The Regional Impact of the Wildwoods Convention Center and Wildwoods Special Events on the Tourism Economy of Cape May County’
2007 Cape May County Tourism Conference
Presented by Mr. John Siciliano, Executive Director/CFO
Greater Wildwoods Tourism Improvement and Development Authority
I would like to thank the Cape May County Freeholders and the County Tourism and Communications Departments for asking me to be a part of their program today. The topic, which I was asked to speak about today is the regional economic impact of the Wildwoods Convention Center and Special Events. Now, in order to talk about these current impacts, I believe it is important to discuss and share with you a brief history about the creation of GWTIDA, the Convention Center and our commitment to Special Events.
In 1993, after several years of planning, by the business community and the city of Wildwood, the city of N. Wildwood, the borough of Wildwood Crest and our State Legislators, the Wildwoods Tourism Authority was created.
At that time, the municipalities, along with the business organizations on the island knew that several changes needed to take place to not only maintain the level of business that was shrinking through the late 80’s and early 90’s but to also create a more year round economy.
In addition, if we were to stay in the convention and meeting business, there were some major changes that were necessary to our existing Convention and Civic Center to make that a viable option. Either a major expansion of the existing center or the construction of a new, modern facility was needed.
So, GWTIDA was given two primary missions:
- To take over the operations of the existing Convention Center and immediately begin to work on the expansion or construction of a new one; and
- To become the advertising and promotional arm of the Wildwoods, marketing it as a premier family vacation destination.
To carry out its mission, GWTIDA was given Dedicated Revenue Streams: A two percent (2%) Tourism Tax and a Tourism Development Fee.
The two percent (2%) Tourism Tax is imposed on room rentals, prepared food and beverage and certain admission fees.
The Tourism Development Fee is paid by business owners who do not collect the 2 percent tourism tax.
This TDF, however, has one caveat; the money derived from this collection can only be used for special events or event promotion. Which, by the way, was done by design. Special events and themed weekends, were planned to be one of the strongest methods of expanding the season, and this legislation indicates that commitment. So, from the very beginning of GWTIDA’s existence, special events were a major part of its tourism plan.
Through the 80’s and early 90’s, the tourism season could be described as Memorial Day weekend to the Sunday, of Firemen’s Convention, which was the second weekend in September. The Monday after Firemen’s Weekend, at least in Wildwood, the town was closed. I remember the old expression, that you could shoot a canon down New Jersey Ave. And you wouldn’t hit anyone. Well, people can’t say that anymore.
I have had the opportunity, to be a part of the Wildwoods Convention Center project from the planning and development stage, through the construction stage, and the sales and marketing efforts, which continue today. The Convention Center project was always viewed as a project that would benefit, the Wildwoods, Cape May County and the State of New Jersey. In 1994, the KPMG Peat Marwick feasibility study, in the first paragraph of its report, identified this future project as a significant asset to Cape May County and the State.
The facility opened its doors on April 2, 2002. And, although owned by the New Jersey Sports and Exposition Authority (NJSEA), GWTIDA was asked, in 1998, by the NJSEA to be their operating agent. Now, I am not sure whether or not people realize just how huge of a benefit that was to us: a local authority running a local state facility. Not, as was once suggested, the NJSEA placing staff here and overseeing it or hiring a company such as SMG or Global Spectrum to be the general managers. And why was it huge? Well, for one, because we understand our market better than anyone could, and two, because this facility was able to become an overall critical part of our special events planning. A Convention Center, is an economic development project. And while, we must keep in mind that there is a bottom line to manage, the bigger picture is to expand and increase the numbers of visitors to the area. Local understanding and control allowed that to happen.
One of the philosophies that GWTIDA employs with special events is to provide seed money to outside promoters who want to hold events in our community.
As I said before, the day after firemen’s weekend, was the official close of the year. Well now, we have three events on the following weekend; the fall Boardwalk Classic Car Show, the Irish Festival and Seafarers Weekend. Each of our three communities, holding events that has created a weekend that makes finding a room on the island nearly impossible and literally a weekend that now surpasses Memorial Day and Labor Day Weekends.
We have taken that concept, and applied it to every weekend from Labor Day through October 21st this year. Either a convention or a special event or two is happening. The Fabulous 50’s Weekend, which is the weekend of October 21st, culminates with a concert that brings 6,500 people to the center. You will be amazed to see the numbers of people who come out for this annual event. So, we have literally added 5 weeks to our fall shoulder season. And we are not talking small events. We are talking thousands of people coming out for these conventions or events. And when they are here, we all know that people are eating out, walking the boards, driving into Cape May and other areas in our County. The overall impact is regional.
And, I guess, one point that I am trying to make about the special events and convention center connection, is that, without our facility, the 50’s weekend, for example would not be possible. Our facility has become a ‘hub’ for a various number of events or functions within an event, from something as large as holding a concert for 6,500 plus or as simple as registration for a tri-atholon. The two truly work hand in hand.
Now, comes the part of this presentation where I attempt to quantify all of this. Not an easy task.
In 2001, the old convention facility hosted 49 groups. Those groups equated to 118 event days in the center, occupied 25 weekends with an estimated attendance of 129,000 and accounted for 51,348 rooms booked.
In 2006, the Convention Center hosted 156 groups. Those groups equated to 222 event days, occupied 46 weekends with an estimated attendance of 235,249 and accounted for 131,265 rooms booked.
There was an increase of three hundred and twenty percent (320%) in the number of groups hosted and just about double the total event days and weekends occupied.
The number of attendees at the facility increased one hundred and eighty three percent (183%) and room nights increased by two hundred and fifty six percent (256%).
Through April 30th of 2007, the convention center has already hosted 47 events with approximately 37,698 attendees to the facility.
We have also calculated, based on our number of attendees and the days that they are here for their event, that we generate over 1,000,000 (1 million) dining opportunities in the community on a yearly basis.
In 2006, Cape May County was responsible for 4.854 billion dollars in tourism expenditures according to the state of NJ and the report prepared by global insight. With our 8,000 hotel rooms, and our nearly 4,000 rental properties and our boardwalk, we estimate that the wildwoods contribute approximately 20% towards that total or around $971,000,000. While reviewing the information presented at last year’s county tourism conference, I saw references made in the survey taken by the county. 23% of those surveyed said they were headed to the wildwoods, and 61% responded ‘boardwalk’ when asked what leisure activity attracted them most to Cape May County. 81% also responded the beach. If we used the survey percentage, which is 23%, that number would be $1.12 billion.
It is very difficult to use our tourism tax numbers to extrapolate out, any real meaningful, factual numbers, because I do believe that we, in Cape May County defy, in some ways the normal averages. I feel that our visitors may not meet the national averages, such as 33% spent on accommodations and 23% spent on food. I feel that our visitors, our families spend more of their vacation dollar on the entertainment side. And it is our boardwalk, which I am unable to ascertain any real numbers from.
If you look at the graphic entitled 2006 tax collections, you will see that we collected $3,435,483 in two percent taxes and $1,525,551 in 1.85% tax. The 1.85% tax equates to $82,462,208 in room rentals, which leaves $89,311,929 in prepared food and beverage. The next graphic shows the 2006 collections of the 2% tax against the 2001 2% tax collections. There was no 1.85% tax in 2001. I truly wish there was, for this comparison because, everything indicates that we are doing so much more business in 2006 vs. 2001.
But there is was one major change that also has taken place that affects these numbers greatly. Over the last 3 years, the wildwoods have lost nearly 3,500 hotel rooms. These rooms were replaced with condos and townhouses, which, if rented, do not collect the 2% tourism tax or state room occupancy tax.
We know that people in the Wildwoods travel to Cape May, Avalon, Stone Harbor, Court House, Sea Isle and even as far north as Ocean City and Atlantic City while visiting. And likewise, we know that there are very many visits to the wildwoods boardwalk, from those very same cities.
We estimate that our special events and our convention center events account for about $60 million a year in economic impact to the county. That would equate to $300 million dollars in the last 5 years. (back to the first graphic booking recap) Although we are happy with the current success of the Wildwoods Convention Center, we are far from satisfied. We have a lot of work to do, to grow those numbers even more over the next couple of years. We have great support from our entire county, from the tourism department and county chamber and from the local chambers in the various municipalities. It is by working together, that we will, maybe someday, stop identifying seasons as in, mid, shoulder, off and just be open for business.