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HomeMy WebLinkAboutMinutes - Hotel and Signature Events Committee 10/12/2016 sl `���'` CITY OF PALM DESERT '�`� �'!4ti ' ECONOMIC DEVELOPMENT DEPARTMENT if 1 INTEROFFICE MEMORANDUM To: Rachelle D. Klassen, City Clerk From: Robin McCormick, Economic Development Technician Date: June 12, 2017 Subject: Submission of Minutes for the Hotel & Signature Events Committee b11 . Attached for your records are the approved minutes of the Hotel & Signature Events Committee Meeting of October 12, 2016 and April 5, 2017. Please let me know if you have any questions or need additional information. Thank you. Attachments (as noted) G:\Econ Development\Hotet Committee\RK Memo-Minutes doc i, 3 PALM DESERT MINUTES PALM DESERT HOTEL AND SIGNATURE EVENTS COMMITTEE ADJOURNED REGULAR MEETING Wednesday, October 12, 2016 —4 p.m. Development Services Conference Room — Palm Desert Civic Center 73510 Fred Waring Drive, Palm Desert, CA 92260 I. CALL TO ORDER Vice Chairman White called the meeting to order at 4:17 p.m. II. ROLL CALL Present: Absent: Mayor Pro Tern Jan Harnik None Member Arnold Kirschenbaum Member Jim Moran Mayor Robert Spiegel Vice Chairman Scott White Staff/Others Present: Lauri Aylaian, City Manager Martin Alvarez, Director of Economic Development Ryan Stendell, Director of Community Development Thomas Soule, Tourism & Marketing Manager David Hermann, Management Analyst Eric Ceja, Principal Planner Amy Lawrence, Program and Events Specialist Alex Ahluwalia, JW Marriott Desert Springs Michael Matthews, Palm Springs Life Barbara Wagner, JW Marriott Desert Springs Brianne Lawson, Recording Secretary III. ORAL COMMUNICATIONS Mr. Alvarez introduced the new City Manager, Ms. Aylaian and Mr. Ahluwalia, General Manager of the JW Marriott Desert Springs. He stated that Mr. Ahluwalia had filed his application to join the committee. MINUTES ADJOURNED REGULAR PALM DESERT HOTEL & SIGNATURE EVENTS COMMITTEE MEETING October 12, 2016 IV. CONSENT CALENDAR A. MINUTES OF THE REGULAR MEETING OF AUGUST 3, 2016 Mayor Spiegel moved, by Minute Motion, to approve the minutes of the August 3, 2016, meeting as presented. Motion was seconded by Member Kirschenbaum and carried by 5-0 (AYES: Harnik, Kirschenbaum, Moran, Spiegel, and White; NOES: None; ABSENT: None). V. CONSENT ITEMS HELD OVER None VI. NEW BUSINESS A. DISCUSS POSSIBLE CONVENTION MEETING SPACE IN THE CITY Member Moran stated that he believes the City has a unique opportunity to create something special in the area of convention meeting space. He referenced WestWorld, which is an indoor/outdoor multiple use facility located in Scottsdale. Additionally, he stated that there is nothing comparable to WestWorld in the Coachella Valley. In response to this statement, Vice Chairman White commented that the closest type of indoor/outdoor event space would be the Empire Polo Club in Indio. Member Moran continued with the idea that a good location for convention meeting space in Palm Desert would be North of Frank Sinatra Drive. He added that while the City has been working on creating new events for El Paseo and also finding more ways to utilize the Civic Center Park, creating a convention space would be allow the opportunity to bring even larger events to Palm Desert. Consequently, these larger events would result in more "heads in beds" for the City hotels. As examples of potential events that could take place at this convention meeting space, Member Moran listed food and wine events as well as high end car shows. He restated that he believes the area north of Frank Sinatra Drive would be appropriate for building this new convention space, and that this area (which he estimated to be 350 acres) is currently zoned for residential and retail construction. Mr. Alvarez stated that the southern portion of this land is 170 acres, while the privately held northern portion is approximately another 100 acres. In addition, Mr. Alvarez included that the 170 acre section of land is owned by the Successor Agency, and the Planning Department is currently looking at a specific plan for this property —which includes primarily residential and commercial zoning. 2 MINUTES ADJOURNED REGULAR PALM DESERT HOTEL & SIGNATURE EVENTS COMMITTEE MEETING October 12, 2016 Mr. Stendell commented that there are nearly 1,000 acres bordered by Portola Drive, 1-10, and Frank Sinatra Drive which creates a triangle of land that is currently being referred to as the "University Area". At the moment, a master plan is being developed for that acreage. This master plan is primarily focusing on the residential units that are required to accommodate the future Cal State University campus in that location. Mr. Stendell added that in his opinion that land is needed to create a college atmosphere, and that it would be difficult to bring the college campus to fruition if that focus was reassigned to convention meeting space. Vice Chairman White inquired if there might be a possibility of synergy between the convention space and the campus space, with the convention facility being available for use by CSUSB. Mr. Alvarez stated that CSUSB is also working on a master plan, and that they will be looking for public and private partnerships down the road. He added that there is a large amount of land on the northern part of the campus that has yet to be planned. Mayor Pro Tern Harnik requested an estimate of what amount of land this would be, to which Mr. Alvarez responded 50-80 acres. Vice Chairman White pointed out that during his eight years in Phoenix he saw what a large economic impact the WestWorld facility had for the city of Scottsdale. The Barrett-Jackson Car Show held at the facility continued to grow; to the point that the event became so large that they threatened to change venues. Due to this, the city of Scottsdale spent 3-4 million dollars to improve the facility, which resulted in the car show continuing to use WestWorld as their event location. In the time since the facility was improved, the amount of taxes brought in from sales at the car show have paid for the improvements. Mayor Pro Tern Harnik commented that the Desert Cancer Foundation's Dr. George Car Show is held at the Indian Wells Tennis Garden, but that the Tennis Garden is not their preferred location. Therefore, a convention meeting space built in Palm Desert could be a possible location for the Dr. George Car Show in the future. After a short discussion regarding the economic performance of the Palm Springs Convention Center, Member Kirschenbaum stated that most of the events that have been discussed are on the small scale and mainly appeal to Coachella Valley locals. He then added that he had heard that convention centers generate a large amount of visitors coming from out of town. In relation to the Palm Springs Convention Center, he stated that while they do lose money — the Convention Center still brings in a significant amount of visitors to Palm Springs. In response to this, Vice Chairman White pointed out that convention centers are most successful when there are enough hotel rooms within walking distance. 3 MINUTES ADJOURNED REGULAR PALM DESERT HOTEL & SIGNATURE EVENTS COMMITTEE MEETING October 12, 2016 At this point Mayor Spiegel directed a question to Mr. Ahluwalia, inquiring if the Marriott Desert Springs could do more conventions if they had more convention space. Mr. Ahluwalia confirmed that more space would mean more conventions. Vice Chairman White stated that currently, Palm Desert's convention space is the JW Marriott. Mayor Spiegel commented that the city should look into seeing how more space could be added to the Marriott facility, to which Vice Chairman White responded that investing in property that the City already owns would be the smarter investment. Mr. Ahluwalia responded that some data will need to be collected, in order to accurately guide the process. Additionally, he commented that research on hotel size will need to be carried out in order to make useful comparisons. Vice Chairman White concluded the discussion, stating that the conversation regarding convention center space will be continued B. RECAP PRESENTATION OF FASHION WEEK EL PASEO and FOOD & WINE FESTIVAL PALM DESERT 2016 BY PALM SPRINGS LIFE Mr. Alvarez introduced Mr. Matthews, who then introduced a video recapping Fashion Week El Paseo 2016. Following the video, Mr. Matthews stated that there was about a 1,500 person drop in attendance for the 2016 event, due to the movement of the date to April. Ms. Aylaian inquired if attendees were counted as individuals each night they attended, or if each attendee was only counted once. Mr. Matthews responded that the attendance counted unique visitors, which meant each attendee was only counted once. Mr. Matthews included that 28 stores on El Paseo participated in more than 50 in-store events, 54 sponsors and partners were secured, and over $56,000 was raised for local charities during the week. In addition, 44% of sales were from out of market, while 56% were from within the Coachella Valley. This information was collected by credit card tracking. After giving a description of the PR and advertising used for Fashion Week, Mr. Matthews gave an estimate of 14,000+ expected attendees for the 2017 event. He then announced that the opening night of Fashion Week 2017 will be Saturday, March 18. Mayor Spiegel inquired why Gucci or Ralph Lauren has never participated in Fashion Week El Paseo. Mr. Matthews responded that while those brands have always refused to do shows that included other labels, Warren Jones of The Jones Group is currently working very hard to get 4 MINUTES ADJOURNED REGULAR PALM DESERT HOTEL & SIGNATURE EVENTS COMMITTEE MEETING October 12, 2016 Ralph Lauren, Gucci, and Burberry to participate. He then added that in his opinion, the brand most likely to agree to this is Burberry. Mayor Pro Tern Harnik inquired if Palm Desert receives tax revenue from sales at Fashion Week trunk shows; Mr. Matthew confirmed that this is most likely true. At this point, Ms. Aylaian brought up the subject of the dog fashion show, and asked if in addition to the Humane Society, the City of Palm Desert's animal shelter could also be a recipient of the proceeds from the show. Mr. Matthews responded that the Le Chien show is primarily sponsored by the Pelican Hill Resort, and that there is a familial connection between the company that owns Pelican Hill and the President of the Humane Society. Due to this connection, it may not be likely to have the Palm Desert Animal Shelter also become a beneficiary of the Le Chien show. Ms. Aylaian then asked how the editorial news value was determined for Fashion Week, to which Mr. Matthews responded that there is a formula the PR company uses that is based on the number of impressions online that mention or involve Fashion Week El Paseo. These impressions are then given a value, which reflects the amount it would have cost to pay for the advertisement placement. Mayor Spiegel inquired what date Fashion Week 2017 will end, and Mr. Matthews informed the committee that the event will take place from March 18-25, 2017. In addition, he stated that El Paseo Jewelers will be the title sponsor of Fashion Week for 2017. Mr. Matthews then introduced the video for Palm Desert Food & Wine 2016. After the video finished, Mr. Matthews stated that Food & Wine has experienced a significant amount of growth. More celebrity chefs are expected to participate at the 2017 Food & Wine event, and attendance for 2016 was at about 3,000 people. He added that the biggest challenge with this event is getting Palm Desert restaurants to participate, as many of them decline when asked. Mayor Pro Tern Harnik agreed with this statement, citing her experience with Pacifica not staying open later during Fashion Week. Mr. Matthews responded that there is going to be an even more concentrated effort to get Palm Desert restaurants to stay open later for Fashion Week, as well as participate in Food &Wine. Member Kirschenbaum asked what reasons restaurants have given for declining to participate, to which Mr. Matthews responded that they frequently claim to not have enough staff, or that participation does not bring in more business. In relation to Food & Wine attendees, Mr. Matthews reported that 2/3 of people come from out of market, while 1/3 are from within the Coachella Valley. Mayor Spiegel asked if three days might work better than the current two days scheduled for the event. Mr. Matthews replied that it is 5 MINUTES ADJOURNED REGULAR PALM DESERT HOTEL & SIGNATURE EVENTS COMMITTEE MEETING October 12, 2016 possible that this would be an improvement, but it would be difficult because the event space is shared. In response to Mayor Pro Tern Harnik's suggestion that there will be more room for Food & Wine to grow once Hotel Paseo is completed, Mr. Matthews stated that it is believed the construction of Hotel Paseo will become the location of many other events in conjunction with Fashion Week and Food &Wine. Rec: Receive and File C. 2018 THIRD QUARTER HOTEL CO-OP SPONSORSHIP PROPOSAL, JW MARRIOTT DESERT SPRINGS RESORT Mr. Soule began by stating that Palm Desert has set aside $200,000 annually for marketing, advertising and incentive programs with Palm Desert hotels. The goal of these funds is to help boost occupancy during need periods, especially during the third quarter of the year. Mr. Soule added that since this program was launched, the Marriott Desert Springs has been the City's primary partner. As a result, a significant impact has been made on the need periods, one example being August 2016. Ms. Wagner then described how Palm Desert hotel occupancy for August had increased by 20.8%. This compared to the following cities and their August occupancy numbers: • Indian Wells & La Quinta — up 7.7% • Palm Springs — down 5.5% • Phoenix— up 2.7% • Tucson — up 6.1% • San Diego — up 3.3% Ms. Wagner then stated that the Marriott Desert Springs feels like a major contributor to this success has been their partnership with the City of Palm Desert. As an example of this partnership, Ms. Wagner described a recent incident where the Airline Information Group was looking at the JW Marriott as the location for an event in late November 2017, which is typically a time of low occupancy. Initially, the group decided that they wouldn't be able to use the hotel for their event, due to issues with their members flying in to the Palm Springs airport. This situation was alleviated with the City's agreement to pay for transportation from Los Angeles to Palm Desert. Due to this, the Airline Information Group agreed to have their event at the JW Marriott, which will fill 700 rooms at a time where the hotel would have been sparsely occupied. 6 MINUTES ADJOURNED REGULAR PALM DESERT HOTEL & SIGNATURE EVENTS COMMITTEE MEETING October 12, 2016 Mr. Soule stated that the city is currently behind pace for the 3rd quarter of 2017, with less bookings than would typically be seen for the following year. Ms. Aylaian asked how far we are behind, to which Ms. Wagner responded 40%. Ms. Wagner then described a potential program that would last through the end of 2016, in which any contracts or conventions booked for arrival in the 3rd quarter would be offered $5 per actualized room night from the City of Palm Desert. Mr. Alvarez asked how far in advance groups typically book their events, Ms. Wagner responded that this varies — but the farther in advance the groups are booked, the better. After a short discussion regarding the performance of the Biggest Loser program at the resort, Mr. Soule stated that staff recommends the committee approve of sponsorship for the 3rd quarter incentive program. Vice Chairman White made a motion to approve the sponsorship. The motion was seconded by Mayor Spiegel and carried by 5-0 (AYES: Harnik, Kirschenbaum, Moran, Spiegel, and White; NOES: None; ABSENT: None). VII. CONTINUED BUSINESS None VIII. OLD BUSINESS None IX. REPORTS FROM CITY COUNCIL LIAISONS Mayor Pro Tem Harnik praised a photo and article about the Palm Desert Concerts in the Park featured in The Desert Sun. Ms. Lawrence responded that the concerts are doing well, and have had a great turnout. Mayor Pro Tern Harnik asked how many people have been in attendance of the concerts, to which Ms. Lawrence answered between 500-1000. X. REPORTS AND REMARKS A. Chairman None B. Committee Members 7 MINUTES ADJOURNED REGULAR PALM DESERT HOTEL & SIGNATURE EVENTS COMMITTEE MEETING October 12, 2016 None C. Staff None Xl. INFORMATIONAL ITEMS A. Presentation on Measure T Mr. Alvarez summarized Measure T as a hotel and bed tax increase from 9% to 11%, which is on the November ballot. Funds from this raise in tax would go to support public services in Palm Desert (including public safety, senior, and parks & recreation programs). Currently, the City of Palm Desert has the lowest TOT tax, and the tax increase would only impact visitors — not residents. Funds raised by Measure T could not be taken by the state, and would be legally required to stay in Palm Desert. XII. NEXT MEETING DATE — December 7, 2016 at 4:00 p.m. XIII. ADJOURNMENT With Committee concurrence, the meeting was adjourned at 5:14 p.m. Brianne aws , cording Secrets 8