Title
Phoenix Convention Center Post Pandemic Booking Update
Description
This report provides information on post pandemic booking activity at the Phoenix Convention Center (PCC) to the Economic Development and Equity Subcommittee.
THIS ITEM IS FOR INFORMATION ONLY.
Report
Summary
Hosting national conventions and trade shows generates economic activity in the State of Arizona and the City of Phoenix through air travel, rental car, lodging and hospitality spending from visitors. The PCC partners with Visit Phoenix (also known as the Greater Phoenix Convention and Visitors Bureau) on the development and implementation of strategies to market and attract citywide conventions, trade shows and group business to Phoenix.
From 2015 through 2019, the PCC hosted on average, 67 citywide conventions each year, representing an average of 245,000 convention delegates annually. This activity equated to approximately 1.6 million hotel room nights generating an estimated $1.7 billion of direct spending. Calendar year 2020 was on pace to be a record setting year for the PCC with 69 definite conventions contracted and an additional 20 tentative conventions at or nearing final negotiations. In early March of 2020, the global spread of COVID-19 began to directly impact the convention and visitor industry. The World Health Organization declared the COVID-19 outbreak a global health pandemic. This was followed by similar declarations from federal, state, and local government agencies as well as public health agencies including the Centers for Disease Control, and the Arizona Department of Health Services. This resulted in cancellations and postponements of all large gatherings including conventions, meetings, and public events. During the pandemic impacted years of years of 2020 and 2021, 98 contracted citywide convention groups cancelled events at the PCC. These cancellations represented more than 302,000 anticipated convention attendees with a projected direct spending impact of more than $465 million.
While the PCC resumed hosting in-person events in June 2021, multiple COVID-19 variants resulted in additional cancellations. Despite the continued loss of business, optimism remained high as evidenced by an increase in lead volume which indicated sustained enthusiasm for Phoenix as a destination. In collaboration with Visit Phoenix, the PCC sales team has aggressively sourced business for future years by leveraging national exposure from hosting major events and high-profile associations industry bookings.
According to the Center for Exhibition Industry Research, cancellation rates for industry events have dropped significantly since 2021. Additionally, attendance numbers for in person events have risen steadily since 2021, which is reflective of the pent-up demand for group meetings. Attendance is a leading indicator of performance, and the year 2024 is expected to see a 4.5 percent increase in attendance over 2019. Convention Sports and Leisure surveyed national convention planners in 2021. Of those surveyed, 76 percent expect the events industry to return to pre-pandemic numbers by 2024, while 92 percent expect a return by 2025. Understanding this demand, event organizers are looking for creative spaces to build events. Outdoor event space such as Canyon on Third, an onsite local brew pub, resonate with planners that are looking for ways produce memorable experiences for their attendees. The PCC is positioned to capitalize on that demand by focusing on industry trends that set the destination apart from competitors.
Convention booking data for calendar year 2022 and beyond, show the PCC has returned to pre-pandemic levels. Future booking pace reports, high lead volumes, and demand for group business indicate that strong convention activity is expected to continue for the next several years. The PCC is well positioned to build on the positive momentum gained from the recovery of convention and visitor business.
Additional details and information are provided in Attachment A for review by this Subcommittee.
Department
Responsible Department
This item is submitted by Interim Deputy City Manager John Chan and the Phoenix Convention Center Department.