The Los Angeles Convention Center, managed by AEG Facilities, closed its Fiscal Year 2016-2017 with the largest financial and operational surplus, highest occupancy rate and hosted the most Citywide conventions and special events in the LACC’s 46-year history. The LACC reported an operating surplus of over $10.2 million; a 5% jump from the year prior. The impressive FY 2016-2017 results are not only in financial performance but also increases in total attendance and Citywide convention bookings, building improvement projects, sustainability metrics, positive client survey results and community involvement and corporate responsibility projects.
Under the management of AEG Facilities, the LACC concluded the fiscal year (June 30, 2017) with an operating surplus of over $10.2 million before reimbursing the City of Los Angeles $3.1 million for the Convention and Tourism Development Department expenses, Staples Bond payment and an allocation for other City services. Since taking over management in December 2013, AEG Facilities has reported improved financial results every year totaling an operating profit of over $26.8 million. In this fiscal year, the LACC also added $1 million to the reserve account, accumulating $7.1 million in reserves at the conclusion of FY 2016-2017.
“We are extremely impressed with all of the accomplishments of AEG’s Los Angeles Convention Center team. AEG Facilities has been able to surpass all expectations and deliver unprecedented financial results, saving millions of dollars for the City. This strategic partnership has proved to be a great move for the City of Los Angeles, and we look forward to the continued success of our convention center,” noted Jon F. Vein, president, Board of Los Angeles Convention & Tourism Development Commissioners.
A&I and CIP
Since the transition, the LACC has reinvested surplus dollars it has generated, more than $11.8 million, on various building improvement projects In FY 2016-2017, the AEG Facilities LACC team assisted the City in executing a total of $5.2 million in Capital Improvement Projects and funded a total of $6 million in Alteration and Improvements projects; $2 million more than the year prior. These projects provide building improvements, increase operational efficiencies, and directly improve the client and attendee experience.
Notable CIP and A&I projects include:
- Building efficiency projects – implementation of the new Computerized Maintenance Management System – a digital work order system to streamline maintenance of the LACC
- Beautification projects – upgraded landscaping and florals in Concourse Walkway, South Lobby planters, and Kentia Palm Court as well as carpet replacements throughout the facility
- Sustainable projects – LED lighting retrofits, Energy Star Appliances for the LACC kitchen area, installation of Water Bottle filling stations, and the addition of the Metro Bike Station at Gilbert Lindsey Plaza
- Safety and security enhancements – the addition of 36 emergency call boxes in all parking areas and 93 security cameras
Increased Events and Citywides Conventions, Overall Attendance, and Improved Client Survey Results
The LACC successfully closed the year at an occupancy rate of 74 percent, surpassing prior year’s 72 percent – industry standard indicates a Convention Center is considered fully occupied at 70 percent.
Through the partnership with the Los Angeles Tourism and Convention Board and the Los Angeles Department of Convention & Tourism Development, the LACC has increased Citywide bookings by 7 percent, which included large medical conventions such as the American Society of Cataract and Refractive Surgery, and the American Association of Neurological Surgeons; and other international conferences such as the USGBC Greenbuild and Optical Society of America. Additionally, the LACC received 96% favorable post event survey results from clients compared to 92% favorable last fiscal year.
“The increase in Citywide conventions is a huge success for the City of Los Angeles with attendee direct and indirect spending stimulating the local economy. Events held this year at the LACC has economically contributed $732 million to the City of Los Angeles and an estimated 300,000 booked hotel room nights. AEG has been instrumental in the Convention Center’s incredible success, and we are proud to call them partners,” commented Doane Liu, Executive Director of the Los Angeles Department of Convention and Tourism Development.
Sustainability and Corporate Social Responsibility
The LACC has also reached a record-breaking 75 percent waste diversion rate this fiscal year, surpassing the prior year by 3 percent. Since the transition to AEG Facilities management, the construction and demolition waste diversion program has diverted more than 4.5 million pounds of C&D waste from the landfill and has recycled 4,000 tons of compost, which represents a significant proportion of the overall waste from the LACC.
The LACC is proud to be a Downtown stakeholder and values giving back to the community through internal programs such as the first LACC Service Day at the Downtown Women’s Shelter, Earth Day
E-Waste Fair, and participation through other AEG sponsored programs such as the Read-to-a- Child program at 10th Street Elementary School in Downtown Los Angeles.
“In under four years of management, the AEG Facilities Team has significantly increased revenues, improved efficiencies, built a healthy reserve, and saved the City millions of dollars. We have also increased the number of events and building occupancy year after year, made millions of dollars in capital improvements and have become leaders in sustainability and social responsibility for the City of Los Angeles. The public-private-partnership between AEG Facilities and the City of Los Angeles has transformed the LACC and proves it was the right choice for L.A.,” states Brad Gessner, General Manager of the Los Angeles Convention Center and Senior Vice President for AEG Facilities
The Los Angeles Convention Center is renowned internationally as a prime site for conventions, trade shows, and exhibitions. Professionally managed by AEG Facilities, the LACC attracts over 2.5 million visitors annually. The facility is an integral economic component to the Southern California area; based on historical averages the total economic impact based on direct and indirect spending is $732 million annually, generating and sustaining over 5,900 local jobs. The LACC also remains an enduring symbol of environmental sustainability and social responsibility, and is proud to be a LEED Gold certified facility; the venue was recertified on the Gold level in 2015 making the LACC the largest convention center in the U.S. to receive LEED EB:O+M Gold recertification. For more information, please visit lacclink.com.
AEG, a wholly owned subsidiary of the Anschutz Company, is the leading sports and live entertainment company in the world. AEG Facilities, a stand-alone division of AEG, and its affiliates owns, operates or consults with more than 120 of the industry’s preeminent venues worldwide, across five continents, providing complete venue management, as well as specialized programs in operations, guest services, ticketing, booking, sales and marketing. AEG Facilities also provides resources and access to other AEG-affiliated entities, including AEG Live, one of the largest live music companies in the world, AEG Global Partnerships and AEG Real Estate, as well as such industry leading programs as AEG 1Earth and AEG Encore to support the success of its venues across the globe. The Los Angeles-based organization owns, operates or provides services to the world’s most elite venues, including STAPLES Center and Microsoft Theater (Los Angeles, CA), StubHub Center (Carson, CA), Sprint Center (Kansas City, MO.), Valley View Casino Center (San Diego, CA), KFC Yum! Center (Louisville, KY.), AmericanAirlines Arena (Miami, Fla.), Prudential Center (Newark, N.J.), Barclays Arena (Brooklyn, N.Y.), Target Center (Minneapolis, MN), Oracle Arena and O.co Coliseum (Oakland, CA), CONSOL Energy Center (Pittsburgh, PA), Mercedes-Benz Arena (Shanghai, China), MasterCard Center (Beijing, China), The O2 Arena (London, England), Mercedes-Benz Arena (Berlin, Germany), Barclaycard Arena (Hamburg, Germany), AccorHotels Arena (Paris, France), SSE Hydro (Glasgow, UK), Qudos Bank Arena (Sydney, Australia), Perth Arena (Perth, Australia), Ericsson Globe Arena (Stockholm, Sweden), Los Angeles Convention Center (Los Angeles, Calif.), Hawaii Convention Center (Honolulu, HI), Puerto Rico Convention Center (PRCC), Brisbane Convention & Exhibition Centre (Brisbane, Australia), International Convention Centre (Sydney, Australia) and the Oman Convention and Exhibition Center (Muscat, Oman). For more information, please visit aegworldwide.com.