Executive Meeting & Events Center Marketing and Economic Impact Study
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Transcript of Executive Meeting & Events Center Marketing and Economic Impact Study
Executive Meeting and Events Center
Market and Economic Impact Study –
Montgomery County, Pennsylvania
Report Prepared For:
King of Prussia District &
Valley Forge Tourism & Convention Board
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
Contents
Executive Summary ................................................................................. ii
E1 Montgomery County Scorecard Analysis ....................................................... iii
E2 King of Prussia Lodging Market Analysis ...................................................... iv
E3 Facility Dimensions & Comparable Facilities ................................................. vi
E4 Feedback from Key Stakeholders ................................................................. vii
E5 Demand & Attendance Projections .............................................................. viii
E6 Potential Economic Impacts........................................................................... ix
1 Introduction ..................................................................................... 1
1.1 Background ................................................................................................. 1
1.2 Report Structure .......................................................................................... 2
2 Local Market Conditions & Scorecard Analysis ............................ 3
2.1 Montgomery County - Background ............................................................. 3
2.2 Infrastructure ............................................................................................... 4
2.3 Companies & Employment ......................................................................... 7
2.5 Local Hotels ..............................................................................................12
2.5.1 Hotel Stock & Hotel Room Density ...................................................12
2.6 Retail Offerings .........................................................................................15
2.7 Overall Scorecard Analysis .......................................................................18
3 King of Prussia Lodging Market Analysis ................................... 21
3.1 King of Prussia Lodging Market ................................................................21
3.2 Hotel Benchmark & Comp Set Analysis ...................................................24
4 Comparable Venues ...................................................................... 29
4.1 Smaller Convention Centers .....................................................................29
4.2 Profiles of Comparable Facilities ..............................................................33
5 Facility Dimensions & Details ....................................................... 45
5.1 Data Normalization ...................................................................................45
5.1.1 Total Sellable Space .........................................................................45
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
5.1.2 Main Exhibit Hall & Banquet Hall SF ................................................46
6 Industry Trends ............................................................................. 50
6.1 The Meetings Industry ..............................................................................50
6.2 Convention Center Trends ........................................................................51
6.3 MICE Industry Trends ...............................................................................52
6.3.1 Reports on the death of meetings are exaggerated .........................52
6.3.2 Meetings are driving economic development ...................................55
6.3.3 Cost consciousness is defining choices ...........................................57
6.3.4 Events are reaching further ..............................................................59
6.3.5 DMOs are driving MICE growth ........................................................59
6.3.6 Events are becoming more targeted.................................................61
7 Feedback from Key Stakeholders ................................................ 62
7.1 Economic Development Professionals .....................................................62
7.2 Potential Corporate Users .........................................................................63
8 Demand Projections ...................................................................... 65
8.1 Projected Events .......................................................................................65
8.2 Projected Attendance ................................................................................67
9 Economic Impacts ......................................................................... 69
9.1 Event Turndowns ......................................................................................69
9.2 Direct Event Spending ..............................................................................69
9.3 Room Nights Generated ...........................................................................70
9.4 Economic Impacts Defined .......................................................................71
9.5 Projected Economic Impacts – Montgomery County ................................72
9.6 Projected Economic Impacts – State of Pennsylvania .............................74
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
ii
Executive Summary
In 2012, the Valley Forge Casino Resort (VFCR) opened its doors, becoming the 11th casino in
Pennsylvania. While the casino represented a new attraction and recreation option in Montgomery
County, it led to a drastic reduction in available space at the Valley Forge Convention Center, and 54,000
square feet (sf) of convention center space was removed from the local market in Montgomery County.
With the reduced exhibit space and meetings and convention offerings, companies and organizers that
used to host events at the Valley Forge Convention Center had to find new venues for their events. In
addition, while the majority of new casino patrons at VFCR are day-trippers, the lack of corporate
meeting/event space in the region has led to reduced demand from the overnight market segment and
lost business opportunities and revenues from the convention/meetings industry.
Local stakeholders believe there is need for corporate/convention meeting and event space that would
effectively replace the lost meeting space and business opportunities since the opening of VFCR. One
main viewpoint mentioned repeatedly by key stakeholders is that the region lacks an attractive, state-of-
the-art facility that can accommodate larger groups. While there are a few newer facilities in the region,
they are too small for larger groups. In addition to providing conventional meeting space, the facility
could also serve as an event and entertainment center, potentially creating strong synergies with the
variety of amenities and facilities that currently exist in Montgomery County.
With the addition of ten new hotels and a significant increase in lodging supply in Montgomery County in
recent years, the proposed executive meeting and events center could be a standalone facility and
capitalize on the supply of existing hotels based on a strategic geographic location. The facility could
have restaurant and retail offerings that would create synergies with existing retailers, restaurants, and
recreation/entertainment options surrounding the facility. In addition, as the facility attracts meetings and
overnight guests, it could boost group demand and serve as a main revenue generator for local hotels
and other local businesses throughout Montgomery County.
Main objectives of the study include:
Provide a framework to assess local market conditions to identify a suitable location
for the proposed executive meeting and events center in Montgomery County;
Project levels of demand and usability at the facility; and
Estimate the potential economic impacts attributable to the facility.
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
iii
E1 Montgomery County Scorecard Analysis
To identify key localities within Montgomery County that would serve as ideal
candidates for a new executive meeting and events center, the analysis focused on the
following local market conditions:
Infrastructure
Companies & employees
Existing hotels
Retail offerings
Demographics
Census places throughout Montgomery County received index scores based on their ranking for each
variable. Figure E1 provides summary rankings and final index scores for the top scoring Census
places in Montgomery County.
As shown, King of Prussia ranks first (index scores of 100) in all measured categories and
has a final scorecard value of 400 (note: higher final index scores are better). Blue
Bell/Plymouth Meeting is a second with a final score of 170, as it ranked slightly behind
King of Prussia in a number of categories. Horsham/Hatboro/Willow Grove ranks third
with a final scorecard value of 166.
Figure E1: Summary Rankings & Final Index Scores, by Census Place
Place Index Score -
Interstate Exits
Index Score-
Companies with More than 100
Employees
Index Score - Hotel
Rooms
Index Score - Retail Sales
Final Index Score
King of Prussia 100 100 100 100 400
Blue Bell/Plymouth Meeting 50 50 45 25 170
Horsham/Hatboro/Willow Grove 20 50 46 50 166
Fort Washington 33 25 18 33 109
Conshohocken/West Conshohocken
33 25 19 13 90
Norristown borough 0 13 1 0 14
Source: Tourism Economics (2014)
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
iv
E2 King of Prussia Lodging Market Analysis
After identifying King of Prussia as the ideal location for a new executive meeting
and events center in Montgomery County, the analysis focused on the lodging
market in King of Prussia. As mentioned previously, Montgomery County and King
of Prussia lost considerable meeting and exhibit space when the Valley Forge
Casino Resort opened its doors in 2012. This loss of meeting and event space led
to a corresponding loss in group room demand in the local lodging market. The
research team identified a set of nine hotels in, and proximate to, King of Prussia as
the King of Prussia Proximate Set. These are properties affiliated with national
chains categorized by Smith Travel Research (STR) as upscale or upper upscale,
plus the VFCR, which was specifically added given its location and facilities. This
set of hotels is a sub-set of the broader inventory of hotels in the area.
As shown in Figure E3, group occupancy contribution in 2011 at the King of Prussia
Proximate Set was 22.5%. In other words, group room nights filled 22.5% of
available rooms, representing 36.2% of room demand. After the loss of convention
and meeting space when VFCR opened, group occupancy contribution dropped five
percentage points and registered just 17.5% in 2012. The trend continued in 2013
as group occupancy contribution dropped to 16.3%. Based on current performance
levels, a new corporate/convention meeting and events center could be a catalyst
for attracting overnight guests, generating new group room demand and boosting
group occupancy contribution to levels similar to those prior to the opening of the
casino in 2012.
Figure E3: Chart of Group Occupancy Contribution, King of Prussia Proximate Set of Hotels, 2008-2012
Source: Smith Travel Research & Tourism Economics (2014)
24.2%
21.5%
23.8%22.5%
17.5%16.3%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
2008 2009 2010 2011 2012 2013
Group Occupancy Contribution (%)King of Prussia Set of Hotels
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
v
The analysis compared the King of Prussia Proximate Set of hotels to two benchmark
groups.
The first benchmark set consisted of hotels in the broader Mid-Atlantic Region with
greater than 350 rooms. This set ranged from large group-oriented hotels in Center
City Philadelphia, such as the Marriott Philadelphia Downtown, to mid-size hotels in
suburban markets. It excluded hotels in Manhattan, and in Atlantic City. Many of the
properties have substantial in-house meeting space, and in some cases, are
proximate to a large meeting and events center.
The second benchmark set consisted of selected regional hotels in Pennsylvania and
New Jersey with between 200 and approximately 400 rooms, and at least 15,000
square feet of in-house meeting space. These properties are in lower density
submarkets, rather than in urban core locations, and do not have proximate access to
major convention facilities.
Figure E4 compared group occupancy contribution (%) at the King of Prussia set of hotels to
the two identified benchmark groups from 2008 to 2013. As shown, the King of Prussia
Proximate Set suffered the most substantial drop in group occupancy contribution over the
time period and had the lowest contribution in 2013.
Figure E4: Group Occupancy Contribution, King of Prussia Set of Hotels and Benchmark Groups
Source: Smith Travel Research & Tourism Economics (2014)
Overall, the analysis of the lodging market in King of Prussia indicates that there is potential
opportunity for the proposed executive meeting and events center to generate group room demand
and boost group occupancy contributions to similar levels prior to the loss of event and convention
space when VFCR opened its doors.
15.0%
17.5%
20.0%
22.5%
25.0%
27.5%
30.0%
32.5%
35.0%
2008 2009 2010 2011 2012 2013
Regional hotels with 350+ rooms
Selected regional hotels with meeting space
King of Prussia proximate hotels
Group Occupancy Contribution (%)King of Prussia Set of Hotels & Benchmark Groups
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
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E3 Facility Dimensions & Comparable Facilities
Preliminary plans indicate that the executive meeting and events center could have 125,000 square feet (sf)
of total sellable space: a 50,000 sf main exhibit hall, 25,000 sf banquet hall, and approximately 20 meeting
rooms. To assess these proposed facility dimensions, the research team assembled detailed data on a
number of comparable convention and meeting facilities in varying communities nationwide. The set of
comparable convention and meeting facilities was based on a number of criteria, including total event space,
local population and employment base, years of operation, and gross revenue. The group of facilities
included in the analysis was selected to provide a range of values for the specified metrics. For example,
the comparable set of facilities has total square footage ranging from 84,500 sf to 200,000 sf. Providing a
range, allows for the comparison of the proposed 125,000 sf at the proposed Montgomery County executive
meeting and events center. Figure E5 summarizes facility details for the identified comparable facilities.
Figure E5: Meeting & Events Centers Performance and Facility Detail
DetailOverland,
KS
Lancaster,
PAIrving, TX
Gwinnet,
GAWaco, TX
Richmond,
VA
Niagara
Falls, NY
Raleigh,
NC
Opened 2002 2009 2011
Opened
1992,
expansion in
2003
Major $17.5M
renovation in
2012,
2002 2004 2008
Total Construction Cost ($ Millions) $178 $133 $134 $170 $225
Total Space (SF) 140,000 90,000 170,000 84,500 125,000 178,000 116,000 200,000
Construction Cost per SF $1,973 $782 $1,586 $955 $1,125
Year 2013 2012 2013 2013 2012 2012 2012
Gross Revenue $9.4 $1.6 $6.6 $10.9 $3.1 $2.4 $6.2
Net Income $0.6 -$1.0 -$1.4 -$0.4 -$0.3 -$1.5
Rental Income $1.4 $1.5 $1.3 $3.8
Food/Beverage Revenue $6.4 $0.1 $4.0 $1.6
Events hosted 400 241 341 281 229 300
Room nights generated 89,000 133,765 14,000 70,000
Attendees 128,883 345,000 36,796 440,000
Main Exhibit Hall (SF) 60,000 46,000 50,000 50,000 50,000 175,000 32,000 150,000
Banquet Hall (SF) 26,000 8,700 20,000 21,600 14,000 30,000 19,500 33,000
Other Meeting Space Noted
7 additional
meeting
rooms of
various
sizes
20 meeting
rooms
20 additional
meeting
rooms of
various sizes
23 additional
meeting
rooms of
various
sizes
14 additional
meeting
rooms, 2,000
SF theater
36 total
meeting and
banquet
rooms
15 meeting
rooms,
49-seat
amphitheater
20 meeting
roomgs
Attached Hotel412 Room
Sheraton
299 Room
Marriott
Reportedly a
new hotel will
open in 2015
(no affiliation
specified)
No (but deal
with Marriott
to build one
was just
announced)
No Yes No Yes
Facility Size
Financial Data ($ Millions)
Construction
Convention Center Performance and Facility Detail
Events & Room Nights
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
vii
E4 Feedback from Key Stakeholders
Overall, economic development professionals who were surveyed indicated that
they strongly supported a new executive meeting and events center in Montgomery
County. While some of the interviewees felt the new facility would be best situated
in the King of Prussia area, others felt Lansdale would be the most ideal location.
All economic development respondents felt that levels of demand are more than
adequate to warrant a new meeting and events center. According to certain
respondents, existing meeting and events clients at regional facilities have
expressed the desire for new space for smaller corporate meetings. According to
ownership/management at the Greater Philadelphia Expo Center at Oaks, the
facility has had tremendous success and has exceeded all forecasts since opening.
While the facility primarily deals with consumer/trade shows, its success could
complement activity at a new executive meeting and events center.
One common theme among respondents was technology and versatility.
Respondents indicated that to attract a wide variety of events and clients the
proposed meeting and events center must be a versatile, multi-use facility in order.
Further, to be successful, the facility must be able to attract business throughout the
year.
An additional factor echoed repeatedly across respondents was the importance of
the proposed facility and regional economic development. Respondents felt the
facility could be an important driver to spur economic development in Montgomery
County, particularly for increasing group room demand at local hotels.
The research team also conducted interviews with representatives from local
corporations and businesses to better understand the needs of potential users of the
proposed meetings and events center.
One main viewpoint mentioned by all of the potential user respondents is that the
region lacks an attractive, state-of-the-art facility that can accommodate larger
groups. While there are a few newer facilities in the region, they are too small for
larger groups.
Respondents indicated that the most important factors that would influence their
decision to use the proposed executive meeting and events center include
convenience/location, price, technology, and customer service. Additional
characteristics factoring into their decision would include the facility’s amenities,
ease and availability of parking, minimal traffic issues, a high quality building and
experience, and good catering options.
Regarding space requirements, potential user respondents indicated they would
need meeting space for 25-200 people and maximum space for 2,000 people.
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
viii
E5 Demand & Attendance Projections
Figures E6 and E7 summarize potential number of events and attendance, respectively, at the proposed
Montgomery County executive meeting and events center. These estimates are provided as representative
levels of operation consistent with the market opportunity as assessed in this analysis. These estimates are
provided for the purpose of illustrating the potential for facility operations in this market context and for the
purpose of quantifying the potential economic impacts associated with such a facility.
Figure E6: Projected Events at Proposed Montgomery County Executive Meeting and Events Center
Source: Tourism Economics (2014)
Figure E7: Projected Attendance at Proposed Montgomery County Executive Meeting and Events Center
Source: Tourism Economics (2014)
Event Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Exhibit Events
Conventions & Tradeshows 16 18 20 22 24 24 24 24 24 24
Consumer & Specialty Shows 6 7 8 8 8 8 8 8 8 8
Subtotal, Exhibit Events 22 25 28 30 32 32 32 32 32 32
Cultural & Social Events
Meetings & Seminars 106 108 110 110 110 110 110 110 110 110
Banquets 40 42 44 46 48 48 48 48 48 48
Entertainment Events 6 7 8 8 8 8 8 8 8 8
Civic Events & Other Events 20 22 24 26 28 28 28 28 28 28
Subtotal, Cultural & Social Events 172 179 186 190 194 194 194 194 194 194
Total Events 194 204 214 220 226 226 226 226 226 226
Event Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Exhibit Events
Conventions & Tradeshows 5,440 6,480 7,400 8,360 9,120 9,120 9,120 9,120 9,120 9,120
Consumer & Specialty Shows 4,500 7,000 9,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000
Subtotal, Exhibit Events 9,940 13,480 16,400 18,360 19,120 19,120 19,120 19,120 19,120 19,120
Cultural & Social Events
Meetings & Seminars 31,800 35,100 37,125 38,500 38,500 38,500 38,500 38,500 38,500 38,500
Banquets 12,000 13,650 14,850 16,100 16,800 16,800 16,800 16,800 16,800 16,800
Entertainment Events 7,200 9,100 10,800 11,200 11,200 11,200 11,200 11,200 11,200 11,200
Civic Events & Other Events 17,000 19,250 21,300 23,400 25,200 25,200 25,200 25,200 25,200 25,200
Subtotal, Cultural & Social Events 68,000 77,100 84,075 89,200 91,700 91,700 91,700 91,700 91,700 91,700
Total 77,940 90,580 100,475 107,560 110,820 110,820 110,820 110,820 110,820 110,820
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
ix
E6 Potential Economic Impacts
Figure E8 summarizes the projected countywide economic impacts of the proposed
facility. In Montgomery County, $30.1 million of total event spending in the facility’s
first year of operations is estimated to generate $19.1 million in indirect and induced
expenditures, resulting in an economic impact of $49.2 million throughout
Montgomery County. This countywide economic impact is estimated to include $9.0
million in employee salaries and wages, supporting an estimated 416 total jobs.
Once the proposed facility reaches its stabilized year of operations in year five, the
total countywide economic impact is estimated to amount to $85.0 million, including
$15.6 million in employee salaries and wages, supporting 719 total jobs throughout
the county.
Figure E8: Projected Economic Impacts, Montgomery County ($ Millions & Total Jobs)
Source: Tourism Economics (2014)
Figure E9 summarizes the projected statewide economic impacts of the proposed
facility. In the State of Pennsylvania, $30.1 million of total event spending in the
facility’s first year of operations is estimated to generate $33.5 million in indirect and
induced expenditures, resulting in an economic impact of $63.6 million throughout
the State. This statewide economic impact is estimated to include $19.0 million in
employee salaries and wages, supporting an estimated 818 total jobs. Once the
proposed facility reaches its stabilized year of operations in year five, the total
statewide economic impact is estimated to amount to $109.9 million, including $32.8
million in employee salaries and wages, supporting 1,415 total jobs throughout the
State.
Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Total Event Spending
($ Millions) $30.1 $38.5 $45.4 $50.1 $52.0 $52.0 $52.0 $52.0 $52.0 $52.0
Indirect & Induced Expenditures
($ Millions) $19.1 $24.5 $28.8 $31.8 $33.0 $33.0 $33.0 $33.0 $33.0 $33.0
Total Economic Impact
($ Millions) $49.2 $63.0 $74.2 $81.9 $85.0 $85.0 $85.0 $85.0 $85.0 $85.0
Total Employment Impact 416 533 628 693 719 719 719 719 719 719
Total Employee Salaries &
Wages ($ Millions) $9.0 $11.5 $13.6 $15.0 $15.6 $15.6 $15.6 $15.6 $15.6 $15.6
Economic Impacts - Montgomery County
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
x
Figure E9: Projected Economic Impacts, State of Pennsylvania ($ Millions & Total Jobs)
Source: Tourism Economics (2014)
Figure E10 summarizes the projected impacts of the proposed facility by total room
nights generated at local hotels, primarily in Montgomery County. As shown, in the
first year of operation, the facility is estimated to host 194 events and nearly 78,000
attendees, generating 36,564 total room nights at local hotels. By the time the
facility reaches steady state operations in year five, it is anticipated to host 226
events and 110,820 attendees, generating 52,737 total room nights.
Figure E10: Projected Lodging Impacts, Montgomery County
Source: Tourism Economics (2014)
Assuming approximately 70% of the 52,737 room nights will represent incremental
room demand to the local area, the proposed facility has the potential to raise
occupancy levels among a group of 15 local hotels by 3.9 percentage points, and
raise RevPAR by $4.90 (in 2013 dollars). Among these hotels, the effects are
expected to be concentrated at ten hotels in particular, yielding a potential
occupancy rate increase of 4.7 percentage points, with a RevPAR gain of $5.94 (in
2013 dollars). This potential impact would increase the group occupancy
contribution at these hotels to approximately 21.0%, which is close to the 22.5%
group occupancy contribution realized by these hotels in 2011, before the reduction
in available space at the Valley Forge Convention Center.
Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Total Event Spending
($ Millions) $30.1 $38.5 $45.4 $50.1 $52.0 $52.0 $52.0 $52.0 $52.0 $52.0
Indirect & Induced Expenditures
($ Millions) $33.5 $42.9 $50.6 $55.8 $57.9 $57.9 $57.9 $57.9 $57.9 $57.9
Total Economic Impact
($ Millions) $63.6 $81.4 $96.0 $105.9 $109.9 $109.9 $109.9 $109.9 $109.9 $109.9
Total Employment Impact 818 1,048 1,236 1,363 1,415 1,415 1,415 1,415 1,415 1,415
Total Employee Salaries &
Wages ($ Millions) $19.0 $24.3 $28.6 $31.6 $32.8 $32.8 $32.8 $32.8 $32.8 $32.8
Economic Impacts - State of Pennsylvania
Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Total Events 194 204 214 220 226 226 226 226 226 226
Total Attendance 77,940 90,580 100,475 107,560 110,820 110,820 110,820 110,820 110,820 110,820
Total Room Nights Generated 36,564 42,783 47,674 51,156 52,737 52,737 52,737 52,737 52,737 52,737
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
1
1 Introduction
1.1 Background
The meetings industry is a significant economic engine for the US economy. Recent
studies have shown that the US meeting industry played a critical role in a recovering
economy, as it supported jobs in communities across America and created environments
that foster innovation and business success. In 2012 there were an estimated 1.83
million corporate and business meetings, trade shows, conventions, congresses,
incentive events, and other meetings in the US. These meetings generated $280 billion in
direct spending, $67 billion in labor income, and $28 billion in federal, state, and local tax
revenues, while supporting 1.8 million total jobs.1
In 2012, the Valley Forge Casino Resort (VFCR) opened its doors, becoming the 11th
casino in Pennsylvania. While the casino represented a new attraction and recreation
option in Montgomery County, it led to a drastic reduction in available space at the Valley
Forge Convention Center, and 54,000 square feet (sf) of corporate meeting/event space
was removed from the local market in Montgomery County. With the reduced exhibit
space and meetings and convention offerings, companies and organizers that had hosted
events at the Valley Forge Convention Center have had to find new venues for their
events. In addition, while the majority of new casino patrons at VFCR are day-trippers,
the lack of corporate meeting/event space in the region has led to reduced demand from
the overnight market segment and lost business opportunities and revenues from the
convention/meetings industry.
Local stakeholders believe there is need for approximately 100,000+ square feet of
corporate meeting and event space that would effectively replace the lost meeting space
and business opportunities since the opening of VFCR. In addition to providing
conventional meeting space, the facility could also serve as an event and entertainment
center, potentially creating strong synergies with the variety of amenities and facilities
that currently exist in Montgomery County.
There has been a significant increase in lodging supply in Montgomery County in recent
years including the addition of ten new hotels, the proposed executive meeting and
events center could be a standalone facility capitalizing on the supply of existing hotels.
Based on a strategic geographic location, the facility could have restaurant and retail
offerings that would create synergies with existing retailers, restaurants, and
recreation/entertainment options surrounding the facility. In addition, as the facility
attracts meetings and overnight guests, it could boost group demand and serve as a
main revenue generator for local hotels and other local businesses throughout
Montgomery County.
1 Source: Economic Significance of Meetings, Convention Industry Council
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
2
1.2 Report Structure
Main objectives of the study include:
Provide a framework to assess local market conditions to identify a suitable location
for the proposed executive meeting and events center in Montgomery County;
Project levels of demand and usability at the facility; and
Estimate the potential economic impacts attributable to the facility.
The remainder of the report is broken down into the following sections:
Section 2 outlines local market conditions in Montgomery County and includes a
scorecard analysis of various metrics to identify potential locations for the proposed
executive meeting and events center. The scorecard metrics include public
transportation, highway accessibility, number of companies, and retail offerings.
Section 3 provides an in-depth analysis of the King of Prussia lodging market.
Section 4 identifies similar sized meeting and convention facilities throughout the US
and also provides in-depth case studies for a selected set of comparable facilities
Section 5 analyzes the potential dimensions of the proposed Montgomery County
executive meeting and events center in terms of total sellable space, exhibit and
banquet hall space, and meeting rooms. This section also focuses on the potential
activity and attendance levels at the facility.
Section 6 identifies current trends in the MICE (meetings, incentives, conferences, and
exhibitions) industry.
Section 7 provides feedback from interviews with key regional stakeholders, including
economic development professionals and potential corporate users of the proposed
facility.
Section 8 focuses on the potential levels of demand at the proposed executive meeting
and events center. Levels of demand are outlined by number of events and estimated
attendance.
Section 9 estimates the regional and statewide economic impacts attributable to the
proposed executive meeting and events center.
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
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2 Local Market Conditions & Scorecard Analysis
A local market’s strength in socioeconomic and demographic attributes can provide
insight to the market’s ability to attract and accommodate meetings and conventions of
varying sizes. A market’s existing hospitality system, along with its transportation,
infrastructure, entertainment, and retail offerings, all contribute to the success of a
potential corporate meeting and events center.
The analysis focused on the following data points to identify key localities within
Montgomery County that would serve as ideal candidates for a new corporate meetings
and events center.
Infrastructure
Companies & employees
Existing hotels
Retail offerings
Demographics
2.1 Montgomery County - Background
Montgomery County, PA is the third largest county in Pennsylvania. It is the second
wealthiest county in the Commonwealth and ranks as the 51st wealthiest nationwide.
Montgomery County is approximately 487 square miles and is home to nearly
800,000 residents2. It is also home to major employers in pharmaceuticals,
manufacturing, banking, healthcare, and education. The county is diverse, ranging
from farms and open land in Upper Hanover to densely populated streets in
Cheltenham.
Montgomery County is part of the Philadelphia-Camden-Wilmington, PA-NJ-DE-MD
Metropolitan Statistical Area (MSA), as well as the larger Philadelphia-Reading-
Camden, PA-NJ-DE-MD Combined Statistical Area (CSA).
Montgomery County maintains 75 miles of roads and 133 bridges. The county has
developed over 60 miles of multi-use trails and cares for seven county parks and
five historic sites.
2 Montgomery County website. http://www.montcopa.org
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
January 2015
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2.2 Infrastructure
Figure 2.1 illustrates the location of Montgomery County, major roads and highways,
and highway exits. Major interstates in Montgomery County include I-476, I-76, and
I-276. As shown in this figure, locations in King of Prussia, Plymouth Meeting, and
Conshohocken (all located towards the Southeastern border of Montgomery
County) have high numbers of highway exits, offering easy access by car for a
potential meeting and events center.
Figure 2.1: Map of Montgomery County, Major Roads, and Highway Exits
Source: Delaware Valley Regional Planning Commission & Tourism Economics (2014)
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Figure 2.2 provides indexed scores for the Census places in Montgomery County
with the highest number of interstate exits in each place. Counts of interstate exits
are based on data compiled by the Delaware Valley Regional Planning Commission.
In Montgomery County, King of Prussia ranks first with 21 interstate exits, followed
by Blue Bell/Plymouth Meeting with ten exits and Conshohocken/ West
Conshohocken and Fort Washington each with eight interstate exits.
Figure 2.2: Count of Montgomery County Interstate Exits, by Census Place
Place Number of
Interstate Exits Index Score
King of Prussia 21 100
Blue Bell/Plymouth Meeting 10 50
Conshohocken/West Conshohocken
8 33
Fort Washington 8 33
Horsham/Hatboro/Willow Grove 2 20
Stowe 2 20
Flourtown 1 14
Kulpsville 1 14
Spring House 1 14
Source: Delaware Valley Regional Planning Commission & Tourism Economics (2014)
Figure 2.3 maps the density of highway exits throughout Montgomery County.
Areas with low densities of highway exits are shaded in blue while areas with high
densities of highway exits are shaded in red. As shown, King of Prussia offers the
highest density of highway exits, providing easy access to/from I-76, I-276, Route
202, and Route 252.
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Figure 2.3: Highway Exit Density Map, Montgomery County
Source: Delaware Valley Regional Planning Commission & Tourism Economics (2014)
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2.3 Companies & Employment
Many major employers have headquarters or branches in Montgomery County.
Large companies span a diverse set of industries, including pharmaceuticals,
manufacturing, banking, healthcare, and education. Figure 2.4 provides a table of
the top 30 employers in Montgomery County.
Figure 2.4: Top 30 Employers in Montgomery County
Source: Hoovers Downloaded January 2014 and Select Greater Philadelphia and Montgomery County
Development Corporation
Rank Company
Employees in
Montgomery
County
1 Glaxosmithkline LLC 9,900
2 Lockheed Martin Corporation 5,150
3 Holy Redeemer Health System,
Inc.
5,000
4 Mercy Health System of
Southeastern Pennsylvania
4,000
5 Abington Memorial Hospital 3,900
6 The Pennsylvania State University 3,683
7 Unisys Corporation 3,400
8 Mds Pharma Services (US) Inc. 2,871
9 Main Line Hospitals, Inc. 2,854
10 County of Montgomery 2,683
11 S E I Investments Company 2,587
12 PRA International Operations, Inc. 2,100
13 Clemens Family Corporation 1,800
14 Giant Food, Inc. 1,789
15 Almac Group Incorporated 1,691
16 First Niagara Financial Group, Inc. 1,615
17 CL&T, Inc. 1,600
18 First Quality Retail Services, LLC 1,600
19 Clemens Food Group, LLC 1,558
20 Susquehanna Structured Products,
LLC
1,500
21 Acts Retirement-Life Communities,
Inc.
1,496
22 Merck Sharp & Dohme Corp. 1,440
23 Wal-mart Stores, Inc. 1,405
24 Quest Diagnostics Clinical 1,375
25 Macy's Retail Holdings, Inc. 1,356
26 Nectar Acquisition Corporation 1,301
27 Home Depot USA, Inc. 1,300
28 JBS Souderton, Inc 1,200
29 Genesis Healthcare Corporation 1,169
30 Acme Markets, Inc. 1,100
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Figure 2.5 provides counts of companies and index scores for the census places
with the most companies in Montgomery County with more than 100 employees.
King of Prussia ranks first with 34 companies with more than 100 employees,
followed by Horsham/Hatboro/Willow Grove and Blue Bell/Plymouth Meeting, each
of which have 19 companies with more than 100 employees.
Figure 2.5: Counts of Montgomery County Companies with 100 or More Employees,
by Census Place
Place
Local Businesses
with More than 100 Employees
Index Score
King of Prussia 34 100
Horsham/Hatboro/Willow Grove 19 50
Blue Bell/Plymouth Meeting 19 50
Conshohocken/West Conshohocken
10 25
Fort Washington 10 25
Pottstown borough 5 17
Harleysville 5 17
Norristown borough 4 13
Audubon 4 13
Bryn Mawr 4 13
Source: InfoUSA & Tourism Economics (2014)
Figure 2.6 maps business in the tri-county region (Montgomery, Chester, and
Delaware Counties) with 100 or more employees. Areas in the county with high
numbers of companies include King of Prussia and Horsham/Hatboro/Willow Grove,
where there are numerous business parks and office complexes.
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Figure 2.6: Map of Companies with 100 or More Employees, by Total Number of Employees
Source: InfoUSA & Tourism Economics (2014)
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Based on the company employment data outlined in Figure 2.4, Figure 2.5, and
Figure 2.6, Figure 2.7 displays the employment density throughout the tri-county
area. Areas shaded in red indicate the highest employment densities in
Montgomery, Chester, and Delaware counties.
In the eastern part of Montgomery County, the Willow Grove/Horsham area has the
highest concentration of employees. In southern portion of the County, King of
Prussia, near Montgomery County’s borders to Chester and Delaware Counties, has
the highest concentration of workers.
Figure 2.7: Employment Density Map, Tri-County Area
Source: InfoUSA & Tourism Economics (2014)
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Analysis of existing meeting venues in the Southeastern Pennsylvania and New
Jersey noted three other proximate areas with concentrations of meeting facilities:
Cherry Hill, NJ area, Philadelphia, PA area, and Princeton, NJ area. The
demographic data presented in Figure 2.8 provides a comparison between King of
Prussia and these other areas. This demonstrates that King of Prussia has similar
broad regional density of population and income as these other areas.
Figure 2.8: Demographic Profile of King of Prussia and Competing Communities
Source: Tourism Economics (2014)
Cherry Hill, NJ 25-mile 50-mile 75-mile 100-mile
Population (2014) 4,439,362 8,212,098 15,074,003 29,081,157
Ave Household Inc. (2013) $78,097 $87,196 $86,271 $86,415
Per Capita Income $30,177 $33,055 $32,318 $32,685
Total Income (000s) $133,966,627 $271,450,899 $487,161,628 $950,517,616
King of Prussia, PA 25-mile 50-mile 75-mile 100-mile
Population (2014) 4,314,134 8,214,317 13,789,364 29,449,188
Ave Household Inc. (2013) $81,101 $84,455 $88,010 $84,056
Per Capita Income $31,520 $32,175 $33,209 $32,036
Total Income (000s) $135,981,503 $264,295,649 $457,930,989 $943,434,186
Princeton, NJ 25-mile 50-mile 75-mile 100-mile
Population (2014) 2,513,647 17,036,006 25,924,755 30,296,318
Ave Household Inc. (2013) $109,404 $88,517 $89,914 $90,457
Per Capita Income $39,562 $34,081 $33,709 $33,814
Total Income (000s) $99,444,902 $580,604,120 $873,897,566 $1,024,439,696
Philadelphia, PA 25-mile 50-mile 75-mile 100-mile
Population (2014) 4,688,882 7,941,067 13,732,380 29,400,527
Ave Household Inc. (2013) $81,237 $85,271 $87,972 $85,107
Per Capita Income $31,436 $32,526 $33,113 $32,327
Total Income (000s) $147,399,694 $258,291,145 $454,720,298 $950,430,836
Demographic Data: Competing Communities
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2.5 Local Hotels
2.5.1 Hotel Stock & Hotel Room Density
The existing stock of hotels is expected to directly contribute to the ability of a
community to host meetings and events. In addition, hospitality infrastructure plays
a key role in the ability of a proposed meeting and events center to generate
economic impacts.
Figure 2.9 maps hotels throughout Montgomery County. In Montgomery County
areas with the most hotels include Horsham/Hatboro/Willow Grove as well as King
of Prussia. Both of these areas also offer easy access via interstate highways and
also have the highest concentrations of businesses in the County.
Figure 2.9: Map of Hotels in Montgomery County, by Total Number of Rooms
Source: Smith Travel Research & Tourism Economics (2014)
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Based on data from Smith Travel Research, Figure 2.10 provides counts of hotels,
hotel rooms throughout Montgomery County, and index scores, by Census place
and proximate area. As shown, King of Prussia ranks first with 15 hotels and an
estimated 2,606 hotel rooms. Horsham/Hatboro/Willow Grove ranks second with
nine hotels and nearly 1,200 total hotel rooms. Blue Bell/Plymouth Meeting ranks
third with eight hotels providing more than 1,000 total hotel rooms. The index score
is calculated based on number of hotel rooms.
Figure 2.10: Counts of Montgomery County Hotels & Hotel Rooms, by Census
Place
Place Hotels Hotel Rooms Index Score
King Of Prussia 15 2,606 100
Horsham/Hatboro/Willow Grove 9 1,199 46
Blue Bell/Plymouth Meeting 8 1,166 45
Montgomeryville 7 602 23
Conshohocken/West
Conshohocken 3 496 19
Fort Washington 3 469 18
Pottstown 5 445 17
Audubon 3 365 14
Kulpsville 2 317 12
Limerick/Royersford 4 296 11
Source: Smith Travel Research & Tourism Economics (2014)
Based on the total number of hotel rooms by property, Figure 2.11 maps the density
of hotel rooms in the tri-county area. King of Prussia offers the highest density of
hotel rooms, as indicated by the areas shaded in red. Despite having many hotels,
the Horsham/Hatboro/Willow Grove does not have a high density of hotel rooms.
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Figure 2.11: Hotel Room Density Map, Tri-County
Source: Smith Travel Research & Tourism Economics (2014)
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2.6 Retail Offerings
The overall attractiveness of the potential host region to a executive meeting and events
center will depend, in part, on the local retail and food and beverage offerings. As shown
in Figure 2.12, King of Prussia offers the highest number of retail and food and beverage
options in Montgomery County. Included in King of Prussia’s numerous retailers and
food and food and beverage establishments is King of Prussia Mall, which is the largest
shopping mall on the East Coast in terms of gross leasable retail square feet. King of
Prussia Mall is a luxury mall with numerous upscale retailers and a variety of food and
beverage options and would complement a new corporate meeting and events center.
Figure 2.12: Montgomery County Retail & Food and Beverage Companies
Source: InfoUSA & Tourism Economics (2014)
Based on data from InfoUSA, Figure 2.13 provides estimates of total retail and food
& beverage sales and index scores by Census place. King of Prussia ranks first
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with nearly $11.3 billion in total sales. Horsham/Hatboro/Willow Grove ranks
second with approximately $1.7 billion in sales, followed by Fort Washington with
$0.9 billion in sales.
Figure 2.13: Montgomery County Retail and Food & Beverage Sales, by Census Place ($ Millions)
Place
Retail and Food & Beverage
Sales ($ Millions)
Index Score
King of Prussia $11,292.3 100
Horsham/Hatboro/Willow Grove $1,708.9 50
Fort Washington $930.7 33
Blue Bell/Plymouth Meeting $867.2 25
Montgomeryville $506.8 20
Ardmore $321.1 17
Audubon $199.2 14
Conshohocken/West Conshohocken
$150.0 13
Flourtown $114.1 11
Harleysville $111.8 10
Source: InfoUSA & Tourism Economics (2014)
Based on the establishment level estimates of retail sales, Figure 2.14 maps retail
sales densities throughout Montgomery County. Areas in red indicate areas with
high concentrations of retail sales. As shown, while Horsham/Hatboro/Willow Grove
has high concentrations of retail sales, King of Prussia by far has the highest
concentration of retail and food and beverage sales in Montgomery County.
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Figure 2.14: Retail & Food and Beverage Establishment Density Map
Source: InfoUSA & Tourism Economics (2014)
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2.7 Overall Scorecard Analysis
The preceding sections have outlined various local market conditions throughout Montgomery
County. The analysis examined transportation options, highway accessibility, countywide
concentrations of companies and employment, existing hotel stock, and retail and food and
beverage offerings. Each section provided visualizations/maps of how the various regions
throughout Montgomery County had particular strengths for each metric. Each individual metric
served as an input for the overall scorecard analysis, which helps identify the ideal location for the
proposed corporate meeting and events center.
Figure 2.15 provide a graphical description of how the various scorecard variables interact and
combine to arrive at the overall scorecard for Montgomery County.
Figure 2.15: Montgomery County Scorecard Outline
Source: Tourism Economics (2014)
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Figure 2.16 summarizes the final index scores based on the various score card metrics
outlined in previous sections. As shown, King of Prussia ranks first (index scores of 100) in
all measured categories and has a final scorecard value of 400 (note: higher final index
scores are better). Blue Bell/Plymouth Meeting is second with a final score of 170, as it
ranked slightly behind King of Prussia in a number of categories. Horsham/Hatboro/Willow
Grove ranks third with a final scorecard value of 166.
Figure 2.16: Summary Rankings & Final Index Scores, by Census Place
Place Index Score -
Interstate Exits
Index Score-
Companies with More than 100
Employees
Index Score - Hotel
Rooms
Index Score - Retail Sales
Final Index Score
King of Prussia 100 100 100 100 400
Blue Bell/Plymouth Meeting 50 50 45 25 170
Horsham/Hatboro/Willow Grove 20 50 46 50 166
Fort Washington 33 25 18 33 109
Conshohocken/West Conshohocken
33 25 19 13 90
Norristown borough 0 13 1 0 14
Source: Tourism Economics (2014)
Figure 2.17 depicts the results of the overall scored analysis throughout Montgomery
County. Blue areas indicate regions with low overall scores, while areas shaded in yellow
and red highlight areas with high overall scores.
As shown in the map, areas along I-276 (the Pennsylvania Turnpike) scored relatively
high, including the Horsham/Willow Grove area. However, King of Prussia ranked the
highest in the scorecard analysis. As described in previous sections, King of Prussia
offers high densities of highway exits and easy access by car, and high concentrations of
employees and companies that could help support a new corporate meeting and events
center.
In addition to providing easy accessibility, King of Prussia offers some of the nation’s
largest and most diverse set of retail and food and beverage options. More importantly,
King of Prussia boasts the highest concentration of hotel rooms in Montgomery County,
which is an important factor in considering a community’s ability to support meetings and
events. Further, as discussed in the benchmarking analysis in the following section,
current group room demand at King of Prussia hotels indicates that a new meeting and
events center could generate new group room demand at local hotels.
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Figure 2.17: Map of Montgomery County Scorecard Analysis
Source: InfoUSA & Tourism Economics (2014)
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3 King of Prussia Lodging Market Analysis
3.1 King of Prussia Lodging Market
The inventory of local hotels includes the 15 hotels in King of Prussia as well as
hotels in proximate areas. Among this inventory of local hotels, the research team
identified a set of nine hotels proximate to King of Prussia, that are anticipated to
accommodate the majority of overnight guests attending meetings and events at the
proposed executive meeting and events center. These hotels are listed in Figure 3.1
as the King of Prussia Proximate Set. Eight of these hotels are in King of Prussia,
Montgomery County, while the ninth is in Wayne, Chester County.
King of Prussia Proximate Set was identified by the research team as hotels that are
affiliated with national chains that are classified by STR as upscale or above, plus
the Valley Forge Casino Resort, which was specifically added given its location and
facilities. There are other hotels in the local area (all within Montgomery County) that
would also be expected to accommodate overnight guests attending events at the
proposed executive meeting and events center. In particular:
Best Western Plus The Inn at King of Prussia (168 rooms, upper
midscale by STR chain scale);
Comfort Inn Valley Forge National Park (121 rooms, upper midscale
by STR chain scale);
Fairfield Inn Valley Forge King of Prussia (80 rooms, upper
midscale by STR chain scale);
Hampton Inn Philadelphia King of Prussia Valley Forge (147 rooms,
upper midscale by STR chain scale);
Holiday Inn Express & Suites King of Prussia (155 rooms, upper
midscale by STR chain scale); and,
Motel 6 Philadelphia King of Prussia (170 rooms, economy by STR
chain scale).
In total, the 1,775 rooms at the nine hotels in the King of Prussia Proximate Set,
plus the 841 rooms at the six upper midscale and economy hotels listed above,
represent a total of 15 hotels with 2,616 rooms. The particular hotels that would
accommodate guests related to a particular meeting or even at the proposed
executive meeting and events center would depend on the characteristics of the
group. We anticipate the majority of the impact would be the nine hotels in the King
of Prussia Proximate Set, with additional impacts to the other six local hotels
identified and at other hotels in Montgomery County, and in the surrounding area.
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Figure 3.1: King of Prussia Proximate Set of Hotels
Source: Smith Travel Research & Tourism Economics (2014)
Figure 3.2 provides historical performance data for the identified set of nine King of
Prussia hotels.
Figure 3.2: Historical Performance, King of Prussia Proximate Set of Hotels, 2008-2013
Source: Smith Travel Research & Tourism Economics (2014)
Property Location Rooms Total Per guest room
Courtyard Philadelphia Valley Forge King Of Prussia Wayne, PA 150 1,250 8.3
Crowne Plaza Philadelphia King of Prussia King Of Prussia, PA 226 16,378 72.5
Doubletree Philadelphia Valley Forge King Of Prussia, PA 327 30,177 92.3
Hyatt House King Of Prussia King Of Prussia, PA 147 3,367 22.9
Hyatt Place Philadelphia King Of Prussia King Of Prussia, PA 129 1,064 8.2
Radisson Hotel Valley Forge King Of Prussia, PA 325 21,807 67.1
Springhill Suites Philadelphia Valley Forge King Of Prussia King Of Prussia, PA 131 350 2.7
Sheraton Valley Forge King Of Prussia, PA 180 37,136 206.3
Valley Forge Casino Resort - Casino Tower King Of Prussia, PA 160 - -
Total 1,775 111,529
Average 197 12,392 62.8
Meeting space (sq. ft.)
YearTotal
occupancyTotal ADR
Group
room
nights
Group
occupancy
contribution
Group
share
Group
ADR
2008 53.8% 132.74$ 128,387 24.2% 45.0% 121.67$
2009 47.5% 116.95$ 113,789 21.5% 45.2% 116.84$
2010 55.1% 110.92$ 130,943 23.8% 43.2% 108.47$
2011 62.2% 120.56$ 113,135 22.5% 36.2% 118.18$
2012 60.9% 123.49$ 102,259 17.5% 28.7% 124.72$
2013 62.7% 124.51$ 105,306 16.3% 25.9% 126.70$
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As mentioned previously, Montgomery County and King of Prussia lost considerable
meeting and exhibit space when the Valley Forge Casino Resort opened its doors in
2012. This loss of meeting and event space led to a corresponding loss in group
room demand in the local lodging market. As shown in Figure 3.3, among hotels in
the King of Prussia Proximate Set group occupancy contribution in 2011 was 22.5%.
In other words, group room nights filled 22.5% of available rooms, representing
36.2% of room demand. After the loss of convention and meeting space when
VFCR opened, group occupancy contribution dropped five percentage points and
registered just 17.5% in 2012. The trend continued in 2013 as group occupancy
contribution dropped to 16.3%. Based on current performance levels, a new
corporate meeting and events center could be a catalyst for attracting overnight
guests, generating new group room demand and boosting group occupancy
contribution to levels similar to those prior to the opening of the casino in 2012.
Figure 3.3: Chart of Group Occupancy Contribution, King of Prussia Proximate Set of Hotels, 2008-2012
Source: Smith Travel Research & Tourism Economics (2014)
Figure 3.4 charts total ADR and group ADR for the identified set of hotels in King of
Prussia. In 2008, total ADR was higher than group ADR, indicating strong transient
rates. During the national recession, both total ADR and group ADR declined as
hotels competitively reduced room rates in a context of weak demand. Since then,
the local lodging market has gradually regained pricing, and group ADR has
recovered to a level that is ahead of its 2008 level. This indicates that some groups
continue to value the opportunity to stay at hotels in the local market, in some cases
potentially paying a premium to secure limited available meeting and event space.
24.2%
21.5%
23.8%22.5%
17.5%16.3%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
2008 2009 2010 2011 2012 2013
Group Occupancy Contribution (%)King of Prussia Set of Hotels
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Figure 3.4: Chart of Total ADR & Group ADR, King of Prussia Proximate Set of Hotels, 2008-2013
Source: Smith Travel Research & Tourism Economics (2014)
3.2 Hotel Benchmark & Comp Set Analysis
In addition to the set of hotels in King of Prussia, the analysis also identified two sets
of hotels to serve as benchmarks for the level of group business that is typically
accommodated at hotels that have adequate meeting space, either in-house or in
nearby convention facilities. These sets of benchmark hotels also help illustrate that
group business has declined more significantly in King of Prussia since 2012.
The first benchmark set, as shown in Figure 3.5, consists of hotels in the broader
Mid-Atlantic Region with greater than 350 rooms. This set ranges from large group-
oriented hotels in Center City Philadelphia, such as the Marriott Philadelphia
Downtown, to mid-size hotels in suburban markets. It excluded hotels in Manhattan,
and in Atlantic City. Many of the properties have substantial in-house meeting
space, and in some cases, are proximate to a large meeting and events center.
$1
32
.74
$11
6.9
5
$11
0.9
2
$1
20
.56
$1
23
.49
$1
24
.51
$1
21
.67
$11
6.8
4
$1
08
.47
$11
8.1
8
$1
24
.72
$1
26
.70
$100.00
$105.00
$110.00
$115.00
$120.00
$125.00
$130.00
$135.00
2008 2009 2010 2011 2012 2013
Total ADR Group ADR
Total ADR & Group ADRKing of Prussia Set of Hotels
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Figure 3.5: Selected Regional Hotels with 350+ Rooms
Source: Tourism Economics (2014)
The second benchmark set outlined in Figure 3.6 consists of selected regional
hotels in Pennsylvania and New Jersey with between 200 and approximately 400
rooms, and at least 15,000 square feet of in-house meeting space. These properties
are in lower density submarkets, rather than in urban core locations, and do not
have proximate access to major convention facilities.
Figure 3.6: Selected Regional Hotels with Meeting Space (Between 200 and 400
Rooms and at Least 15,000 SF of In-house Meeting Space)
Source: Tourism Economics (2014)
The historical performance of each of the benchmark sets is summarized in Figure
3.7. We noted that the King of Prussia Proximate Set has experienced a significant
decline in its group occupancy contribution, which declined from 24.2% in 2008, to
16.3% in 2013. This is a larger magnitude decline than was experienced by either of
the two other sets of hotels.
Property Location Rooms Total Per guest room
Crowne Plaza Philadelphia Cherry Hill Cherry Hill, NJ 408 24,900 61.0
Crowne Plaza Princeton Plainsboro, NJ 291 29,069 99.9
Dolce Stockton Seaview Hotel & Golf Club Galloway, NJ 296 16,638 56.2
Hilton Philadelphia City Avenue Philadelphia, PA 209 23,863 114.2
Hyatt Regency Princeton Princeton, NJ 330 26,372 79.9
Princeton Marriott at Forrestal Princeton, NJ 302 29,510 97.7
Total 1,836 150,352
Average 306 25,059 81.9
Meeting space (sq. ft.)
Area
Guest
rooms
Share of
total
New Jersey excluding Atlantic City 6,484 26.7%
New York excluding Manhattan 5,205 21.5%
Maryland (primarily Baltimore metro) 4,730 19.5%
Pennsylvania (Philadelphia metro) 5,230 21.6%
Delaware 500 2.1%
Connecticut (Stamford and Greenwich) 2,096 8.6%
Sub-total 24,245
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Figure 3.7: Historical Performance of Benchmark Sets
Regional hotels with 350+ rooms
Year Total occupancy Total ADR
Group room
nights
Group
occupancy
contribution Group share Group ADR
2008 65.3% 163.62 2,127,324 25.3% 38.8% 157.60
2009 60.4% 144.37 1,922,576 22.0% 36.4% 146.77
2010 65.4% 139.81 2,076,332 23.6% 36.0% 140.42
2011 66.5% 144.48 2,164,749 24.5% 36.8% 144.17
2012 68.9% 150.26 2,249,166 25.4% 36.9% 150.47
2013 69.9% 153.23 2,175,607 24.6% 35.2% 153.78
Selected regional hotels with meeting space
Year Total occupancy Total ADR
Group room
nights
Group
occupancy
contribution Group share Group ADR
2008 52.7% 146.83 161,652 23.0% 43.6% 153.72
2009 48.3% 128.38 128,883 18.3% 37.9% 139.14
2010 49.3% 121.23 136,457 19.4% 39.3% 126.01
2011 52.7% 124.22 135,553 20.1% 38.1% 126.63
2012 52.0% 129.92 131,847 19.1% 36.8% 133.59
2013 51.4% 134.03 113,848 18.2% 35.4% 135.02
King of Prussia proximate hotels
Year Total occupancy Total ADR
Group room
nights
Group
occupancy
contribution Group share Group ADR
2008 53.8% 132.74 128,387 24.2% 45.0% 121.67
2009 47.5% 116.95 113,789 21.5% 45.2% 116.84
2010 55.1% 110.92 130,943 23.8% 43.2% 108.47
2011 62.2% 120.56 113,135 22.5% 36.2% 118.18
2012 60.9% 123.49 102,259 17.5% 28.7% 124.72
2013 62.7% 124.51 105,306 16.3% 25.9% 126.70
Source: STR; Tourism Economics
Historical performance of benchmark sets
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Figure 3.8: Group Occupancy Contribution, King of Prussia Proximate Set of Hotels and Benchmark
Groups
Source: Smith Travel Research & Tourism Economics (2014)
We summarized the meeting space and guest room inventory of each of the three sets in the
following table. Total meeting and exhibit space per guest room, which includes in-house space
and selected convention facilities, averages 109 square feet per guest room at the regional hotels
with greater than 350 rooms, and 88 square feet per guest room at the selected regional hotels
with meeting space, as shown in Figure 3.9. Meanwhile, hotels in the King of Prussia set offer only
63 square feet of meeting space per guest room.
Figure 3.9: Meeting Space and Group Room Nights (2013)
Source: STR & Tourism Economics (2014)
Regional
hotels with
greater than
350 rooms
Selected
regional
hotels with
meeting space
KOP
proximate set
Guest rooms 24,207 1,717 1,775
In-house meeting space (in square feet, at hotels) 1,274,000 150,000 112,000
Meeting space per guest room (in square feet) 53 88 63
Selected convention facilities (in square feet) 1,362,000 Meeting and exhibit space per guest room (in
square feet) 56
Total meeting and exhibit space (in square feet) 2,637,000 150,000 112,000
109 88 63
Total meeting and exhibit space per guest room
(in square feet)
15.0%
17.5%
20.0%
22.5%
25.0%
27.5%
30.0%
32.5%
35.0%
2008 2009 2010 2011 2012 2013
Regional hotels with 350+ rooms
Selected regional hotels with meeting space
King of Prussia proximate hotels
Group Occupancy Contribution (%)King of Prussia Set of Hotels & Benchmark Groups
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We expanded this analysis to include the group room nights generated in each of
the sets, as reported to STR. The regional hotels with greater than 350 rooms
generate 90 room nights of group demand per guest room annually, compared to 66
room nights at the selected regional hotels, and 59 room nights at the King of
Prussia Proximate Set. The hotels in the King of Prussia Proximate Set generate a
high level of group demand relative to meeting space (944 annual group room
nights per 1,000 square feet of meeting space), but have a low level of meeting
space (63 square feet per guest room). Group demand at properties in the King of
Prussia Proximate Set contributes a moderate level of occupancy (16.3%)
compared to hotels in the regional set of properties with more than 350 rooms
(24.6%) or compared to the selected regional hotels with between 200 and
approximately 400 rooms (18.2%), as shown in Figure 3.10. Overall, this analysis is
consistent with the potential opportunity for the proposed meeting and events
center.
Figure 3.10: Meeting Space and Group Room Nights (2013)
Source: STR & Tourism Economics (2014)
Regional
hotels with
greater than
350 rooms
Selected
regional
hotels with
meeting space
KOP
proximate set
KOP
proximate set
(stabilized
year)
Guest rooms 24,207 1,717 1,775 1,775
In-house meeting space (in square feet, at hotels) 1,274,000 150,000 112,000 112,000
Meeting space per guest room (in square feet) 53 88 63 63
Selected convention facilities (in square feet) (b) 1,362,000 100,000 Meeting and exhibit space per guest room (in
square feet) 56 56
Total meeting and exhibit space (in square feet) 2,637,000 150,000 112,000 212,000
109 88 63 119
Group room nights (annual, in thousands) 2,176 114 105
Group room nights per guest room (annual) 90 66 59
Group contribution in occupancy points 24.6% 18.2% 16.3%
Group segment share of total occupancy 35.2% 35.4% 25.9%
825 757 944
Group room nights per 1,000 square feet of
meeting space (annual)
Total meeting and exhibit space per guest room
(in square feet)
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4 Comparable Venues
This section identifies comparable convention and meetings facilities throughout the US and
takes a closer, in depth look at the profiles of certain facilities. The main purpose of examining a
set of comparable facilities is to obtain insight into the physical and operational characteristics of
facilities located in similar communities. More importantly, data compiled on various aspects of
these comparable facilities will serve as inputs for the subsequent estimation of physical and
operational data for the potential meeting and events center in King of Prussia.
4.1 Smaller Convention Centers
With approximately 100,000+ square feet of exhibit and meeting space, the proposed
Montgomery County executive meeting and events center would fall under the group of “smaller”
convention centers offering between 50,000 and 125,000 sf of prime exhibit space. According to
the publication Trade Show Executive, this group of centers, also referred to as “Tier IV”,
constitutes 57% of the 307 North American convention centers with a minimum of 50,000 sf of
prime exhibit space, as shown in Figure 4.1. The average square footage of prime exhibit space
for Tier IV venues in North America is slightly over 80,000.
Figure 4.1: Convention Centers by Size Classification (%)
Source: Trade Show Executive (2013)
Tier IV smaller convention centers located in the US account for a total of approximately 11.4
million sf of prime exhibit space. A list of these convention centers is detailed in Figure 4.2. This
list was originally published in Trade Show Executive magazine and may not include every
convention/executive meeting facility throughout the US and may have inconsistencies in the
reported prime exhibit space.
Tier I 1,000,000 +
sf, 4%
Tier II 350,000 -
999,999 sf, 13%
Tier III 125,000 -
349,999 sf, 26%
Tier IV 50,000 -
124,999 sf, 57%
Convention Centers by SIze Classification
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Figure 4.2: Listing of Tier IV Convention Facilities (50,000 – 124,999 sf of Prime Exhibit Space)
Exhibition FacilityPrime Exhibit
Space (sf)Location Web Site
1 Duluth Entertainment Convention Center 120,000 Duluth, MN www.duluthconventioncenter.com
2 Knoxville Convention Center 119,922 Knoxville, TN www.kccsmg.com
3 Rushmore Plaza Civic Center 119,000 Rapid City, SD www.gotmine.com
4 Nashville Convention Center 118,675 Nashville, TN www.nashvilleconventionctr.com
5 Seaport Boston Hotel & Seaport World Trade Center 118,000 Boston, MA www.seaportboston.com
6 Charleston Area Convention Center 115,000 Charleston, SC www.charlestonconvention.com
7 Hilton Chicago 115,000 Chicago, IL www.hiltonchicago.com
8 Ontario Convention Center 115,000 Ontario, CA www.ontariocc.com
9 Tucson Convention Center 114,000 Tucson, AZ www.tucsonconventioncenter.org
10 Springfield Exposition Center 112,000 Springfield, MO www.springfieldexpo.com
11 Arizona Exposition & State Fair 111,000 Phoenix, AZ www.arizonaexposition.com
12 Walt Disney World Swan & Dolphin Resort 110,500 Lake Buena Vista, FL www.swandolphinmeetings.com
13 John Ascuaga's Nugget Resort Casino 110,000 Sparks, NV www.janugget.com
14 Fargodome 110,000 Fargo, ND www.fargodome.com
15 Franklin County Veterans Memorial 110,000 Columbus, OH www.fcvm.com
16 Peoria Civic Center 110,000 Peoria, IL www.peoriaciviccenter.com
17 Sevierville Convention Center 108,261 Sevierville, TN www.seviervilleeventscenter.com
18 Mobile Civic Center 108,000 Mobile, AL www.mobilecivicctr.com
19 Hot Springs Convention Center 103,000 Hot Springs, AR www.hotsprings.org
20 Cox Business Center 102,600 Tulsa, OK www.coxcentertulsa.com
21 Hampton Roads Convention Center 102,600 Hampton, VA www.thehrcc.com
22 Caesars Palace 102,000 Las Vegas, NV www.lvmeetingsbyharrahs.com
23 Georgia Dome 102,000 Atlanta, GA www.gadome.com
24 Chattanooga Convention Center 100,800 Chattanooga, TN www.chattanoogaconventioncenter.org
25 Myrtle Beach Convention Center 100,800 Myrtle Beach, SC www.myrtlebeachconventioncenter.com
26 Spokane Convention Center 100,160 Spokane, WA www.visitspokane.com
27 Alliant Energy Center 100,000 Madison, WI www.alliantenergycenter.com
28 Baton Rouge River Center 100,000 Baton Rouge, LA www.brrivercenter.com
29 Cox Convention Center 100,000 Oklahoma City, OK www.coxconventioncenter.com
30 Dulles Expo Center 100,000 Chantilly, VA www.dullesexpo.com
31 Knoxville Expo Center 100,000 Knoxville, TN www.knoxvilleexpocenter.com
32 Monroeville Convention Center 100,000 Monroeville, PA www.monroevilleconventioncenter.com
33 North Atlanta Trade Center 100,000 Norcross, GA www.northatlantatradecenter.com
34 Arthur R. Outlaw Mobile Convention Center 100,000 Mobile, AL www.mobileconventions.com
35 Palm Beach County Convention Center 100,000 West Palm Beach, FL www.pbconventioncenter.com
36 Renaissance Schaumburg Hotel & Convention Center 100,000 Schaumburg, ILwww.renaissanceschaumburg.com
37 Rhode Island Convention & Entertainment Complex 100,000 Providence, RI www.riconvention.com
38 Santa Clara Convention Center 100,000 Santa Clara, CA www.santaclara.org
39 Savannah International Trade & Convention Center 100,000 Savannah, GA www.savtcc.com
40Sheraton Greensboro Hotel at Four Seasons/ Joseph
S. Koury Convention Center100,000 Greensboro, NC
www.sheratongreensboro.com
41 Hara Arena, Conference & Exhibition Center 98,400 Dayton, OH www.haracomplex.com
42 Las Vegas Cashman Convention Center 98,100 Las Vegas, NV www.vegasmeansbusiness.com
43 Fresno Convention & Entertainment Center 98,000 Fresno, CA www.fresnoconventioncenter.com
44 Clark County Event Center at the Fairgrounds 97,200 Ridgefield, WA www.clarkcoeventcenter.com
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Exhibition FacilityPrime Exhibit
Space (sf)Location Web Site
45 Wynn | Encore 96,197 Las Vegas, NV www.wynnmeetings.com
46 Rosen Shingle Creek Hotel & Golf Club 95,848 Orlando, FL www.rosenshinglecreek.com
47 Ocean Center 95,000 Daytona Beach, FL www.oceancenter.com
48 Will Rogers Memorial Center 95,000 Fort Worth, TX www.willrogersmemorialcenter.com
49 Shreveport Convention Center 95,000 Shreveport, LA www.shreveportcenter.com
50 Roland E. Powell Convention Center 93,180 Ocean City, MD www.ococean.com
51 Ford Park Event Center 93,000 Beaumont, TX www.fordpark.com
52 Trump Taj Mahal Casino & Resort 93,000 Atlantic City, NJ www.trumptaj.com
53 Omaha Civic Auditorium 92,700 Omaha, NE www.omahacivic.com
54 Palm Springs Convention Center 92,000 Palm Springs, CA www.palmspringscc.com
55 The Broadmoor 90,000 Colorado Springs, CO www.broadmoor.com
56 Lee Civic Center 90,000 Fort Myers, FL www.leeciviccenter.com
57 JW Marriott Desert Ridge Resort & Spa 90,000 Phoenix, AZ www.jwdesertridgeresort.com
58 The Mirage Hotel & Casino 90,000 Las Vegas, NV www.mirage.com
59 Bally's Las Vegas 86,000 Las Vegas, NV www.lvmeetingsbyharrahs.com
60 Disney’s Coronado Springs Resort 86,000 Lake Buena Vista, FL www.disneymeetings.com
61 Paris Las Vegas 85,000 Las Vegas, NV www.lvmeetingsbyharrahs.com
62 Expo Center at the South Florida Fairgrounds 84,750 West Palm Beach, FL www.southfloridafair.com
63 Montana ExpoPark 84,000 Great Falls, MT www.goexpopark.com
64 Statehouse Convention Center 83,000 Little Rock, AR www.littlerockmeetings.com
65 Island Grove Regional Park & Events Center 82,400 Greeley, CO greeleygov.com/parks/
66 U.S. Cellular Center 81,779 Cedar Rapids, IA www.uscellularcenter.com
67 Empire State Plaza Convention Center 81,500 Albany, NY www.empirestateplaza.org
68 Champlain Valley Exposition 81,000 Essex Junction, VT cvexpo.org
69 El Paso Convention & Performing Arts Centers 80,000 El Paso, TX www.visitelpaso.com
70 Fredericksburg Expo & Conference Center 80,000 Fredericksburg, VA www.fredericksburgexpocenter.com
71 Gillette Stadium 80,000 Foxborough, MA www.gillettestadium.com
72 South Point Hotel & Spa 80,000 Las Vegas, NV www.southpointmeetings.com
73 Town & Country Resort & Convention Center 80,000 San Diego, CA www.towncountry.com
74 Prime F. Osborn III Convention Center 78,500 Jacksonville, FL www.jaxevents.com
75 Cajundome/Convention Center 77,303 Lafayette, LA www.cajundome.com
76 Dayton Convention Center 77,000 Dayton, OH www.daytonconventioncenter.com
77 American Bank Center 76,500 Corpus Christi, TX www.americanbankcenter.com
78 La Crosse Center 75,000 La Crosse, WI www.lacrossecenter.com
79 Miami Airport Convention Center 75,000 Miami, FL www.macc.com
80 SeaGate Convention Centre 75,000 Toledo, OH www.toledo-seagate.com
81 The Wildwoods Convention Center 75,000 Wildwood, NJ www.wildwoodsnj.com
82 St. Cloud River's Edge Convention Center 74,000 St. Cloud, MN www.stcloudriversedgeconventioncenter.com
83The Renaissance Montgomery Hotel & Spa at the
Convention Center73,000 Montgomery, AL
www.visitingmontgomery.com
84 Lansing Center 72,000 Lansing, MI www.lansingcenter.com
85 Gwinnett Center 71,600 Duluth, GA www.rentgwinnettcenter.com
86 D.C. Armory 70,000 Washington, DC www.dcsec.com
87 Hyatt Regency Chicago 70,000 Chicago, IL chicagohyatt.com
88 KCI Expo Center 70,000 Kansas City, MO www.kciexpo.com
89 LVH - Las Vegas Hotel & Casino 70,000 Las Vegas, NV www.thelvh.com
90 Palmer Events Center 70,000 Austin, TX www.palmereventscenter.com
91 Roberts Centre 70,000 Wilmington, OH www.robertscentre.com
92 Tinley Park Convention Center 70,000 Tinley Park, IL www.tinleyparkconventioncenter.net
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Source: Trade Show Executive (2013)
Exhibition FacilityPrime Exhibit
Space (sf)Location Web Site
93 XL Center 69,000 Hartford, CT www.xlcenter.com
94 Gatlinburg Convention Center 67,000 Gatlinburg, TN www.gatlinburg-tennessee.com
95 Hilton Americas Houston Hotel 66,000 Houston, TX www.americashouston.hilton.com
96 Lexington Convention Center 66,000 Lexington, KY www.lexingtoncenter.com
97 Washington Marriott Wardman Park 66,000 Washington, DC www.marriott.com/wasdt
98 Nicholas J. Pirro Convention Center at Oncenter 65,250 Syracuse, NY www.oncenter.org
99 Neal S. Blaisdell Center 65,000 Honolulu, HI www.blaisdellcenter.com
100 Buffalo Niagara Convention Center 64,000 Buffalo, NY www.buffaloconvention.com
101 Kansas Expocentre 62,300 Topeka, KS www.ksexpo.com
102 Garden State Convention & Exhibit Center 62,000 Somerset, NJ www.gsec.com
103 ODEUM Sports & Expo Center 62,000 Villa Park, IL www.odeumexpo.com
104 Peppermill Resort Spa Casino 62,000 Reno, NV www.peppermillreno.com
105 Meadowlands Exposition Center 61,000 Secaucus, NJ www.mecexpo.com
106 Big Sandy Superstore Arena 60,000 Huntington, WV www.bigsandyarena.com
107 Crown Center 60,000 Fayetteville, NC www.atthecrown.com
108 Jackson Convention Complex/SMG 60,000 Jackson, MS www.jacksonconventioncomplex.com
109 Nassau Veterans Memorial Coliseum 60,000 Uniondale, NY www.nassaucoliseum.com
110 Norfolk Scope 60,000 Norfolk, VA www.sevenvenues.com
111 Overland Park Convention Center 60,000 Overland Park, KS www.opconventioncenter.com
112 Lane Events Center 59,000 Eugene, OR www.laneeventscenter.org
113 Hyatt Regency Atlanta 58,243 Atlanta, GA www.atlantaregency.hyatt.com
114 Hilton Anaheim 57,084 Anaheim, CA www.hiltonanaheimhotel.com
115 Comcast Arena Everett & Hansen Conference Center 57,000 Everett, WAwww.comcastarenaeverett.com
116 Reno Events Center 56,000 Reno, NV www.renoeventscenter.com
117 MassMutual Center 55,000 Springfield, MA www.springfield-first.com
118 Pasadena Convention Center 55,000 Pasadena, CA www.pasadenacenter.com
119 Valley Forge Convention Center 54,000 King of Prussia, PA www.vfconventioncenter.com
120 Charleston Civic Center & Auditorium 52,000 Charleston, WV www.charlestonwvciviccenter.com
121 Crown Center Exhibit Hall 52,000 Kansas City, MO www.crowncenter.com
122 The Lakeland Center 52,000 Lakeland, FL www.thelakelandcenter.com
123 Overland Park International Trade Center 51,391 Overland Park, KS www.optradecenter.com
124 Amarillo Civic Center 51,265 Amarillo, TX www.amarillociviccenter.com
125 New York Hilton Midtown (formerly Hilton New York) 51,084 New York City, NY www.hiltonfamilynewyork.com
126 Rio All-Suite Hotel & Casino 51,000 Las Vegas, NV www.lvmeetingsbyharrahs.com
127 Sioux Falls Convention Center 50,400 Sioux Falls, SD www.siouxfallscc.com
128 Arlington Convention Center 50,000 Arlington, TX www.arlingtoncc.com
129 M.C. Benton Jr. Convention Center 50,000 Winston-Salem, NC www.twincityquarter.com
130 Bismarck Civic Center 50,000 Bismarck, ND www.bismarckciviccenter.com
131 Branson Convention Center 50,000 Branson, MO www.bransonconvention.com
132 DCU Center 50,000 Worcester, MA www.dcucenter.com
133 Dena'ina Civic & Convention Center/Egan Center 50,000 Anchorage, AK www.anchorageconventioncenters.com
134 Exhibition Building at Osceola Heritage Park 50,000 Kissimmee, FL www.ohpark.com
135 Fair & Expo Center 50,000 Rochester, NY www.fairandexpocenter.org
136 Foxwoods Resort Casino & MGM Grand at Foxwoods 50,000 Mashantucket, CTwww.foxwoods.com
137 Grand Wayne Convention Center 50,000 Fort Wayne, IN www.grandwayne.com
138 Irving Convention Center at Las Colinas 50,000 Irving, TX www.irvingconventioncenter.com
139 Rochester Riverside Convention Center 50,000 Rochester, NY www.rrcc.com
140 Greater Tacoma Convention & Trade Center 50,000 Tacoma, WA gtctc.org
141 The Westin Diplomat Resort & Spa 50,000 Hollywood, FL www.diplomatresort.com
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4.2 Profiles of Comparable Facilities
As a meeting and events center destination, King of Prussia presents an unusual
profile since it is a suburban location of a large metropolitan area that is already well
served by competing business meeting space in the central business district. The
research team identified a variety of comparable meeting and events centers to
compile a set of facilities with varying characteristics (i.e., size and offerings) and
demographics of the facilities’ respective host communities. The identified facilities
included:
Overland Park Convention Center – Overland, KS
Lancaster County Convention Center – Lancaster, PA
Irving Convention Center at Las Colinas – Irving, TX
Gwinnett Convention Center – Gwinnett, TX
Waco Convention Center – Waco, TX
Greater Richmond Convention Center – Richmond, VA
Conference & Event Center Niagara Falls - Niagara Falls, NY
Raleigh Convention Center – Raleigh, NC
Figure 4.3 provides community profiles for the identified comparable venues as well
as for Montgomery County.
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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Figure 4.3: County Profiles for Comparable Meeting and Events Centers
Montgomery County is of average size (population of 812,000) compared to the
other eight locations (average of 777,000 excluding Montgomery County) but has
the highest median household income of nearly $79,000.
In addition, Montgomery County is near the top on payroll per business
establishment, lagging slightly behind Dallas County, Texas.
It is interesting to note that, despite ranking either first or second in population,
income, and retail sales, Montgomery County does not rank as high in
accommodation and food service sales, further suggesting that a new meeting and
events center could generate new group room demand and revenue for the
accommodation sector.
The following pages provide summary descriptions and floor plans for each
identified comparable facility.
Convention Center Proposed Overland Park Lancaster Irving Gwinnet Waco Richmond Niagara Falls Raleigh
County/State Montgomery, PA Johnson, KS Lancaster, PA Dallas, TX Gwinnet, GA McLennan, TX Henrico, VA Niagara, NY Wake, NC
Population 812,376 566,836 529,600 2,480,331 859,304 241,481 318,611 214,249 974,289
# Households 308,083 214,670 193,306 849,874 264,592 83,966 123,392 88,542 341,303
Median Household Inc $78,984 $75,139 $56,172 $49,159 $61,944 $41,589 $61,300 $47,736 $65,826
Total Businesses 26,675 20,937 12,636 70,602 24,439 4,965 10,203 4,730 29,579
Total Employees 468,668 319,958 221,104 1,494,676 311,894 102,663 179,427 70,953 473,854
Total Payroll ($ 000s) $28,989 $16,324 $9,030 $89,945 $15,046 $4,100 $8,933 $2,686 $23,627
Payroll /Est ($ 000s) $1,087 $780 $715 $1,274 $616 $826 $876 $568 $799
Total Retail Sales ($ 000s) $15,151 $9,255 $6,542 $33,177 $13,857 $2,943 $6,737 $2,075 $12,598
Accomodation and
food service sales ($ 000s) $1,478 $1,083 $764 $5,705 $375 $375 $686 $662 $1,727
Persons per sq. mile 1,656 1,150 550 2,718 227 227 1,313 414 1,079
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Overland Park, KS- Located in suburban Kansas City.
The exhibit hall offers 60,000 square feet that can be
divided into two rooms, as well as seven meeting rooms
and an executive conference room available for
smaller-scale corporate meetings. The attached
Sheraton hotel was built in conjunction with the
convention center. The hotel has an additional 25,000
square feet of meeting space and is attached by
covered walkway to the center. In addition, the facility
also offers a 25,000 square foot outdoor courtyard. Of
note, Overland Park is the only one of the comparable
facilities showing a profit; and its revenue from food and
beverage exceeds its rental income by a nearly $5/1 ratio.
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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Lancaster, PA – Located 60 miles to the west of King of
Prussia, this convention center does not serve any major
metropolitan market. In general, its events tend to be small
trade shows (crafts, furniture) and trade associations. No
blue chip corporate events were highlighted or noted.
Providing more than 90,000 square feet of combined space
for conventions, events, and trade shows, this $177-million
integrated facility is ideal for groups ranging in size from
five to 5,000 in a location that is convenient to northeast
metropolitan cities
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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Irving, TX – The Irving Convention Center at Las Colinas represents the
innovative future of meetings and events. With almost 100,000 square feet of
meeting and exhibit space, the building's unique architecture, vertical design,
and interior finishes create a new niche in the marketplace. Situated on 40
acres in the heart of Irving's Las Colinas Urban Center, the convention center
is the first phase of a mixed-use entertainment district that will include a
6,000-person capacity performance venue and unique dining and shopping.
Located a short distance from DFW Airport, Irving has both convenient
access and a very large cluster of leading companies located in immediate proximity
to the convention center. Of note, there are over 2,500 hotel rooms located within
one mile of the facility.
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Gwinnet, GA- Located in Duluth, GA a
community located at the fringe of the
greater Atlanta metropolitan area (25
miles to the northeast of Atlanta’s Central
Business District.). The center does some
trade show and business association
meetings; however, large religious
gatherings are an important recurring
source of revenue. The convention center
is located in a complex that includes an
arena and performing arts center. Local
hotels are oriented toward family as
opposed to corporate visitors.
The heart of the Convention Center is the
50,000 square foot Exhibit Hall. The Exhibit Hall has a ceiling height of 28 feet, an
unlimited load-bearing floor and the ability to be divided into three individual halls.
With drive-in access and nine covered loading docks, set-up and breakdowns are a
smooth and efficient process for over 300 exhibitors. The Convention Center also
has 23 versatile meeting rooms and a 21,600 square foot Grand Ballroom that is
fully capable of meeting various needs.
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Waco, TX- Located in Waco, TX between Dallas/Fort
Worth and Austin, the Waco Convention Center is
blocks from Interstate 35, minutes from Waco Regional
Airport, and within walking distance of restaurants,
shopping, attractions, and a variety of entertainment
options. There are 1,000 convention-quality hotel
rooms within a one-mile radius of the Waco Convention
Center and 4,200 hotel rooms in greater Waco.
With a 32,976 square foot exhibit hall, a 15,000 square
foot exhibit hall, and the new 13,818
sq. ft. Brazos Ballroom—the Waco
Convention Center has the space
needed to accommodate larger
conventions, social events, and
tradeshows.
In July, 2012, the Waco Convention
Center completed a three year, $17.5
million renovation, adding over
25,000 sq. ft. and increasing the total
square footage to 144,000 sq. ft.
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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Richmond, VA- The Greater Richmond Convention Center is
Virginia's largest exposition and meeting facility. The Center
brings hundreds of thousands of visitors into the metropolitan
area each year. Located in Virginia’s capital, the Greater
Richmond Convention Center is a 700,000-square-foot facility
that sits on five and a half city blocks. Interior accommodations
include 178,159 square feet of exhibit space, meeting and
banquet rooms, and the 30,550-square foot Grand Ballroom.
Parking consists of two adjoining decks that hold 1,540 vehicles
and an additional 4,600 spaces are within a six-block radius.
There are 650 hotel rooms adjacent to the center, with thousands
more nearby.
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Niagara Falls, NY- The Conference & Event Center Niagara Falls combines
116,000 square feet of versatile state-of-the-art indoor meeting and event space
with vibrant outdoor activities. Its unique Western New York location, along the
dynamic Old Falls Street, USA, offers a myriad of customized convention, meeting
and banquet options including the ability to host private outdoor receptions, just
footsteps from Niagara Falls State Park and the famed waterfalls themselves. The
facility is also a 20-minute drive from Buffalo, NY.
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Raleigh, NC- Since opening in September 2008, the Raleigh Convention
Center has been a bustling hub for the culture, commerce and technologies
that make the Triangle one of the most admired and sought after regions in
the United States. The modern, 500,000 sq ft, LEED Silver-certified facility
includes a soaring street level lobby, an elegant, easily partitioned ballroom, a
150,000 sq ft exhibit hall and a 4,100 sq ft mezzanine as well as cutting edge
tech amenities and award-winning culinary offerings. Convention center staff
also operates the nearby Red Hat Amphitheater and Duke Energy Center for
the Performing Arts, which can also be part of an event experience.
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Figure 4.4 provides a summary table of detailed characteristics and available
financial and event information for the comparable facilities.
Figure 4.4: Meeting & Events Centers Performance and Facility Detail
Source: Tourism Economics & Respective Convention Facilities (2014)
DetailOverland,
KS
Lancaster,
PAIrving, TX
Gwinnet,
GAWaco, TX
Richmond,
VA
Niagara
Falls, NY
Raleigh,
NC
Opened 2002 2009 2011
Opened
1992,
expansion in
2003
Major $17.5M
renovation in
2012,
2002 2004 2008
Total Construction Cost ($ Millions) $178 $133 $134 $170 $225
Total Space (SF) 140,000 90,000 170,000 84,500 125,000 178,000 116,000 200,000
Construction Cost per SF $1,973 $782 $1,586 $955 $1,125
Year 2013 2012 2013 2013 2012 2012 2012
Gross Revenue $9.4 $1.6 $6.6 $10.9 $3.1 $2.4 $6.2
Net Income $0.6 -$1.0 -$1.4 -$0.4 -$0.3 -$1.5
Rental Income $1.4 $1.5 $1.3 $3.8
Food/Beverage Revenue $6.4 $0.1 $4.0 $1.6
Events hosted 400 241 341 281 229 300
Room nights generated 89,000 133,765 14,000 70,000
Attendees 128,883 345,000 36,796 440,000
Main Exhibit Hall (SF) 60,000 46,000 50,000 50,000 50,000 175,000 32,000 150,000
Banquet Hall (SF) 26,000 8,700 20,000 21,600 14,000 30,000 19,500 33,000
Other Meeting Space Noted
7 additional
meeting
rooms of
various
sizes
20 meeting
rooms
20 additional
meeting
rooms of
various sizes
23 additional
meeting
rooms of
various
sizes
14 additional
meeting
rooms, 2,000
SF theater
36 total
meeting and
banquet
rooms
15 meeting
rooms,
49-seat
amphitheater
20 meeting
roomgs
Attached Hotel412 Room
Sheraton
299 Room
Marriott
Reportedly a
new hotel will
open in 2015
(no affiliation
specified)
No (but deal
with Marriott
to build one
was just
announced)
No Yes No Yes
Facility Size
Financial Data ($ Millions)
Construction
Convention Center Performance and Facility Detail
Events & Room Nights
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Based on available data on sellable exhibit space, banquet halls, meeting rooms,
and operating data for the eight identified facilities, Figure 4.5 provides averages of
various metrics across the facilities.
On average, the eight identified facilities offer approximately 77,000 sf in the main
exhibit hall, 22,000 sf in the main banquet hall, and 19 meeting rooms. With an
average of nearly 300 events, the facilities generate an average of $5.0 million in
revenues and operate at a net loss of $0.5 million.
Figure 4.5: Average Sellable Space and Operating Data of Identified Comparable
Facilities (Square Feet & $ Millions)
Description Average
Main Exhibit Hall (SF) 76,625
Banquet Hall (SF) 21,600
Total Sellable Space (SF) 137,938
Meeting Rooms 19
Gross Revenue ($ Millions) $5.0
Net Income ($ Millions) -$0.5
Events Hosted 299
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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5 Facility Dimensions & Details
The following section analyzes the potential dimensions of the proposed
Montgomery County executive meeting and events center in terms of total sellable
space, exhibit and banquet hall space, and meeting rooms.
For purposes of the analysis, we assume that the proposed Montgomery County
executive meeting and events center will offer the following physical space
dimensions:
Main Exhibit Hall: 50,000 sf
Banquet Hall: 25,000 sf
Meeting Rooms: 20 rooms
Total sellable sf: 125,000
5.1 Data Normalization
5.1.1 Total Sellable Space
Section 4 identified a set of comparable convention and events/meeting centers that
share certain characteristics with the proposed Montgomery County facility. The
analysis provided various size and performance metrics and calculated averages in
absolute terms. It is also important, however, to examine these metrics in terms of
normalized values.
One way of normalizing data is to calculate total sellable space in a market divided
by the market’s total employment, effectively providing a measurement of sellable
space per employee. For example, the Overland Park Convention Center offers
140,000 sf of total sellable space. Johnson County, KS has a total workforce of
approximately 320,000. Dividing total sellable space by the total population yields a
result of 0.44. The weighted average across the eight identified comparable
facilities is 0.35.
Based on an estimated 125,000 sf of total sellable sf at the proposed facility, and
the absence of other facilities in Montgomery County, along with a countywide
workforce of approximately 474,000, total sellable sf per employee yields a result of
0.26. Montgomery County’s result of 0.26 total sellable sf per employee is lower
than the average value across the eight identified comparable facilities. As shown
in Figure 6.1, it has the second lowest value in the identified group of facilities,
which suggests that a facility with 125,000 sf of total sellable space is in line (and
somewhat conservative) compared to the identified markets.
The facilities in markets with labor forces closest to that of Montgomery County
(approximately 474,000 employees) are the Gwinnett Center in Georgia
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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46
(approximately 320,000 employees) and the Raleigh Convention Center in North
Carolina (approximately 474,000 employees). These markets also have similar
numbers of businesses and population bases. The Gwinnett Center offers
approximately 85,000 sf total sellable space (though it is also part of a complex that
offers a full size arena), while the Raleigh Convention Center has 200,000 sf of total
sellable space. The Montgomery County facility’s normalized total sellable space
value of 0.26 is nearly identical to the Gwinnett Center’s value of 0.27 and is
comparable to the Raleigh Convention Center’s value of 0.42.
Figure 5.1: Total Sellable Space (SF) per Employee, by Facility
Source: Tourism Economics (2014)
5.1.2 Main Exhibit Hall & Banquet Hall SF
In addition to examining total sellable space normalized by employment, the
analysis also focused on normalized values of main exhibit hall and banquet hall
square footage.
Figure 5.2 summarizes the values of main exhibit hall space normalized by number
of employees for the proposed Montgomery County facility and the eight identified
existing facilities. As shown in Figure 5.2, with a main exhibit hall of 50,000 sf, the
Montgomery County facility’s normalized value of exhibit hall space per employee
would be 0.11. The normalized values for the eight identified facilities range from a
low of 0.03 at the Irving Center in Texas to a high of 0.98 at the Greater Richmond
0.110.26 0.27
0.41 0.42 0.44
0.99
1.22
1.63
0.00
0.20
0.40
0.60
0.80
1.00
1.20
1.40
1.60
1.80
Irvin
g C
on
ve
ntio
nC
en
ter
(TX
)
Mo
ntg
om
ery
Co
un
ty(P
A)
Gw
inn
ett
Ce
nte
r(G
A)
La
nca
ste
r C
ou
nty
Co
nve
ntio
n C
en
ter
(PA
)
Ra
leig
h C
on
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ntio
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en
ter
(NC
)
Ove
rla
nd
Pa
rkC
on
ve
ntio
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ter
(KS
)
Gre
ate
r R
ich
mo
nd
Co
nve
ntio
n C
en
ter
(VA
)
Wa
co
Co
nve
ntio
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ter
(TX
)
Th
e C
on
fere
nce
& E
ve
nt
Ce
nte
r N
iag
ara
Fa
lls (
NY
)
Total Sellable Space SF/Employee
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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Convention Center in Virginia. Across all eight facilities, the weighted average of
banquet space per employee is 0.19.
Similar to the normalized value for total sellable space, the proposed Montgomery
County facility’s normalized value for main exhibit hall space falls in the lower
spectrum of values across the identified sites.
Figure 5.2: Main Exhibit Hall Space (SF) per Employee, by Facility
Source: Tourism Economics (2014)
Figure 5.3 summarizes the values of banquet hall space normalized per employee
for the proposed Montgomery County facility and the eight identified existing
facilities. As shown, with a 25,000 sf banquet hall, the normalized value for the
Montgomery County corporate meeting and events center would be 0.05. The
normalized values for the eight identified facilities range from a low of 0.01 at the
Irving Convention Center to a high of 0.27 at the Conference and Events Center in
Niagara Falls. Across all eight facilities, the weighted average of banquet space
normalized by population is .05.
As with the normalized values for total sellable space and main exhibit hall space,
the proposed Montgomery County facility’s normalized value for banquet hall space
falls towards the lower end of values across the identified sites.
0.030.11
0.16 0.19 0.210.32
0.45 0.49
0.98
0.00
0.20
0.40
0.60
0.80
1.00
1.20
Irvin
g C
onve
ntio
nC
en
ter
(TX
)
Montg
om
ery
Co
unty
(PA
)
Gw
innett C
ente
r(G
A)
Ove
rland P
ark
Con
ven
tion
Cente
r (K
S)
Lan
caste
r C
ounty
Con
ven
tion
Cente
r (P
A)
Rale
igh C
onvention
Cen
ter
(NC
)
Th
e C
onfe
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& E
vent
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ter
Nia
gara
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(N
Y)
Waco C
on
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tion
Cen
ter
(TX
)
Gre
ate
r R
ichm
ond
Con
ven
tion
Cente
r (V
A)
Main Exhibit Hall SF / Employee
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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Compared to the markets with similar population and business counts, the
Montgomery County facility’s normalized banquet hall space value of .05 is higher
than the Lancaster County Convention Center and the Irving Convention Center.
Figure 5.3: Banquet Hall Space (SF) per Employee, by Facility
Source: Tourism Economics (2014)
Figure 5.4: Summary Metrics Normalized by Population (Total Sellable Space, Main Exhibit Hall, and Banquet
Hall SF per Employee)
Eight Identified Sites
Description Montgomery
County Minimum
Value Maximum
Value Weighted Average
Total Sellable Space 0.26 0.11 1.63 0.35
Main Exhibit Hall 0.11 0.03 0.98 0.19
Banquet Hall 0.05 0.01 0.27 0.05
Figure 5.4 summarizes the various metrics normalized by employment (total sellable
space, main exhibit hall space, and banquet hall space) for Montgomery County,
along with the minimum value, maximum value, and weighted average for the eight
identified facilities. All of the normalized values for the Montgomery facility fall
between the minimum-maximum range of values and are equal to or below the
0.010.04
0.050.07 0.07 0.08
0.14
0.17
0.27
0.00
0.05
0.10
0.15
0.20
0.25
0.30
Irvin
g C
onve
ntio
nC
en
ter
(TX
)
Lan
caste
r C
ounty
Con
ven
tion
Cente
r (P
A)
Montg
om
ery
Co
unty
(PA
)
Gw
innett C
ente
r(G
A)
Rale
igh C
onvention
Cen
ter
(NC
)
Ove
rland P
ark
Con
ven
tion
Cente
r (K
S)
Waco C
on
ven
tion
Cen
ter
(TX
)
Gre
ate
r R
ichm
ond
Con
ven
tion
Cente
r (V
A)
Th
e C
onfe
rence
& E
vent
Cen
ter
Nia
gara
Falls
(N
Y)
Banquet Hall SF / Employee
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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weighted average for each category. This suggests that the indicated physical
dimensions of the proposed Montgomery County facility (50,000 sf main exhibit hall,
25,000 sf banquet hall, and 125,000 total sellable sf) are reasonable compared to
the dimensions of existing facilities in markets with similar characteristics.
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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6 Industry Trends
6.1 The Meetings Industry
In 2013, facilities hosted an estimated 1.8 million meetings throughout the US.
These 1.8 million meetings had nearly 225 million participants, with approximately
half of these participants attending corporate/business meetings. Conventions,
conferences, and congresses had the second most participants with nearly 61
million, constituting 27% of all participants. While trade shows had the least number
of meetings, they attracted nearly 27 million participants, or 12% of all participants.
Figure 6.1: Number of Meetings & Participants by Meeting Type, 2013
Source: Trade Show Executive (2014)
Figure 6.2 summarizes total numbers of meetings and participants by host type. As
shown, corporations hosted the most meetings in 2013. Over one million meetings
hosted by corporations had nearly 110 million participants, or nearly half of all
participants. Associations and membership organizations drew the second most
participants (more than 59 million) at approximately 315,000 events.
Figure 6.2: Number of Meetings & Participants by Host Type, 2013
Source: Trade Show Executive (2014)
Meeting Type Meetings Participants % Participants
Corporate/Business Meetings 1,298,300 113,337,000 50%
Conventions/Conferences/Congresses 273,700 60,960,000 27%
Trade Shows 10,900 26,768,000 12%
Incentive Meetings 67,700 9,172,000 4%
Other Meetings 182,600 14,710,000 7%
Total 1,833,200 224,947,000 100%
Meeting Type Meetings Participants % Participants
Corporate 1,017,000 109,571,000 49%
Association/Membership 315,400 59,495,000 26%
Non-Government, Not-For-Profit 432,100 51,572,000 23%
Government 68,600 4,308,000 2%
Total 1,833,100 224,946,000 100%
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6.2 Convention Center Trends
Based on Trade Show Executive’s 2013 Word’s Top Convention Centers (WTCC),
more than half (57%) of convention centers in the United States, Canada, and
Mexico were in the “Tier IV Smaller Facilities” category, comprised of convention
centers offering 50,000 sf to 124,999 sf of prime exhibit space.
Venues in this category have a total square footage of 13,933,713, and their space
represents approximately 20% of the total square footage of North American venues
listed in the 2013 WTCC. This segment of the market continues to grow, as two
new convention centers completed construction in 2013:the U.S. Cellular Center in
Cedar Rapids, IA (featuring 81,779 sf of prime exhibit space) and the Dulles Expo
Center in Chantilly, VA (which added 30,000 sf of prime exhibit space and now
offers a total of 130,000 sf). In 2012, this tier of smaller convention centers included
173 facilities, offering an average of 79,931 sf of prime exhibit space.
According to Trade Show Executive, small convention centers typically fill their
space with a wide range of statewide meetings, regional trade shows, corporate
events, consumer shows, and other local events. However, these facilities have
also started trying to attract more national and international exhibitions that would
ultimately generate a higher economic impact to their respective local communities.
To attract national and international business, some facilities are adding more space
or making renovations. According to Johnna Boxley, general manager of the
Spokane Convention Center in Washington, “Our goal is to attract more national
business…We didn’t have the right configuration before, but our expansion should
help us gain more market share.” The Spokane Convention Center is currently
adding 20,000 sf of prime exhibit space and 25,000 sf of meeting space. Upon
completion, the center will offer 120,160 sf of prime exhibit space, 67,900 sf of
meeting space, and 17,390 sf of flex space.
Technology has been a significant factor for smaller convention centers (and for
facilities of all sizes). To effectively compete in this category, many facilities offer
free WiFi throughout their buildings, including exhibit halls. According to a regional
vice president at SMG, “People think of WiFi like they think of air. They think it
should be free and it should be always available.” He also said that many smaller
convention centers will be investing in distributed antenna systems (DAS) to handle
the additional bandwidth from multiple devices.” The Irving Convention Center,
which opened just three years ago, has already invested in WiFi upgrades to stay
competitive. According to Maura Gast, executive director of the Irving Convention &
Visitors Bureau in Texas, WiFi is just not going to be a revenue generator, but it can
be a deal maker or breaker.”
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6.3 MICE Industry Trends
The MICE industry (meetings, incentives, conferences, and exhibitions) has witnessed an
acceleration of change over recent years. Key, important trends span a range of issues
including:
Shifts in global participation around the world
Tailoring of event content
Role of DMOs (destination marketing organizations)
Use of technology
New growth drivers
New challenges
Defining trends for the MICE industry include:
Reports on the death of meetings are exaggerated
Meetings are driving economic development
Cost consciousness is defining choices
Events are reaching further
DMOs are driving growth
Events are more targeted
6.3.1 Reports on the death of meetings are exaggerated
The MICE sector has endured harsh conditions since 2009, including sharp
cutbacks among companies, widespread adoption of virtual meeting technology,
and political opposition.
However, the MICE sector has emerged from the ashes as the underlying value of
events to participants and companies remains as strong as ever.
Group room demand in the US fell 16% over the two-year period of 2008 and 2009.
However, it has nearly fully recovered to 97% of its pre-recession level.
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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Figure 6.3: US Luxury/Upscale Group Hotel Demand, 2004-2013
(Million Room Nights)
60
65
70
75
80
85
90
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
US Luxury/Upscale Group Hotel Demand million room nights
Source: Smith Travel Research
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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Data on the exhibition sectors tell a similar story. Attendance fell 11% from 2007 to
2009. In 2013, attendance recovered to pre-recession highs and is expected to
expand another 3% in 2014.
Figure 6.4: Exhibition Attendees, 2000-2014
Over the long run, a trend of strength is evident in data on association meeting
participation around the world. Global meetings participation has more than
doubled form under 10 million in 1993-1997 to 21 million in 2008-2012
Figure 6.5: Global Association Meeting Participants, 1963-2012
40
45
50
55
60
65
70
75
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
201
1
2012
2013
2014
Exhibition AttendeesMillions
Source: CEIR
0
5
10
15
20
25
19
63-6
7
19
68-7
2
19
73-7
7
19
78-8
2
19
83-8
7
19
88-9
2
19
93-9
7
19
98-0
2
20
03-0
7
20
08-1
2
Global association meeting participantsMillions
Source: International Congress and Convention Association
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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6.3.2 Meetings are driving economic development
Meetings, conventions, and exhibitions have long been understood to represent
economic value to a destination as attendees, exhibitors, and meeting planners
spend money in a destination. According to the Business Events Council of
Australia, “The legacy and flow on effects of business events is delivered in many
ways... Research has identified that this leads to global profiling, international
network creation, cultural and business development, innovation and foreign
investment.”
However, these events are increasingly being leveraged as an engine of economic
development in other sectors.
Driving services supply chain
Driving innovation
Driving economic clusters
Driving bottom lines
Driving the services supply chain
The development of the MICE sector is one way to develop industries in the event
supply chain. These include a broad range of service providers including
companies in the fields of technology, marketing, design, catering, and event
management & production. MICE is increasingly acting as a catalyst for the
development of these related economic sectors.
Driving innovation
The MICE sector is driving the knowledge economy and spurring innovation.
Business events deliver much more than travel and hospitality spend. They are the
forefront of the knowledge economy, providing a direct and powerful platform for
new information3
3 Business Events Council of Australia
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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Nearly 80% of US executives indicated that conferences provide significant industry
insights.
Figure 6.6: Impact of Conference and Convention
Source: Oxford Economics survey of US executives, 2013
Driving economic clusters
The MICE sector is integral to the development of targeted economic clusters.
Singapore and China are leveraging the MICE industry to attract regional
headquarters in key industries.
The Cleveland Clinic has built the Global Center for Health Innovation – a
showroom space for medical devices and technology. Along with a renovated
convention center, the new facility has been designed to spur further development
within the health care economic cluster.
In Tampa, a medical learning and simulation center was opened within a block of
the convention center. It is expected to attract more than 60,000 medical
professionals each year for training.
0% 40% 80%
Industry insights
Industry partnerships
Customer retention
New leads
Morale
New sales
4 5
Impact of conferences and conventions
% of respondents indicating high impact on 1 to 5 scale
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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Driving bottom lines
The MICE sector is being harnessed to drive performance in companies. Nearly
60% of frequent business travelers believe that increase in travel (including MICE
events) would have a positive impact on both revenue and profitability. And roughly
half of respondents believe such an increase would have a positive impact on
employee productivity.
Figure 6.7: Impact of Increased Travel Spending on Revenue, Profits, and
Employee Productivity
Source: Oxford Economics survey of US business travelers, 2013
6.3.3 Cost consciousness is defining choices
The legacy of the great recession, along with a highly competitive market for
attracting events and the longer lead times associated with contracting group room,
rates continues to weigh on group room rates. As a result, group hotel room rates
remained below pre-recession levels in 2013, even as transient room rates have
recovered more strongly.
A move to mid-tier lodging and non-traditional meeting facilities (museums,
restaurants, etc.) also reflects budget constraints.
59% 58%
49%
39%36%
47%
2%6%
4%
0%
10%
20%
30%
40%
50%
60%
70%
Revenue Profits Employee productivity
positive no impact negative
Impact of increased travel spending on...
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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Figure 6.8: Upper Tier Hotel ADR by Segment
The yields on the MICE segment continue to be squeezed. According to CEIR
(Center for Exhibition Industry Research) data on exhibition revenue per attendee,
the industry continues to struggle to achieve revenue growth even as attendance
recovers. In 2013, CEIR estimates revenue per attendee in the US to have fallen to
$163 from $190 in 2007. Events are exploring off-peak bookings more frequently,
and incentives by destinations and convention centers are the norm, not the
exception, in attracting meeting planners.
Figure 6.9: US Revenue per Exhibition Attendee
$100
$110
$120
$130
$140
$150
$160
$170
$180
$190
$200
200
4
200
5
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
Upper Tier Hotel ADR by Segment
Source: STR
Group
Transient $22 diff.
$193
$174
$190
$165 $163
$145
$150
$155
$160
$165
$170
$175
$180
$185
$190
$195
$200
2001 2003 2005 2007 2009 2011 2013
US Revenue per Exhibition Attendee
Source: CEIR
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6.3.4 Events are reaching further
MICE events are extending their reach by stronger interactions with participants
before and after events as well as by using virtual forums to extend participation to a
wider audience.
Virtual and hybrid meetings continue to grow. According to the 2013 American
Express survey of planners, these forums are being adopted to achieve a wider
reach at a lower cost. These virtual meetings can also open up new revenue
streams. However, it appears this growth in virtual meetings is not at the expense
of physical meetings due to the former’s difficulty in engaging and monitoring active
participation, which is intrinsic to physical meetings.
Figure 6.10: Portfolio with More than 10% Virtual or Hybrid
6.3.5 DMOs are driving MICE growth
As meeting demand recovers, DMOs are playing a leading role, steadily increasing
their share of overall group room demand in the US since 2010. In addition, rooms
booked for future events exceeded rooms consumed in 2013, indicating growth
momentum in the DMO channel.
18%
28%
40% 40%
30%
43%47%
58%
0%
10%
20%
30%
40%
50%
60%
70%
N A
mer.
Euro
pe
La
tin
Am
.
Asia
2013 2014
Portfolio with more than 10% Virtual or Hybrid
Source: American Express Survey of Planners, Sept 2013
Share of Client Portfolio
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Figure 6.11: DMO Group Channel Impact
In emerging markets, DMO/DMC support is vital to meeting planners. Destination
management support is a significant concern among respondents to the American
Express planners survey.
“Having a connection to a destination management company (DMC) with local
expertise can help ensure the right planning decisions are made and improve the
overall attendee experience4.”
4 2014 Meetings Forecast by American Express Meetings and Events
2009 2010 2011 2012
Sources: DMAI, STR
DMO % of group hotel room
nights sold in DMO markets20.6% 20.2% 20.3% 20.7%
DMO Group Channel ImpactOccurred room nights (DMO Markets)
2009 2010 2011 2012
Booked 37.0 35.4 37.1 39.0
% growth -4.3% 4.8% 4.9%
Occurred 34.3 35.8 37.2 38.3
% growth 4.4% 3.8% 3.1%
Source: DMAI
DMO Group Channel ImpactRoom nights (million)
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Figure 6.12: Destination management Support of Great Importance
6.3.6 Events are becoming more targeted
Average participation in association events is illustrating the trend of events
becoming more targeted. Association events averaged more than 1,000
participants in the early 1970’s. The past five years has seen this number fall to 424
people per event. However, the number of events has grown at a much faster rate,
increasing overall attendance.
Figure 6.13: Participants per Association Meeting
100%
80%76%
89%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Bra
zil
Ru
ssia
Ind
ia
Ch
ina
Destination Management Support of Great Importance
Source: American Express Survey of Planners, Sept 2013
0
200
400
600
800
1,000
1,200
1,400
19
63-6
7
19
68-7
2
19
73-7
7
19
78-8
2
19
83-8
7
19
88-9
2
19
93-9
7
19
98-0
2
20
03-0
7
20
08-1
2
Participants per association meeting Global average
Source: International Congress and Convention Association
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7 Feedback from Key Stakeholders
The research team conducted interviews with key stakeholders who represent a
broad spectrum of expertise in Montgomery County’s commerce and hospitality
sectors. These stakeholders are familiar with current market dynamics and the
various factors and sources of demand that would support business at the proposed
corporate meeting and events center. Stakeholders included representatives from
economic development agencies, hotel professionals, and meeting and events
planners from local corporations.
Some of the key issues and recommendations are summarized in the following
sections.
7.1 Economic Development Professionals
Overall, economic development professionals who were surveyed indicated that
they strongly supported a new meeting and events center in Montgomery County.
While some of the interviewees felt the new facility would be best situated in the
King of Prussia area, others felt Lansdale would be the most ideal location. One
respondent even indicated that Montgomery County could potentially benefit from
having more than one new meeting and events center.
All economic development respondents felt that levels of demand are more than
adequate to warrant a new meeting and events center. According to certain
respondents, existing meeting and events clients at regional facilities have
expressed the desire for new space for smaller corporate meetings. According to
ownership/management at the Greater Philadelphia Expo Center at Oaks, the
facility has had tremendous success and has exceeded all forecasts since opening.
While the facility primarily deals with consumer/trade shows, its success could
complement activity at a new executive meeting and events center.
One common theme among respondents was technology and versatility.
Respondents indicated that the proposed meeting and events center must be a
versatile, multi-use facility that can attract a wide variety of events and clients.
Further, to be successful, the facility must be able to attract business throughout the
year. In terms of specific clients and event types, the facility could cater to state and
government meetings and other smaller, single-day events during the week, while
attracting larger events such as weddings and banquet during the weekends.
An additional factor echoed repeatedly across respondents was the importance of
the proposed facility for regional economic development. Respondents felt the
facility could be an important driver to spur economic development in Montgomery
County, particularly for increasing group room demand at local hotels.
Montgomery County Executive Meeting and Events Center Market & Economic Impact Study
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Additional feedback from economic development professionals is summarized as
follows:
Versatility is a key factor. Facility needs to be multi-use in order to
maximize its potential.
Certain niche of events that can’t use convention facilities in Center City
Will be important to correctly set up the financials of the new facility, unlike
in Lancaster.
New facility can be developed in conjunction with existing hotel(s). One
example is the Chase Center in Wilmington, which is adjacent to the Westin
Wilmington.
Facility could be very helpful for prompting economic development in the
region.
Potential users of the facility are the government and state association
meetings that are currently using convention and meeting facilities in
Lancaster and Allentown.
During the week, the facility can cater to single-day local/regional meetings
with 35-200 attendees. During the weekends, the facility could target large
social events with 300+ people (i.e., weddings, concerts, banquets)
The design/layout of the facility should cater to a diverse set of customers.
For example, meeting rooms and common areas should cater to corporate
clients, while exhibit areas should cater to large trade shows.
Having meeting space is important, but the biggest need in the region is for
a new, state-of-the-art facility that can accommodate large groups.
Maybe Montgomery County could benefit from having more than one new
meeting and events center.
7.2 Potential Corporate Users
The research team also conducted interviews with representatives from local
corporations and businesses in order to get feedback from potential users of the
proposed meetings and events center.
One main viewpoint mentioned by all respondents is that the region lacks an
attractive, state-of-the-art facility that can accommodate larger groups. While there
are a few newer facilities in the region, they are too small for larger groups.
Respondents indicated that the most important factors that would influence their
decision to use the proposed meeting and events center include
convenience/location, price, technology, and customer service. Additional
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characteristics factoring into their decision would include the facility’s amenities,
ease and availability of parking, minimal traffic issues, and good catering options.
In terms of space requirements, respondents indicated they would need meeting
space for 25-200 people and maximum space for 2,000 people.
Additional feedback from corporate respondents is summarized below:
The region does not offer any attractive facilities that are able to
accommodate large groups
Lately, in past year, majority of smaller meetings are scheduled through
video conference.
Some current facilities are nice, but too small and can’t accommodate large
groups
While there is need for larger event space, the immediate need is for
smaller meeting space.
Local facilities are “tired” and old and need a facelift.
Used to go up to convention center before Valley Forge Casino came
online.
Desmond Hotel in Malvern has nice facilities, but location isn’t convenient.
Trend is to use local facilities for meetings.
New facility would be good for meetings for upper level (directors, above).
For meetings with lower level employees, usual protocol is to use video
conferences.
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8 Demand Projections
Based on the analysis of comparable convention and meetings facilities in Section
4, as well as the estimated dimensions outlined in Section 5, the analysis now
focuses on the potential levels of demand at the proposed Montgomery County
executive meeting and events center. Levels of demand are outlined in terms of
number of events and estimated attendance. The analysis assumes that the facility
will be a standalone facility with limited restaurant options.
These estimates are provided as representative levels of operation consistent with
the market opportunity as assessed in this analysis. These estimates are provided
for the purpose of illustrating the potential for facility operations in this market
context and for the purpose of quantifying the potential economic impacts
associated with such a facility.
8.1 Projected Events
Figure 9.1 summarizes the projected events at the proposed Montgomery County
executive meeting and events center, by event type, for a ten year period after the
facility opens. We assume that year five represents the stabilized year of operations
As previously mentioned, key stakeholders stressed the need for a versatile facility
able to host a diverse set of events ranging from small corporate meetings to
entertainment events and trade shows.
Figure 8.1: Projected Events at Proposed Montgomery County Executive Meeting and Events Center
Source: Tourism Economics (2014)
Event Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Exhibit Events
Conventions & Tradeshows 16 18 20 22 24 24 24 24 24 24
Consumer & Specialty Shows 6 7 8 8 8 8 8 8 8 8
Subtotal, Exhibit Events 22 25 28 30 32 32 32 32 32 32
Cultural & Social Events
Meetings & Seminars 106 108 110 110 110 110 110 110 110 110
Banquets 40 42 44 46 48 48 48 48 48 48
Entertainment Events 6 7 8 8 8 8 8 8 8 8
Civic Events & Other Events 20 22 24 26 28 28 28 28 28 28
Subtotal, Cultural & Social Events 172 179 186 190 194 194 194 194 194 194
Total Events 194 204 214 220 226 226 226 226 226 226
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Conventions & Tradeshows: these events are generally held by
associations, professional groups, and other membership organizations. In
the first year of operations, the Montgomery County facility will host an
estimated 16 conventions and tradeshows, ramping up to 24 by year five.
Consumer & Specialty Shows: typically have larger average attendances
than trade shows. We assume there will be six consumer and specialty
shows in the first year and eight by the fifth year.
Meetings & Seminars: usually require less space and attract fewer
attendees than the larger exhibit events. Since there is a high concentration
of local businesses, we assume meetings and seminars will constitute the
highest number of events at the proposed Montgomery County facility, with
106 in year one and 110 by year five.
Banquets: similar to meetings, banquets don’t require as much space as
some of the larger exhibit events. However, banquets will require in-house
catering services. The ability of the facility to attract banquet events on the
weekends will be a key element for its financial viability. We estimate there
will be 40 banquets in the first year, ramping up to 48 by the fifth year of
operations.
Entertainment Events: again, versatility is key. It will be important for the
facility to attract a variety of events throughout the year. The facility will be
multi-use and will be able to host concerts, entertainment events, cultural
festivals, and other similar events. We assume the facility will host six
entertainment events in its first year and eight in its fifth year of operations.
Civic Events & Other Events: are any other events not included in the
previously mentioned categories. These events might include school
concerts or graduations, as well as other public events. We estimate the
facility will host 20 of these event in the first year and 28 in the fifth year.
Overall, the facility is estimated to host an estimated 194 total events in its first year
of operations. By the fifth year of operations, the proposed Montgomery County
executive meeting and events center is estimated to host an estimated 226 total
events. As outlined in Section 4, the average number of events hosted at the
identified set of comparable convention and meeting facilities was 299 events per
facility. The estimated 226 events at the proposed Montgomery County facility are
in line with this average number of events at the existing facilities.
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8.2 Projected Attendance
Based on the projected number of events, Figure 9.2 summarizes estimated
attendance levels at the Montgomery County facility.
Conventions & Tradeshows: In the first year of operations, attendance at
conventions and tradeshows is estimated to total approximately 5,440
people, resulting in an average of 340 people per event. This is consistent
with typical tradeshows and larger exhibit events at similarly sized facilities.
By the stabilized year of operations (year five), average attendance is
estimated at 380 per event, resulting in 9,120 total attendees at conventions
and tradeshows.
Consumer & Specialty Shows: In the facility’s first year of operations,
consumer and specialty shows is estimated to average 750 attendees per
events, resulting in total attendance of 4,500. Once operations stabilize in
year five, consume and specialty shows are projected to attract 1,250
attendees per event, resulting in total attendance of 10,000 people.
Meetings & Seminars: In year one, the facility is estimated host an
estimated 106 meetings with an average attendance of 300 per meeting,
resulting in total attendance of 31,800. By year five of operations, average
meeting attendance is estimated to ramp up to an estimated 350 per
meeting, or a total attendance of 38,500.
Banquets: We assume the proposed Montgomery County facility will host
larger banquets, as smaller banquets will utilize existing, smaller banquet
facilities. Average banquet attendance of 300 per banquet will result in total
attendance of 12,000 in year one. By year five, average banquet
attendance is estimated to ramp up to 350 per event, resulting in total
attendance of 16,800.
Entertainment Events: Concerts and entertainment events will host an
estimated average of 1,200 guests per event, resulting in total attendance of
7,200 in the facility’s first year of operations. By year five, average
attendance at entertainment events is estimated to ramp up to 1,400 per
events, resulting in total attendance of 11,200.
Civic Events & Other Events: We assume civic events and other events will
host an average 850 guests per event in year one. By year, five, average
attendance at civic events is estimated to increase to 900 per events,
resulting in total attendance of 25,200.
Taken together, total attendance across all categories amounts to an estimated
77,940 attendees in the Montgomery County facility’s first year of operations,
resulting in an overall average of 402 attendees per event.
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By the time the facility reaches steady state operations in year five, average
attendance is estimated to ramp up to 490 guests per event, resulting in total
attendance of 110,820 guests.
Figure 8.2: Projected Attendance at Proposed Montgomery County Executive Meeting and Events
Center
Source: Tourism Economics (2014)
Event Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Exhibit Events
Conventions & Tradeshows 5,440 6,480 7,400 8,360 9,120 9,120 9,120 9,120 9,120 9,120
Consumer & Specialty Shows 4,500 7,000 9,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000
Subtotal, Exhibit Events 9,940 13,480 16,400 18,360 19,120 19,120 19,120 19,120 19,120 19,120
Cultural & Social Events
Meetings & Seminars 31,800 35,100 37,125 38,500 38,500 38,500 38,500 38,500 38,500 38,500
Banquets 12,000 13,650 14,850 16,100 16,800 16,800 16,800 16,800 16,800 16,800
Entertainment Events 7,200 9,100 10,800 11,200 11,200 11,200 11,200 11,200 11,200 11,200
Civic Events & Other Events 17,000 19,250 21,300 23,400 25,200 25,200 25,200 25,200 25,200 25,200
Subtotal, Cultural & Social Events 68,000 77,100 84,075 89,200 91,700 91,700 91,700 91,700 91,700 91,700
Total 77,940 90,580 100,475 107,560 110,820 110,820 110,820 110,820 110,820 110,820
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9 Economic Impacts
9.1 Event Turndowns
The Valley Forge Tourism & Convention Board provided data on lost convention business in
Valley Forge. Based on the provided data, there have been a total of 34 events that turned down
convention space in Valley Forge. Potential clients ranged from national trade shows with
estimated room blocks of nearly 5,000 rooms to smaller, regional clients with requested room
blocks of 100 to 300 rooms. The 34 events would have generated an estimated 44,000 room
nights at a value of more than $70.1 million.
The proposed Montgomery County executive meeting and events center is expected to generate
significant impacts as it attracts exhibit event and cultural/social events to the local region. More
importantly, with a cutting edge facility offering a variety of amenities, the region is expected to
once again be an attractive option for meeting and event planners. As these events utilize the
new facility, they will bring exhibitors and attendees, all of whom will spend money in the local
economy on items such as lodging, food and beverage, recreation, and retail goods at local
businesses and establishments. This spending is expected to generate additional economic
impacts as it ripples through the regional and state economies.
9.2 Direct Event Spending
Based on industry averages and historical data from existing convention and meeting facilities,
Figure 9.1 summarizes projected event spending for exhibit events and cultural/social events. As
shown, total exhibit event spending is estimated to amount to an estimated $19.9 million in the
first year of operations, and event spending for cultural and social events will amount to an
estimated $10.2 million, resulting in total spending of $30.1 million. In the facility’s stabilized year
of operations in year five, exhibit event spending will amount to $38.2 million and cultural/social
event spending will amount to $13.8 million, resulting in total event spending of $52.0 million.
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Figure 9.1: Estimated Direct Impacts of Regional Event Spending, Proposed
Montgomery County Executive Meeting and Events Center
Source: Tourism Economics (2014)
9.3 Room Nights Generated
As previously shown, the proposed facility is estimated to host 200 events and 78,000 attendees
in its first year of operations. We conservatively estimate that these events will generate a total of
36,564 room nights at area hotels during the first year. By the time the facility reaches steady
state operations in year five, it is estimated to host 226 events and nearly 111,000 attendees,
generating 52,737 room nights at area hotels.
This stabilized, or steady state, estimate of 52,737 room nights represents the equivalent of
approximately 422 group room nights per 1,000 square feet of meeting space. In comparison, as
referenced in Figure 3.10, selected regional hotels with meeting space have historically
generated 757 group room nights per 1,000 square feet of meeting space (2013), and regional
hotels with greater than 350 rooms have generated 825 group room nights per 1,000 square feet
of meeting space (2013). The stabilized estimate of 52,737 room nights recognizes that the
proposed Montgomery County executive meeting and events center is not assumed to have a
connected hotel, and would not be anticipated to generate as many room nights per square foot
of meeting space as a result.
To provide an estimate of the magnitude of the potential impact to local hotels, we performed
several calculations. First, we assumed that approximately 70% of the 52,737 room nights,
Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Total Events 22 25 28 30 32 32 32 32 32 32
Total Event Days 66 75 84 90 96 96 96 96 96 96
Total Attendance 9,940 13,480 16,400 18,360 19,120 19,120 19,120 19,120 19,120 19,120
Estimated Room Nights 5,964 8,088 9,840 11,016 11,472 11,472 11,472 11,472 11,472 11,472
Exhibit Event Spending
($ Millions) $19.9 $27.0 $32.8 $36.7 $38.2 $38.2 $38.2 $38.2 $38.2 $38.2
Total Events 172 179 186 190 194 194 194 194 194 194
Total Event Days 516 537 558 570 582 582 582 582 582 582
Total Attendance 68,000 77,100 84,075 89,200 91,700 91,700 91,700 91,700 91,700 91,700
Spending per Attendee $150 $150 $150 $150 $150 $150 $150 $150 $150 $150
Estimated Room Nights 30,600 34,695 37,834 40,140 41,265 41,265 41,265 41,265 41,265 41,265
Cultural & Social Event
Spending ($ Millions) $10.2 $11.6 $12.6 $13.4 $13.8 $13.8 $13.8 $13.8 $13.8 $13.8
Total Event Spending
($ Millions) $30.1 $38.5 $45.4 $50.1 $52.0 $52.0 $52.0 $52.0 $52.0 $52.0
Total Room Nights Generated 36,564 42,783 47,674 51,156 52,737 52,737 52,737 52,737 52,737 52,737
Exhibit Events (Trade Shows, Conventions, Consumer/Specialty Shows
Cultural & Social Events
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equivalent to 36,916 room nights, would represent incremental demand to the local inventory of
15 hotels with 2,616 rooms. This is the group of 15 hotels as described in section 3.1 King of
Prussia Lodging Market. It includes nine hotels in the King of Prussia Proximate Set plus six
additional upper midscale and economy hotels in the local area. One of 15 hotels is located in
Chester County, while the remaining 14 are in Montgomery County. We assumed the remaining
30% of the total room night impact would represent room nights that were not incremental, such
as groups that would have otherwise used existing facilities in the area (e.g. smaller on-site space
at existing hotels, office buildings, and other venues) at stayed at local hotels, or room nights that
would result in a displacement of room nights that would otherwise have been accommodated
(e.g. by accommodating a group related to the proposed executive meeting and events center a
local hotel would have fewer rooms available on particular peak periods to accommodate
transient travelers).
Next, we considered that the inventory of 15 local hotels with 2,616 rooms offers 954,840
available room nights annually. Relative to this inventory, 36,916 incremental room nights is
equivalent to an increase to occupancy of 3.9 percentage points. Assuming an average group
room rate of $126.70 (based on 2013 average group room rate for the King of Prussia Proximate
Set), implies a room revenue impact of $4.7 million annually in 2013 dollars. This is equivalent to
a revenue per available room (RevPAR) impact of $4.90 to the set of 15 local hotels.
Within the group of 15 local hotels, we anticipate the greatest impact would be to the nine hotels
in the King of Prussia Proximate Set, as well as the Best Western Plus The Inn at King of Prussia,
with a total of 1,943 rooms. If 90% of the 36,916 incremental room night impact occurs at these
10 hotels, the occupancy impact would be 4.7 percentage points, and the RevPAR impact would
be $5.94 (in 2013 dollars). In 2013, the group occupancy contribution at the King of Prussia
Proximate Set was 16.3%, as shown in Figure 3.2. With an increase of 4.7 percentage points, the
group occupancy contribution would be 21.0%, which is still slightly below the 22.5% group
occupancy contribution realized by these hotels in 2011, before the reduction in available space
at the Valley Forge Convention Center.
9.4 Economic Impacts Defined
The economic impacts of the event spending outlined in the previous section were estimated
using a regional Input-Output (I-O) model based on IMPLAN (www.implan.com) models. IMPLAN
is recognized as one of two industry standards in local-level I-O models. An I-O model represents
a profile of an economy by measuring the relationships among industries and consumers. For
example, an I-O model tracks the flow of a visitor’s restaurant expenditures to wages, profits,
capital, taxes and suppliers. The supplier chain is also traced to food wholesalers, to farmers, and
so on. In this way, the I-O model allows for the measurement of the direct and indirect sales
generated by a restaurant meal. The model also calculates the induced impacts of tourism. These
induced impacts represent benefits to the economy as employees of tourism sectors spend their
wages in the local economy, generating additional output, jobs, taxes, and wages.
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Figure 9.2: Illustration of Economic Impact Model
The modeling process begins with aligning the expenditure measurements with the related
sectors in the model (e.g. sports & recreation, restaurants, retail, and entertainment). The model
is then run to simulate the flow of these expenditures through the economy. In this process, the
inter-relationships between consumers and industries generate each level of impact for each
economic indicator (sales, wages, employment, etc.).
9.5 Projected Economic Impacts – Montgomery County
Figure 9.3 summarizes the projected countywide economic impacts of the proposed facility. In
Montgomery County, $30.1 million of total event spending in the facility’s first year of operations is
expected to generate $19.1 million in indirect and induced expenditures, resulting in an economic
impact of $49.2 million throughout Montgomery County. This countywide economic impact will
include $9.0 million in employee salaries and wages, supporting an estimated 416 total jobs.
Once the proposed facility reaches its stabilized year of operations in year five, the total
countywide economic impact is estimated to amount to $85.0 million, including $15.6 million in
employee salaries and wages, supporting 719 total jobs throughout the county.
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Figure 9.3: Projected Economic Impacts, Montgomery County ($ Millions & Total Jobs)
Source: Tourism Economics (2014)
Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Total Event Spending
($ Millions) $30.1 $38.5 $45.4 $50.1 $52.0 $52.0 $52.0 $52.0 $52.0 $52.0
Indirect & Induced Expenditures
($ Millions) $19.1 $24.5 $28.8 $31.8 $33.0 $33.0 $33.0 $33.0 $33.0 $33.0
Total Economic Impact
($ Millions) $49.2 $63.0 $74.2 $81.9 $85.0 $85.0 $85.0 $85.0 $85.0 $85.0
Total Employment Impact 416 533 628 693 719 719 719 719 719 719
Total Employee Salaries &
Wages ($ Millions) $9.0 $11.5 $13.6 $15.0 $15.6 $15.6 $15.6 $15.6 $15.6 $15.6
Economic Impacts - Montgomery County
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9.6 Projected Economic Impacts – State of Pennsylvania
Figure 9.4 summarizes the projected statewide economic impacts of the proposed facility. In the
State of Pennsylvania, $30.1 million of total event spending in the facility’s first year of operations
will generate $33.5 million in indirect and induced expenditures, resulting in an economic impact
of $63.6 million throughout the State. This statewide economic impact will include $19.0 million in
employee salaries and wages, supporting an estimated 818 total jobs. Once the proposed facility
reaches its stabilized year of operations in year five, the total statewide economic impact will
amount to $109.9 million, including $32.8 million in employee salaries and wages, supporting
1,415 total jobs throughout the State.
Figure 9.4: Projected Economic Impacts, State of Pennsylvania ($ Millions & Total Jobs)
Source: Tourism Economics (2014)
Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Total Event Spending
($ Millions) $30.1 $38.5 $45.4 $50.1 $52.0 $52.0 $52.0 $52.0 $52.0 $52.0
Indirect & Induced Expenditures
($ Millions) $33.5 $42.9 $50.6 $55.8 $57.9 $57.9 $57.9 $57.9 $57.9 $57.9
Total Economic Impact
($ Millions) $63.6 $81.4 $96.0 $105.9 $109.9 $109.9 $109.9 $109.9 $109.9 $109.9
Total Employment Impact 818 1,048 1,236 1,363 1,415 1,415 1,415 1,415 1,415 1,415
Total Employee Salaries &
Wages ($ Millions) $19.0 $24.3 $28.6 $31.6 $32.8 $32.8 $32.8 $32.8 $32.8 $32.8
Economic Impacts - State of Pennsylvania
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