By Gary J. Groman, a.k.a. The Ole Seagull
The city of Branson and the Hilton Hotels Corporation have something in common, neither one has managed a municipally owned convention center before. At its Dec. 18 meeting of the city of Branson’s Budget and Finance Committee (the committee) met with members of the Senate Hospitality Group (Senate) to discuss an asset management relationship.
Glen Malone, the Chief Operating Officer and CFO described Senate’s asset management roll for the Branson Convention Center as one of providing knowledge and expertise in the hospitality industry, that the city does not currently have, to help maximize the return on the city’s investment in its convention center. In response to the specific question of Mayor Raeanne Presley, Malone said that although Senate has not done any asset management on a stand alone convention center they have done so on a number of convention and meeting facilities such as the Gaylord Opryland Resort and Convention Center complex in Nashville, TN.
Mayor Presley made it very clear that the city and Mark Hartman, the General Manager of the Hiltons of Branson, were working together as a team to try to efficiently manage the convention center. The general consensus of the committee was that for the city to effectively participate in the process they needed someone with the specialized knowledge and expertise that it did not have to help them insure that systems and procedures are put into place to enable the city to effectively monitor and oversee the convention center operations.
One of the immediate areas of concern of the committee was getting some assistance in evaluating the 2008 Operating Budget for the Convention Center that was recently presented by Hilton. It is anticipated that Senate will be able to review the proposed budget as to the appropriateness and reasonableness of some of the specialized items that the committee has no, or limited, expertise with. There was some concern among committee members that at least a part of the proposed budget mirrored the budget contained in a consulting report that the city had commissioned while the convention center was being initially evaluated.
While acknowledging that charge backs under the agreements could be pretty complex, the committee noted that there are a tremendous amount of charge backs to the convention center from the Branson Convention Center Hotel. It was also noted that between $500,000 and $1 million dollars a year are to be allocated to the marketing of the convention center and that although there is a marketing plan it is not very detailed as compared to the plan that the Branson/Lakes Area Chamber of Commerce & CVB is required to submit under its marketing contract with the city.
Another area of concern was the format of reports on the convention center operations. Although the city and Hilton are currently working on the further development and refinement of such reports it is anticipated that Senate would get involved in the process. As an example of the type of report that the committee would like to see, the reports of the St. Charles, Missouri Convention Center, managed by Global Spectrum was mentioned as an example.
Another area of concern expressed by the committee was an analysis of all current management agreements relating to the convention center. A lot of time was spent discussing the laundry that was built as part of the convention center, how the Convention Center Hotel is charged for the laundry done at the convention centers laundry, and the fact that the current agreement with Hilton is fairly mute on the operation of the laundry.
Senate will submit a proposal for a six month engagement by the end of this week. It is anticipated that during the engagement Senate will, at a minimum, review the proposed 2008 budget for the convention center, all definitive agreements that exist, give a summary of what rights the city has and advise of any unusual provisions contained within the agreements. Senate will also review how the sales and marketing of the convention center is being handled and help develop the final management and financial reports that the committee wants.
Furnished courtesy of the Branson Daily Independent.
