dallas convention center hotel briefing

8/13/2019 Dallas Convention Center Hotel Briefing

1/30


2/30

Budget, Finance & Audit Committee January 21, 2014

Dallas Convention Center HotelUpdate riefing


3/30

Purpose

2

Provide an update on the ConventionCenter Hotel Operations, ongoing andfuture development opportunities.


4/30

Outline

3

Vision for the overall developmentKey components of the hotel projectTimeline/Milestones

Convention Center HotelRestaurant Development Overview(Phase II Hotel Development)Omni/DART Lamar ConnectionPotential future developmentSummary


5/30

Vision for Overall Development

4

Build another destination for DallasEnhance convention attendee experienceDevelop hotel, restaurant, retail, cultural and entertainmentelements

Create a Lamar Street entertainment corridor by:Improving connectivity from Kay Bailey Hutchison ConventionCenter Dallas (KBHCCD) south into the Lamar StreetEntertainment Corridor and north through downtown, to VictoryPlaza

Source: December 6, 2010 Economic Development Briefing, Dallas City Council


6/30


7/30


8/30

7

Convention Center HotelOrganizational & Financial Structure

B/R/PDesign/Builder

MSW Developer

OMNI

Hotel Operations ParkingOperations PropertyManagement

HotelFinancial Structure

Funding Revenue Bonds Build America

Bonds

Debt Service

Hotel Net Operating Revenue

Economic Development Agreement 6% State HOT* 6.25% State Sales Tax* 7% Local HOT

Reserve Accounts

*Years 1-10 only

RestaurantLeases

Hotel LGC

City of Dallas

DCVB(Citywide Sales &

Marketing Initiatives)

Convention &Services Dpt.

KBHCCDOperations Contract

Managementsupport


9/30

Convention Center Hotel Site

8

(November 2007)


10/30


11/30

M/WBE Participation

10

Hotel Construction: Significant joint venture between

Balfour Beatty and two M/WBE

firms: Pegasus Texas H.J. Russell Co. (BRP JV)

Exceeded goal of 30% for a totalof 37.9%

Resulted in 163 separatecontracts to M/WBE

25% 25%31% 32.7%

2012 2013

Hotel Operations M/WBEParticipation

M/WBE Goal M/WBE Actual


12/30

Citywide Events Booked

11A Citywide event is based upon 2,500+ room nights on peak.Bookings occur into the future.

12

9

19 20

17

2931

0

5

10

15

20

25

30

35

FY06-07 FY07-08 FY08-09 FY09-10 FY10-11 FY11-12 FY12-13

Hotel AnnouncedHotel Opened


13/30

Room Night Reservations

12

57.0

63.5 63.0

69.9

30

40

50

6070

80

Occupancy Rates (%)(Convention Center Hotel)

ProformaActual

2012 2013

Hotel Occupancy rates haveexceeded proforma in both2012 and 2013

2014 Proforma based on66% occupancy rates

Average occupancy rate forthe City of Dallas was61.8% for 2012 and 65%for 2013


14/30


15/30

Food & Beverage Performance(Convention Center Hotel, including ballrooms)

14 0

10,000,000

20,000,000

30,000,000

40,000,000Food & Beverage Revenues

ProformaActual

2012 2013


16/30

Omni Dallas Success to date

15

The hotel is expected to close2013 with:

Occupancy 7.2% over proforma*

Food and Beverage revenueexceeding proforma by $11.08M*

Total revenue exceeding proforma by approximately $13.2M *

Earnings $4.9M *

*Preliminary unaudited


17/30

16

Restaurant Development Overview


18/30

Restaurant Development Overview(Phase II Hotel Project)

17

Original hotel ancillary development anticipated additional debt.

Development plan is now to be paid with unspent/existing bond proceeds.Project paid from original hotel construction budgetRevenue will offset the approximate $1.6M debt service payment on theland.Land is owned by the City of DallasLand is leased to the Dallas Convention Center Hotel DevelopmentCorporation (DCCHDC)Current project plan includes development of land in front of the OmniDallas Hotel:

350 space below grade parking garageApproximately 15k square feet of restaurantsFour individual storefront concepts

Omni will manage/maintain the parking and restaurant leases as anextension of current hotel operations.


19/30


20/30

Restaurant Development Benefits(Phase II Hotel Project)

19

Makes Dallas as a destination more attractive

Enhances Convention Center Hotel project

Clients are requiring more restaurant and entertainment venues withinwalking distance of the Convention Center

Increases the economic impact of the destination

Enhances convention attendee experience

Enhances the overall Lamar Streetscape Plan

Enhances Lamar entertainment venues


21/30

Conceptual Rendering

20


22/30


23/30


24/30

Omni/DART Lamar ConnectionUnder the Convention Center

23


25/30

24


26/30

25

Total Budget $ 4,673,574

Sources:2009 Convention Center Revenue Bonds $ 2,073,574NCTCOG Grant Funds $ 600,0002006 Bond Program $ 2,000,000

Total Sources $ 4,673,574Uses:

Concept (Approved by City Council April 25, 2012) $ 69,986Design (Approved by City Council May 22, 2013) $ 771,638Construction (For City Council consideration January 22, 2014) $ 3,831,950

Total Uses $ 4,673,574

DART/OMNI Connection Budget


27/30

Lamar Street Entertainment Corridor

26

NYLO Hotel

W Hotel

Loft

Hotel


28/30


29/30

Summary

28

Convention Center Hotel performing better than proformaConvention Center Hotel has met or exceeded establishedgoalsCitywide convention bookings have increased moving intothe futurePhase II development currently underwayLamar streetscape improvements in progress

There is potential for future development in the ConventionCenter District


30/30

dallas convention center hotel briefing

Documents