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[EXECUTIVE SUMMARY]
[PUBLIC SURVEY]
[EVENT PROJECTIONS]
[FEATURE & AMENITIES]
Executive Summary
Introduction
Leisure Management International ("LMI") is pleased to present the
"Okaloosa County Conference Center Business Plan" to the Okaloosa County Tourist
and Development Council ("Council"). The purpose of this Business Plan is to
assist the Council in developing and evaluating options regarding the development,
construction and operation of the proposed Okaloosa County Conference Center. The flow of
this report follows a logical sequence of fact-finding and assessment of the current
situation, and is based on LMI's research of the Okaloosa County market, typical industry
standards and experience in the management and operation of similar facilities.
Market Survey
The first phase of the market survey entailed conducting personal interviews
with the local hospitality, hotel/motel and political leaders in the community. The
majority of those contacted were in support of the project and felt that it would be a
great economic stimulator during the off-peak season, as well as generating better quality
of life events for the local community. The primary concern expressed was to make sure
that transportation issues were addressed. Upon completion of the first phase of the
market survey, LMI contacted numerous individuals and organisations to gain a better
perspective of the local market. These contacts ranged from local and regional users to
national organisations who currently
From our research, it appears that the majority of Center usage would come from
local, regional, and some national users such as the Destin Snowbirds, American Business
Women, Kiwanis Club, Krewe of Bowlegs, Tupperware, Mary Kay Cosmetics and various other
corporations and associations.
Public Survey
LMI conducted a public survey which resulted in approximately 90 responses. The
purpose of this survey was to gauge the public's interests as to types of events and other
amenities it would like to see and support in the new Okaloosa County Conference Center.
The survey asked respondents to list the most important aspect to patrons when
attending events. Survey results indicated that parking, comfortable seating and acoustics
were the primary concerns to potential patrons.
Community Meeting
A community meeting was, held at the Fort Walton Beach Municipal Auditorium to
encourage citizens of Okaloosa County to share their views about the proposed Okaloosa
County Conference Center. It was an opportunity for citizens to express ideas about types
of events and other entertainment that they would like to see in Okaloosa County. Over 70
people participated in the forum. Major general points of interest included:
- Overall support from the Fort Walton Beach Chamber of Commerce and the Destin
Chamber of Commerce
- Economic impact to local businesses
- Site selection
- Quality of life
- Economic development tool
Event Projection
Based on the findings of the user surveys, market research and LMI's experience
in the management and operation of similar facilities, the event activity at the Okaloosa
County Conference Center should average approximately 319 events annually with an average
attendance of approximately 291,000 patrons. This level of event activity will typically
require two to three years to reach a sustained level of event activity.
Facility Program
After establishing the projected event activity for the Conference Center, the
next step in the development of the Business Plan was to create the facility program. The
purpose of the program is to establish the overall square footage of the facility and to
identify the Center's major features, amenities and components. The total program square
footage for the Okaloosa County Conference Center is anticipated to be 87,790 square feet.
FF&E
Crucial to the successful and efficient operation of the facility is the
selection of proper Furnishings, Fixtures and Equipment (FF&E). The total FF&E
budget for the Conference Center is estimated to be $2,072,705. The budget was prioritized
using "A" and "B" priority items. "A" priority items are
those items that are required prior to the facility's opening. "B" priority
items are items that could be purchased later or obtained from other sources such as
leases or sponsorships.
Project Cost Estimate
The total Project Cost Estimate for the Okaloosa County Conference Center is
$15,982,772. The Project Cost Estimate was calculated using an average construction cost
of $125 per square foot times the projected 87,790 square footage facility program. The
Project Cost Estimate also includes the Conference Center construction, food service
equipment, Option "A" items only of furniture, fixtures and equipment,
architectural and engineering fees, permits, legal fees plus a 5% contingency. Pre-opening
costs are not included in the Project Cost Estimate.
Schedule
Typically, projects of this size and scope have required a twelve (12) month
design period, an eighteen (18) month construction period and two (2) months for move-in
and Grand Opening preparations.
Pre-Opening
The Pre-Opening Budget for the Okaloosa County Conference Center is anticipated
to be $1,180,161. The Pre-Opening Budget identifies the costs associated with booking,
marketing and preparing the Conference Center for operations during the construction
period. The budget is based on LMI's experience with the pre-opening of similar
convention/conference facilities such as the Pontchartrain Center, Gwinnett Civic &
Cultural Center and numerous other public assembly facilities.
Annual Operating Budget
The Annual Operating Budget provides a detailed forecast of a typical operating
year at the Okaloosa County Conference Center. Annually, the facility is anticipated to
host approximately 319 events with 291,000 people in attendance. Total operating revenues
are projected to be $718,148 with operating expenses of $1,350,300 yielding a net
operating loss of $632,152.
The primary sources of revenue attributable to the operation of the Okaloosa
County Conference Center will include, but not be limited to, facility rent, concession
sales, catering sales, merchandise sales, parking income, ancillary income (i.e. equipment
rental, telephone equipment rental, electrical services and exhibit booth rentals),
advertising income, box office fees and interest income.
Operating expenses will include, but not be limited to compensation &
benefits, general & administrative, utilities, maintenance & repair, contract
services, legal and professional services, advertising & marketing, insurance, travel,
entertainment & promotions, dues & subscriptions, and licenses & permits.
Expense projections are based on LMI's experience in the management and operation of
similar facilities.
Staffing
Full-time staffing for the Okaloosa County Conference Center will consist of
seven (7) salaried employees and nine (9) hourly employees for a total staffing complement
of sixteen(16) full-time people. The positions and salary levels shown are consistent with
current LMI and industry practices. The full-time staff will be recruited, hired and
trained throughout the pre-opening period. Training will focus on job knowledge, systems
training and customer service training.
Financial Forecasts
LMI has provided two preliminary financing scenarios for the construction of the
Conference Center. Based on conversations with financial advisors and taking into
consideration current market conditions the anticipated interest rate should range from 5%
to 5.5%. Scenario 1, assumes a 30 year term with a 5% annual interest rate. Scenario 2,
assumes a 30 year term with a 5.5% annual interest rate.
The source of funds that will be used to retire the debt, is a $.02 increase to
the existing hotel/motel tax of which $.01 will be dedicated to project costs associated
with the construction and capital improvements of the Conference Center. Based on the
history of existing hotel/motel tax collections and conversations with the Okaloosa County
Tourist and Development Council, estimated revenues from the additional $.01 hotel/motel
tax collection should approximate $1,000,000 annually.
In both Scenario 1 and Scenario 2, the principal payments have been deferred for
the first 3 to 5 years respectively to allow for the creation of a reserve fund to cover
funding shortfalls in the early term of the bond.
Economic Impact
Annually, it is anticipated that the Okaloosa County Conference Center will
generate an economic impact of $11,066,410. Eighty-eight percent (88%) of this total sum
represents new dollars introduced into the local economy through the generation of
additional visitor night spending. The existence of the Conference Center would provide a
substantial economic boost to the local economy. Furthermore, the presence of the Center
would enhance the economic outlook of Okaloosa County by creating a regional marketplace
identity for mid-sized events for the surrounding communities. The final analysis is that
the Center would play an integral part in the positive economic forecast, while
simultaneously enriching the residents of Okaloosa County's quality of life. See Section 8
for detailed assumptions and calculations related to economic impact.
Statement of Appreciation
LMI appreciates having the opportunity to assist the Genesis Group and the
Okaloosa County Tourist and Development Council in assessing its options related to the
proposed new Okaloosa County Conference Center and the impact it would have on Okaloosa
County. This report has been prepared and based upon the most current information
available to LMI, along with information provided by the Okaloosa County Tourist and
Development Council staff. Leisure Management International makes no representation,
guarantee or warranty, expressed, implied or otherwise with respect to the actual results
which can be expected or derived regarding the construction and operation of the Okaloosa
County Conference Center.
Market Survey
Introduction
The first phase of the market survey entailed conducting personal interviews
with the local hospitality, hotel/motel and political leaders in the community. The
majority of those contacted were in support of the project and felt that it would be a
great economic stimulator during, the off-peak season, as well as generating quality of
life events for the local community. The hospitality and hotel/motel leaders indicated
that a large ballroom was needed and that meeting and break out rooms were critical. The
primary concern expressed was to make sure that transportation issues were addressed. Upon
completion of the first phase of the market survey, LMI contacted numerous individuals and
organisations to gain a better perspective of the local market. These contacts ranged from
local and regional users to national organisations who currently utilise facilities in the
region or would potentially use the new Okaloosa County Conference Center.
From our research, it appears that the majority of Center usage would come from
local, regional, and some national users such as the Destin Snowbirds, American Business
Women, Kiwanis Club, Krewe of Bowlegs, Tupperware, Mary Kay Cosmetics and various other
corporations and associations. LMI believes there will be a number of users from
Louisiana, Mississippi, Georgia and Alabama as well as the state of Florida.
User Comments
Of the users contacted most viewed Okaloosa County as a resort type destination
with their major concern being airfare and air accessibility. The number of flights into
the market, price and ease of travel from the airport will definitely be important factors
taken into consideration by meeting planners. Many individuals and groups were very
excited about the possibility of a new facility in the local market. Following are some
highlights from our conversations:
JVC, Pre-show and Key Dealer Meetings
"We would definitely consider Okaloosa County for our meetings, depending
on airfare and convenience of travel from airport." Requirements would include 14,000
sq. ft. ballroom and 10-12 break out meeting rooms. Currently the JVC, Pre show and Key
Dealer Meetings are held in Orlando.
Tupperware, Various Meetings
"Okaloosa County would be a possibility. Our major concern would be airfare
and air accessibility into the market as well as the space to fit our needs." Exact
meeting requirements vary because Tupperware has a large number and variety of meets.
Essentially though, a ballroom, exhibit hall and meeting rooms would be required.
Georgia Hospital Association, Annual Meeting and Seminars
"Not many resorts have conference centers. We would definitely consider
Okaloosa County, we like the destination. We see it as a niche and we would come during
the off season and get the value. We consider Okaloosa County to be similar to Myrtle
Beach." The requirements for the Georgia Hospital Association, Annual Meeting and
Seminars would include a 20,000 sq. ft. ballroom and exhibit space for 140 booths.
Institute in Basic Life Principles
"Yes, Okaloosa County would definitely be a possibility. Cost would be a
key issue for us. Building personnel is key! Good/free parking is also key" The
requirements for the Institute in Basic Life Principles would include accommodations for a
general session of up to 1,200 people, break out meeting rooms for 300 people and a large
reception area with room for lines.
Avon, District Sales Meeting
"The destination is very attractive. The majority of our attendees are
female and would come from Ohio, Kentucky and Georgia. Attendees would come early and stay
late with their families. How easy is air travel? If the hotel is not across the street we
would need transportation (i.e. U.S. Host). Our major concern would be the available work
pool, the ability to rent staffing from the local CVB for manning the registration tables
etc." The requirements for the Avon, District Sales Meeting would include meeting
space for 600 attendees.
Mary Kay Cosmetics, Annual Career Conference
"We would definitely consider Okaloosa County, we are currently going to
Mobile, Alabama. We see Okaloosa County as a good alternative to Mobile, attendees would
bring their families. We like the fact that there are hotel rooms across the street."
The requirements for the Mary Kay Cosmetics, Annual Career Conference would include 20,000
sq. ft. for exhibits, ability to feed up to 800 attendees, and a lot of break out space.
State Farm Insurance, Large Agent Meetings
"We would definitely consider Okaloosa County for our larger agent
meetings. We normally have four (4) per year. We prefer destinations within driving
distance." The requirements for the State Farm Insurance, Large Agent Meetings would
include space for general sessions to accommodate 50 to 300 attendees as well as break out
rooms and entertainment.
Georgia Society of Association Executives, Annual Meeting
"Okaloosa County would be a possibility. We would consider
merging/combining our annual meeting with the Florida Society of Association Executives.
The hotel would need to be at least walking distance from the Conference Center. We have
high tech A.V. needs that would need to be met. Having an area to co-ordinate 'beach'
events or a pier would be nice." The requirements for the Georgia Society of
Association Executives, Annual Meeting would include a keynote area and ballroom for at
least 300 to 400 attendees, 6 break out meeting rooms, and ample prefunction space for
networking and registration.
World Marketing Alliance, Regional Meetings and Small Meetings
"We would definitely have use for a facility in Okaloosa County. We are
currently going to Tampa and we used to go to Orlando but it got too busy there. We have
an agent located in Destin." The requirements for the World Marketing Alliance,
Regional Meetings and Small Meetings would include space to accommodate 1200+ attendees
for regional meetings and 50 to 150 attendees for smaller meetings. They would need AN but
no food and beverage.
Royal Palace Circus Inc., Circus
"We would be very interested in coming to a facility in Okaloosa County.
Please send the information when the facility is ready. We would definitely consider
adding this facility to the schedule." The requirements for the Royal Palace Circus
Inc., Circus would include 20,000 sq. ft. of space.
New Birth Missionary Baptist Church, Annual Meeting
"We would definitely consider Okaloosa County as long as the facility could
accommodate our annual meeting of 2,500 to 3,000 attendees. Distance from the airport is
not a problem, we will utilise bussing. The food must be of high quality, it is very
important to our overall event. Customer service and attitude of staff is key to us."
The requirements for the New Birth Missionary Baptist Church, Annual Meeting would include
general session and meal space to accommodate 2,500 to 3,000 attendees and 8 break out
rooms for 400 each.
Religious Conference Management, Regional Conferences
"We would not bring a national conference to this area without a large
national airport. We cannot make 1,300 people get transportation to the facility. We would
consider bringing our smaller regional conferences here, as these attendees could possibly
drive in. Hotel must be in walking distance." The requirements for the Religious
Conference Management, Regional Conferences would include 1,000 sq. ft. of general session
space with break out meeting rooms.
Southern Association of Orthodontists, Large Meetings
"Okaloosa County would definitely be a consideration, We must have outside
activities for families. We need a lot of space, 1200 people, 650 hotel rooms." The
requirements for the Southern Association of Orthodontists, Large Meetings would include
25,000 sq. ft. of exhibit space and two (2) break out rooms – 600 each.
Southern Christian Youth Conference, Meetings
"A facility in Okaloosa County would be a consideration if you had
activities for youth in the surrounding area to avoid driving to Panama City. We would
need plenty of fast food/restaurants in the immediate area. We travel on buses and would
require 300 to 400 double/double rooms, preferably within walking distance. Having
everything in-house is a must for us. We would also need a large registration area for
registration and information." The requirements for the Southern Christian Youth
Confer Meetings would include at least 25, 000 sq. ft. and general session space for 300
to 400 attendees with adequate space break outs and space to feed the entire group.
United States Olympic Congress, Olympic Activities/Events
"A facility in Okaloosa County would be a consideration. We are looking for
communities that have preferences in Olympic activities/events (i.e. sports commissions
established). We also need an arena for youth sporting events for our 'Champions in Life'
segment. We would also need the hotel to be within walking distance." The
requirements for the United States Olympic Congress, Olympic Activities/Events would
include 30,000 to 40,000 sq. ft. of exhibit space, a general session space for 500 people,
seminar rooms for 100 people each, and meal space for 300 to 400 people.
The Berry Company, Meetings
"We would definitely use a facility in Okaloosa County. We currently use
Florida as a destination, from Panama City to Sanibel." The Berry Company is a sister
company of Bell South Advertising and Publishing. They do Yellow and White pages for
Tennessee, Kentucky and Mississippi. The Berry Company has more money in their budget and
plans more meetings than BAPCO. No specific meeting requirements given.
Royal Hanneford Circus, Circus
"I am not familiar with this area, however, we do currently go to
Pensacola, where they have a facility, so we would definitely come if there were a
facility built in Okaloosa County. We could come at any time of year." The
requirements for the Royal Hanneford Circus, Circus would include 35' ceiling heights, a
floor at least the length of a basketball court with telescopic seating or bleachers a
must.
Deere and Company, Meetings
"Our smaller university meetings of 450 attendees meets in February. This
facility would be too small, as we require a lot of room for displays and test drive
equipment. Another major concern for us is the lack of a major airport. We probably would
not consider the Okaloosa County area because of these concerns."
