "opening" of the pedestrian entry and the removal of the atrium roof structure have alleviated some of the previous "internal compound" design characteristics prevalent in earlier versions of this plan and have created a more inviting entry feature along the southern streetscape. Additionally, staff believes the revised plan will provide more southern sun exposure within the internal garden area. Although the north fagade presents a bit of a "mirror image" along the frontage road, staff believes this may be alleviated through the use of alternating colors and materials. This issue will be addressed as part of the design review process. 13 Heiaht "The height along West Meadow Drive should be stepped down again to a level more consistent with the established character of the area" (PEC, 11/27/00). Staff Resoonse The primary ridge height along West Meadow Drive no longer exceeds the 48 feet requirement under the underlying zoning and staff believes the height is presented within a roof plan that helps to minimize perception of bulk and mass. For example, eave heights along West Meadow Drive range between 16-41 feet while the primary southern ridge (at 47.5 feet) is setback from the street edge about 100 feet. Therefore, the height is stepped back and the bulk is perceived to be less from the pedestrian perspective. The building is proposed with a 10.0' floor-to-floor height for each story. LavouVFootprint "The inward focus of the project should be turned outward. The current proposal is reminiscent of the Vail Gateway project. It needs to be more inviting to the public from the outside. The large internal atrium could be reduced in size; this would allow more flexibility in breaking up the layout of the proposal" (DRB, 12/8/00). Staff Resoonse - The Vail Land Use Plan identifies the subject property as part of a "transition zone" that forms a buffer between the foreground residences along the south side of the West Meadow Drive and the larger, higher-density structures along the frontage road. The long, unbroken linear masses proposed along the frontage road add to the massive appearance of the building. However, staff believes the revised atrium and pedestrian entry along West Meadow Drive are a successful effort towards opening the project towards the outside and the public. On April 18th, the Town of Vail Design Review Board made a finding that the project is in general compliance with the design criteria established for special development districts. The applicant has submitted a Vail Plaza Hotel West Sun/Shade Analysis (Exhibit E) and Vail Plaza Hotel West View Analysis (Exhibit F) to demonstrate impacts to the streetscape and public ways. The sun/shade analysis indicates substantial portions of South Frontage Road (including the sidewalk on the south side) will be impacted by shade during the winter months. However, the applicant is proposing to snowmelt the sidewalk along the Chateau property line in an effort to mitigate this issue. One of the urban design goals the town has adopted for redevelopment in Lionshead is a predominantly north-south orientation for buildings. Although the subject property does not fall directly into the context area for the redevelopment master plan for Lionshead, the design concepts that apply to adjacent Lionshead properties are a critical element in the evaluation of compatibility with neighborhood character. Additionally, the design concepts promoted here are general "good design" policies, and not specific sub-area concepts from any specific plan. One goal adopted by the DRB, PEC and Town Council is "it should be a priority in future development and redevelopment to orient vertical building masses along a north-south axis whenever possible." This will help to accomplish the following objectives: a. Sun Access - During the winter months, the sun is low in the southern sky, providing the greatest solar exposure to the south faces of buildings and to streets and spaces open to the south. A north-south orientation of building masses will increase the amount of sun reaching the Lionshead 14 pedestrian core and the buildings to the north. b. Views from New Buildings - In double loaded buildings oriented on an east-west axis, units on the south side of the building get great views of the mountain, but units on the north side do not. Orienting the building mass on a north-south line creates angled southern views for both sides of the building, and units on both sides will get direct sun sometime during the day. C., Views from Existing Buildings - By orienting new buildings on a north- south axis, the potential visual impact on existing buildings is reduced. d. Creation of "Streets" or Areas of Interest for Pedestrians. Although staff believes a diagonal "sawtooth" treatment similar to Eldon Beck's plan for the Vail Village Inn properties fronting East Meadow Drive would be more desirable than the linear east-west horizontal mass that is proposed by the applicant, the opening of the southern wing to allow greater sun exposure and the more inviting pedestrian entry along West Meadow Drive are greatly improved over previous submittals. Setbacks - In the PA District, the minimum setback shall be 20 feet on all sides. Although the project's footprint maintains at least a 20-foot setback from all property lines, the covered entries along the South Frontage Road and the Vail Road spur encroach 20 feet and 4 feet respectively. At the discretion of the PEC and DRB, variations to the setback standards may be approved, subject to the applicant demonstrating compliance with the following criteria: A. Proposed building setbacks provide necessary separation between buildings and riparian areas, geologically sensitive areas and other environmentally sensitive areas. There are no identified geologically or environmentally sensitive areas on this property. Pursuant to the provisions of the Town of Vail Zoning Regulations and the Uniform Building Code, the applicant is complying with minimum setbacks between buildings. There are two "covered entry" encroachments proposed in the plan. The northern "loading dock screen" encroachment abuts the property line along the South Frontage Road and does not abut any buildings. The eastern "guest entry" encroachment comes within 16 feet of the property line adjacent to the spur access drive between the Alpine Standard and Nine Vail Road buildings. B. Proposed building setbacks comply with applicable elements of the Vail Village Urban Design Guide Plan and Design Considerations. These elements of Vail's Comprehensive Plan are not applicable to the subject property. C. Proposed building setbacks will provide adequate availability of light, air and open space. Staff does not believe the two (2) proposed covered entry areas would impede the availability of adequate light, air and open space. 15 D. Proposed building setbacks will provide a compatible relationship with buildings and uses on adjacent properties. One of the challenges with the existing conditions of this property and adjacent lots is the configuration of adjacent buildings within required setbacks. All of the buildings directly abutting this property encroach into required setbacks. The Alphorn building, for example, is built almost directly on its eastern property line. As mentioned previously, the proposed encroachment along the South Frontage Road does not abut any buildings. The guest entry encroachment, as proposed, is separated a distance of 48 feet from the Alpine Standard station, 104 feet from the Nine Vail Road building, and 185 feet from Vail Road. E. Proposed building setbacks will result in creative design solutions or other public benefits that could not otherwise be achieved by conformance with prescribed setbacks standards. The use of the northern covered entry along South Frontage Road will help screen the below-grade delivery activities from public view. The eastern covered guest entry helps create a sense of arrival to the hotel and provides shelter from the elements. Although staff believes the two covered roof features could be constructed within setbacks if the plan were altered, the applicant has indicated the northern encroachment along South Frontage Road is necessary to maintain an appropriate setback area along West Meadow Drive. Therefore, the applicant is requesting Town Council, PEC and DRB review of the proposed entry, encroachments. B. Uses, activity and density which provide a compatible, efficient and workable relationship with surrounding uses and activity. The uses, activities and densities for the Vail Plaza Hotel West development site are prescribed by the underlying zoning. According to the Official Town of Vail Zoning Map, the underlying zoning for the proposed special development district is Public Accommodation. The Public Accommodation Zone District encourages the development of lodges (accommodation units) and accessory eating and drinking establishments at a density of twenty-five dwelling units per acre. The surrounding uses and zoning designation include Public Accommodation to the south, east and west (Sonnenalp, Nine Vail Road & Special Development District No. 6 - Vail Village Inn), High-Density Multiple Family to the west and northwest (Alphorn and Scorpio), Heavy Service to the north (Alpine Standard) and Commercial Core I/SDD #21 (Gateway) to the northeast. The same development standards that apply to the Vail Plaza Hotel West development site apply to the Sonnenalp, Nine Vail Road and Vail Village Inn properties. The Commercial Core I underlying zoning of the Gateway Special Development District is intended to provide sites for a mixture of commercial and residential development. The Heavy Service district is intended to provide sites for automotive-oriented land uses. The Vail Plaza Hotel West is proposed as a mixed-use development. The mixture of uses includes commercial, lodging, recreational and residential. Staff believes the proposed mixture of uses and its proximity to both Vail Village and Lionshead is consistent with the intended purpose of the underlying zoning of Public Accommodation. Further, staff believes that the proposed uses within the Vail Plaza Hotel West will compliment those existing uses and activities on surrounding and adjacent properties. The proposed density of the hotel and the presence of the conference facilities will 16 improve and enhance the viability and success of the existing restaurant and retail businesses in the immediate area. Emplovee Housina Reauirements As indicated in a number of the goals and objectives of the Town's Master Plans, providing affordable housing for employees is a critical issue which should be addressed through the planning process for Special Development District proposals. In reviewing the proposal for employee housing needs, staff relied on the Town of Vail Employee Housing Report. This report has been used by the staff in the past to evaluate employee housing needs. The guidelines contained within the report were used most recently in the review of the Austria Haus, Marriott and Special Development District No. 6 - Vail Village Inn development proposals. The Employee Housing Report was prepared for the Town by the consulting firm Rosall, Remmen and Cares. The report provides the recommended ranges of employee housing units needed based on the type of use and the amount of floor area dedicated to each use. Utilizing the guidelines prescribed in the Employee Housing Report, staff analyzed the incremental increase of employees (square footage per use), that results from the redevelopment. The figures identified in the report are based on surveys of commercial-use employment needs of the Town of Vail and other mountain resort communities. As of the drafting of the report, Telluride, Aspen and Whistler, B.C. had "employment generation" ordinances requiring developers to provide affordable housing for a percentage of the new employees resulting from commercial development. "New" employees are defined as the incremental increase in employment needs resulting from commercial redevelopment. Each of the communities assesses a different percentage of affordable housing a developer must provide for the new employees. For example, Telluride requires developers to provide housing for 40% (0.40) of the new employees, Aspen requires that 60% (0.60) of the new employees are provided housing and Whistler requires that 100% (1.00) of the new employees be provided housing by the developer. In comparison, Vail has conservatively determined that developers shall provide housing 15% (0.15) or 30% (0.30) of the new employees resulting from commercial development. When a project is proposed to exceed the density allowed by the underlying zone district, the 30% (0.30) figure is used in the calculation. If a project is proposed at, or below, the density allowed by the underlying zone district, the 15% (0.15) figure is used. The Vail Plaza Hotel West special development district does not exceed the density permitted by the underlying zone district. However, the Planning and Environmental Commission and Vail Town Council have indicated the 30% figure should be used given the substantial scope and impact of this project. The applicant is proposing to provide employee housing for a percentage of the "new" employees resulting from the hotel construction. The new hotel is expected to generate 93.5 "new" employees. The "new" employees are in addition to the 79 "full time equivalent" employees already working at the Chateau at Vail. The applicant is proposing to provide deed-restricted employee housing for 29% (28 beds) of the "new" employees. In order to maximize the benefit of the housing to the Town of Vail, the applicant has suggested that the housing will be available only to Vail Plaza Hotel West employees. 17 EMPLOYEE HOUSING GENERATION ANALYSIS For a point of reference, the "top," "middle" and "bottom" ranges of calculations for the Vail Plaza Hotel West proposal are provided below. ¦ Bottom of Range Calculations = 7.4 employee beds ¦ Middle of Range Calculations = 27.5 employee beds ¦ Top of Range Calculations = 47.6 employee beds • Staff Recommended Range = 28.0 employee beds ¦ Applicant's Proposal = 28.0 employee beds Staff Recommended Ranae Calculations: Staff believes that the Vail Plaza Hotel West redevelopment will create a need for the housing of 97 additional "new" employees. Of the 97 additional employees, at least 28 employees (30%) will need to be provided deed-restricted housing by the developers of the Vail Plaza Hotel West. Please refer to Section IX of the staff memorandum for details regarding square footages and configuration of the units. The staff recommended range is based on: 1. the type of retail and commercial use proposed in the commercial space within the Vail Plaza Hotel West; 2. the size of the Vail Plaza Hotel West lodging component; 3. the level of services and amenities proposed by the developers for the guests of the Vail Plaza Hotel West; and 4. the result of research completed by Town of Vail staff of similar hotel operations in the Vail Valley. 18 a) Retail/Service Commercial = 1,127 sq. ft. @ (5/1000 sq. ft.) = 5.6 (bottom of range) b) Health Club/Spa = 13,835.7 sq. ft. @ (1.5/1000 sq. ft.) = 20.8 (top of range) C) Restaurant/Lounge = 2,535.3 sq. ft. @ (6.5/1000 sq. ft.) = 16.5 (middle of range) d) Conference Center = 20,624 sq. ft. @ (1/1000 sq. ft.) = 20.6 (range does not vary) e) Lodging = 116 units @ (.75/unit) = 87.0 (middle of range) f) Multi Family (Club Units) = 15 units @ (.4/unit) = 6.0 (range does not vary) g) Fractional Fee Units = 40 units @ (.4/unit) = 16.0 (range does not vary) Total = 172.5 (-79 existing employees) = 93.5 (X 0.30 multiplier) = 28.0 new employees *Lodging has a particularly large variation of employees per room, depending upon factors such as size of facility and level of service/support services and amenities provided. Bottom of Range Calculations: a) Retail/Service Commercial = 1,127 sq. ft. @ (5/1000 sq. ft.) = 5.6 b) Health Club = 13,835.7 sq. ft. @ (1/1000 sq. ft.) = 13.8 C) Restaurant/Lounge/Kitchen = 2,535.3 sq. ft. @ (5/1000 sq. ft.) = 12.7 d) Conference Center = 20,624 sq. ft. @ (1/1000 sq. ft.) = 20.6 e) Lodging = 116 units @ (.25/unit) = 29.0 f) Multi-Family Units = 15 units @ (.4/unit) = 6.0 g) Fractional Fee Units = 40 units @ (.4/unit) = 16.0 Total Employees =103.7 79 existing employees) = 24.7 (X 0.30 multiplier) = 7.4 new employees Middle of Range Calculations: a) Retail/Service Commercial = 1,127 sq. ft. @ (6.5/1000 sq. ft.) = 7.3 b) Health Club = 13,835.7 sq. ft. @ (1.25/1000 s.f.) = 17.3 C) Restaurant/Lounge/Kitchen = 2,535.3 sq. ft. @ (6.5/1000 sq. ft.) = 16.5 d) Conference Center = 20,624 sq. ft. @ (1/1000 sq. ft.) = 20.6 e) Lodging = 116 units @ (.75/unit) = 87.0 f) Multi-Family Units = 15 units @ (.4/unit) = 6.0 g) Fractional Fee Units = 40 units @ (.4/unit) = 16.0 Total Employees =170.7 79 existing employees) = 91.7 (X 0.30 multiplier) = 27.5 new employees 19 Top of Range Calculations: a) Retail/Service Commercial = 1,127 sq. ft. @ (8/1000 sq. ft.) = 9.0 b) Health Club =13,835.7 sq. ft. @ (1.5/1000 sq. ft.)= 20.8 C) Restaurant/Lounge/Kitchen = 2,535.3 sq. ft. @ (8/1000 sq. ft.) = 20.3 d) Conference Center = 20,624 sq. ft. @ (1A000 sq. ft.) = 20.6 e) Lodging = 116 units @ (1.25/unit) =145.0 f) Multi-Family Units = 15 units @ (.4/unit) = 6.0 g) Fractional Fee Units = 40 units @ (.4/unit) = 16.0 Total Employees = 237.7 79 existing employees) = 158.7 (X 0.30 multiplier) = 47.6 new employees Depending upon the size of the employee housing unit provided, it is possible to have up to two employees per bedroom. For example, a two-bedroom unit in the size range of 450 - 900 square feet is possible of accommodating three to four employees. These figures are consistent with the requirements for the Type III employee housing units outlined in the Municipal Code. Please refer to Section IX of this memorandum for details. C. Compliance with parking and loading requirements as outlined in Chapter 12-10 of the Vail Town Code. The proposal complies with the parking and loading requirements outlined in Chapter 12- 10 of the Vail Town Code. Staff's parking calculations are contained in the attached Exhibit G. D. Conformity with the applicable elements of the Vail Comprehensive Plan, Town policies and Urban Design Plan. Vail Land Use Plan: The Vail Land Use Plan applies two "future land use" designations to the property: Resort Accommodations and Service: This area includes activities aimed at accommodating the overnight and short-term visitor to the area. Primary uses include hotels, lodges, service stations, and parking structures. These areas are oriented toward vehicular access from 1-70, with other support commercial and business services included. Also allowed in this category would be institutional uses and various municipal uses. Transition: The activities and site design of this area is aimed at encouraging pedestrian flow through the area and strengthening the connection between the two commercial cores. Appropriate activities include hotels, lodging and other tourist-oriented residential units, ancillary retail and restaurant uses, museums, areas of public art, nature exhibits, gardens, pedestrian plazas, and other ties to the north. The goals contained in the Vail Land Use Plan are to be used as the Town's policy guidelines during the review process for the establishment of a special development district. Staff has reviewed the Vail Land Use Plan and believes the following policies are relevant to the review of this proposal: 20 1. General Growth/Development 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. 1.2 The quality of the environment including air, water, and other natural resources should be protected as the Town grows. 1.3 The quality of development should be maintained and upgraded whenever possible. 1.12 Vail should accommodate most of the additional growth in existing developed areas (infill). 3. Commercial 3.1 The hotel bed base should be preserved and used more efficiently. 3.2 The Village and Lionshead are the best location for hotels to serve the future needs of the destination skier. 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. 5. Residential 5.1 Quality timeshare units should be accommodated to help keep occupancy rates up. 5.2 Affordable employee housing should be made available through private efforts, assisted by limited incentives, provided by the Town of Vail, with appropriate restrictions. The Land Use Plan suggests that increased density for commercial, residential and lodging uses in the Village/Lionshead Core areas would be acceptable so long as the existing character of each area is being preserved. Town of Vail Streetscaoe Master Plan The town's Streetscape Master Plan identifies West Meadow Drive as the primary pedestrian route between Vail Village and Lionshead Mall. To improve the quality of the walking experience and give continuity to the pedestrian ways, as a continuous system, two general types of improvements adjacent to the walkways are considered: 21 1. Open space and landscaping, berms, grass, flowers and tree planting as a soft, colorful framework linkage along pedestrian routes; and plazas and park greenspaces as open nodes and focal points along those routes. 2. Infill commercial storefronts, expansion of existing buildings, or new infill development to create new commercial activity generators to give street life and visual interest, as attractions at key locations along pedestrian routes. Future streetscape improvement concepts for West Meadow Drive include: ¦ A primary pedestrian path (10'-12' wide) on one side of the street with a smaller (6) sidewalk on the opposite side of the street. The primary path crosses from the north to the south side of the street to avoid the head-in parking that exists at the Alphorn and Skaal Hus. Curb and gutter would be used to define the street. The street has been narrowed to the minimum width of 26' curb-to=curb. ¦ Sidewalks are constructed of concrete unit pavers to clearly distinguish them from the roadway. The primary path may be a different color than the secondary walkway. ¦ A pedestrian priority crosswalk is planned near the Chateau Vail site. This raised crosswalk keeps the path at the same level as it crosses the street. ¦ The plan calls for extensive landscaping along the right-of-way to reflect the landscape character of nearby Gore Creek. Seating is provided at regular intervals. Public art or a similar feature is proposed adjacent to the pocket park at the intersection with Vail Road. Although the town is in the process of refining the plan for West Meadow Drive, staff believes the applicant's preliminary streetscape plan demonstrates substantial compliance with the above-listed provisions. Staff believes the uses and activities proposed are in compliance with the policies, goals, and objectives identified in the Vail Land Use Plan. E. Identification and mitigation of natural and/or geologic hazards that affect the property on which the special development district is proposed. According to the Official Town of Vail Geologic Hazard Maps, the Vail Plaza Hotel West development site is not located in any geologically sensitive areas or within the 100-year floodplain. F. Site plan, building design and location and open space provisions designed to produce a functional development responsive and sensitive to natural features, vegetation and overall aesthetic quality of the community. 22 Loadina and Deliverv Staff believes the removal of loading and delivery traffic from West Meadow Drive is a substantial improvement over existing conditions and the revised location along South Frontage Road minimizes impacts to adjacent residents. Additional screening of loading docks in the form of a meandering site wall along the berm between the hotel and the sidewalk abutting South Frontage Road is recommended. Landsr:ane Plan and Ooen Soace Provisions Staff feels the overall preliminary plan for landscaping and open courtyard areas is functional and aesthetically improved over what exists today along West Meadow Drive. On the other portions of the property, staff believes the size and massing of the building proposed may inhibit the ability of the landscaping to provide a true feeling of "open space." This is particularly true of the western lot perimeter adjacent to the Alphorn and Scorpio buildings. However, is important to recognize the applicant is providing adequate setbacks (pursuant to PA zoning) and that adjacent buildings are encroaching into their respective setbacks nearly 100 percent. Although there are good preliminary concepts at work (particularly along West Meadow Drive), staff does not believe this criterion will be adequately addressed until some of the building's massing/footprint issues are finalized. G. A circulation system designed for both vehicles and pedestrians addressing on and off-site traffic circulation. Pursuant to Section 12-7A-14 (Mitigation of Development Impacts) of the "Public Accommodation" zone district regulations, property owners/developers shall 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. The intent is to provide appropriate mitigation to an extent that is proportional to the anticipated impacts of new development. Vehicular Traffic and Road Impacts: The applicant has submitted a traffic study from an engineering consultant to address the impacts of this proposal. The study indicates the proposed SDD will generate 97 additional peak hour (p.m.) trip ends. Although the applicant's traffic circulation plan is the most feasible for this property, the following concern needs to be addressed prior to first reading of an ordinance that would adopt the proposed SDD: • The alignment of the proposed guest exit drive needs to be shifted slightly east (upon the existing access easement on Alpine Standard property) to minimize the potential for conflicts with gas station user entries from South Frontage Road. Pedestrian Traffic Circulation: The applicant (as well as the town staff and elected/appointed boards) has identified the need for a strong pedestrian connection between the proposal and the Vail Village Inn site via the access drive adjacent to Vail Road. The applicant is proposing a 4-foot wide paver sidewalk for pedestrians along this drive. The applicant has added a pedestrian connection along the north wing between the employee housing units and the bus stop along South Frontage Road. 23 H. Functional and aesthetic landscaping and open space in order to optimize and preserve natural features, recreation, views and functions. There are no established public view corridors in the immediate vicinity of this proposal. As mentioned previously, staff believes the exterior changes to the southern fagade and the removal of the atrium roof are a substantial improvement over previous versions of the proposal. Staff believes the preliminary landscape plan is both functional and aesthetically pleasing. Landscape plan details will be addressed during the design review phase. 1. Phasing plan or subdivision plan that will maintain a workable, functional and efficient relationship throughout the development of the special development district. The applicant is proposing to construct the project in one phase. A subdivision of the property is not necessary to facilitate this proposal (with the exception of a condominium map). Construction staging is reviewed as part of a building permit submittal for any project. VIII. CRITERIA AND FINDINGS FOR A CONDITIONAL USE PERMIT- FRACTIONAL FEE UNITS Upon review of the Vail Town Code, the Community Development Department recommends approval of the request for a conditional use permit to allow for the construction of 40 fractional fee units within the Vail Plaza Hotel West 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 and Vail Plaza Hotel projects have been approved by the Town. The applicant is requesting the issuance of a conditional use permit to allow for the operation of a fractional fee club within the Vail Plaza Hotel West. The proposed club would be comprised of 40 one and two- bedroom units. These units would range in size from 943 square feet to 24 2,274 square feet. The average club unit size is approximately 1,400 square feet in size. Each of the units has been designed in such a manner as to provide multiple "keys" to for lock-off units. The total number of "keys" in the club is 122. According to the applicant, the ownership of the club units will be divided into a maximum of 1/12tn intervals for the 28 winter weeks during the ski season, while the remaining 24 shoulder season and summer weeks would be owned by the hotel. This ownership program allows for the most attractive weeks of the year to be sold as club units with the proceeds helping to finance the redevelopment project. The remaining interest in the clubs is then used by the hotel to support the conference facility during the summer months. According to the applicant this program will create the best possible occupancy of the hotel and maximize the viability of the conference facility. 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 Plaza Hotel 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. These review criteria are addressed in the Special Development District review portion (Section VII) 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 parking areas. These review criteria are addressed in the Special Development District review portion of this memorandum (Section VII). 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. 25 These review criteria are addressed in the Special Development District review portion of this memorandum (Section VII). Please refer to the nine design criteria used to evaluate special development district proposals. 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 Plaza Hotel West proposal is a redevelopment of an existing hotel. The applicant is proposing to meet the equivalency requirement by replacing a greater amount of accommodation unit GRFA on the site than what exists today. According to information on file in the Community Development Department 120 accommodation units exist at the Chateau at Vail with a total of 33,600 square feet of GRFA. The applicant is proposing to replace the existing units with 116 new hotel rooms totaling approximately 45,666 square feet of GRFA. 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. The applicant meets the equivalency requirements irregardless of the calculation of lock-off square footage. C. The ability of the proposed project to create and maintain a high level of occupancy. The fractional fee club component of the Vail Plaza Hotel West proposal is intended to provide additional hotel and hotel-type accommodation units in the Town of Vail. Although not included in the equivalency requirement, the fractional fee club units have been designed to accommodate lock-off units. 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. 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 26 availability of accommodation units in the Town of Vail. 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. 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. Staff included the fractional fee club units into the calculation of the employee generation resulting from the proposed major amendment of the Special Development District. Based strictly on the number of club units, the development will generate a need for 16 "new" employees. When the multiplier of 0.30 is factored in, 4.8 of the "new" employees 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, Doramar Hotels, represented by Waldir Prado (dba Daymer Corporation) is the sole owner of the property. No other written approval is required. 27 B. FINDINGS The Plannina and Environmental Commission shall make the followina findinas before arantina a conditional use permit: 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. IX. CRITERIA AND FINDINGS FOR A CONDITIONAL USE PERMIT- EMPLOYEE HOUSING UNITS The Community Development Department recommends approval of the applicant's request for a conditional use permit to allow for the construction of 14 Type III employee housing units within the Vail Plaza Hotel West 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 September and December of 1992, the Town Council passed Ordinances 9 and 27, Series of 1992, to create Chapter 12-13 (Employee Housing) which provides for the addition of Employee Housing Units (EHUs) as permitted or conditional uses within certain zone districts. The definition in that ordinance states: "Employee Housing Unit (EHU) shall mean a dwelling unit which shall not be leased or rented for any period less than thirty (30) consecutive days, and shall be rented only to tenants who are full-time employees of Eagle County. EHUs shall be allowed in certain zone districts as set forth in Section 12-13 of this Code. Development standards for EHUs shall be as provided in 12-13 - Employee Housing. For the purposes of this Section, a full-time employee shall mean a person who works a minimum of an average of thirty (30) hours per week. There shall be five (5) categories of EHUs: Type I, Type II, Type III, Type IV, and Type V. Provisions relating to each type of EHU are set 28 forth in Chapter 12-13 - Employee Housing of, this Code." The applicant is proposing 14 two-bedroom Type III employee units for a total of 28 beds. Pursuant to Section 12-13-3(C)(7), Vail Town Code, occupancy of an employee housing unit shall be limited to a maximum of two persons per bedroom. The applicant is now proposing two beds per bedroom and is therefore consistent with the Town's minimum basic requirements for employee housing units. All other standards for employee housing units have been met. Each EHU contains bathroom and kitchen facilities and is approximately 355 square feet in size. 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. These review criteria are addressed in the Special Development District review portion (Section VII) 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 parking areas. These review criteria are addressed in the Special Development District review portion of this memorandum (Section VII). 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. These review criteria are addressed in the Special Development District review portion of this memorandum (Section VII). Please refer to the nine design criteria used to evaluate special development district proposals. B. FINDINGS The Plannina and Environmental Commission shall make the followina findinas before arantina 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. 29 VAIL PLAZA HOTEL WEST LIST OF EXHIBITS EXHIBIT NUMBER DESCRIPTION A Architectural Drawing Reductions B Staff Zoning Analysis C Staff Building Height Correlation Analysis D Staff Adjacent Building Height Analysis E Applicant's Sun/Shade Analysis F Applicant's View Analysis G Staff Parking Analysis H Applicant's Traffic Study I Applicant's Statement of the Request 30 EXHIBIT A ARCHITECTURAL DRAWING REDUCTIONS New Lendxepa MMi® / j~+1]7.(1') / x Exit Only Sign - / eis fiep 2Z ' \ - 1 Paw Sid -E tPaleI]31 1+173) •,••r.......... - ..C , Snonmcll~A Sideae@ e,(w]j'/ 'nnRLi a ~I%'/yam I ..P.il Only' Sip . 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E) El El F-1 El EJ E] 0 F] 11 E XED L Ej/ u u u -u I~ ?uD m m ~ ' LJ LJ ? ? o W o West ~ Level 5 (212.5') Haza Hi 7LEa--~REd~V~~ AND ASSOCIATES, INC. Vail, Colorado Scale: 1" = 50'-0" ^"°^°m'"~ • nwrw~a • meeor ,.x May 9, 2001 asra+wms nxwalwa,ao T a. e n,uEO,v ~ ue 1 I / I ~ 1 .u+ au, w+ / `L I cw a 1, aw "-U -1 H- -1 - -B H- / ~ I D-JU F-8 F-9 F-10 j oL M ca1~O'f~L -'"'ter 11 Elrvamr Blevamr Labhy Lahby ~p 0 0 0 0~ ~ Mah Cb Qn aC"n Gb Ofb GY] Mah uNE FFFF r„ f,~ ? ? - ID L ? ? ewe ? ? m ocb ? Mechanical ~ 1 V OUR 0 0 / J VaH Naza Hot d e West i Level 4 (202.5') Z H R INC Vail, Colorado Scale: 1" = SO'-0" AND ASSOCIATES, - MIwm May 9, 2001 PJD" I= AVM GGIA. nm ,a ers.+mn nv,wsw.im 77771 -J 4 F'- d -I / H-2 H-13 H-1 H-] H-It H-14 R O El- F-12 F-I) F-14 Elevala vV n F-1 Lobby Lobby F.1 110 H. F-7 m.h K7l] [YY! Kn Cb ari CC17 Mmh A - F M1I F~q AS FNi S O -20 1{.1 ~1 I 0" !1~ ® Mc - t~1: ~ H-1 -l9 _ 0 E ML ° I--II+.IUIr Bm~ 1 Eleven, lbby I~ aoo nn m mn V I )IIIIIIIIII~ I I [ j o-~ Va H Naza HoW ° West U Level 3 (192.5') AND ASSOCIATES, INC. Vail, Colorado Scale. 1 11 = 50'-011 PI •wr4 ~ nM May 9, 2001 is s~al+wmo rnxlmsw~m ~ I I I ~y v J/ kY 1.L Liu Y,Y kF+ LlL Llx1 Ov0 01'70 H-2 H-12 H-1 4-7 H-8 H-I4 Q / I O lJ I~ F-17 F-I8 F-19 Elevator Lobby Mah. QU ft-n [Cb COD e[7] Ora Cna Man. .27 12 ~P6 ~2P X49 L .,b L~u .7 p 8 -26 H-I 8 -~_-MOIp1}y LLO .24 Lobby Mid .y H•22 ,a y -20 H-19 Mud Lobby ML O P \J tlIIb I N I D- ny; d.7 I I ~ f.1L ML M1H. ML Ma b 0 aoo I~ 1 L - o 0 \ u u u U~ e West ~ Level 2 (182.5') L ~ ~Naza H ®t ZEHREN X10 AND AssoCIATI3 INC Vail, Colorado Scale: 1" = 50'-0" MCHMEM 88 - KNOMW - MIAORI May 9, 2001 PA" IM A%V%CM M0 MW n s "aw FNls7s+w,ao 4~w~ m Iaara,r,r ux[ ~l IaE - \ 1!!! . Ham- ~ -~H i - L-- --I .w ----r t y---- oaa~Be H-2 H-II -7 H -5 H -7 H- -9 H-12 U-u p1 O 1 1 1 R^ ~ O Elevamr ~ Lobby - .3 H. '1" H-1 .35 -3 Lobby VVVV F \ V Meth Merle (17fYf KY, l~ H-13- Q .22 I v -29 _~I,IOFAry Lm ^OFeo b Below B .28 III----{~I - I I H-u n~II -23 PT-.; ua 1 a - o -n I:X Lobby ' - Lobby as 2 Lbby F-2 Z CCU 0c)(0)" cca CGO I \1QQ Q~~ 11 Mechanical .I -000 • Ratl 0 E) 03 09 L Va 0 Naza Hotd ° West Level 1 (172.5') ZEHREN AND ASSOCIATES, INC. Vail, Colorado Scale. 1 - 50'-011 AaOaII RW . MANWO - N'== May 9, 2001 .Haul ,fll Awl. 0OWa1BD mm ,d oA/ mw M%a/411L1aO - - 1 Loading Dak \ H-2 ORa OR H-I s 1 Front Desk C-d- ~w O LaMry I I r TI I H-3 F27 HJ r 'O 1 r I~_ J~ EASEMENT t. I • PROM M LLY LI-U 0 -2g J x Lnnhy - po F-29 7 e } fj F-M F-31 F-33 u a o o Mechanical / P3 V IIII ~ - CCO C~ L 0 Q Nana Hote o West ~ Level 0 (162.5') ZEHREN AND ASSOCIATES, INC. Vail, Colorado Scale: 1" = 50'-0" ,MC.IR,UR • FL « -m May 9, 2001 PD I- •WK CMDWO nm m sTS. ruu7s..,m PRaoP„vr.r - twoamta,~~ - F - - - - - - - - - `Ygrkm I ~ R TDax Service Condor Be- 2% _ Meehan' I i ® I M-h..icd \ Lim Cmm E2 _1 .G Ballroom Below I 1 E6 E-5 x +5 Ramp E-A x 1 6.P eT Im 7 Open to Paol Bebw © E 9 I I PRPPERTI' ® Prt-CunveM Below ~ (fff I ® ' Mine ' ~1 n E1 - E-11 ® Vea~ibule Raail PRpPt],n. {YC cm % lope I.ISn, '•,s'~ E-1 St., ~ Realaunnt - . - E-I Retail Ski Stange 1 .P \ I 1 J © KimM1en I \ 4 E-1 I SW' up F-34 ki. ~ p g g Re p p 2%$ s R F-33 F-36 - FJ] `a •t.~n SP"eaMClub 4 „~e 0 Up Up 0 Mech \ \ a, tin Cj03 I S CID -1 vl•Inn.f, F-3 Jo lasx1 VIN' ~ - F-l9 Q-n 07D a 0 O ° Q Naza otd West Level -1 (152.5') ZEHREI\~ AND ASSOCIATES, INC. Vail, Colorado Scale: 1" = 50'-0" ".Omm rt - PtA,Na6 -'mm m May 9, 2001 Pn m Im'g AM4 m10RPDtg 1"m miengs racsngtwr5em ` _ ~ {ry' Puking ~k (Ia2S) R2'4 Slope (I57.5)>.{~ \ Smice Corridor B.11- I \ \ / 1 M 1 /Vs.~ 1 M Sbmge \ d Receiving?rash Stm.gc I I \ 1 IVII - ~ I I B.1lmom I II ~J EL r I I ELobby II - - Fond end Bevmge Storage CartiMr I I C..idor JI LF ~ - IIIIIIIIII ~.•,mr we r PreConve= M I M I I I M I ~ ^ROPOrr; Mein Kitahm Breakmu I Breakma I Breakout I Bmkout I Brnkout I Brnkout Condor I I I I I I \ ZLL I I I ~N I 1 \ \ / \ / \ w w w \ \ ^`7" I Service Corridu Neelthclub ~ I M \ \ ELr cmm~. ogee \ \ Employee unge Shop \ \ J Rehm C.r-d. E~mpb t Nouttkeening Landry Engi-ing Mechaninl Pl.nt R mtr - P \ J I Lnckm Lockers (I54.0' \ '0 Mm's Women's M ^8 Sbrege - ~ Rhsti om wom ~ \ ~ \ \ M PekinUg NeaUAclub ..p 2% S1. > \ a (147.51 -----2 _ - - - - - - - - - - - - P8q'QT} L Level -2 (142.5') ~ ~o--~~ ~ ~ V~l 0 ~ FlX17~1 H®~(~ 0 ° West U _ AND ASSOCIATES, INC. Vail, Colorado Scale.. 1 - 50'-011 ARMVrWfW - PLAWOM -'"em° May 9, 2001 1a IM AVOK aotaaoo nos ,s Irm,R.mn PAxblawlwm MIOPFAIY IK HIIaPFRIY 11L r 1I op 2.a) a Rj- (142.5) So, ~I x lix ' R-P Up 12% Slope F-82 ~ slop s~pn ` F 1 a rF F-2 V-1 V-22 VJ3 V-61 F83F-3 V-23 VJ V-65 Sfi I F-94 FJ V A-1 A-2 V-3 V-66 F.37 11(A-33 4 F-83 One Wry Om Way V-24 V-45 One Wry One Wey F-5 V> V-25 V< Vfi 1-e6 1 Jf,') I V-5 V-26 V47 V.68 A F-82 F-7 C-1 V-6 V-27 V49 V-69 C-3 I GS F-88 FB F-24 F-17 V-7 V-2H V41 V-70 F-58 F.70 F-89 F'9 F-25 F. V-8 V-29 V-50 V-71 F-59 F-71 F-911 E4 ME., I~NC F-10 _ F-26 F-39 VA V-30 V-51 V-72 F-60 F-72 F-91 MIOPO17y 111 R11 pM Wey F-27 F-40 One Wry V-10 V-71 V-52 V-73 One Wey F-61 F-71 One Wry F-92 F-12 F-28 FJl V-II V-32 V-53 V-74 F-62 F-74 F-93 F-13 F-29 F42 V-12 V-13 V-54 V-7S F-63 pp ))33 F-94 /1J1.5'1 112751 x(128.5') ..1Y 1... F-14 F-30 F43 V-17 V-31 V-55 V-76 F-64 F-76 F-95 F-IS F-44 V-14 V-J5 V46 V-77 F-65 F-77 F% F-16 F-45 V-IS V-16 V,7 V-79 F'" F-78 F-97 717 F-31 F-46 V-16 C-4 C6 F-98 V-37 V-59 V-79 JU R Down 99 F-32 F47 F- 'a V-17 V-76 V-59 V-80 ~Slape F F-19 F-13 FJR V-18 V-39 V-60 V-el F-100 f FM One Way F-M F49 On Way V-19 V40 V41 V-82 p Wey F-67 F-79 O Wry FA01 MecHenical 1 F-21 (V1 F-35 F-50 4 V-20 V41 V42 V43 ~ F-68 F-80 ~ F 102 F-101 II F-105 F-IO6IF-107 F-22 F-69 F-81 F-36 1-51 V-21 V42 Vfi1 V-84 F-10J V _ _ no m O ay _ F 21 b ~ II c~ F-52 V C-7 C-8 Sa d nd G-m 1--l lm F. V-85 V-17 I F.:: V46 VISO TT. C-9 C-10 C-II C-12 C43 C-Id C-15 C-16 C-17 C-18 %Sly x035.09 7%ShOK 0.3.59 •1Hmgn. ~ L H Naza HoW e West U Level -3 (132.5') ZEHREN AND ASSOCIATES, INC Vail, Colorado Scale. 1 - 50'-011 HIm.1:,3i • HA MM • Mmm May 9, 2001 n.981foms4 M1181981w84s0 EXHIBIT B STAFF ZONING ANALYSIS Exhibit B Zoning Analysis Vail Plaza Hotel West (Deviations from underlying zoning are indicated in bold type) February 12, 2001 May 14, 2001 Development Criteria Allowed/Reauired Proposed SDD Prooosed SDD Lot Area: 101,140 sq. ft.. 101,140 sq. ft. 101,140 sq. ft. GRFA: 150% / 151, 710 sf* 150% or 151, 710 sf* 150% or 151,696 sf* Dwelling units per acre: 25 du/acre or 58 d.u. 7.33 du/acre or 17 d.u. 6.47 du/acre or 15 d.u. 120 (au) 116 (au) 39 (ffu) 40 (ffu) 17 (du) 15 (du) Site coverage: Above grade: 65% or 65, 741 sq. ft. 62.4% or 63, 116 sq. ft. 57.9% or 58,522 sq. ft. Below grade: 65% or 65, 741 sq. ft. 76.0 % or 76,821 sq. ft. 76.3% or 77,219 sq. ft. Min. Setbacks (above grade): Frontage Road: 20' 0' 0' Vail Road: 20' 20' 16' West Side: 20' 21' 20.0' W. Meadow Drive: 20' 20' 20.5' Min. Setbacks (below grade): Frontage Road: 20' 15.75' 8.5' Vail Road: 20' 4.75' 4.5' West Side: 20' 8.75' 16.75' W. Meadow Drive: 20' 19.5' 2.5' Max. Height: 48' sloping 77.5' sloping 73.0' sloping (North Wing) 60' arch. proj. 92.3 arch. proj. 86.5' arch. proj. Max. Height: 48' sloping 60.25' sloping 47.5' sloping (South Wing) 60' arch. proj. 85.25' arch. proj. 64.5' arch. proj. Landscaping: 30% or 30,342 sq. ft. 26.1 % or 26,438 sq. ft. 30.5% or 30,874 sq. ft. Parking: 222 spaces 216 spaces 225 spaces Loading: 3 berths 3 berths 3 berths * this proposal complies with the required 70%130% equivalency requirement for GRFA within the PA zone district. EXHIBIT C STAFF BUILDING HEIGHT CORRELATION ANALYSIS Building Height Correlation Analysis - Vail Plaza Hotel West Northwest Corner (Adjacent to Scorpio) Heiaht Proposed Heiaht Allowed Highest Ridge: 73' 48' Avg. Dormer: 53.5' 48' Eave: 40.5' 48' Arch. Proj.: 86' 60' Southwest Corner (Adjacent to Alphorn) Heiaht Proposed Heiaht Allowed Highest Ridge: 59' 48' Avg. Dormer: 52' 48' Eave: 29.75' 48' Arch. Proj.: n/a 60' Southeast Corner (Adjacent to 9 Vail Rd.) Heiaht Proposed Heiaht Allowed Highest Ridge: 40.5' 48' Avg. Dormer: 34.75' 48' Eave: 16.75' 48' Arch. Proj.: 64.5' 60' Northeast Corner (Adjacent to Amoco) Heiaht Proposed Heiaht Allowed Highest Ridge: 70.5' 48' Avg. Dormer: 49.25' 48' Eave: 36' 48' Arch. Proj.: 82.5' 60' EXHIBIT D STAFF ADJACENT BUILDING HEIGHT ANALYSIS Adjacent Building Heights- Vail Plaza Hotel West "Resort Accommodations and Services" Zone - South Frontaae Road Buildinq Max. Height Zone District/Heiaht Allowed Alpine Standard 25.3' HS/38' Existing Chateau Vail 52.8' (roof); 56.9' (proj.) PA/48' Scorpio 55.2' HDMF/48' West Star Bank Building approx. 54'* SDD-CSC/38' Evergreen Lodge approx. 88'* SDD-HDMF/48' "Transition Area" zone - West Meadow Drive Buildina Max. Height Zone District 9 Vail Road approx. 66.2'* PA/48' Alphorn 32.6' HDMF/48' Skaal Hus approx. 46' (phase II) HDMF/48' VVMC approx. 53'* GU/per PEC First Bank 28' PA/48' Villa Cortina approx. 48'* HDMF/48' Fire Station 42.3' GU/per PEC Meadow Vail Place approx. 52'* HDMF/48' Other Residential Units approx. 33'* R/33' Vail Villaae Zone - east of Vail Road Buildina Max. Heiaht Zone District Gateway 54.8' SDD-CCI/43' Vail Village Inn (VPH East) 77.3' (approved) SDD-PA/48' Sonnenalp (Bavaria Haus) approx. 47'* PA/48' * indicates heights referenced from architectural drawings and town records. All other building heights are referenced from stamped surveys. Of the 17 properties contained in the "context area" (including the existing Chateau Vail), 8 buildings (or 47%) exhibit a deviation in building height. EXHIBIT E APPLICANT'S SUN/SHADE ANALYSIS t A I Z E H R E -N Vail Plaza Hotel - West ~gs°'~u Sun/Shade Diagram Nail` Colorado Summer 2pm i LO i I ~k r I li 1 :I 7 1 I. Z E H R E N ~ 0.N0 SSOCIyT85 !NC Vail Plaza Hotel - West Sun/Shade Diagram Fail. Colorado Summer loam i it tJ J~1 fi 4 II ,I I ` 1 '"*t': J'i zr I. E " E " ANC ASSOCIATES Vail Plaza Hotel - West Diagram ;I w.w ESun/Shade Fail. Colorado Winter 2pm j i I i '~C fi l a. _ 5~a iZI 4• sz' . 1 _ E H.R E N ANC ,tl550 : NC Vail Plaza Hotel - West Sun/Shade Diagram Fail. Colorado Winter loam c Flo I r 1 x Z E H R E N ANO Vail Plaza Hotel - West e-Svx..,. ,,wNSun/Shade Diagram Fail. Colorado Fall 2pm I -miA wi I i i i r _H asocuresr+c 1, Z E H R E N Vail Plaza Hotel - West _ Sun/Shade Diagram ` Vail. Colorado ii _ . _ Fall 10am V EXHIBIT F APPLICANT'S VIEW ANALYSIS t5 3 }Fxv~ 21, .t .vV ~i 3v 3 R . f N I is ! l ::t S :J tl is v C~ a ' awe gar 3 3 9 , \6 s av vFy p. M E R E N rai].i. y' iL.~.ty yAF aHi,3 (fiti.,. g. - West j 3I: .Fronti1r1'.` fl()<` d ((I is E:a.f..f.:ia!<r: tau ;a f ~ 1 ;r 30! 's i •s • v ka s~ : . •i <i * Vail Irlaza Hotel - West West Mcadomv Driv 3 f, d a , rr T n I 2 k{i i . t ' e"aal Plaza Hotel - West Golden Peak Vie ki f _ . _ , F:: y j(jt5 2. ;i ate: _ ,r c „ - ii VAil Plaza Hotel - West Frontagt Road Laai Caloraatdo _ . . s 'i 1 :i i i + ~e ar , , , E + + ` i` ( f H PJ a l:Zc`1 Hotel _ NN,"est Road . a,. : l ii E „ ea r k ~~,y,5,`.:N _ ~k ,vllZa ik e"Yt•~~ s.. ; :i , a: : , z.. La'a , o a ~r Z~iA\w ru 4? b\e`•s a3ya • ''ray .a., . 5~. €:a ~ ~Z ? i.: A~`~ ~ ^,k a wF x~ ~Yao- ~'.^,oxr~c,3~S$<'t~k' ~ .:2'~i+z`~.:a" ,~4 "~A •u~'~ . a v. c~ a a. g.:a,":•;: ~.aakr:. ,•t:~!~>'~"•~.<' ~ t:~:~ ~4ka.<.h:3 ~ti;$:,~: ~ :.,,yr~?v;~ c, c w "a'aci ?.,.cc.,>.:~. "'"~,.,<`Y?: k ~~~'v. ~~w;~k„.` ~ s:. as5wv,. ,,..,<ik: ~ c. o "H.ctSG. :.r.N.s:»a?ra .w...aa,wa,:>, w.c v~s4L.a.~. z'~•.,'S,`,:i:. c.' xM.. . ' ~ ->:a`F'AA~~k'". ~.:x:: .w~~'` 6!?t `a ~:.:>.'w:. v..;YtY;svi > tki € 4 r : Vail Playa doe - West Fronta-e Road i , a t v~ b h"- j' , i~ 2 i; Vail. PIaza Hotel. - West Ggat, Station View t'A, i..aEor:tcto Ii i` E a 'NOMS i : , ~:t f ~ ~ #1NME f; i i H.. CJ F • - all Plaza Hotel - NVest ~ ~f off f, , , S SF€ { . >:ttt"tEi3 f! 3 . . t ~ 10 3 Y g'• 3Y N w { 05 ii , R " a:x WON" Y T r p{ YStA Plaza Hotel. N,* e 7 Golden 1Cii i View EXHIBIT G STAFF PARKING ANALYSIS STAFF PARKING CALCULATIONS VAIL PLAZA HOTEL WEST Parking Use Factor Requirement Sub-total Notes Reduction Sub-total Accommodation Units 116 0.7 81.2 81.2 Fractional Fee Units 40 0.7 28 I 28 Dwelling Units 15 1.4 21 21 Employee Housing Units 14 1.4 19.6 19.6 Restaurant/Bar 1708 1/250 sf 6.832 6.832 Retail 1127.25 2.3/1000 sf 2.59269056 Primarily internal 25% 1.9445179 Conference (Ballroom Only) 10029 1/330 sf 30.3909091 30.390909 Health Club 10015.7 1/300 sf 33.3856667 Leasable Area Credit 15% 28.377817 Spa / Group Wellness - Therapy 3820 1/370 sf 10.3243243 Primarily external 10% 9.2918919 233.325591 226.63714 Staff Total Per Code Recommendation (includes mixed use (includes mixed use credit) 221.659311 credits) 215.30528 (Functional) Parking Proposed 225 spaces MAY 14, 2001 EXHIBIT H APPLICANT'S TRAFFIC STUDY ALPINE ENGINEERING, INC. April 13, 2001 Mr. Greg Hall, P.E. Town of Vail Department of Public Works 1309 Elkhorn Drive Vail, CO 81657 Re: Chateau Vail Access Locations Dear Greg: The purpose of this letter is to make recommendations for the access driveways to the proposed Chateau Vail Hotel based on the revised site plan as requested per Town of Vail PEC. This will include location with respect to other driveways (both existing and proposed), the roundabout, design criteria, full or restricted access, etc. The site is located between South Frontage Road and West Meadow Drive, near the southwest comer of the intersection of South Frontage Road and Vail Road: The existing hotel has 120 rooms, an 80 seat restaurant and 60 seat bar. The revised development plan currently includes a . 116 room hotel, 15 free market condominiums, 40 fractional fee condominiums, 85 seat restaurant, 1,127 sf retail space and a 15,200 sf spa/health club. Use of the health club/spa will be primarily by hotel guests, however spa services (massages, salon, etc.) will be available to the general public on a walkin/reservation basis. The hotel will also have about '14 employee housing units with 28 beds. Existing Conditions: Access to the site is from 3 locations: 1) South Frontage Road via a shared driveway entrance with the existing Amoco service station; 2) the private driveway from Vail Road and 3) the driveway J-Llv.,, West Meadow Drive. 1) Access from the South Frontage Road is provided from a shared entrance with the Amoco (Alpine Standard) service station. The South Frontage Road has two eastbound, two westbound and a middle turning lane adjacent to the site. A third eastbound lane is provided just before the roundabout. The posted speed is 25 mph. A concrete median on the South Frontage Road extends from the edge of the roundabout to the western edge of the entrance, which terminates at the center turning lane. Vehicles exiting I-70 can travel west on the South Frontage Road, make a short u-turn around the median and enter the driveway. It is assumed that only a few vehicles(10%) make this tum to enter the site. This shared entrance is located about 100 ft. west of the roundabout. 2) The second access is a two way driveway from Vail Road, approximately 150 ft. south of the roundabout and about 60 ft. south of the Vail Road access to the Amoco service station. An existing two lane driveway that leads to the parking garage for Vail Gateway is located directly across from the hotel driveway on Vail Road. Proposed plans for development of the parcel Edwards Business Center - 20. Box 97 • Edwards, Colorado 81632 - (970) 926-3373 • Fax (970) 926-3390 south of the Vail Gateway indicate the construction of a 'one-way' exit adjacent to the existing access to the Vail Gateway parking garage. 3) The third access to the site is a two-way driveway from West Meadow Drive located on the western side of the site. We assume that this access is rarely, if ever, used by hotel guests since it is not readily apparent that the hotel parking lot can be accessed from this driveway. Since the majority of vehicles travel on the South Frontage Road or Vail Road, trip rates are expected to be low at this entrance and are not considered in this report. Proposed Conditions: 1) A separate one-way entrance for service vehicles making deliveries to the hotel (approximately four per day) is proposed from South Frontage Road on the western side of the site, approximately 130 ft. west of the Town of Vail Municipal Center entrance and 300 fl. west of the Amoco access. This access drive will parallel South Frontage Road along the front of the hotel and connect to the existing shared access at the Amoco service station. Vehicles will only be permitted to make a right (eastbound) turn from the Amoco access onto South Frontage Road. It is proposed to extend the existing median on South Frontage Road approximately 100 ft to the west to prohibit left turns in/out of the shared Amoco access. 2) The existing driveway from Vail Road is proposed to be one-way in (right turn only from Vail Road), and will be used by hotel guests to enter the property. Vehicles will exit onto South Frontage Road via the shared access at Amoco. 3) The existing driveway onto West Meadow Drive will be closed. References and Assumptions: The Institute of Traffic Engineers (ITE) "Trip Generation" publication (6 h edition) has been used . to determine average vehicle trip ends (AVTE) for the existing and proposed conditions. As various uses will be considered in this analysis, the "peak hour of adjacent street traffic" has been used to determine traffic volumes Using the "peak hour of generator" could give false results since the timing of peak traffic can vary for a given use. Two time periods are thus analyzed, 7 am - 9 am and 4 pm - 6 pm as outlined per ITE. The ITE publication provides various land use options for hotel-type establishments. This report will consider the existing and proposed hotel as a "Resort Hotel", land use 330 per ITE. As described in the manual, "Resort Hotels are similar to hotels (land use 310) in that they provided sleeping accommodations, restaurants, cocktail lounges, retail shops and guest services. The primary difference is that resort hotels cater to the tourist and vacation business, often providing a variety of recreational facilities, rather than convention and meeting business. Resort hotels are normally located in suburban or outlying locations on larger sites than conventional hotels." It was assumed that this project fits the above description. The trip generation per room tends to be less for a "resort hotel" than for a "hotel" and given the location of the site, this should be true for this project. Since the hotel is within close proximity to the various attractions in Vail, it would be expected that the majority of guests will walk or use the free public transportation, thus generating less vehicle volumes than a typical hotel where guests would normally have to drive to attractions. The description of a resort hotel (as well as a hotel) includes restaurant, cocktail lounge, retail shops, etc. Based on this description, this report will include the proposed restaurant, bar, etc. in the traffic generated by the resort hotel, and does not break these out separately in determining traffic volumes. It is to be noted that the ITE description does not specify square footages, seating, etc. for each auxiliary use in relation to the number of hotel rooms. The manual does not provide data for trips generated on weekends, only weekdays, as we have previously discussed. This land use is also used to determine the trips generated by the employee housing units since there is no "employee housing unit" or similar category in the ITE manual. Thus, the AVTE vs. Employees chart is used, although this value should be conservative as it determines all trips generated by the hotel, not just those by employees. The proposed development will also have 15 free market condominiums and 40 fractional fee condominiums which are designated as "High-Rise Residential Condominium/Townhouse" Land Use 232 per ITE to determine trip rates. This designation was chosen since the description best matches the proposed development. The proposed health club/spa is identified under land use 493 (Health Club) in the ITE manual. It should be noted that only one observation was used in the ITE study, thus the data extrapolated should be used with extreme caution due to the small sample size. Additionally, the ITE study for health clubs was based on square footage of floor area and not on the number of members. Since the club will be used primarily by hotel guests and is not a "stand alone" facility but part of a hotel complex, it is difficult to determine actual vehicle trips. An on-site traffic count has not been conducted for this report. Vehicle trip ends were estimated using the values for each land use as provided by ITE. The percentage of vehicles entering the site from any given direction has been assumed and is not based on actual observations. The assumed percentage for each direction is indicated along the turning movement arrow on the accompanying diagrams. Existing Average Vehicle Trip Ends: I Peak hour* Peak hour* 7am-9am 4pm-6pm Land Use # rooms Total Enter Exit Total Enter Exit Resort Hotel 120 37 27 10 51 22 29 Gas Station i 5 pumps ! 61 31 30 73 37 36 Total 98 58 40 124 59 65 Proposed Average Vehicle Trip Ends: Peak hour* Peak hour* 7am-9am 4pm-6pm Land Use Units Total Enter Exit Total Enter Exit Resort Hotel 116 rooms 36 26 10 49 21 28 Employee 28 beds 4 3 1 7 3 4 Housing Deliveries ' 1 truck 6** 3 3 6** 3 3 Condo/Timeshare 55 units 19 4 15 21 13 8 I Health Club , 15.2 ksf I 5 2 3 65 40 + 25 Subtotal - Site 70 38 ! 32 148 80 + 68 Gas Station 5 pumps ! 61 31 30 ` 73 37 36 Total 131 69 62 221 117 104 * Peak Hour of Adjacent Street Traffic Assumes that one delivery truck enters and exits within the peak hour. Auxiliary Lane Requirements: Frontage Road Per the 1998 State Highway Access Code Section 3.13, South Frontage Road is category F-R (Frontage Road). The posted speed limit is 25mph. Section 3.13 of the State'Highway Access Code states that auxiliary lanes are required as follows: 1) A left turn lane with storage length plus taper length is required for any access with a projected peak hour left ingress turning volume greater than 25vph. Existing left turn DHV from South Frontage Road into the existing shared entrance is estimated at 6. The one-way entrance drive on the west side of the property is for service vehicles only. . Since the DHV = 1 (or up to 3 pce's), a left turn lane is not required. However, approximately 155ft is available in the existing turn lane (which can be used for deceleration and stacking) from the end of the proposed median to the new entrance. 2) A right turn with storage length plus taper length is required for any access with a projected peak hour right ingress turning volume greater than 50vph. Existing right turns from South Frontage Road are estimated at 18. Proposed right turns are estimated to be 1 (or up to 3 pce's) at the hotel and 15 at Amoco. A right turn lane should not be required. 3) A right turn acceleration lane with taper is required for any access with a projected peak . hour right turning volume greater than 50 vphwhen the posted speed on the highway is greater than 40 mph, and the highway has only one lane for through traffic in the direction of the right turn. A right turn acceleration lane is not required on multi-lane highways of this category. Since South Frontage Road is multi-lane with a posted speed of 25 mph, a right turn acceleration lane is not required. 4) A left turn acceleration lane with transition taper may be required if it would be a benefit to the safety and operation of the roadway or as determined by subsection 3.5. A left turn . acceleration lane is generally not required where: the posted speed is less than 45mph, or the intersection is signalized, or the acceleration lane would interfere with the left turn ingress movements to any other access. South Frontage Road has a posted speed of 25 mph. No left turns are proposed from the project, thus a lane should not be required. Subsection 3.5 of the State Highway Access Code states: The auxiliary lanes required in the category design standards may be waived when the 2& year predicted roadway volumes conflicting with the turning vehicle are below the following minimum volume thresholds. The right turn deceleration lane may be dropped if the volume in the travel lane is predicted to be below 150 DHV. The left turn deceleration lane may be dropped if the opposing traffic is predicted to be below 100 DHV. The right turn acceleration lane may be dropped if the adjacent traveled lane is predicted to be below 120 DHV. The left turn acceleration lane may be dropped if the volume in the inside lane in the direction of travel is predicted to be below 120 DHV. Summary Table* For Relocated Frontage Road Access South Frontage Road Allowed per 3.13 Current/Projected Lane Req'd per 3.13 Left Decel 25 6/3 (pce's) N Right Decel 50 18/3 (pce's) N Left Accel N/A 1410 N Right Accel N/A 32/90 N *The information contained in the summary table with regards to existing and proposed vehicle trips is based solely on ITE "Trip Generation" publication for specific land use as previously described in this report. Turning movements are estimates and not based on actual field observations. The Current/Projected movements include hotel and gas station trips. Recommendations/Conclusions: (also addressing comments presented during the Town of Vail PEC meeting held on 2/12/2001.) 1. South Frontage Road Access The one-way entrance from the Frontage Road should only be used by service vehicles. Section . 4.3 in the State Highway Access Code discusses sight distance along the highway and at access points. Minimum/design site distance along the South Frontage Road is 150 ft. (based on 25mph posted speed). Section 4.4 states that each access should be separated at a minimum by a distance equal to the design sight distance, in this case 150 ft. The current plan indicates that the proposed entrance (located on the westernmost portion of the property) is separated from the entrance to the Amoco service station by approximately 300 ft and 130 ft from the Town . of Vail Municipal Center entrance (centerline distances). The existing median on the South Frontage Road should be extended approximately 100 ft to the west to the Town of Vail building entrance. This should reduce any conflicting movements adjacent to the roundabout for vehicles travelling west and provide for better traffic flow on South Frontage Road. 2. Vail Access Road: The access from Vail Road should be a'one way in' driveway, used by hotel guests. This is consistent with information obtained from the PEC. Providing "one-way in" should also limit the conflicting turning movements on Vail Road if the proposed 'exit-only' access is constructed adjacent to the Vail Gateway driveway. Use of this access by hotel guests only (and directing service vehicles to the Frontage Road access) should reduce disturbance to the Nine Vail property and address the safety concerns voiced by Alpine Standard regarding service vehicles backing up adjacent to the service station to access the loading dock area. 3. West Meadow Drive Access: This driveway will be closed. We also recommend that a copy of the site plan, showing the proposed access revisions, be forwarded to the owner of the Amoco service station and Town of Vail Fire Department for their review and comments. Please feel free to contact us if you have any questions or to discuss this matter further. Sincerely, Frederick E. Tobias, PE Enclosures Cc: Waldir Prado Tim Losa %1\1401 ?e3 ~x+sr ~ N c= l- . use of AAA T¢A Ho'~~V~ ~-RAtri ~ ~ -,AS r 4-~Pm 'To-rA L Plm ~D Ip~O guI~.o~N~S Z _ Iz .L0~0 Z59. 5 b 40 L VIC ~ i/ «.r- - t ii i=-- _f`~•w ( TL "o, •F~GE OA APO,, " ~M0 Lp Zt- = n L. S- _ N ~r ~ n - .i•~`__~~. _ ~ • ~ `'',fir, - - V1`o Posen Lotwo vT1Dt,~\ - . \11. fool Rm -Twrm- PEPuc. Ho~,~z o~ ADsPicr~i i2AF~1C_ Q~ %Pj.rTrct/EY~T ~ RM S~Rw~~csly GAS ~tRT\DN I 1'~bbE~1 E1JT TOWN OF VAIL MUNICIPAL CENTER L-4 IA O,'a._ 1 / \ Am - 1-9 Am 9 \ ?m - 4 -loPm - Ap ~ EX. TURN LANE _ SOV111 \s- 15 3 40 ~I I ! EX. AMOCO STATION I~ L__1 ' i III) ~ I • ' PROPO EI TEL I I~~I I ~ - I ' ,1 v J ~ I L I I I~ EX. DRIVEWAY \ TO BE CLOSE D \ WES Tr- 0 o Resort Hotel -(330) Average Vehicle Trip Ends vs: Rooms On a: Weekday, Peak Hour of Adjacent Street Traffic, One Hour Between T and 9 a.m. Number of Studies: 7 Average Number of Rooms: 504 Directional Distribution: 72% entering, 28% exiting Trip Generation per Room Average Rate Range of Rates Standard Deviation 0.31 0,24 - 0:41 0.57 Data Plot and Equation 400 X 300 w ; a m j 200 ...........:X.......... ~j,...... m ro X: Q X 100 X ...X X . 0 1 I I I i 1 300 400 Soo 600 700 Soo S-00. X = Number of Rooms X Actual Data Points Fitted Curve Average Rate Fitted Curve Equation: T = 0.395(X) - 40.786 R2 = 0.75 Trip Generation, 6th Edition 586 Institute of Transportation Engineers Resort Hotel (330) Average Vehicle Trip Ends vs: Rooms On a: Weekday, Peak Hour of /adjacent Street Traffic, One Hour Between 4 and 6 p.m. Number of Studies: 10 Average Number of Rooms: 495 Directional Distribution: 43% entering, 57% exiting Trip Generation per Room Average Rate Range of Rates Standard Deviation 0.42 0.19 - 0.51 0.65 Data Plot and Equation Soo :x 400 c a 300 ~X... F- 2 200 X; X . X :X i' X 100 X 0 100 200 300 400 500 600 700 E00 Soo X = Number of Rooms X Actual Data Points Fitted Curve Average Rate Fitted Curve Equation: Ln(T) =1.437 Ln(X) - 3.621 R2 = 0.93 Trio Generation, 6th Edition 587 Institute of Transportation Engineers Resort Hotel (330) , Average Vehicle Trip Ends vs: Employees On a: Weekday, Peak Hour of Adjacent Street Traffic, One Hour Between 7 and 9 a.m. Number of Studies: 4 Avg. Number of Employees: 818 Directional Distribution: 69% entering, 31 % exiting Trip Generation per Employee Average Rate Range of Rates Standard Deviation 0.15 0.11 - 0.34 0.39 Data Plot and Equation Caution - Use Carefully - Small Sample Size 200 190 160 170 ..............X 160 . , 150 tj d 140 m 130 - - V 7 120 . 110 , cc ; Q 100 t- 90 x . 80 70 60 50 ' • . 40 200 300 400 500 600 700 800 900 1000 1100 1200 1300 X = Number of Employees X Actual Data Points Fitted Curve Average Rate Fitted Curve Equation: T = 0.066(X) + 69.519 R2 = 0.87 Trip Generation, 6th Edition 582 Institute of Transportation Engineers . Resort Hotel (330) Average Vehicle Trip Ends vs: Employees On a: Weekday, Peak Hour of Adjacent Street Traffic, One Hour Between 4 and 6 p.m. Number of Studies: 4 Avg. Number of Employees: 818. Directional Distribution: 40% entering, 60% exiting Trip Generation per Employee Average Rate Range of Rates Standard Deviation 0.25 0.10 - 0.73 0.53 Data Plot and Equation Caution - Use Carefully - Small Sample Size 400 300 ~ : ; ; . C, F- 200 X . . X . 100- 0 200 300 400 500 600 700 Boo 900 1000 1100 1200 1300 X = Number of Employees X Actual Data Points Average Rate Fitted Curve Equation: Not given R2 = Trip Generation, 6th Edition 583 Institute of Transportation Engineers High-Rise Residential Condominium/Townhouse (232) Average Vehicle Trip Ends vs: Dwelling Units On a: Weekday, Peak Hour of Adjacent Street Traffic, One Hour Between 7 and 9 a.m. Number of Studies: 4 Avg. Number of Dwelling Units: 543 Directional Distribution: 19% entering, 81 % exiting Trip Generation per Dwelling Unit Average Rate Range of Rates Standard Deviation 0.34 0.31 - 0.48 0.59 Data Plot and Equation Caution - use Carefully- Small Sample Size 500 . . . 400 . N W 300 U : o~ 200 : . X 100 x- o-, 100 200 300 400 500 600 700 800 900 1000 1100 1200 1300 1400 1500 X = Number of Dwelling Units X Actual Data Points Fitted Curvo Avera; Rate Fitted Curve Equation: T = 0.288(X) + 28.861 R2 = 0.98 Trip Generation, 6th Edition 395 institute of Transportation Engineers High-Rise Residential Con doffii n! urn/Townhouse (232) Average Vehicle Trip Ends vs: Dwelling Units On a: Weekday, Peak Hour of Adjacent Street Traffic, One Hour Between 4 and 6 p.m. Number of Studies: 5 Avg. Number of Dwelling Units: 444 Directional Distribution: 62% entering, 38% exiting Trip Generation per Dwelling Unit Average Rate Range of Rates Standard Deviation 0.38 0.34 - 0.49 0.62 Data Plot and Equation Caution - Use Carefully- Small Sample Size 600 . . . . . 500 C 400 j 300 C13 F! 200 X 100 . . . . . . . . . . . . . ,".X + ' __r_-_r~ I + 0-1 0 100 200 300 400 500 600 700 800 900 1000 1100 1200 1300 1400 1300 X = Number of Dwelling Units X Actual Data Points Fitted Curve Average Rate Fitted Curve Equation: T = 0.342(X) + 15.466 R2 0.99 Trip Generalion, 61h Edition 396 Institute of Transportation Engineers Land Use: 493 Health Club Independent Variables with One Observation The following trip generation data are for independent variables with only one observation. This information is shown in this table only; there are no related plots for these data. Users are cautioned to use these data with care because of the small sample size. Trip Size of Number Generation Independent of Indeoendent Variable Rate Variable Studies Directional Distribution 1,000 Square Feet Gross Floor Area Weekday A.M. Peak 0.30 43 1 46% entering, 54% exiting Hour of Adjacent Street Traffic Weekday P.M. Peak 4.'30 43 1 61 % entering, 39% exiting Hour of Adjacent Street Traffic Weekday A.M. Peak 0.30 43 1 46% entering, 54% exiting Hour of Generator Weekday P.M. Peak 4.30 I 43 1 61 % entering, 39% exiting Hour of Generator - - - -1-r- ,en^rfannn Fnnineers Gasoline/Service Station (844) Average Vehicle Trip Ends vs: Vehicle Fueling Positions On a: Weekday, Peak Hour of Adjacent Street Traffic, One Hour Between 4 and 6 p.m. Number of Studies: 18 Average Vehicle Fueling Positions: 8 Directional Distribution: 51 % entering, 49% exiting Trip Generation per Vehicle Fueling Position Average Rate Range of Rates Standard Deviation 14,56 5.00 - 27.33 6.70 Data Plot and Equation 220 210 . 200 190 180 • X , 170 C 160 z W - CL 150 d 140 j 130 rn 120 ............X. > 110 . F 100 90 80-1111, .........X ........................................................70 60 50 .......................X............ 40 6 7 8 9 10 11 12 X = Number of Vehicle Fueling Positions X Actual Data Points Average Rate Fitted Curve Equation: Not given R2 = Trip Generation, 61h Edition 1459 `J Institute of Transportation Engineers Gasoline/Service Station (844) Average Vehicle Trip Ends vs: Vehicle Fueling Positions On a: Weekday, Peak Hour of Adjacent Street Traffic, One Hour Between 7 and 9 a.m. Number of Studies: 12 Average Vehicle Fueling Positions: 8 Directional Distribution: 51 % entering, 49% exiting Trip Generation per Vehicle Fueling Position Average Rate Range of Rates Standard Deviation 12.27 7.33 - 17.50 4.36 Data Plot and Equation 150 140 130 ............X 120 W 110 .a 100 90 ,s.......?C............ q 80 F-- 70 , 60 50 , 40 , I I I I I 6 7 8 9 10 11 12 X = Number of Vehicle Fueling Positions X Actual Data Points Fitted Curve Average Rate Fitted Curve Equation: T = 9.810(X) + 18.865 R2 = 0.51 Trip Generation, 6th Edition 1458 Institute of Transportation Engineers EXHIBIT I APPLICANT'S STATEMENT OF THE REQUEST Z E H R E N AND ASSOCIATES, INC. May 8, 2001 Mr. Brent Wilson Town of Vail Department of Community Development 75 South Frontage Road Vail, Colorado 81657 Re: Vail Plaza Hotel - West Brent: This letter is to address design criteria A through I as outlined in section 12-9A-8 of the town code. It is the applicant's understanding that these nine criteria are to be used in evaluating the merits of the creation of the new Vail Plaza Hotel-West Special Development District. A. Compatibility: Design compatibility and sensitivity to the immediate environment, neighborhood and adjacent properties relative to architectural design, scale, bulk, building height, buffer zones, identity, character, visual integrity and orientation. The proposed hotel is designed in such a way that is both compatible and sensitive to the immediate environment, neighborhood, and adjacent properties while at the same time giving the project an identity as a commercially viable hotel project within both the immediate neighborhood and the community at large. The predominant orientation of the proposed hotel is toward the pedestrian areas along the southern edge of the site. Public, pedestrian oriented functions including the predominant pedestrian entrance to the hotel, spa, conference facilities, retail area, and the restaurant have been located along West Meadow Drive. Additionally, this area also has the largest setbacks, greatest amount of landscaping, and lowest building heights in order to in order to relate to the existing buildings along East and West Meadow Drive, maintain a comfortable pedestrian scale, and to provide for a transition to the smaller scale residential properties to the south. In order to create this transition and buffer zone along West Meadow Drive, the greatest density and subsequent height for the hotel have been located along the South Frontage Road along the northern edge of the site. The building height in this area, although exceeding the underlying zoning, directly relates to the heights of existing and proposed structures east of Vail Road. The intent is to create a "gateway" to the village, as structures would step up to similar heights on either side of Vail Road. Other proposed buffer zones are also consistent with or exceed the underlying zoning in that they meet or exceed the minimum required property line setbacks and coverage requirements. Increased setbacks and landscaped screening have also been proposed along the eastern portions of the site to minimize the impacts of vehicular circulation on neighbors. The mass and bulk of the proposed hotel, as determined primarily by the prescribed setbacks, site coverage, landscape coverage, and gross residential floor area requirements within the town code, all conform to the underlying zoning. It is the belief of the applicant that because it is the underlying zoning which determines the building envelope for any given site, and because the proposed project complies with these portions of the underlying zoning, it is the intent of the Vail Comprehensive Plan that a hotel of this size, density, mass, and bulk is intended this site. Furthermore, the site's location, proximity, access to main thoroughfares, and prescribed uses, help to lend credence to this belief. ARCHITECTURE- PLANNING•INTERIORS* LANDSCAPE ARCHITECTURE P.O. Box 1976 • Avon, Colorado 81620 • (970) 949-0257 • FAX (970) 949-1080 Vail Plaza Hotel Zehren and Associates, Inc. 961070.00 5/8/01 The architectural design, character, and visual integrity of the proposed hotel with other structures within the community is meant to be both compatible with the immediate neighbors while at the same time relating to some of the larger, more recent hotel projects east of Vail Road. The project has been designed with stepping and broken ridge lines, variations in building materials, and varied wall and deck planes acting to break down the overall mass and bulk of the project, add pedestrian scale and interest, and relate the hotel to the surrounding neighborhood. B. Relationship: Uses, activity, and density, which provide a compatible, efficient and workable relationship with surrounding uses and activity. The uses, activities and densities are consistent with those listed within the underlying zoning. C. Parking and Loading: Compliance with the parking and loading requirements as outlined in Chapter 10 of this Title, (Zoning). The proposed parking and loading facilities are in compliance with the requirements of the zoning title, adopted town standards, and staff policy/requirements. D. Comprehensive Plan. Conformity with the applicable elements of the Vail Comprehensive Plan, Town policies and Urban Design Plan. The proposed development substantially complies with applicable goals and policies as expressed in both the Streetscape Master Plan and the Land Use Plan. The Land Use Plan identifies portions of the site as both "resort accommodation and service" and as "transition". As such, the plan recommends activities and uses consistent with the underlying zoning aimed at accommodating the overnight and short-term visitor. As such, the uses and functions are oriented in order to maintain a clear separation between the vehicular orientation of the resort accommodation zone along the South Frontage Road and the pedestrian orientation of the transition zone along West Meadow Drive. The proposed improvements to the South Frontage Road, Vail Road, and West Meadow Drive conceptually comply with the applicable elements of the Streetscape Master Plan by providing improvements in the materials, configurations, and sizes as indicated in the plan. E. Natural and/or Geologic Hazards: Identification and mitigation of natural and/or geologic hazards that affect the property on which the special development district is proposed. We believe that there are no natural or geologic hazards that may affect the development of this site. F. Design Features: Site plan, building design, and location and open space provisions designed to produce a functional development responsive and sensitive to natural features, vegetation, and overall aesthetic quality of the community. The proposed building location, site plan, building design, and open space provide for a functional and efficient, full service, conference hotel that is both responsive to the location and circulation patterns within the town, orientation of the site, and aesthetic quality of the immediate neighborhood and the cuLiu..anity at large. 2 Vail Plaza Hotel Zehren and Associates, Inc. 961070.00 5/8/01 Because of the proposed hotel's location within the town and proximity to the main Vail roundabout, the project's impacts on existing traffic volumes and infrastructure will be minimal. The site plan and building design further minimize impacts by simplify existing traffic patterns into one-way, right turn patterns. In addition, the site plan and building design improve upon the aesthetic quality of the immediate environment, especially with regard to the pedestrian orientation along West Meadow Drive, through the elimination of vehicular traffic, the provision for additional open space and landscaping, and provisions for public improvements and infrastructure including public plazas and artwork. G. Traffic: A circulation system designed for both vehicles and pedestrians addressing on and off-site traffic circulation. The proposed a pedestrian and vehicular traffic circulation system provides for minimal impact on existing infrastructure through the limitation of multiple turning movements and simplification of traffic patterns, while at the same time providing a safe and efficient means of circulation through an effective separation of guest vehicles on Vail Road, service vehicles on the South Frontage Road, and pedestrian systems on West meadow Drive. In addition, the proposed traffic patterns and improvements would have no impact on existing easements held by neighboring properties and would allow neighboring properties to exercise full use of their rights. Furthermore, the traffic patterns proposed for the hotel would eliminate all vehicular circulation on current easements held by the hotel across both Nine Vail Road Condominium and Alpine Standard property. H. Landscaping: Functional and aesthetic landscaping and open space in order to optimize and preserve natural features, recreation, views, and function. The proposed landscape design provides for an effective and aesthetic buffering of vehicular circulation and service areas, for the privacy and shading requirements of private residential areas, and for pedestrian scale and interest in and along the public areas of the proposed hotel development. There currently exist no significant natural features, recreation, or functions, public views to be preserved or enhanced on, from, or over this site. I. Phasing Plan: Phasing plan or subdivision plan that will maintain a workable, functional and efficient relationship throughout the development of the special development district. The development will be constructed in one phase. It is also the applicant's understanding that in addition to demonstrating compliance with the nine criteria above, that it is the applicant's responsibility to demonstrate that, "any adverse effects of the requested deviation from the development standards of the underlying zoning are outweighed by the public benefits provided". The following is a list of the proposed deviations from adopted development standards, adverse effects, and proposed mitigation measures as proposed by the applicant as well as the perceived public benefit's derived from the project: Deviations from Develonment Standards - Adverse effects/Mitigation Measures (1) • Building Heights - Impacts from this deviation include increased shading on the South Frontage Road public right of way and impacts on views to the south from that right of way. Public and private benefits derived through implementation of this deviation include lower densities, mass, bulk, and building heights along West Meadow Drive. Proposed mitigation measures include snowmelt systems, retention and addition of large trees and landscaping features including berms within the right of way, and enhancement of primary pedestrian areas along West Meadow Drive including provisions for increased setbacks and landscaping coverage. 3 6 Vail Plaza Hotel Zehren and Associates, Inc. 961070.00 5/8/01 Setback Deviations to be Reviewed in Accordance with Criteria Identified in 12-7A-6. (2) • Below Grade Setbacks - No adverse impacts occur from this deviation. Public and private benefits derived from this deviation include increased area of landscaping coverage, and an increase in the amount of full size parking spaces provided. • Porte-Cochere Setbacks - No adverse impacts occur from this deviation. Public and private benefits derived from this deviation include increased weather protection at entry areas, screening of vehicular and service areas, architecturally identify primary and secondary building entries, and add visual interest within elevations. Public Benefits Provided - General (21) • Implementation of applicable goals, objectives, and policies as outlined in Vail Comprehensive Plans. • Economic redevelopment of an aging hotel property. • Improved residential character in the design of the structure. • Increase in number of short-term accommodation units. • Increase in size and quality of short-term acc.,..,..,odation units. • Increase in size and quality of conference facilities. • Increase in size and quality of restaurant facilities. • Increase in size and quality of retail facilities. • Increase in size and quality of spa and health club facilities. • Elimination of surface parking. • Elimination of vehicular traffic on West Meadow Drive. • Elimination of vehicular maneuvering on within the town's right of way. • Elimination of a surface loading dock within a front setback. • Improved vehicular safety through decrease in turning movements. • Improved vehicular safety through implementation of one-way traffic patterns. • Improved pedestrian safety through provision of grade separated sidewalks. • Elimination of existing setback encroachments. • Elimination of existing landscaping deficiency (developments standards). • Increase in amount and quality of landscaping. • Potential increase in year round guest occupancy. • Potential increase in hotel, resort, and town marketing and resources. Public Benefits Provided - Potential Economic Benefits (4) • Potential increase in recurring revenues (property taxes, lift taxes, franchise fees, business licenses, etc.). • Potential increase in recurring sales tax revenues (town and county). • Increase in non-recurring building permit revenues. • Increase in non-recurring real estate tax revenues. Public Benefits Provided - Develonment Standards (9) • Provision of setbacks in excess of development standards. • Provision of landscaping in excess of development standards. • Provision of open space in excess of development standards. • Provision of on site, deed restricted employee-housing units in excess of development standards (number of units). • Provision of on site, deed restricted employee-housing units in excess of development standards (size). • Provision of densities below prescribed development standards. • Provision of uses consistent with prescribed development standards. • Provision of parking in excess of prescribed development standards. • Provision of loading facilities consistent with development standards. 4 1 Vail Plaza Hotel Zehren and Associates, Inc. 961070.00 5/8/01 Direct Economic Benefits - Public Infrastructure (5) • Construction of public infrastructure with private money on West Meadow Drive including sidewalks, roads, medians, plazas, lighting, landscape, hardscape, snowmelt, curb and gutter, and drainage facilities. • Construction of public infrastructure with private money on the South Frontage Road including sidewalks, roads, medians, lighting, landscape, hardscape, snowmelt, curb and gutter, and drainage facilities. • Construction of public infrastructure with private money on Vail Road including sidewalks, roads, medians, lighting, landscape, hardscape, snowmelt, curb and gutter, and drainage facilities. • Potential improvements and provision of easements for Spraddle Creek infrastructure. • Provision of public art in compliance with development standards. Public Benefits Provided - Direct Benefits to Neighboring Pronerties (10) • Elimination of adjacent surface parking lot, (all neighbors). • Increase in adjacent landscaped buffering, (all neighbors). • Improved residential character of the proposed hotel, (all neighbors). • Physical improvements to Vail Road parking easement, (Nine Vail Road Condominium). • Continued access to Vail Road parking easement, (Nine Vail Road Condominium). • Elimination of adjacent loading dock and traffic conflicts, (Nine Vail Road Condominium). • Potential increase in landscape coverage, (Nine Vail Road Condominium). • Increased setbacks adjacent to property, (Nine Vail Road Condominium). • Increase solar access, (Nine Vail Road Condominium). • Improved view corridors to south, (Nine Vail Road Condominium, Scorpio Condominium). Please do not hesitate to contact me with any questions or concerns regarding the information presented. Additionally, if you need any additional information, please do not hesitate to contact me. Sincerely, Timothy R. Losa., A.I.A Senior Associate Zehren and Associates, Inc. 5 May-11-01 09:58A Kent 303 674 2285 P.02 A.-, TO: Planning and Environmental Commission, Town of Vail " Town Council, Town of Vail Design Review Board, Town of Vail FROM: Scorpio Homeowners Association; Alphorn Condominium Association DATE: May 11, 2001 SUBJECT: 13 Vail Road / Lot A, B, C, Block 2, Vail Village Filing 2 (Vail Plaza Hotel West Wing) Following are comments regarding the position of the Scorpio and Alphom Condominium Associations. After sending the April 27, 2001 letter to Brent Wilson, Brent immediately responded (see attached April 27, 2001 letter to Mitch Rewold, Davis Partnership) with written criteria regarding the determination of height for proposed projects in Vail. It is my understanding that the grade of the land is determined prior to construction, but that having topographical surveys of certain lots prior to construction is not always possible. Was a topographical survey prior to the construction of the existing building available for this property? It is also my understanding that if such a document is not available "the 'existing' grades are interpolated onto the site plan for use in building height calculation. " ThL.; f-e our conclusion is that the heights for this property are being "interpolated" and it is impossible for the respective Board of Directors of Alphorn and Scorpio to accept the view studies provided. Based upon the definitio of the purpose of the Special Development District provide in the staff memo of May 14,2001 200I we y (paragraph VII) s ..,bly.believethe "scenic.featrresofopen spaces" are severely restricted. The loading and delivery areas for the proposed project have been relocated to the frontage road side and placed below grade. We believe this is the best solution provided so far. Recently safety issues have arisen due to the shared ingress/egress easement with the Alpine Standard property owner. A comprehensive traffic study during the busy season and at. peak times needs to be performed To base the traffic study on national averages does not seem reasonable because of Vail's uniqueness as a tourism destination. In prior hearings dating back to October 24, 2000, the Town Council has prudently recommended this project be directly related and tied together to the VVl project in order to be considered for Special Development District approval. Since that time, this has never been done. By relating the two projects, it is logical to conclude a more efficient product could be delivered to the guests and visitors to the project, and that a public benefit could be more easily demonstrated We do not agree with the staff conclusion that "The applicant has demonstrated that any adverse ef°ects ,of the requested deviations from the development standards of the underlying zoning are outweighed by the puhhi benefits provided " The applicant has not shown in any drawings a sidewalk on the west !side of the project. All plans for the West Meadow Drive streetscape proposals show access from the frontage road through to West Meadow Drive. This also speaks to the way the project closes itself off form the public. C4..:,.Aly, pedestrians walk through our hared parking lot and the Chateau Vail property to get to the Village. This sidewalk would provide access to West Meadow Drive from the shared ScorpijdAlphom parking lot_ While this is still cutting off access through the Chateau Vail property, it woul4c a reasonable compromise. We would like to reiterate our serious concern regarding the underground setback vipiations. We are concerned about the developer being allowed to build to the lot line underground and the ramifications of disturbing our foundation footers. This calls into question the structural integrity of our entire building. We would like to be assured that the applicant and/or contractor will have in place sufficient insurance in place to repair any damage to our respective buildings during construction. 1 i May-11-01 09:58A Kent 303 674 2285 P.03 In conclusion, we believe an SDD should not be granted to the applicant because: the height bulk and mass is still too much for the character of the immediately surrounding properties; a comprehensive traffic study during high season and at peak times needs to be performed; no public benefit has been shown to outweigh the necessity to change the underlying zoning; and the layout of the property cuts offexisting access to the Village. Richard Kent, President, Board of Managers, Scorpio Condominiums and on behalf of Alphom Condominium Association 1 i i i I 5-15-01 UAu, 3 Town of Vail Hub Site Market Analysis: Preliminary Recommendations Economics Research Associates February 22-23, 2000 LIONSH EAD CANDIDATE FACILITIES ¦ Conference/Learning Center ¦ Performing Arts Center ¦ Second Ice Rink ¦ Family Entertainment Center 1 CONFERENCE/LEARNING CENTER CONFERENCE CENTER/ LEARNING CENTER ~Wueu 16WaauarWrr~ar„yVVrir...... ,:...~WWaa+aJll+aiir, .mV, ¦ If you build it, will they come? ¦ How big should it be? ¦ What features should it include? ¦ How will it work synergistically with other project components? ¦ Will it pay for itself? 2 Three Bottom Lines Hotel Tax to Increase is on ? Hotel Tax All Rooms Wit, on Incremental Operating Debt Operating Incremental Sales and 1 Expenses Service Revenues Delegates Other Taxes 0'-- i i i i V i i i i i i $ Facility: "Financials" Municipal Government: "Fiscal Impact" Community Benefits: "Economic Impact" What do Meeting Planners Want? 3 Metropoll Selection Criteria ~l~d~A6i1 ~ IIIIV edIIII I Ii IVIIYi I h II"Il,l.i ll. i'~labi;~~'lllal I•i ~ II W,u Percent Rating Criteria "Very Important" 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% Food and lodging costs Convenient airline service Travel costs T ~ I I I No. of hotel morns avail. Security/ crime rate Clean/ attractive city Attractiveness of Convention ,I Center Survey of Meeting Planners ¦ 123 contacted. 29 in-depth interviews. ¦ Corporations, Associations, Education, Government meetings. ¦ Conferences, Trade Shows, Incentive. ¦ 31% have met in Vail before. 4 Potential Problems VAIL ¦ Expensive ¦ Lack of Air Service FACILITY ¦ Lack of on-site hotel rooms Vail Meeting Facilities FACILITY SIZE (sq.ft.) LARGEST Marriott 23,000 8,400 ail Cascade 49,000 5,940 odge at Vail 10,000 6,000 anor Vail 8,700 2,800 onnelalp 4,250 4,250 ew Vail Village 10,000 7,000 nn 5 Nearby Competitive Facilities FACILITY SIZE (sq.ft.) LARGES Keystone 50,000 20,00 Hyatt Beaver Creek 23,000 10,67 Copper Station 40,000 7,77 Breckenridge 30,000 7120 Snowmass 38,000 11,00 Comparable Facilities FACILITY SIZE (sq.ft.) LARGES Telluride 11,000 6,07 Taos Civic 23,000 6,05 North Lake Tahoe 8,090 4,84 Aspen Meadows 15,000 4,00 Whistler 35,000 13,60 6 Target Market ¦ Capable of handling groups of 700 comfortably, self-contained. ¦ Capable of handling groups of 1,000 to 1,300, especially in combination with Dobson Arena. ¦ Capable of simultaneous use. ¦ Association: Professional/Medical. ¦ Tie in with Learning Center. Program Recommendations ¦ 20,000 sq. ft. Ballroom ¦ 6,500 sq. ft. Breakouts ¦ 500 sq. ft. Boardroom ¦ 10,000 sq. ft. Prefu nction/ Lobby ¦ Learning Center ¦ Business Center, Kitchen, Circulation, Restrooms, Storage Learning Center Component ¦ Computer work stations ¦ Web, e-mail, games, education ¦ Teleconferencing ability ¦ Color printers and other peripherals ¦ Access to breakout spaces ¦ Sharing with business services center ¦ Tech support on staff PERFORMING ARTS CENTER g Candidate Theaters ¦ 200-seat "Black Box" ¦ 1,100-2,200 seats ¦ Complement existing venues - Vilar (527 seats) - Ford Amphitheater (965 fixed, 1,600 lawn) - Dobson Arena (2,500 capacity) Theaters in Vacation Locations Ili 'i fll,'d al, ii p Iml V';I I III, I iiI ii,;,lluAill Ili I, WI 11!11111111: li fig I. ¦ Most indoor-theaters in resort markets are small 300-500 seats, many with production companies ¦ Larger theaters of 1,000-2,400 seats have much larger resident markets than the Vail region, or university-related ¦ Larger theaters more dependent on resident market - 3-15% penetration of 50-mile resident mkt 9 Vail's Strengths ¦ Strengths -Well-educated, higher-income, growing population - Large and growing second home market -Captured, extended-stay, high-income, well-educated tourist market ¦ (600,000+ total/450,000+ > 30 yrs/200,000+ >45 yrs) - Marketable brand name - Proximity to Denver Va i l's Weaknesses ¦ Weaknesses - Small population base - Highly seasonal tourism -Theatrical options of second home population - Proximity to Denver (exclusivity clauses) 10 Vail Valley's Performing Arts Experience ¦ Successful summer program at Ford - Bravo, Dance Festival, Others -Amphitheater popular venue ¦ Mixed experience at Vilar - 43% average occupancy in FY99 - Programming adjustments - Earned income 22% of total costs in FY99 - $2.1 million annual subsidy - 28% penetration rate of resident market 200-seat theater ¦ Flexible - Intimate drama, cabaret, recitals, community meetings ¦ Too small to attract commercial presenters ¦ Associated with repretory production houses, experimental theater ¦ Little demand identified ¦ Vilar serves local community groups 11 1,000-1,200 Seat Theater YYldrl,li'Mna i. Vlu !"Im!u, i i utld I' n IYIII i,,!III, ¦ More attractive to commercial promoters, though larger preferred ¦ Competes with ballrooms & large clubs for some acts ¦ May still compete with Vilar 2,000-2,200 Seat Theater ¦ Would be the largest in a mountain resort market ¦ Most attractive to commercial promoters ¦ But competes with Dobson Arena for pop/rock acts ¦ Program limited by small market size for this size facility -"'Dark" most of the year 12 Theater Niche: 1,400-1,600 Seats? ¦ Too large to compete with Vilar, too small to compete with Dobson ¦ Primarily rental/presenting house ¦ Utilization low due to market size (30- 50 performances per year) - Risk - Vail would have to achieve among the highest market penetration rates ¦ $1.0 to $1.4+ million annual subsidy Conclusion ¦ Would enhance community's artistic programming options ¦ Sales tax benefits ¦ But unmet demand limited - mostly for major classical artists during winter/fall - some popular artists for whom Dobson is unsuitable ¦ Limited synergy with conference center 13 ~ )5 5.1.5,61 X ~`J ~i PERFORMANCE HALLS Y 1!!r(!M 4Yr $f> 9r tact t C{~ fat t t T % b } ti^•Y j[ Lg } } • i • 1T } t Al 1 w .tF' tr . 1 t .r... ~ ~ f. 2 7=-E i im - oTIii `r unnnw t CERRITOS CENTER 1000-1900 SEATS ~ T ;.:.~}:t{ •?gin: .~~rl .k ••v iY:t•"us~+~•=r ::\?tvv::; rrtti PERFORMANCE HALL 1200 SEATS Milli 20,000 SF BALLROOM THE VAIL CENTER MAY 15, 2001 EDAW / ZEHREN / HGA PERFORMANCE HALLS Qt1 s:.s.a QQ oc Dc.") DO r>v QQ 3 QQ QQ QQ QQ f 1{ \ CERRITOS CENTER 1000-1900 SEATS Cltl ?C C I i nt7 uu f~i r ~u r f_¢~ I(1~ rlt) f7ri Sl.l CHl i lC1 ClC! r_ r1ClI jI II ; _ , PERFORMANCE HALL } I e~ I I ; j I I I I ~a ~ 1200 SEATS L ,y lFl- i F_ - - pJ_ fIf ~I _ - i ' 20,000 SF I BALLROOM 600-1300 SEATS THE VAI L CENTER MAY 15, 2001 EDAW / ZEHREN / HGA PERFORMANCE HALLS r ¦ AM>: . . f' all ¦ v{}a §Y2Yl tf: ~ .$::Sr '•:a>.~:;;~i:'i ~{ai.^••T:?>{>.fti;;;. },;fir ::YT`,`.;•i,:{.;.t+' .v~.n.}{.. ..1111 A l . r •'vT:'Td}2j`.~: < T{:1;.'•Y t::; r i I I ...4. r 1 I r i ri.. :'v ~ •'•}.td'•. :tin}}}:::::}:• ~•t: .:::t!.,Tt+;}<i',}::a •~r.:•.:£t:•rt:.,a,... `stv::t ~'T,•:i i.S:.}.:8}•.;.. ia...~::;:::;':t :::}.:nisi:'1:4i:'.'`y4{~;•lv.;S:;'.,'i':i iJ' T:T+T..:}{a.%iRYX•.: aa{{•}. x: i2 :•~T.}}}}T:':t t:} • : . } ~ . • to ~ r..:.. • .%4 : tit a..: ' rF THE VAIL CENTER MAY 15, 2001 . EDAW / ZEHREN / HGA To: Vail Town Council From: Russ Forrest Date: May 15, 2001 Subject Vail Center Performing Arts 1. PURPOSE The purpose of the May 15th worksession is to further explore the direction staff received at, the May 8th worksession which included eliminating the 300 seat theatre and adding a fly to the 20,000 square foot meeting room. Specifically staff and the design team would like to receive input on: • Goals for a performing arts space i.e. seating, uses, types of performances, economic considerations. • If the 20,000 square foot space also integrates performing arts what is the first goal in designing this space. • Next steps for the design team and financial planning. Greg Haley from HGA will be present at the worksession and will review different ideas to address this direction. Greg will also review trade-offs with this approach from a physical stand point. Attached is a memo from Greg Haley, HGA, describing various alternatives for doing a convertible space. Also attached is a copy of the ERA study. This study looked at the economic viability of the recreational uses, meeting facility, a 1200 seat theatre, and a theatre over 2000 seats. This change in program could have a significant impact on the operational numbers for the facility and the fund raising potential. ERA is available to update this study if requested. It is critical to receive the Town Council's direction on the meeting space and the performing arts space at the May 15th meeting to maintain the opportunity to pursue a November 2001 election. Significant changes in the program will result in delays in both the design and financial analysis that will prevent the Town from meeting the necessary deadlines for a 2001 election. 2. PROJECT OBJECTIVES • The facilities plan will build upon the community facility ideas and lands that have been identified through community surveys and the Vail Tomorrow, Common Ground, Lionshead Master Plan, and other community processes. • The facilities programming will complement both recreational (e.g., skiing and mountain sports) and cultural (e.g., art, performing arts) amenities that exist in the Vail Valley so as to create a world class network of community facilities in the Valley. • The facilities shall be outstanding in their design and programming. Potential residents and guests would be drawn to Vail because of them. These should be unique facilities. • The facilities will serve both Vail Valley residents and guests. • Public-private partnerships will be pursued to finance the development of the facilities. 3. SUMMARY OF COUNCIL DECISIONS TO-DATE: • On September 21, 1999; November 16, 1999; and on March 14, 2000 the Town Council affirmed the list of public uses that would be considered further, primarily a 2nd sheet of ice, a family activity center, learning/meeting/performing arts facility (convertible floor space which can convert into either a meeting space or a performing arts/event venue), and affordable housing. • On July 18, 2000 the Town Council eliminated alternative 3 from further consideration. • On August 1, 2000 the Town Council directed staff to move forward with a 2001 ballot initiative. • On August 1, 2000 the Town Council directed staff to: - Foster the redevelopment and enhancement of existing hotel properties near the project site. - Work with VVTCB to encourage existing hotels to commit rooms at a competitive price for meetings and functions. - When refining the design for the project site, identify phasing plans that could allow the expansion of the meeting center and a future hotel in a phase 2 plan if the market demonstrated it was necessary to make the meeting center operate successfully. - Identify alternative mass transit technologies to move people more efficiently along the in-town route. • On August 15, 2000 the Town Council directed the Town Manager to sign a contract with the White River Institute to assist in the development of a fund raising campaign for all the public uses and to also help refine the concept of a "learning center." • On May 23, 2000 and on September 5, 2000, the Town Council decided to stay with the existing design team. The Council did indicate that obtaining a third party designer to provide a critique of the design and to enrich the thinking of the design team would be valuable. • On December 12, 2000 the Town Council indicated their support for the concept paper. • On December 19, 2000 the Town Council developed a square footage and use "wish list." • On February 7th, 2001, the Town Council reviewed a draft contract with EDAW and reaffirmed their interest in moving forward with the existing design team. • On March 6th the Finance Team reviewed the capital and operational plans with the Town Council. • On April 17th the Town Council gave direction to move forward with a design contract with EDAW to design the Vail center to include a: 2nd Sheet of Ice, Skate park, Youth Center, climbing wall, meeting facility with break out space, limited retail to support the facility, 300 seat theatre, and approximately 15 units of affordable housing. • On May 8th, the Town Council directed staff to eliminate the 300-seat theatre and to place a theatrical fly on the 20,000 square foot meeting room. e 4. CAPITAL COST ESTIMATES Two different cost estimators, ARC and Hansel Phelps, have reviewed the Vail Center program elements identified by Council in December and developed cost estimates for those uses (Attachment B). Since March 6th staff and individual Council members have met with representatives of Vail Resorts to discuss the Lionshead Parking Structure. At this time staff would propose eliminating the parking costs of $14.5 million and allow Vail Resorts to further investigate redeveloping the Lionshead Parking Structure. Preliminary cost estimates for a new parking structure are $43 million. This idea is only viable if Council conceptually accepts the idea of developing for sale development above the parking structure. The potential revenue from real estate development above the parking structure is approximately $25 million. Below are three scenarios. The first proposal is the one that was presented on March 7th. The other scenarios (A & B) reflect two approaches that don't include a parking cost. Budget Scenario Vail Center Revenue I Implications Cost March 7 Proposal $97 million $97 million • Endowment is in (includes -$52 million public bonds capital fund parking and -$38 million private versus endowment donations operational Significant • 2.75 mils (6.1 % annual RETT increase) property tax payment for • $1,500,000 annual recreational commitment from sales uses tax (March 7th budget had $1.5 mil.) • $941,580 annual commitment from RETT 1) April 17th Total Cost $75 million Revenue • This assumes Scenario A: Vail is $75 mil - $35 million public bonds that the Vail Center is Down from down from $52 million Center buys 150 integrated with a $97 million - $40 million donations down spaces from the new parking (Endowmen from $45 million parking structure. TOV t move out structure at cost and VR work of the . 2.75 mils (6.1% ($15,000) together to develop capital plan increase) property tax It requires a a new parking along with • $1,195,000 million high level of structure parking annual commitment from commitment cost) sales tax (March 7th from Vail budaet had $1.5 mil.) Resorts. • No RETT dollars are used • Minimizes capital dollars 2) April 17'" Total Cost $75 million Revenue • If no additional Scenario B: Vail is $75 - $44 million public bonds parking is Center is million down from $52 million created at the completely down from - $31 million donations down Lionshead independent of the $97 million from $45 million Parking Parking Structure (Endowmen • 3.0 mils (6.7% increase) structure the with no new t move out in property tax. additional parking added. of the • $1.5 million annual demand of 163 capital plan commitment from sales spaces could along with tax - capital fund not be parking . $245,000/year debt from guaranteed in cost) RETT for landscape and the month of streetscape. March. • RETT used for landscape and streetscape Staff Recommendation: Staff would ask that both scenarios be considered until a vote is needed in August on the ballot issue. The first scenario for funding leverages public money to the greatest extent. However, it is contingent upon what happens to the parking structure. It is important to understand that Council is comfortable with one of the two funding scenarios at this point but it is not critical to decide which one is the preferred scenario for a ballot initiative in November. 5. BENEFITS OF DEVELOPING THE VAIL CENTER • Development of a community cross-roads where residents and guests can enjoy recreation, learning, and culture. • $26-$39 million in additional spending per year by additional business that would be generated from the facility and $1-1.5 million in additional sales tax. • The facility will generate an additional 90,000 room nights. • This facility will provide additional business in shoulder seasons and provide greater stability for our employee base. • This will provide additional amenities for guests and residents which will be critical to achieve the Town's vision of being "The premier mountain resort community." • Multiple funding sources will be used to fund the Center and the plan leverages private funding. The Finance team would propose that public funding or the actual collection of additional taxes be contingent upon raising private funds. • Younger seasonal employees have identified creating additional activities as a critical need along with affordable housing to their overall satisfaction. In other words this could help attract and retain quality employees based on survey work the Vail Village merchants conducted. Attachments: A. Memo from HGA B. Pictures of facilities C. Capital costs for space D. ERA Study FAcdev\COUNCIL\MEMOS\01\com 0306 costupdate.doc , Architecture Engineering I Planning _ December 14, 2000 WRITER'S DIRECT DLU (612) 331-4116 Mr. Russell Forrest Director of Community Development Town of Vail 75 South Frontage Road Vail, Colorado 81657 Re: Town of Vail -Community Facilities FIG-A Commission Number 2035-002-00 Dear Russ: In our telephone conversation, yesterday you described the town of Vail's continuing interest in a performing arts space suitable for community- theater as part of the Charter Bus Site Development. Apparently, two ideas are currently under.- discussion for the physical form of this space. The first idea is a space suitable for lectures, meetings, community theater, and small performances. The room would have seating for 250-300, and have suitable support and backstage spaces for those events. The second idea is for a larger performance space. In the town of Vail vision, this rrdght be creative use of the 20,000 square foot ballroom space using pullout risers with upholstered theater seating. A 250-300 seat performance space would be ideal for comm. unity theater and a very- worthwhile component in a conference center. Performances in a space designed for this size audience will have a sense of imirnacy and scale appropriate to the types of uses envisioned by the town of Vail. This space could be 2500-4000 square feet with a flat floor, pullout seating, and a portable stage. It could also have a formal proscenium stage (picture window opening in a gall). The proscenium. stage arrangement suggests seating focusing on that more two-dimensional presentation, while a flexible stage could allow for theater in the round, thrust stage performances, etc. The Sierra Room at Cerritos Center for the Performing Arts is a 5200 square foot space suitable for theater, banquets, and conferences. You mentioned that some representatives from Vail visited the facility, and were impressed with the pullout seating risers with upholstered theater seats. Vail's performance space could be similar to the Sierra Room, allowing a great deal of flexibility. Depending on Vail's intended level of sophistication, a room similar to the Sierra Room could be supplemented with a proscenium stage, and further accommodations for theatrical lighting. This solution provides an intimate, well-proportioned space that suits the town of Vail's intended uses very well. Hammel, Green and Abrahamson, Inc. 1201 Harmon Place • Minneapolis, Minnesota USA 55403-1985 Telephone 612.337.4100 Facsimile 612.332.9013 Visit our Website: www.hga.com Page 2 The ballroom option was discussed at length in a May 10, 200 memo. Excerpts of this memo follow. A 20,000 square foot ballroom will be about 120 feet by 170 feet, and have a 25-foot high ceiling. The primary use is as a Conference Center ballroom, which means it is suitable for flat-floor shows 'convention booths, trade shows, etc.), large group lectures, sit down banquets and smaller meetings by subdividing the space into as many as eight meeting rooms. Since its primary use is as a ballroom, finish materials would ideally be sound absorptive so hundreds of people could talk simultaneously without being overwhelmed by other conversations. The floor material would be carpeting, and there would be acoustical wail panels on the upper walls. The 25-foot ceiling is typical of ballrooms of this size, and allows a great deal of flexibility for displays. Theaters and concert hats, however, are typically taller and have hard, reflective surfaces so a good sound for classical music presentations is naturally obtained. True performance spaces of this size also have a sloped floor and fixed theater seating for improved sight lines and comfort Since these key factors are missing (acoustical volume, reflecting elements and sloped floor), the ballroom will not be a "World Class" performance space. The ballroom can physically accommodate a wide range of performances on a temporary stage and audience seating that includes telescoping seating risers. Many configurations are possible, including a 1,300 seat layout in the full 20,000 square foot ballroom, a 600 seat layout in one-half of the ballroom (10,000 square feet), 300 seats in one-quarter of the ballroom, and 800 seats in a theater-in-the-round configuration utilizing three-quarters of the ballroom (15,000 square feet;. Of these, the smaller audience arrangements work best with the 25-foot ceiling. Ballroom performances might include theater, dance and musical presentations appropriate to a performance space without fly-space or rigging, limited lighting positions, a stage that has not been designed for dance and a platform without a concert shell. It would be suitable for performances which would allow amplification for good sound intelligibility in the ballroom space. We would not recommend adding a permanent stage and fly space to a ballroom audience area. The stage and tagging components are a very expensive part of a facility, and would only be warranted if a true Performing Arts facility was being designed. The ballroom solution also relies on movable partitions to subdivide the spaces. The height of the ballroom is best suited for smaller performances, and therefore relies on these partitions to provide for an acoustical separation from other meeting rooms. Over time these partitions get out of adjustment, and can lose their effectiveness as an acoustical separation between adjacent spaces. Therefore, it may be difficult to have multiple events occurring in a subdivided ballroom while there is a performance. Also, due to the limited ceiling height in the ballroom, balconies are not possible. This means that a significant number of viewers axe a considerable distance from the stage. This further compromises the viewer's experience. The seating options with fewer viewers Jess than 400 seats) are in a small enough space that all viewers are quite close to the stage. Page 3 Attached are several pages of plan diagrams showing relative sizes of the different options. On the first page is a 20,000 square foot ballroom footprint, the Cerritos Center for the Performing Arts footprint, and two layouts for the Sierra Room Theater at Cerritos. These diagrams effectively show the relative sizes of the spaces being discussed. Page 2 shows a diagram of a community theater space with 275 seats. "This space could have an attached proscenium stage in lieu of the flexible stage -within the room. The nett diagram on page 2 shows the 20,000 square foot ballroom with maximized seating of about 1300 seats. The ballroom section shows that the riser seating gets to be quite close to the ceiling at its highest point, and has the viewer 150 feet from the stage. For performances demanding this amount of seating, Dobson Arena may be a better choice. If a second sheet of ice is part of the Community Facilities project, Dobson may have more dates available for these larger events. The third page shows different seating options within a subdivided ballroom. These smaller layouts are more appropriate to the volume of the ballroom space, but have other limitations, such as the movable partitions. My comments speak to the use of each type of space as a performance venue. Other factors -will enter into the mix as a direction is chosen. Flexibility of use for other events, financial feasibility, operating cost, and other factors will have to be weighed as the T own of Fail comes to a final conclusion. I would be happy to discus the options outlined above by phone. Please call with your questions or to set up a conference call. Sincerely, HAti MEL, GREEN AND ABRAKA.NNISON, INC. , Greg Haley Vice President Enclosure CC. Russ Butler, ED AW u:\2000\ 203 5\ 002\ comm-des\ corres\gth005.doc;aih 170'-0" i t I I I I I o N i I I f I I I I i ' I ii 20,000 sf BALLROOM 150'-C" 1 J 1` iI } I !iii I l i I !`1 `'I 'I CD ~ ;mill i; I~ if II' 12,000 sf CERRITOS CENTER 920-1935 SEATS WITH BALCONIES 5C'-0" L 72 2800 sf 5200 sf 200 SEATS 400 SEATS SIERRA THEATRE AT CERRITOS VAIL 1 A I G HGA ROOM SIZE COMPARISONS 12/14/00 PAGE 1 60'-0" STAGE - °i r 3,600 sf COMMUNITY THEATRE 275 SEATS 170°-0" I I / ~,yy .I 20,000 sf BALLROOM 1300 SEATS ci BALLROOM SECTION VAIL COMMUNITY FACILITIES HG ROOM SIZE COMPARISONS 12/14/00 PAGE 2 k , t N r ~~Q' ° QB L~Roo1°14 'lp,pp® sfi ~'osoc~ sEls.~'s opp s# 905300 s ppCaE 3 12i~ 4lpp AR1S~~~' p®M COMP R C Y HGA Vail Center Ballroom/Theater Performance Space Comparison 5111101 Ballroom - 20,000 sf Theater - 5,000 sf 1300 Seats 350 Seats Room Height 25 feet 50 feet Proscenium eight 30-40 feet+3 ft to floor I 24-30 feet+3 ft to floor Stagehouse Height I 90 feet I 75 feet Room Width ( 120 feet 70 feet Proscenium Width I 45-58 feet 36-45 feet Room Length I 170 feet I 70 feet Floor I Flat, Carpeted I Sloped, Concrete Seating Loose Banquet Chairs Fixed Theater Seats Some Telescoping Theater Seating Distance Up to 120 feet Within 60 feet Sense of Intimacy I Poor I Excellent Sight Lines Poor Excellent Limited by Flat Floor Sloped Floor And Distance Acoustics Absorptive Surfaces Reflective Surfaces To Control Sound To Enhance Sound Sound System Always Used I Rarely Used Ceiling High Finish No Finish Coffered, Finished Open, Painted Black Ceiling With Catwalks Lighting Fixed Downlights Theatrical Lighting Chandeliers on Catwalk Pipes Adjustable Spots on Followspot Positions Suspended Light Pipes Walls High Finish Low Finish Wood Paneling to 8 ft Wood Panels, Acoustical Panels over Painted Plaster Orchestra Pit None Orchestra Pit or Forestaqe i Large Space Cerritos E, t 7, t ,t to 'P~ rr ~ x x i E. > 4ak ~ r p 'p i y < Sa 'Yt, ~ L ti ~ ~~?M ; L w~' ~ ~ J G-1 C 1 k t ~ S ~ K. ~4 J 'Sa / Matt cow& 1 "A , ~ x+71 c >r r x T.g 3 r ~ F . 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I i i x a e v/photocd/c u Itu ra I/isu/isu r02 THE VAI MITER PRELIMINARY SPACE NEEDS 03/01 /01 DESIRABLE RECOMM. CONSTRUCTION COST FEATURES& C/S COST FINISHES TOTAL EXTENDED SPACE FUNCTION EXPERIENCE RANGE PER SF COST/SF COST/SF Lump Sum LEARNING 8d MEETING CONFERENCE SPACE LARGEST ROOM CONF./PERFORMANCEE WARM VS COLD 20,000 220 1 69 389 7,780,000 STAGE AND BALCONY PRE-FUNCTION RECEPTIONS WELCOMING 5,000 131 137 268 1,340,000 FACILITY MANAGEMENT ADMINISTRATIVE BUSINESSLIKE 3,000 131 63 1 94 582,000 KITCHENS (10% OF CONF/LC SPACE) FOOD PREP FUNCTIONAL 4,560 194 130 324 1,477,440 STORAGE ROOMS/CLOSETS (5% OF CON STORAGE FUNCTIONAL 2,280 131 29 1 60 364,800 CIRCULATION & MECHANICAL 20% FUNCTIONAL 6,968 131 69 200 1,393,600 SUBTOTAL CONFERE14CC SPACE 41,808 309 12,937,840 LEARNING CENTER BREAKOUT I CONFER INTERACTIVE 6,000 131 127 258 1,548,000 BREAKOUT 2 CONFER INTERACTIVE 5,000 131 127 258 1,290,000 BREAKOUT 3 CONFER INTERACTIVE O 131 127 258 0 PLANNING ROOM PLANNING WHITE BDS/SOFT WALLS 1,200 131 127 258 309,600 SEMINAR/DIALOGUE ROOM 1 MEETING INTERACTIVE 2,500 131 127 258 645,000 SEMINAR/DIALOGUE ROOM 2 CIRC. OR HEXAGONAL 0 131 1 27 258 0 CLASSROOM 1 MEETING INTERACTIVE 1,000 131 70 201 201,000 CLASSROOM 2 0 131 70 201 0 BOARDROOMI 500 131 127 258 129,000 BOARDROOM 2 400 131 127 258 103,200 READING ROOM/LOUNGE 1 STUDY/RESEARCH READING, WR[TING,QUIET 1,000 166 127 293 293,000 READING ROOM/LOUNGE 2 0 166 127 293 0 LEARNING STUDIO RESEARCH & TECHNOLOGICAL 3,000 131 137 268 804,000 INTERACTION GIS (GEOL. INFO SYS.) 0 131 137 268 0 BUSINESS CENTER OFFICE 0 3,000 131 90 221 663,000 COPYING, PRODUCT INCUMBATOR COMPUTING TECHNOLOGY CENTRAL COMPUTER CORE FUNCTIONAL 1,000 304 1 69 473 473,000 TELECOMMUNICATIONS DISTANCE LEARNING CIRCULATION & MECHANICAL 20% FUNCTIONAL 4,920 131 70 201 988,920 SUBTOTAL LEARNING SPACE 29,520 252 7,447,720 `HEALTH & WELLNESS SPACES (DEDICATED) RECEPTION/LOBBY H&W CHECK-IN WELCOMING 0 131 137 268 0 EXAM ROOM (5) TESTING DIAGNOSTIC 0 131 96 227 0 EKG 0 131 96 227 0 LABORTORY TESTING RESEARCH 0 194 130 324 0 DEMONSTRATION KITCHEN DISPLAY INTERACTIVE 0 1 94 130 324 0 MEDICAL OFFICES (4) ADMINISTRATIVE BUSINESS-LIKE 0 131 63 194 0 PROVIDERS (2) 0 131 63 194 0 MASSAGE ROOMS (2) MEDITATIVE O 131 106 237 0 SHOWER/LOCKER ROOM CHANGING ROOM 0 220 137 357 0 QUIET ROOM SITTING REFLECTIVE O 166 96 262 0 STORAGE 0 131 29 160 0 NURSES STATION MEDICAL ADMINISTRATIVE 0 194 161 355 0 FITNESS CENTER GYMNASTICS/DANCE ATHLETIC MART. ARTS/EXERCISE CLUB-LIKE 0 127 176 303 0 SHOWERS/STORAGE CIRCULATION & MECHANICAL 20% FUNCTIONAL 0 131 70 201 0 5UB-TOTAL HEALTH & WELLNESS ONLY O #DIV/O? 0 SUBTOTAL LEARNING & WELLNESS' 29,520 252 7;447,720 SUB-TOTAL CONFERENCE. & LEARNING & HEALTH/WELLNESS 71,328 286 20,385,560, ARTS COMMUNITY THEATER (250-300) FILM, LECTURE, ETC. LISTENING 10,000 150 100 250 2,500,000 WITH STAGE & FLY PROFESSIONAL 1,200,000 CONCERTS, THEATER REHEARSAL 1,500 100 120 220 330,000 STORAGE/DRESSING/ELECT SUPPORT 2,000 131 70 201 402,000 GALLERY ART DISPLAY ARTISTIC 2,500 166 96 262 655,000 CIRCULATION & MECHANICAL 20% FUNCTIONAL 3,200 166 96 262 838,400 SUB-TOTAL ARTS;. 19,200 309 5,925,400 RECREATION INDOOR ICE HOCKEY, SKATING PRACTICE 29,000 171 58 229 6,641,000 EXHIBITIONS COMPETITION LOCKERS /DRESSING HOCKEY, SKATING SHOWER/DRESS 2,500 171 1 27 298 745,000 YOUTH CENTER HANG-OUT WELCOMING 2,500 131 63 194 485,000 INDOOR PLAYGD. FUN 1,500 131 148 279 418,500 CLIMBING WALL ADVENTURE 2,000 220 127 347 694,000 SKATEPARK EXERCISE FUN 20,000 75 50 125 2,500,000 CIRCULATION & MECHANICAL 20% FUNCTIONAL 11,500 131 70 201 2,31 1,500 SUB-TOTAL RECREATION 69,000 200 13,795,000 COMMUNITY RETAIL CAFE/COFFEE SHOP NOURISHMENT SOCIAL 2,500 194 63 257 642,500 BOOKSTORE READING, SALES INTELLECTUAL 0 131 63 194 0 GALLERY OBSERVATION, SALES ARTISTIC 0 131 63 194 0 RESTAURANTS (2) NOURISHMENT SOCIAL 0 194 63 257 O DINNER THEATER ? CIRCULATION & MECHANICAL 20% FUNCTIONAL 500 131 63 1 94 97,000 SUBTOTAL ktTAIL ' 3,000 247 739,500 OFFICES= NON-PROFITS ADMINISTJ4ATIVE BUSINESS-LIKE 0 131 63 194 0 CONFERENCE ROOM 1 MEETING PROFESSIONAL 0 131 63 194 0 CONFERENCE ROOM 2 0 131 63 194 0 AV STUDIO RECORDING (TV) 0 304 169 473 0 M CIRCULATION & MECHANICAL 20% FUNCTIONAL 0 131 70 201 0 SUB-TOTAL OFFICES 0 #DIV/O! 0 SUB-TOTAL RETAIL & OFFICES 3;000 247 739,500 HOUSING FOR SALE CONDOS (FRACTIONAL) PART-TIME LIVING 2ND HOME 0 186 147 333 0 CIRCULATION & MECHANICAL 20% FUNCTIONAL 0 186 114 300 0 SUB-TOTAL HOUSING O #DIV/O! O SUB-TOTAL COMMUNITY 3,000 247 7:39,500 SITE AMENITIES, PARKING PARKING SPACES (@ 325 SQ.FT) PARKING SKI STORAGE 0 50 18 68 0 0 ADDITIONAL PARKING COST 0 0 O 0 0 0 SUB-TOTAL PARKING (INCLUDES CIRC. & MECH) O #DIV/O! O OTHER INTERIOR PUBLIC SPACES 2's ARE MAIN LOBBY OBSERVATION VAIL'S FRONT DOOR 3,500 166 137 303 1,060,500 CONVERSATION ROTUNDA-LIKE PEOPLE CONNECTIONS WATER FEATURE SMALL LOBBIES (4) CONVERSATION CONNECTIONS 11000 131 137 268 268,000 CIRCULATION & MECHANICAL 10% FUNCTIONAL 450 131 70 201 90,450 ,SUv, Q. AL-OTHER INTERIOR PUBLIC SPACES 4,950 287 1,418,950 OTHER EXTERIOR PUBLIC SPACES OUTDOOR ICE SKATING FESTIVE, FAMILIES 0 100 58 1 58 0 GARDENS SOCIAL CONTEMPLATIVE 0 0 42 42 0 OUTDOOR ROOM (W/ 15%) MEETING FRESH AIR 0 131 63 194 0 SOCIAL VAIL INTERNATIONAL ACCESS 2,000,000 COVERED DROP-OFF ARRIVAL WELCOMING 1,000 131 55 186 186,000 E. LIONSHEAD CIRCLE AUTO TRAFFIC 0 0 16 16 0 STREETSCAPE/LANDSCAPE FOOT TRAFFIC LANDSCAPED 35,000 45 60 105 3,675,000 PROMENADE FOOT TRAFFIC LANDSCAPED 0 50 60 110 0 LOADING DOCKS FREIGHT FUNCTIONAL 4,000 131 29 160 640,000 UNIQUE ACCESS SUB TOTAL EXTERIOR PU13LIC SPACES 40,000 163 6,501,000 TOTAL SQUARE FOOTAGE 207,478 0 0 235 48,765,410;; Economics Research Associates Final Report Community Facilities Market Analysis Prepared for The Town of Vail Submitted by E- ics Res J ,Associates May 2, 2000 ERA Project No. 13401 10990 Wilshire Boulevard Suite 1500 Los Angeles, CA 90024 ERA is affiliated with Drivers Jonas 310.477.9585 FAX 310.478.1950 www.econres.com Los Angeles San Francisco San Diego Chicago Washington DC London TABLE OF COM'ENTS Section Page I INTRODUCTION I- 1 General Limiting Conditions I- 1 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 III-13 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 Considerations for Future Expansion IV-27 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- 1 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 CON ENTS (Continued) Section -Page VII FAMILY ENTERTAINMENT CENTER AND AQUATIC FACILITY VII- 1 Commercial Family-Entertainment Centers VII- 1 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 IMPACT 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 Figure Page III- 1 VAIL VAT I FY SEASONAL RENTAL PROPERTY TRENDS IN 1998 AND AVERAGE ANNUAL OCCUPANCY RATES AND DAILY ROOM RATES IN THE VAIL VALLEY 1994 TO 1999 III-17 LIST OF TABLES Table Page II- 1 OPERATING PROFORMA FOR STABILIZED YEAR OF OPERATION II- 9 II- 2 ESTIMAltll FISCAL IMPACT OF PROPOSED ALTERNATIVES II-ii III- 1 EMPLOYMENT DISTRIBUTION IN EAGLE COUNTY (1995 & 1998) III- 3 III- 2 MAJOR EMPLOYERS IN EAGLE COUNTY: 1995 III- 4 III- 3 ESTIMA i rli POPULATION BY TOWNSHIP IN EAGLE COUNTY III- 6 III- 4 VAIL AVERAGE DAILY CLIMATE STATISTICS III- 8 III- 5 KEY DEMOGRAPHIC CHARACTERISTICS OF PERMANENT RESIDENTS IN THE PRIMARY AND SECONDARY MARKET AREAS III-10 III- 6 OCCUPANCY PARTNERS IN THE VAIL VALLEY: 1998-1999..... III-14 III- 7 AVERAGE DAILY ROOM RATES IN THE VAIL VALLEY: 1998-1999 III-16 III- 8 ESTIMAi mot) VISITOR NIGHTS IN THE VAIL VAT T FY III-21 III- 9 ESTIMAlbu NUMBER OF VISITORS III-22 iii LIST OF TABLES (Continued) Table Page V- 1 CHARACTERISTICS OF SELECTED THEATERS WITH LESS THAN 700 SEATS V- 6 V- 2 CHARM; i LRISTICS OF SELEL i tD THEATERS WITH 1,100 TO 2,900 SEATS V-15 V- 3 ESTIMA i hi) RESIDENT MARKET PENETRATION RATES FOR SELECTED THEATERS V-31 VI- i SUMMARY OF KEY CHARAU i hRISTICS AND ECONOMICS OF RFT FVANT PUBLICLY-OWNED ICE SKATING FACILITIES VI- 4 VII- 1 SUMMARY OF KEY CHARM: i hRISTICS AND ECONOMICS OF RELEVANT PUBLICLY-OWNED ICE SKATING FACILITIES VII- 4 VIII- 1 TOWN OF VAIL CONFERENCE/LEARNING CENTER ESTIMA i r ij USAGE ASSUMr i iONS AND REVENUE PROJECTSIONS: ALTERNATIVE #1 VIII- 5 VIII- 2 TOWN OF VAIL CONFERENCE/LEARNING CENTER ESTIMA i vli USAGE ASSUMPTIONS AND REVENUE PROJECTIONS: ALTERNATIVE #2 VIII- 7 VIII- 3 STAFFING PLAN FOR PROPOSED CONFERENCE/LEARNING CENTER: ALTERNATIVE #1 AND ALTERNATIVE #2 VIII- 8 VIII- 4 TOWN OF VAIL CONFERENCE/LEARNING CENTER ESTIMATED REVENUE IN STABILIZED YEAR OF OPERATION VIII- 9 VIII- 5 TOWN OF VAIL NEW ARENA (ALTERNATIVE #1) ADDITIONAL USAGE ASSUMr i IONS AND REVENUE PROJECTIONS VIII-12 VIII- 6 TOWN OF VAIL PRACTICE SHEET OF ICE (ALTERNATIVE #2) ADDITIONAL USAGE ASSUMPTIONS AND REVENUE PROJECTIONS VIII-13 iv LIST OF TABLES (Concluded) Table Page VIII- 7 TOWN OF VAIL DUAL ICE SHEET FACILITY ESTIMA i hli NET REVENUE IN A STABILIZED YEAR OF OPERATION VIII-15 VIII- 8 TOWN OF VAIL PROPOSED ALi r-KNATIVES CONSOLIDA i rli OPERATING PRO FORMA FOR STABILIZED YEAR OF OPERATION VIII-18 VIII- 9 ESTIMA l tij USE DAYS - STABLE YEAR -1,400-SEAT THEATER VIII-19 VIII-10 ASSUMED RENT SCHEDULE VIII-20 VIII-11 ESTIMAitv STABLE YEAR OPERATING CASH FLOW VIII-21 VIII-12 PROJECTED HOUSE TEN-YEAR CASH FLOW -1,400-SEATS VIII-22 VIII-13 ESTIMA i hij VISITATION FROM NEW NET OUT-OF-COUNTY VISITORS VIII-25 VIII-14 ESTIMA i tli DAILY OFF-SITE CONFERENCE AND ICE RINK VISITOR SPENDING VIII-28 VIII-15 ESTIMAi hu FISCAL IMPACT OF PROPOSED ALTERNATIVES ON TOWN OF VAIL VIII-30 • 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 deveLj .,.ent 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 op.,,.L:ng 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; Steven Spickard, AICP, Sr. Vice-President; Katherine Kleinbaum, Associate; and Anne Wurtz, Associate. GENERAL IXhu uiG 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, and 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 Economics Research Associates I-1 C..,.,,,,,mity Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Research Associates. This study may not be used for purposes other than that for which it is prepared. This study is qualified in its entirety by, and should be considered in light of, these limitations, conditions, and considerations. Economics Research Associates 1-2 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. i uL REGIONAL ECONOMY, DEMOGRAr'imiCS, 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 Economics Research Associates 11-1 C*.Akn..unity 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. Economics Research Associates H-2 C,,......unity Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 CEN t..R 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. Economics Research Associates U-3 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Economics Research Associates 114 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. Economics Research Associates 11-5 C.,......unity Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 MPACT 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: Economics Research Associates 11-6 C%jiL&u&,unity Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 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 Economics Research Associates 11-7 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Consolidated Operating No F,,,,.a The consolidated operating pro forma for the proposed facilities under each alternative is shown in Table II-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 conference/learning 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 Economics Research Associates II-8 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table II-1 TOWN OF VAIL PROPOSED ALTERNATIVES CONSOLIDA t ho 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 he Sheet Facility Operating Revenue $983,900 $893,900 Operating Costs (1) 5995.750 $935.250 Net Operating Revenue (Loss) ($11,850) ($41,350) 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 II-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. Economics Research Associates U-10 C-, --..anity Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table U-2 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 (4.01/o) $345.600 $315.400 Total Direct Revenues to Town of Vail $853,580 $7719118 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. Economics Research Associates ID-1 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Employment Growth and Job Distribution Eagle County has enjoyed rapid employment growth in recent decades, with total employment in the County increasing from only about 3,600 jobs in 1970, to about 11,000 jobs in 1980, about 20,700 jobs in 1990, and about 26,000 jobs in 1998. Employment growth has been concentrated in the service, construction, and retail/wholesale trade sectors, while agriculture, resource production, and manufacturing sectors have become increasingly less important. Table III-1 shows the breakdown of ;....Vloyment by sector in Eagle County. As is typical for a tourism-oriented economy, jobs are now concentrated in retail and service sectors, which together account for about 60 percent of the County's total jobs. Table III-2 lists Eagle County's major employers. Unemployment Rates Eagle County's average annual unemployment rates (as estimated by the Colorado Department of Labor) have fallen since the early 1990s, as summarized below: • 1993 - 5.2 percent. • 1995 - 3.3 percent. • 1998 - 3.3 percent. The 1998 unemployment rate of about 3.3 percent compares favorably with the statewide average of about 3.8 percent. In recent years, Eagle County's low unemployment rate has consistently placed the County in the bottom quartile (lowest unemployment rates) of counties in Colorado. Income Growth and Distribution In addition to strong employment growth and low unemployment, Eagle County also enjoys high per capita incomes and median family incomes. Recent estimates from the U.S. Bureau of Economic Analysis place Eagle County's median family income at about $64,300 for 1999 - up from an estimated $60,900 in 1998. In comparison, the Bureau currently estimates Colorado's 1998 median family income at about $49,300, and the national median family income at about $45,300. Although per capita income and median family income are well above state and national averages, average wages per job are below state and national averages in Eagle County, reflecting the high number of service jobs and part-time positions (refer to Table M- Economics Research Associates III-2 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table III-1 EMPLOYMENT DISTRIBUTION IN EAGLE COUNTY (1995 and 1998) Total Jobs in County, 1998 Average % Change % of Jobs Annual EmDlovment by Sector 1995 1998 (1995-98) by Tvue Waae ('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, Insur., 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 / Emnlover Name Sector Emulovees 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). According to the U.S. Bureau of Economic Analysis, the average annual wage in Eagle County increased from about $23,400 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 III-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 0 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 . ~...ain rather small. Economics Research Associates III-5 C.,......anity Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table III-3 ESTIMATED POPULATION BY TOWNSHIP IN EAGLE COUNTY % of County 1995 19981 % Change 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 111-4, 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 Economics Research Associates III-7 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table III-4 VAIL AVERAGE DAILY CLIMATE STATISTICS Days Below Daily High 3 Daily 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 Precipitation 2: 21.17 Annual Snowfall 2 186 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 Table 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. Economics Research Associates HI-9 C,,-----unity Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table III-5 KEY DEMOGRAPHIC CHARACTERISTICS OF PERMANENT RESIDENTS IN THE PRIMARY AND SECONDARY MARKET AREAS Remainder of Vail Valley Eagle County (Primary 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 Aee (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) so-$19'999 6.7% 9.8% 8.3% 17.9% $20,000 - $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% $75,000 - $99,999 16.0% 13.1% 14.5% 10.3% $100,000 - $149,000 11.8% 8.4% 10.1% 8.0% $150,000 & Over 6.6% 2.5% 4.5% 3.5% Median Household Income $59,212 $48,979 $52,472 $43,823 Median Net Worth $58,292 $52,216 $46,751 $48,977 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 Economics Research Associates III-11 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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, Breckenridge, 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 $3 3,100 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 Economics Research Associates III-12 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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` Qf 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 the proposal for a performing arts center and' 66 percent supported the proposal of a con&rence center. However, when asked r 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 rm 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 41998, Economics Research Associates 111-13 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table III-6 OCCUPANCY PATTERNS IN THE VAIL VALLEY: 1998-1999 Vail Valley Town of Beaver Vail Valley Vail Valley Vail Valley Region Vail Creek Hotels' Condos2 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% 4 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 Economics Research Associates III-15 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table 111-7 AVERAGE DAILY ROOM RATES IN -i nf, VAIL VALLEY: 1998-99 Vail Valley Town of Beaver Vail Valley Vail Valley Vail Valley Region Vail Creek Hotelsi Condos2 GrouD 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% $350 M Occupancy $300 80.0% ADR $250 60.0% $200 40.0% $150 $100 20.0% $50 0.0% I $0 P4~~~~ ~J1~ ,5`" Q~~~ro~S `moo ~S o~ ~•~~S G~~o~~ AVERAGE ANNUAL OCCUPANCY RATES AND DAILY ROOM RATES IN THE VAIL VALLEY 1994 TO 1999 70.0% .$275 M Occupancy $250 65.0% --*---ADR $225 60.0% $200 55.0% $175 50.0% _ $150 45.0% a $125 40.0% I I I 1 $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 • 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 inferred: • 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; Economics Research Associates III-18 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 • 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 Percent 0 to 17 22.5% 18 to 24 15.4% 25 to 34 17.4% 35 to 54 29.1% 55 to 64 8.4% 65 + 7.3% • 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 Economics Research Associates III-19 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 III-8, 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). Economics Research Associates III-20 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table 111-8 ESTIMATED VISITOR NIGHTS IN THE VAIL VALLEY BASED ON REPORTED OCCUPANCY AND ESTIMATED NUMBER OF ROOMS / VISITORS PER ROOM Hotel 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 Hotel Visitors Per the Vail Valley Condo Visitors Per Nights in Hotel Visitor Per Month in 1999 Rooms Hotel Room, in 1999 Units 2 Condo Unit & Condo Units Nights 3 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 1.6 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 1/ Occupancy rates reported to VVTCB for 1999, with the exception of Oct. through Dec. which are from 1998. 2/ Includes private homes available for short-term 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 III-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 1 Niahts 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: Economics Research Associates III-23 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 • 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. Economics Research Associates III-24 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Section IV CONFERENCE AND LEARNING CENTER This section presents an industry overview and trend analysis of the public events market and a review of the operating characteristics of competitive and comparable facilities to the proposed conference and learning center in Vail. Following this discussion, ERA presents our findings on potential market demand and the recommended facility configuration. INDUSTRY TRENDS Public Meetings Market Definitions The national market for meeting and exhibition events is broad, incorporating local corporate meetings, consumer shows, trade shows, along with state, national, and international association convention events. Because the definitions used to describe these activities and venues have evolved over time, ERA has highlighted some nationally accepted definitions for the different types of events that utilize meeting and/or exhibition facilities and the specific facility needs of each event. These definitions form the basis for an analysis of a suitable meeting center for the Town of Vail. National, Regional, or State Meetings The following events have national, regional, state, and/or local components. National events draw their base from across the country, bringing people together for annual or semi- annual meetings. Regional events are focused either on associations or trade groups from specific areas of the country, such as the Denver metropolitan area, or they are sponsored by a national association, which has semi-annual regional meetings, in addition to a national assembly. State events draw from within one state, and local groups draw from within a metro area; these events can also include local chapters of state, regional, or national groups. • Conventions are privately held meetings attended by professional and association groups with the purpose of exchanging ideas, networking, and discussing industry trends. These meetings can be for as few as 300 people or as many as 15,000 people. Convention groups typically require large assembly or plenary space, exhibit space, meeting/breakout Econonucs Research Associates IV-1 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Shows 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. Economics Research Associates W-2 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 • 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, and 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 Economics Research Associates IV-3 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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, and 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 &LLsact 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. Economics Research Associates IV-4 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 ofM&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 1997 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 1,019,600 983,600 984,700 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 Economics Research Associates IV-5 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 I 84 79 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. Economics Research Associates IV-6 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Facility Selection Criteria Considered "Very Important" by Corporate Meeting Planners Percent of Respondents Selected 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. Economics Research Associates IV-7 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. • 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. Economics Research Associates IV-8 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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% esort 61.2% 64.5% 68.6% 7.4% Full-Service Hotel 70.3% 70.2% 69.4% -0.9% Resort 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. Economics Research Associates IV-9 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Annual Occupancy Rate by Location Location Occupancy Rate( 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 Economics Research Associates IV-10 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 CoIL/Univ. Centers Local 60.2% 74.6% 65.3% 45.5% 55.5% Regional 20.6% 8.0% 17.3% 31.7% 25.4% 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 ,..t.y 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. Economics Research Associates IV-11 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 t uh 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. I 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. 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. 4,250 sT Vail Village Inn 10,000 s.f. 7,000 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 Economics Research Associates IV-12 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 it it l i %7E FACII,i t jit~S 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 Economics Research Associates IV-13 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 I 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 6,050 s.f Town Taos, New Mexico North Lake Tahoe Conference Center 8,100 ST 4,840 s.f. Public District Kings, Beach; Califomia Whistler Conference Center 35,000 s.f. 13,600 s.f. Town Whistler, British Colombia Telluride Conference Center 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 Economics Research Associates W-14 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Economics Research Associates IV-15 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Economics Research Associates N-16 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 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 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 Economics Research Associates N-17 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Economics Research Associates IV-18 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates IV-19 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates IV-20 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Economics Research Associates W-21 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Growth 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 INTERVIEWS WiYrm 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. Economics Research Associates IV-22 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Economics Research Associates IV-23 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 CEN i LR 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. Economics Research Associates IV-24 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 i 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. Economics Research Associates IV-25 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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; • 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 conf,,. -...ce center which would be available for both community use and conf,..,,..ce 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 ~,..~.«nce 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 Economics Research Associates IV-26 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 I 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. Considerations for Future Expansion A common finding with major convention centers built across the country over the last 20 years has been that as soon as a center is finally open for business, it is already time to begin planning to expand it. Room in the Vail project area (especially air rights) could be reserved for possible future expansion of the conference center to guard against a similar finding. Unfortunately there are no rules of thumb or specific trigger points that indicate definitively when a meeting facility should be expanded. One would think that a high occupancy rate would be the clearest indicator. When availability of dates first becomes a problem in a center, however, it usually means the booking policy needs to be reviewed and refined, rather than concluding that additional construction is immediately called for. Booking policies serve as load management devices, and can increase the value of conference business to a community within the same space and occupancy level. Alternative priorities set by the community can include: (1) generating beneficial economic impact by filling hotel rooms; (2) increasing rental revenues and other operating income for the facility; or (3) community service by providing space and dates for local events. Even when the benefits of load management have been maximized, and it is time to build more space, there is also no rule of thumb for how to expand. Rarely do all types of space in a conference center need equal expansion. The operating experience in the initial years as the facility is filling up with business will dictate the type of expansion ultimately required, if any. Sometimes only additional breakout meeting rooms are needed. In other situations the need will be for exhibit or ballroom space. While Vail can reserve an air rights Economics Research Associates IV-27 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 site for possible expansion, any additional facility needs will not be known until several years of operations have been experienced. Economics Research Associates TV-28 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 SECTION V PERFORMING ARTS CENTER L 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: Economics Research Associates V-1 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 1. 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. t tt-,A t -LX 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 Economics Research Associates V-2 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. ji =t 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. Economics Research Associates V-3 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates V4 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates V-5 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table V-1 CHARACTERISTICS OF SELE•_ i r,u THEATERS WITH LESS THAN 700 SEATS (in alphabetical order) a Q' ti~ Q c Name/Location 4/ Asolo Theater Company 1960 Non-profit Nov. - 2 500 producing 14 n.a. n.a. $4.1 in. 70% Yes n.a. 80% 70% 56439 Sarasota, FL organization June 161 Big Beer Lakes Perf- March - renting & forming Arts Center 1988 City Dec. 1 398 producing 20 85 20/80 $250,000 25% No 20,000 99% me. $9-S35 Bi.¢ Bear Lakes, CA Jackson Hole Playhouse 1978 Individual May- 1 300 producing 1 240 90/10 $175- 1000/0 No 50,000 95% 75% S10415 Jackson Hole, 97 Sept. - S200K Laguna Playhouse 1920 Non- Sept. - 1 420 producing 11 112 20/80 S4 in. 85% No 110,000 100% 90% $9-S43 Laguna Ns CA profit Juno Lake Placid Center for Non- Year- , . -y..._ing 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. 510420 Santa Maria, CA 700 (outdoor) only) Pacific Repertory Non- Feb. - 300 (main) producing Theatre (Golden Hough) 1982 Profit Oct. 2 99 (back) & renting 8 104 30/70 n.a. n.a. Yes n.a. n.a. n.a. S12425 Carmel, CA Organization Self Family Arts Center 1970 Non- Year 2 348 producing 46 200- 30/70 $2.3 in. 50% No 11.3. 85% n.a. 56-S34 Hilton Head, SC Profit round 225 & renting 250 Aspen Wheeler Opera year- presenting Ba House 1989 City mind 1 500 renting 356 20/80 n.a. n.a. No n. a. n.a. 75°x6 S10-S40 Aspen, CO (incl.film) Estimates provided by theater manaMent Source : Individual Theater mt, Amusement Business. AudArena 2000 Guide, and Economics Research Associates. Big Bear Perf,,,,,ing 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 Economics Research Associates V-7 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 percent occupancy rate. The theater's annual budget varies from $1754200,000. 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 for adults and $10 for children. The restaurant serves 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 n..... al 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 Economics Research Associates V-8 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates V-9 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 $10 per person. Pacific Conservatory of the Perf,,,.JngArts (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 Economics Research Associates V-10 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates V-11 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates V-12 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 $6-$34. 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 run with a full-time staff of 6 people, and 60-80 part-time employees. Additional 200-250 volunteers are also needed throughout the year. Economics Research Associates V-13 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 $500-$600 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 $30-$40 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-.ATERS 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 Wolje 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 Economics Research Associates V-14 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table V-2 CHARACTERISTICS OF SELECTED THEATERS WITH 1,100 TO 2,900 SEATS (in alphabetical order) fob bF~ Z ve° ro +'°4~b ,~°0 0 s° 6 j, O p Name/Location 44, 0- ?s A 1! 11.4 P4 ~o ti° o\• O 4,g Asheville Civic Center - Sept. - Thomas Wolfe Audit. 1940s city May 1 2,431 rental only 100 U.S. 3/95 $2.0 m. No n.a. U.S. 75% SiS-S50 Asheville, NC Bob Hope Cultural Ctr. Private Arts Sept. - producing, McCallum Theater 1989 Foundation may 1 1,125 presenting& 72 80 25/75 n.s. NO 63,000 87% 800/9 $5495 Palm Desert CA reatinq Cape Cod Melody Tent South June - 2,300 producing, Theatre 1930 Shore Sept. 1 (in the presenting & 32 32 50/50 11.4. No 66,000 100% 85% S20-S65 Hyannis, MA Playhouse round) renting Community Arts Ctr. & PA Sept. - presenting & Theatre 1993 College MAY 1 2,159 50-55 63-70 20/80 $1.3 Yes 80,000 906/o 50% 55475 Williamsport; PA of Tech. Eccles Center for the Jan. PC School Year- 1,300 presenting & Performing Artse I99E Dist. & round 2 180 (block renting 25-30 35 15185 5470,000 n.a. U.S. U.S. 80% $154100 Park City. UT Arts Found. box) Maul Arts & Cultural Private Sept. - 1200 producing, 3,000 Center 1995 Found. July 1 + black presenting & U.S. events n.s. n.a. Yes U.S. o a. e.g. $5-$73 Kahului, HI box (300) Oregon Shakespeare Non- Feb. - 1,200 (outdoor) Festival 1935 profit Oct. 3 600 11 763 88/12 $15.8 Yes 374,000 93% 93% S11-S43 Ashland OR 140 Rushmore Civic Plaza Sept. • 1 Ctr. - Flee Arts Theatre 1977 City may 1 1,799 presenting & n.a. n.s. 5195 S4.4 in. No n.a. 80% 45% $3-S41 RapidC1q, SD rentinq Saginaw Civic Center - Sept. - Heritage Theater 1972 City June 1 2,300 rental only U.N. U.S. U.S. $3.5 m. No U.S. 13.01. a.a. S3-S60 Saginaw, MI Santa Cruz Civic And. Sept.. presenting & Santa Crus CA 1939 City Mav, 1 2.000 rental n.a, U.S. U.S. n.a. No 11.4. n.s. 65% U.S. Sweeney Convention Ctr. You. Theatre U.S. City nand 1 1,500 rental a.a. e.g. n.s. $1.5m No 11.8. 13.11. 75% U.S. Santa Fe, N.M. San Luis Obispo Univ., Sept. - 1,282 + reh. Performing Arts Ctr. 1996 city & July 1 pev. (250) rental only U.S. 130 13183 SlA in. No 106,000 99% U.S. $15-365 San Luis Obism CA donors & room (180) Pikes Peak Center - El Paso Year- rental only Great Hall 1981 County round 1 2,061 (formerly ISO 250 13183 $1.0 No 165,000 90% 90% S5465 Colorado Springs CO (310ovt. produced) Telluride Conference July of Town of 11,000 SF rental Center 1999 Mtn. U.S. 1 ballroomw/ only 15 11.11 n.a U.S 11.9. n.a 2.e 11.01 Telluride, CO Village portable stage ' Estinwas provided by theater management 'The Eccles Center draws potions from neurby Solt Lake City, thentom the Summit County (pop. 26,300) and SLC Metro area/ have been combined ' SLOPAC is a rental only facility and not a promoter, therefore ticket revenue does not reflect whet the Center takes in Source: Individual Theater _11,.., . t, Arne"mont Bualness: Aud Arena 2000 OWds, and Economics 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. Economics Research Associates V-16 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Cape Cod Melody Tent Theater (Hyannis, Massachusetts) One of the oldest summer tent theaters in the country, Cape Cod Melody Tent 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 Economics Research Associates V-17 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Economics Research Associates V-18 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 perf.,a,a,ance, 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 $154100, 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 Ccaau,al 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 "riot 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. Econonucs Research Associates V-19 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 perfv, .,,ances. 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. Economics Research Associates V-20 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates V-21 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates V-22 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. • 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. Economics Research Associates V-23 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 • 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 Vilar 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 Economics Research Associates V-24 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Vilar 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. Economics Research Associates V-25 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Econonucs Research Associates V-26 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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!, $10-$80 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. Economics Research Associates V-27 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates V-28 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 a commercial 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) Economics Research Associates V-29 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 • 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. VAIL 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 aPF1 u.,dinately 32 to 40 performances per year. Economics Research Associates V-30 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table V-3 ESTIMATED RESIDENT MARKET PENETRATION RATES FOR SELECTED THEATERS' 1999 Total Season % of Est Est. # of Estimated Theater Resident Resident M ~ l litan Resident Mkt. Theater Attendance Attendancel Attendance Population Penetration Bob Hope Cultural Ctr. McCallune Theater 65,000 75% 48,750 290,000 17% Palm Desert, CA Pikes Peak Center - Great Hall 165,000 85% 140,250 495,300 28% Colorado Springs, CO San Luis Obispo PerforntingArts Ctr.° 106,000 85% 90,100 245,200 37% San Luis Obispo, CA Cape Cod Melody Tent Theatre 66,000 50% 33,000 209,800 16% Hyannis, AM Community Arts Ctr. & Theatre 80,000 80% 64,000 118,300 54% Williamsport, PA Pacific Conservatory of the Pe 6. g Arts 100,000 40% 40,000 413,800 10% Santa Maria, CA r applies only to those theaters for which attendandance was estimated Source: Sales and Marketing M-6--ant: 1999 Survey of Buying Power (Metro 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 Economics Research Associates V-32 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 compdte 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. Economics Research Associates V-33 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates VI-1 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 • 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. Economics Research Associates V1-2 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. REVIEW 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 Economics Research Associates VI-3 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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.) $1004150 $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 II 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 Economics Research Associates VI-5 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Economics Research Associates VI-6 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates VI-7 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 • 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 O t b r:R SELECTED RELEVANT ICE RINK FACILITIES 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 c,,..-Farables 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 1.4 million skier-days per year. In total, Economics Research Associates VI-8 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Economics Research Associates VI-9 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 11 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 Economics Research Associates VI-10 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 • 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. Howelsen 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. Economics Research Associates VI-11 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Economics Research Associates VI-12 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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; • Youth hockey brought in about $65,000; • Adult hockey leagues generated about $21,500; • Special groups and tournament play generated about $20,000; • Dasher board advertisements generated about $21,600; • Figure skating brought in roughly $15,000; • 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 Economics Research Associates VI-13 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Zamboni 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; Economics Research Associates VI-14 Community Fapilities M irket Anadlysis for the Hub Site Location - EkA k6ject No. 13401 • $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. Economics Research Associates VI-15 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Economics Research Associates VI-16 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Town of Eagle Ice Aink, 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. Economics Research Associates VI-17 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 1999, 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 both 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. Economics Research Associates VI-18 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Hockey Tournament Potential in Vail Hosting national and regional hockey tournaments present a potential source of revenue 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. Economics Research Associates VI-19 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Economics Research Associates VI-20 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 proposed conference center if both facilities are developed. ERA's detailed demand and revenue projections are discussed in Section VIII. Economics Research Associates VI-21 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 CEN i LRS 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 outdoorrndoor 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 Economics Research Associates VII-1 Community Facilities Market Analysis for the Hub Site Location - ERA Project No..13401 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. Economics Research Associates V11-2 Community Facilities Market Analysis for the Hub Site L..u.uon - ERA Project No. 13401 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 VII-1 contains basic industry information taken from a 1996 season survey of 52 profiled commercial FECs. While the information is several years old and FECs Economics Research Associates VII-3 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table VII-1 U.S. FAMILY ENTERTAINMENT CENTERS' 1996 SEASON PHYSICAL & OPERATING CHARACTERISTICS Minimum Mean 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 Emplovees 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 10.00/0 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 0.00/0 2.6% 16.0% Least/Rent 0.00/0 11.40/6 40.0% Taxes & Government Fees 0.0% 4.0% 13.0% Interest 0.00/0 9.0% 45.0% Other 0.0°/a 7.7% 69.0% Operating Margin 2.0% 17.6% 41.00/o I 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 :.1.lYloyees 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 Economics Research Associates VII-5 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 the development of a new entertainment center, both entry and renovation costs have also escalated. HIGH-TECH EN i.LRTAINMENT CENTERS High-tech entertainment centers generally are located in areas with high pedestrian traffic and/or tourist-oriented areas. Their ability to generate 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 f.,,,.,s 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 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. Economics Research Associates VII-6 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Dave & Buster's Ina 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 IOpm. 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. Economics Research Associates VII-7 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 lVh 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. Economics Research Associates VII-8 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Eli t.tRTAINMENT CEN it rRS 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 Economics Research Associates VII-9 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 hosts a 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. Economics Research Associates VII-10 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Van's Skatepark - The 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. Economics Research Associates VII-11 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates VII-12 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Economics Research Associates VII-13 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates VII-14 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 ofgach.alternative: ALTERNATIVE I 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 Economics Research Associates VIII-1 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 • 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 - 5,000-6,000 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 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 n-L CONFERENCE CENTER/LEARNING 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 Economics Research Associates VIII-2 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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. Economics Research Associates VIII-3 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 11 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 I 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 Economics Research Associates VIII-4 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table VIII-1 TOWN OF VAIL CONFERENCE/LEARNING CENTER ESTIMATED USAGE ASSUMPTIONS AND REVENUE PROJECTIONS: ALTERNATIV 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 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 & Beveraee 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 n/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 n/a n/a n/a $15,000 Learning Center 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 $1,898,600 ' 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 op~.at:ng 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 VIII-4, based upon current operating budgets of comparable facilities. The operating costs under Economics Research Associates V111-6 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 Con:~~,, xe Services $0 $300,000 $472,500 $336,000 $92,400 $1,200,900 Food & Beveraee 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 n/a n/a n/a n/a $2,500 Projected Event Days Per Year n/a n/a n/a n/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. Q.-W and basic AV. Source: Economics Research Associates. Table VIII-3 STAv v ju 1G PLAN FOR PROPOSED CONFERENCEILEARNING CENTER: ALTERNATIVE #1 # Full-Time Fully Loaded Position Equivalents Salary Total Salary Salary Cost 1 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 STArjejuiG PLAN FOR PROPOSED CONFERENCE/LEARNING CENTER: ALTERNATIVE 02 # Full-Time Fully Loaded Position Equivalents Salary Total Salaries Salary Cost 1 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 1/ Fringe benefit portion of fully loaded salary is 30 percent over base salary levels. Source: Economics Research Associates. Sacg-financials Staffing Plan Table VIII-4 TOWN OF VAIL CONFERENCE/LEARNING CEN i LR 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 i nr: 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; Economics Research Associates VIII-10 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 • 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 $31$,600 in revenue over the operations of Dobson Arena. ERA estimates that additional utilization from hockey leagues and other Economics Research Associates VIII-11 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 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 lHockev 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 1/ 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. 31 Assumes each tournament event spans 3 event days. Source: Economics Research Associates. Sec8-financials Ice Rink Revanues-Ahl Table VIII-6 TOWN OF VAIL PRACTICE SHEET OF ICE (ALTERNATIVE #2) ADDITIONAL USAGE ASSUMPTIONS AND REVENUE PROJECTIONS # of Hours per Week/Event Davs Additional Revenue2 User Group Rates 1 Period Dobson Current With Practice Sheet Per Week Per Year Hockey 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 $3,500 day 30 50 - $70,000 Hockey and Skating Tournaments a $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 1/ Rates management's planned rate increase following the ct_.:,..21y 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. sec8-rinanoida loo Rink Revenue.-plea Table VIII-7 TOWN OF VAIL DUAL ICE SHEET FACILITY ESTIMA'iLij 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. Sec8-fimmoials Ice Pro Forme 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 2900, 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 VHI-8 TOWN OF VAIL PROPOSED ALTERNATIVES CONSOLIDA i rw 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 $751-000 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) Family Recreation Center Operating Revenue $235,000 $235,000 Operating Costs (1) $150.000 5150.000 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. 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 world 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 not use surplus revenue to support 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 .i t-L PERFORMING ARTS CENTER Tables VIII-9 through VIII-12 present a hypothetical pro-forma for a 1,400-seat performing arts theater, operated as a presenting/rental house. The number of perf.,...tances 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 Economics Research Associates VIII-17 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table VIII-15 ESTIMA'Yr.D 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 $411180,000 $3,8175,500 Visitor Lodging Spending $12.699.500 $11.392.960 Total Increase in Spending $2193399500 $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 $4553-718 Sales Tax Revenues to Town of Vail (4.0%) $345.600 $315.400 Total Direct Revenues to Town of Vail $853,580 $7711,118 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% Commercial 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 Events/Yr. 51 $ 138,500 97% Rehearsals _ % of Perf. Festival Events 100% 2 $ 200 0% Local Arts Groups 200% 4 $ 200 0% Commercial Performances 0% 0 $ - 0% House Presented Performances 100% 20 $ 4,000 3% C-Z .ances 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: Economics Research Associates Table VIII-10: ASSUMED RENT Sunr.DULE (in 2000 dollars) Proscenium (1,400 seats) ASSUMED RENTAL RATES/USE Performances Festival Events $ 2,500 Local Arts Groups 1,500 C,,......ercial 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: ESTIMArj&,r STABLE YEAR OPERATING CASH FLOW (in 2000 dollars) Proscenium (1,400 seats) ESTIMATED RENTAL INCOME Performances Festival Events $ 5,000 Local Arts Groups 3,000 Commercial Performances 70,000 House Presented Performances 50,000 Conferences 3,000 Summer Residency Group - Other Organizations/Events 7,500 Sub-total $ 138,500 Rehearsals Festival Events $ 2,000 Local Arts Groups 2,000 Commercial Performances - House Presented F.,.:~,a...ances 20,000 Conferences 500 Summer Residency Group - Other Organizations/Events 1,250 Sub-total 25,750 Total Rental Income S 164,250 ESTIMATED CONCESSION INCOME Estimated Audience Per Year Total Events 51 Total Number of Seats 1,400 Average C-.p..ncy Rate 60% Estimated Audience Per Year 42,840 ated Concession Income Assumed Per Capita E,,,,.: -Atures $ 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 VIII-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. S Yr. 6 Yr. 7 Yr. 9 Yr. 9 Yr. 10 HOUSE PRESENTATIONS Revenue Ticket Sales Avg. $32 main thester@601% occupancy $ 322,560 $ 430,080 $ 537,600 S 537,600 $ 537,600 $ 542,976 S 548,406 S 553,890 $ 559,429 $ 565,023 Net Revenue From Food & Beverage $3.50/cep; 600% occpancy; 201% 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 $ 439,488 $ 549,360 $ 549,360 S 549,360 $ 554,854 S 560,402 $ 566,006 $ 571,666 $ 577,383 Ernenses Artists $35,000 main theater S 420,000 5 560,000 S 700,000 $ 700,000 $ 700,000 $ 707,000 $ 714,070 $ 721,211 $ 728,423 $ 735,707 Pass-Through Costs (2) $600/performance 7,200 9,600 12,000 12,000 12,000 12,120 12,241 12,364 12,487 12,612 Advertising/Promotion $3,0001show 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 $ 617,600 $ 772,000 $ 772,000 $ 772,000 $ 779,720 S 787,517 $ 795,392 $ 803,346 $ 811,380 Net Income -41)eflclb From House $ (133,584) $ (178,112) $ (222,640) $ (222,640) $ (222,640) $ (224,866) $ (227,115) $ (229,386) $ (231,680) $ (233,997) Presentations ~Pr S (1,085,036) $ (1,084,925) $ (1,084,814) $ (1,084,814) S (1,084,814) $ (1,084,808) S (1,084,803) $ (1,084,797) $ (1,084,791) S (1,084,786)1 Net Income esen Presentations clbAfterHouse Prexntations Note: (1) Before depreciation (2) Technician, box office, security, Bc maintenance time Source: L.... _..:cs 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 Vait's. FISCAL IMPACTS OF 1 nh 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 VIII-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 Visitation 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 ESTIMA l Liu 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 1 14,000 8,000 Ice Rink Tournaments Attendees 2 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 I 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 conf;,.;,..ce 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 alt;,...«tive. 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 Economics Research Associates VIII-26 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 razes 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 Community Facilities Market Analysis for the Hub Site Location - ERA Project No. 13401 Table VIII-14 ESTIMA e," DAILY OFF-SITE CONFERENCE AND ICE RINK VISITOR SPENDING Alternative #1 Alternative #2 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 Conf;;.,...ce Center Attendees $25.00 $25.00 Families of Conf;,....ce 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 Conf;,.,...Ce 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-ar i r, 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. Economics Research Associates VIII-29 Community Facilities Market. Analysis for the Hub Site Location - ERA Project No. 13401 MEMORANDUM TO: Vail Town Council FROM: Bob McLaurin, Town Manager RE: Critical Strategies Report DATE: May 11, 2001 This report is not in your packet. I will have it updated for you on Tuesday, May 15th. 1