Executive Summary

1
Executive Summary

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Background

• For over 20 years, the City of Greater Sudbury
  and its predecessor municipalities have
  considered the potential involvement of local
  government in a purpose-built convention
  facility.
• In 1982, the Sudbury Regional Development
  Corporation commissioned a study investigating
  the feasibility of a conference and convention
  centre in Sudbury.
• In 1988, the Downtown Development Action Program
  identified the establishment of a conference and
  convention facility as a priority for downtown
  redevelopment.
• The concept of a convention facility was further
  supported by the Next Ten Years Conference, which
  identified a combined convention/casino/hotel
  facility as an opportunity for community and
  economic development.
• The issue of a purpose-built convention facility
  has recently be raised by the owners of the City
  Centre shopping mall, who approached the City of
  Greater Sudbury with the opportunity to
  participate in a private-public sector
  partnership leading to the development of such a
  facility to be located in the City Centre
  shopping mall. We understand that the proposed
  facility would be capable of accommodating in
  excess of 1,000 delegates.
• As a result of this opportunity, City Council
  approved a public-private partnership process for
  a convention centre in Greater Sudbury. As part
  of the process, KPMG LLP was retained to assess
  the potential level of market support for a
  convention facility in the community.

2
Executive Summary

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Summary of Findings

• Conventions, especially larger ones, have the
  potential to provide significant economic
  benefits to their host communities. For example,
  we have estimated that a convention involving
  1,000 delegates could result in almost than
  300,000 in direct spending daily, with secondary
  economic benefits amounting to almost the same
  amount.
• While Greater Sudbury already hosts a large
  number of conventions, these are generally
  limited to smaller events (150 to 300 delegates)
  due to capacity limitations of the existing
  facilities.
• While Greater Sudbury has hosted larger
  conventions in the past, this has been
  accomplished through the use of multiple
  locations or secondary facilities, such as vacant
  retail space. Both of these options are less
  desirable than a single, purpose-built convention
  facility.
• Our research indicates that a new, larger
  convention facility should be capable of
  attracting between five and ten large conventions
  to Greater Sudbury on an annual basis. The
  ability of the convention centre to realize this
  level of activity will be contingent upon a
  number of factors, most notably the effectiveness
  of its marketing and promotional efforts.

3
Executive Summary

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

• This level of convention activity will have a
  significant economic benefit to the community as
  a whole. Overall, we estimate that the
  convention centre could generate as much as
• 195 direct and indirect employment positions,
  providing total wages and benefits of 3.8
  million annually.
• 2.5 million in new taxation revenues for all
  levels of government, including 300,000 for the
  City of Greater Sudbury.
• Despite the economic benefits provided by the new
  convention centre, some degree of competitive
  pressure will likely result from its
  establishment. Our research indicates that while
  large conventions will likely be attracted to
  Greater Sudbury, the new facility will need to
  supplement this level of activity with smaller
  conventions, corporate meetings and other special
  events. Given that these events are already
  served by existing convention and conference
  facilities in Greater Sudbury, the new facility
  will be in competition with existing businesses.

4
Executive Summary

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Recommended Course of Action

• The results of our analysis indicate that the
  establishment of a new convention facility does
  represent a valid and supportable public policy
  issue.
• A new facility will enhance the communitys
  ability to attract larger conventions that
  currently do not consider Greater Sudbury to be a
  suitable host community, thereby creating
  incremental economic benefits for the community
  as a whole.
• Sufficient market support exists for the
  facility.
• The use of a public-private partnership process
  provides an opportunity for all interested
  parties to participate in the establishment of
  the convention centre.
• The establishment of a larger convention facility
  is consistent with comparable communities across
  Canada.
• A larger convention facility would enhance
  Sudburys position as the leading centre in
  Northern Ontario.
• Accordingly, we would recommend that the City
  undertake the next phase of establishing the
  convention centre that being the issuance of a
  request for letter of interest and
  qualifications.
• To assist the City in the next stage of the
  public-private partnership process, we have
  provided suggested criteria for evaluating
  proposals received from interested parties

5
Objectives and Scope of the Assignment

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Objectives

• The City of Greater Sudbury has engaged KPMG to
• Assess the potential market support for a
  convention facility in Greater Sudbury.
• Provide recommendations as to the type and size
  of centre that would be appropriate in light of
  the perceived level of market support.
• Suggest criteria to be used by the City of
  Greater Sudbury and other participating
  organizations to evaluation potential locations
  for the centre.
• Quantify the incremental community benefits
  resulting from the establishment of a convention
  facility and the corresponding increase in
  visitation to Greater Sudbury.
• Identify the likely impact that a new convention
  centre would have on current facilities in
  Greater Sudbury.

6
Objectives and Scope of the Assignment

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Scope of the Assignment

• In order to achieve these objectives, our
  workplan included the following procedures
• Reviews of previously commissioned reports
  concerning convention facilities in Sudbury,
  specifically
• Regional Sudbury Convention and Trade Centre
  Study, prepared by Peter Barnard Associates,
  1982.
• Sudbury Convention Centre Study, prepared by
  Peter Barnard Associates, 1983.
• Downtown Development Action Program, prepared by
  the City of Sudbury, 1989.
• An assessment of the current level of convention
  activity on a national, regional and local level,
  obtained through
• Reviews of secondary research sources concerning
  the conference and convention industry.
• Discussions with representatives of various
  government agencies (both municipal, provincial
  and federal) involved in sponsoring or otherwise
  supporting conventions in Northern Ontario.
• Interviews of local accommodation and conference
  facilities.

7
Objectives and Scope of the Assignment

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

• An assessment of the potential level of market
  support for a convention centre, obtained
  through
• Interviews of local associations and
  organizations that could potential host
  conventions in Greater Sudbury.
• A survey of provincial and national organizations
  that may consider Greater Sudbury as a potential
  host for conventions.
• Discussions with industry associations involved
  in the hospitality and accommodations industry.
• An indication of facility requirements for the
  proposed facility (including capacity, spatial
  requirements, design guidelines and site
  selection criteria) obtained through
• An analysis of convention centres located in
  other Canadian communities.
• Reviews of industry publications.
• Discussions with members of KPMGs National
  Tourism and Hospitality practice.
• An assessment of the potential community benefits
  resulting from the establishment of the
  convention centre, maintained by the Ontario
  Ministry of Tourism, Culture and Recreation.
• An indication of the potential impact of the new
  facility on existing businesses in Greater
  Sudbury, determined through interviews of local
  accommodation and conference facilities.

8
Objectives and Scope of the Assignment

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Restrictions

• Our role in this engagement has been to estimate
  the projected support for a convention centre in
  Greater Sudbury based on available information.
  Inherent in our study is the risk of future
  social, political, economic or other changes that
  may influence or affect the operations of the
  convention centre. Given that these factors, by
  their nature, are both uncontrollable and
  unforeseen, the actual level of market support
  could vary significantly from that outlined in
  our report.
• Our engagement has been specifically limited to
  assessing potential market support and does not
  entail an assessment of overall financial
  performance, which would involve a review of
  operating and capital costs.
• In light of these factors, we will assume no
  responsibility or liability for any losses
  occasioned as a result of the reliance on our
  report and conclusions.

9
Industry Demand Trends

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

North American Demand Trends

• The 2000 Meetings Market Study (a bi-annual
  publication produced by Meetings Conventions
  Magazine) found that the convention industry has
  been relatively flat since the early 1990s.
  During 2000, an estimated 12.3 million delegates
  attended 11,600 conventions in North America.
  While this may seem significant, both the number
  of conventions and total attendance are less than
  those experienced during 1990.
• While the average attendance per convention is
  just over 1,000 delegates, almost half (46) of
  conventions involve less than 300 delegates.
• The average lead time required to plan a
  convention is approximately 20 months.

Source 2000 Meetings Market Study
10
Industry Demand Trends

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

• Conventions are typically annual events,
  concentrated in late winter (January and
  February) and early fall (September and October).
• Hotels are by far the largest hosts of
  conventions, accounting for two-thirds of all
  conventions held. This ratio is not necessarily
  indicative of the competitiveness but rather the
  low number of convention centres as compared to
  hotels.

Source 2000 Meetings Market Study
11
Industry Demand Trends

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Convention Activity in Sudbury

• Our research indicates that Sudbury is home to a
  thriving convention and meeting industry focused
  primarily on small to medium sized conferences
  and conventions.
• The predominance of small to medium sized
  conventions is a reflection of the available
  facilities in Greater Sudbury
• Average capacity appears to be in the order of
  400 delegates.

Source Interviews with local hotel and
convention facilities

• The largest hotel in Greater Sudbury can
  accommodate approximately 700 delegates.
• The figures noted above reflect the capacity in a
  convention setting (normally theatre-style
  seating). In certain instances, the effective
  capacity of some hotels is limited not by the
  number of delegates that can be accommodated in a
  convention setting, but rather the capacity of
  the facilitys dining area. As a result, the
  effective capacity for conventions is likely in
  the range of 350 to 450 delegates.

12
Industry Demand Trends

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

• While other facilities in Greater Sudbury, such
  as the Sudbury Arena, community halls and
  post-secondary institutions, have the ability to
  host larger conventions, their attractiveness to
  convention organizers is hinder by
• A lack of adjoining hotel accommodations
• Limitations on onsite food preparation and
  serving facilities
• Physical layout that is not conducive to
  conventions
• Our review of the 2000 Meetings Market Study
  indicates that these factors rank among the most
  important considerations when selecting a site
  for a convention. Accordingly, the absence of
  these characteristics in the larger facilities in
  Greater Sudbury effectively precludes the
  community from hosting larger conventions.
• Despite the lack of suitable facilities for
  larger conventions (500 delegates), Greater
  Sudbury has experienced past successes in
  attracting and hosting conventions of this
  magnitude through
• The use of more than one hotel/convention
  facility
• The use of secondary facilities. For example,
  the Ramada Inn has used vacant portions of the
  City Centre Shopping Mall to accommodate larger
  conventions, including the former Eatons store
  and the former Cineplex movie theatres
• We note, however, that the use of multiple or
  secondary facilities does not represent the
  preferred solution for Greater Sudburys capacity
  issues.
• We have provided a summary of the larger
  convention facilities in Greater Sudbury on the
  following page.

13
Industry Demand Trends

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Convention Facilities in Sudbury

• Estimated Number Capacity of Hotel Rooms
• Hotels
• Ramada Inn 700 delegates 150
• Howard Johnson 400 delegates 200
• Holiday Inn 400 delegates 80
• Quality Inn 150 delegates 100
• Community Halls
• Caruso Club 1,000 delegates n.a.
• United Steelworkers Hall 1,000 delegates n.a.
• Public sector facilities
• Sudbury Arena 5,000 delegates n.a.
• Laurentian University 2,000 delegates 500
• Cambrian College 450 delegates 300
• College Boreal 300 delegates n.a.
• Cambrian Foundation 1,000 delegates n.a.

Source Interviews with local hotel and
convention facilities. The capacity figures
reflect the number of delegates that can be
accommodated in a conference/convention setting.
14
Industry Demand Trends

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Implications of Industry Demand Trends

• Currently, Greater Sudbury is only capable of
  attracting relatively small conventions (less
  than 350 to 450 delegates).
• Establishments with the required amenities
  (adjoining hotel accommodations, quality food
  services) have a maximum effective convention
  capacity of 350 to 450 delegate
• Establishments that have larger convention
  capacities lack the required amenities
• In light of these limitations, Greater Sudbury is
  limited to hosting conventions of 350 to 450
  delegates and appears to be missing out on a
  sizeable portion of the convention market.
• 54 of conventions involve more than 300
  delegates.
• 39 of conventions involve more than 500
  delegates.
• While the ability of existing facilities to host
  larger conventions is limited by available
  capacity, our research indicates that the level
  of turnaways (where event organizers approach
  facilities in Greater Sudbury but cannot use the
  facility due to issues relating to capacity or
  scheduling) is minimal. As a result, it is
  reasonable to assume that organizers of large
  conventions currently do not view Greater Sudbury
  as a potential host for their conventions.

15
Will a Convention Centre be Supported?

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Basis of Analysis

• Our conclusions as to the potential level of
  market support for a convention facility in
  Greater Sudbury are based on the results of the
  following research procedures
• A survey of 150 national and provincial
  organizations to determine their interest in
  Greater Sudbury as a convention destination
• A survey of local organizations to identify their
  interest in attracting national and provincial
  conventions to Greater Sudbury
• A review of similar sized communities in Canada
  designed to assess the degree of success achieved
  by convention centres in medium-sized communities

16
Will a Convention Centre be Supported?

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

National and Provincial Survey

• Oraclepoll Research was retained to conduct a
  survey of 150 national and provincial
  organizations to determine interest in hosting
  conventions in Sudbury.
• The organizations were selected from Associations
  Canada and were selected to provide
  representation from a number of sectors,
  including government, professional organizations,
  labour and community groups.
• A sizeable number of the conventions held (24)
  involved more than 400 delegates and, as such,
  likely could not be held in Greater Sudbury.
• A summary of Oraclepoll Researchs findings has
  been included as an appendix to our report.

Source Oraclepoll Research Survey
17
Will a Convention Centre be Supported?

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

• The location of conventions appears to be highly
  centralized, with five cities accounting for 55
  of all conventions held. The remaining 45 of
  conventions was distributed among more than 40
  communities.
• The vast majority of organizations surveyed (97)
  have never held a conference in Greater Sudbury,
  indicating that attracting conventions on a
  national and provincial level could be a
  significant challenge.
• This conclusion is supported by the fact that the
  majority of organizations surveyed indicated that
  they would be unlikely to consider Greater
  Sudbury as a host. This corresponds with our
  earlier findings concerning turnaways and the
  conclusion that Greater Sudbury is likely not
  perceived to be a suitable host for larger
  conventions.

Source Oraclepoll Research Survey
18
Will a Convention Centre be Supported?

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

• Despite the apparent disinterest in Greater
  Sudbury as a convention host, an examination of
  the reasons why organizations would not chose
  Greater Sudbury indicates that these views are
  based, to a large extent, on either negative
  perceptions about Northern Ontario or a lack of
  knowledge about the community, including
• The perception that Sudbury is too far (17 of
  respondents)
• The northern location of the City (9 of
  respondents)

Source Oraclepoll Research Survey

• A lack of information or experience with Greater
  Sudbury (7 of respondents)
• Perceived difficulties in accessing the community
  by air (6)
• The belief that entertainment activities are not
  available for delegates (4)
• Interestingly, those organizations that have
  hosted conventions in Greater Sudbury have an
  extremely positive impression of the community,
  with all of these organizations indicating that
  they were very satisfied with Greater Sudbury
  as a location and that they would be very
  likely to refer the community to others.

19
Will a Convention Centre be Supported?

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

• Based on a straightforward interpretation of the
  Oraclepoll Research survey results, we believe
  that the establishment of a new convention centre
  in Greater Sudbury would likely attract ten to
  fifteen new conventions from the organizations
  surveyed.
• Low High
• Number of organizations surveyed 150 150
• Percentage of conventions over 400
  delegates 24 24
• Number of conventions within target market
  segment 36 36
• Likelihood of locating convention in Greater
  Sudbury 261 442
• Number of conventions to be attracted 10 15
• In comparison, a study prepared for the Peter
  Barnard and Associates for the Sudbury Regional
  Development Corporation in 1982 projected that a
  new convention centre could attract up to 35 new
  conventions per year to Sudbury.

1 Represents all of the respondents who indicated
they were very likely and 50 of the respondents
who indicated they were somewhat likely to
consider Greater Sudbury as a host site. 2
Represents all of the respondents who indicated
they were very likely or somewhat likely to
consider Greater Sudbury as a host site.
20
Will a Convention Centre be Supported?

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Survey of Local Organizations

• In a report prepared for the Vancouver Trade
  Convention Centre, the involvement of local
  bodies in attracting conventions undertaken by
  their affiliated or parent associations was
  considered to be essential
• This is particularly true for Greater Sudbury
  given that local bodies could address some of the
  negative perceptions surrounding the community
• In order to identify the level of support for
  positioning Greater Sudbury as a host for
  provincial and national association conventions,
  we interviewed a number of local representatives
  from a variety of sectors, including
• Government
• Healthcare
• Education
• Community organizations
• Labour
• A listing of associations interviewed has been
  included as Appendix C.

21
Will a Convention Centre be Supported?

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

• Based on our interviews, it appears that strong
  support exists for positioning Greater Sudbury as
  a host for larger provincial and national-level
  conventions
• The majority of individuals contacted indicated
  that they would work towards attracting
  conventions held by associations in which they
  were members.
• The development of a new convention centre was
  considered by many to be beneficial for the
  community as it addressed a perceived lack of
  suitable facilities.
• Some provincial associations apparently have
  difficulty in attracting delegates from Northern
  Ontario due to distance and cost. The
  establishment of a convention centre in Greater
  Sudbury was seen as a means of overcoming this
  challenge, thereby adding to the communitys
  appeal as a convention site.
• Greater Sudbury is considered by Aboriginal
  organizations to be centrally located, thereby
  making the community well-positioned to service
  this sector. However, it was recognized that the
  potential market for large Aboriginal conventions
  is relatively small.
• The establishment of a new convention centre,
  along with the founding of the new medical school
  and expansion of the Sudbury Regional Hospital
  facility, would likely increase Greater Sudburys
  ability to attract conventions focusing on the
  medical sector.
• The combination of a new convention centre and
  Greater Sudburys position in the mining industry
  would enhance the ability to attract national and
  international conventions relating to the mining
  industry.

22
Will a Convention Centre be Supported?

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Experience of Other Communities

• In order to provide an indication as to the
  potential level of support for the proposed
  convention centre, we have conducted a review of
  existing convention centres in communities
  similar to Greater Sudbury, including
• Saskatoon
• Winnipeg
• Windsor
• The number of large conventions (500 delegates)
  held in the centres ranged from 15 to 35 per
  year.

23
Will a Convention Centre be Supported?

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

• Saskatoon Centennial Auditorium
• 18 to 20 conventions per year
• Maximum capacity 1,400 delegates

• Cleary International Centre (Windsor)
• 15 to 18 conventions per year
• Maximum capacity 1,000 delegates

• Winnipeg Convention Centre
• 28 to 35 conventions per year
• Maximum capacity 8,000 delegates

Source Interviews with convention facilities
listed.
24
Will a Convention Centre be Supported?

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Overall Conclusions

• Based on the results of our research, we
  anticipate that a new convention centre in
  Greater Sudbury would be able to attract
  approximately ten to fifteen large conventions
  (400 delegates) annually.
• Given the difficulty of current facilities to
  accommodate this size of convention at the
  present time, it is reasonable that this
  increased level of activity would be incremental
  to the community.
• The degree to which this level of activity could
  be sustained in contingent upon a number of
  factors, primarily the effectiveness of ongoing
  marketing and promotional activities.
• Our discussions with representatives of
  convention and conference facilities, both
  locally and nationally, indicate that convention
  centres are unable to rely exclusively on large
  conventions. As a result, the new centre will
  also be required to target smaller conventions
  and alternative uses for the facility, such as
  trade shows, banquets, corporate meetings,
  sporting events and theatrical performances.

25
Will a Convention Centre be Supported?

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Other Issues

• While our research indicates that the
  establishment of a new convention centre will
  result in an increase in convention activity in
  Greater Sudbury, we have identified some issues
  that may provide challenges to the facility
• Air access Currently, Air Ontario offers a
  total of seven flights daily between Sudbury to
  Toronto, with an average capacity of 50
  individuals per aircraft. This results in a
  total capacity of 350 people per day, which does
  not appear to be sufficient to support the travel
  needs of a 500 person convention, especially
  after consideration is given to spouses,
  association staff and non-convention related
  airline traffic. While the addition of air
  service by Westjet could alleviate some of this
  concern, air transportation could pose a
  challenge.
• Hotel accommodations We understand that there
  are 1,500 hotel rooms in Greater Sudbury
  (excluding rooms available through Laurentian
  University and Cambrian College) of which
  approximately 1,200 would be suitable for
  convention accommodations. Given an average
  occupancy rate of 60 in Northern Ontario3, this
  translates into 480 hotels rooms available to
  support incremental demand. Accordingly, a
  concern may exist surrounding the ability of the
  community to accommodate conventions involving
  more than 500 delegates.
• Rotating conventions Our research indicates that
  the types of conventions attracted to Greater
  Sudbury are likely to be rotated among a number
  of different communities. As a result, it could
  be a number of years before a specific convention
  returns to Greater Sudbury.

3 Source Ontario Restaurant, Hotel and Motel
Association
26
Recommended Convention Facilities

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Delegate Capacity

• Our analysis indicates that the optimum capacity
  for a new convention facility in Greater Sudbury
  would be approximately 1,000 delegates.
• A convention centre with a capacity of 1,000
  delegates would be larger than existing
  facilities in the community, thereby allowing
  Greater Sudbury to overcome its current inability
  to host conventions of greater than 450 delegates
  (representing approximately 40 to 50 of all
  conventions held).
• Conventions of 1,000 delegates represent the
  upper limit that could be attracted to Greater
  Sudbury. Our discussions with representatives of
  KPMGs National Tourism and Hospitality Group
  indicate attracting conventions larger than this
  to medium-sized communities such as Greater
  Sudbury is a significant challenge.
• A convention centre with a total capacity of
  1,000 delegates, if properly designed, could be
  divisible into two or more sections, thereby
  allowing the facility to host multiple large
  conventions.
• A convention centre of this size would be
  consistent with those located in comparable
  communities.

27
Recommended Convention Facilities

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Size of the Facility
Total Area of Comparator Convention Centres(in
square feet) Total Delegate Area
Per Area Capacity Delegate Saskatoon
30,400 1,400 22 Windsor 26,000 1,000 26 Winnipeg
145,000 8,000 18

• Based on our review, we would suggest that the
  proposed convention facility comprise
  approximately 25,000 square feet of convention
  and exhibit area. This estimate is based on the
  projected capacity of 1,000 delegates and the
  average square feet of comparator convention
  centres.

Source Interviews with convention facilities
listed.

• Additional area will be required for functions
  such as food preparation, storage, building
  maintenance and loading and unloading areas. The
  square footage required for these functions is
  contingent upon the ultimate design of the
  facility.
• Based on our discussions with representatives of
  other convention centres, we strongly recommend
  that any design work undertaken on the proposed
  facility involve an architectural firm with
  considerable experience in the field of
  convention centre design and construction.

28
Recommended Convention Facilities

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Design Characteristics

• Our research indicates that well-designed
  convention facilities share several
  characteristics
• Exhibit space (used for trade shows, exhibits and
  plenary sessions) should be contiguous and
  preferably on the same floor. A building design
  that results in the perception of prime and
  secondary exhibit space should be avoided.
• Exhibit areas should be characterized by high
  ceilings (20 to 30 feet) and a lack of support
  pillars or columns. These characteristics permit
  the use of large exhibits, enhance pedestrian
  traffic flow and contribute towards the overall
  openness of the area.
• If possible, exhibit areas should be located on
  the ground floor to enhance the ease of loading
  and unloading.
• The design of exhibit space should accommodate
  divisions into multiple areas to support separate
  events. This is especially important as
  convention facilities in small to medium-sized
  centres rely upon sources of revenue other than
  conventions, such as smaller conferences,
  corporate meetings, banquets and social
  functions.
• Theatres for plenary sessions are gaining
  popularity among larger associations and should
  be incorporated into the design of the convention
  centre.

29
Recommended Convention Facilities

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

• Availability of communication link-ups (e.g.
  video conferencing, internet access) and computer
  projection capabilities are considered desirable.
• Sufficient meeting facilities should be
  available. We understand that a common ratio of
  exhibit to meeting areas is 21. As a result, a
  convention centre with 30,000 square feet
  available for conventions should consist of
  20,000 square feet of exhibit space and 10,000
  square feet of meeting rooms.
• The convention area should incorporate a
  sufficient amount of storage space for
  exhibitors, convention organizers and the
  convention centre itself. Our discussions with
  representatives of convention centres in both
  Winnipeg and Windsor indicate that the current
  level of storage area in those facilities is
  insufficient.
• Dining facilities should be sufficient to
  accommodate all delegates attending a given
  convention. This would eliminate the current
  shortcoming of existing local facilities, where
  the effective capacity of the establishment is
  limited not by exhibit or seating areas, but
  rather dining capacity.
• Loading and unloading areas should allow for
  simultaneous move-in/move-out. Areas should also
  be provided for holding vehicles waiting to
  load or unload.
• As the public-private partnership proceeds, a
  number of different designs and layouts for the
  convention centre may be presented to the City.
  Ideally, the final layout of the centre should
  reflect the design characteristics noted above.

30
Facility Selection

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Overview

• As noted earlier in our report, our review of the
  potential market support for a convention
  facility came about as a result of a proposal to
  the City relating to a private-public sector
  partnership
• In the event that other interest private-sector
  parties may exist, the City could be faced with
  the choice of multiple sites for a convention
  facility
• Accordingly, site selection criteria have been
  requested to assist the City in evaluating
  potential locations for a convention facility.
  In designing these criteria, we have attempted to
  reflect information obtained through
• A review of factors influencing the
  decision-making process for convention planners,
  as published in the 2000 Meetings Market Study.
• Consultation with members of KPMGs National
  Hospitality and Tourism practice.
• A review of the internal due diligence policy for
  the City of Greater Sudbury approved by City
  Council in November 2001.

31
Suggested Site Selection Criteria

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Suitability of the Proposed Facility

• Ability to accommodate larger conventions
  (upwards of 1,000 delegates).
• Conformance with the suggested design criteria,
  including
• 25,000 square feet of convention and exhibit
  area.
• Main floor exhibit area, with high ceilings and
  an absence of support pillars and columns.
• Sufficient meeting and storage areas.
• Suitable loading and off-loading facilities.
• Suitability of dining and kitchen facilities.
• Appropriateness and attractiveness of surrounding
  land uses.

Location of the Proposed Facility

• Proximity to hotel accommodations.
• Proximity to off-site entertainment and dining
  facilities.
• Availability of parking spaces.
• Ease of access, including access to public
  transit, major land transportation routes and
  proximity to the Sudbury Airport.

32
Suggested Site Selection Criteria

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Secondary Uses for the Facility

• Ability to divide exhibit and conference space
  into multiple areas.
• Intended secondary uses for the facility,
  including
• Smaller conventions and conferences.
• Trade shows.
• Sporting events.
• Theatrical or entertainment events.

Qualifications of the Proponents

• Experience of proponents in convention centre
  management.
• Demonstrated financial resources available to the
  proponents to support the centre.
• Proposed marketing and business strategies for
  the convention centre.
• Involvement of architectural firm experienced in
  convention centres.

33
Suggested Site Selection Criteria

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Municipal Involvement

• Extent to which the City of Greater Sudbury will
  be require to contribute financial resources
  towards the convention centre, including
• Initial capital contribution.
• Ongoing financial contributions to subsidize
  operations.
• Degree to which the financial commitment required
  from the City will be offset by increased
  taxation revenues from the convention centre.
• Extent to which the convention centre will be
  incorporated into existing municipal buildings or
  facilities. The inclusion of a convention centre
  into an already existing municipal building, such
  as an arena, could increase the Citys revenue
  from the facility while reducing the overall
  capital and operating costs of the project.

Other

• Anticipated financial performance of the
  convention centre based on business case provided
  by the proponents.
• Extent to which the convention centre is
  incorporated into an existing hotel. Our
  research indicates that the majority of
  standalone convention facilities cannot operate
  profitably. Convention facilities that are
  incorporated into existing hotels benefit from
  the revenue generated by non-convention related
  activities, such as hotel room rentals,
  restaurant sales and shared administrative and
  operating costs.

34
Economic Benefits of Conventions

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Direct Spending

• Conventions are considered to be significant
  economic events in that they are typically
  associated with a large amount of direct spending
  by delegates, sponsoring associations and
  exhibitors
• A convention of 1,000 delegates and 25 exhibitors
  held in Greater Sudbury will generate
  approximately 270,000 in direct spending daily.

Source Convention Income Survey Report,
International Association of Visitors and
Convention Bureaus, adjusted to reflect small
market spending patterns.
35
Economic Benefits of Conventions

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

Direct and Indirect Benefits

• Understandably, the economic impacts of
  conventions extent well beyond the level of
  direct spending experienced as the amounts spent
  directly circulate through the community.
• Overall, we estimate that if the convention
  centre is successful in attracting ten to fifteen
  large two-day conventions to Greater Sudbury
  annually, the economic benefits could be fairly
  significant.
• Almost 6 million in direct spending.
• Just under 200 direct and indirect employment
  positions, resulting in 3.8 million in wages.
• 5.7 million in value-added.
• 2.5 million in new tax revenues, including
  300,000 for the City.

36
Economic Benefits of Conventions

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

• Average number of delegates per convention 500
  750
• Number of conventions held annually Ten Fifteen T
  en Fifteen
• Direct spending 2,800,000 4,200,000 4,000,000
  5,900,000
• Employment positions created
• Direct 60 90 85 125
• Indirect and induced 35 50 50 70
• Total 95 140 135 195
• Total wages and benefits generated
• Direct 1,000,000 1,500,000 1,400,000 2,100,0
  00
• Indirect and induced 800,000 1,200,000 1,100,0
  00 1,700,000
• Total 1,800,000 2,700,000 2,500,000 3,800,00
  0
• Total value-added created
• Direct 1,400,000 2,000,000 1,900,000 2,800,0
  00
• Indirect and induced 1,500,000 2,000,000 1,900
  ,000 2,900,000
• Total 2,900,000 4,000,000 3,800,000 5,700,00
  0

Source Ontario Ministry of Tourism, Culture and
Recreation. The economic impact analysis has
been based on multipliers for the Rainbow Country
Tourism District.
37
Impact on Existing Facilities

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

• Based on our research, it is likely that the
  establishment of a new convention centre in
  Greater Sudbury will both benefit and harm
  existing establishments
• Hotels and local entertainment establishments
  (such as restaurants, bars and tourist
  attractions) will benefit from an increase in
  demand for accommodations resulting from an
  inflow of delegates to the community.
• As noted earlier, the design of the proposed
  convention centre should incorporate the ability
  to divide the main exhibit space into multiple
  areas to accommodate smaller events. This will
  have an adverse impact on existing convention and
  conference facilities in Greater Sudbury as it
  will allow the convention centre to host meetings
  and gatherings of less than 400 people, thereby
  directly competing with existing facilities.
• To the extent that the new convention centre is
  established through the redevelopment of an
  existing facility, this competitive impact may be
  lessened
• The establishment of a convention centre will
  also adversely impact the City, as events
  currently held at local arenas may shift to the
  centre, thereby reducing the revenues generated
  by these facilities.
• Our survey of local hotels and convention
  facilities indicated that support for the
  convention centre was almost evenly divided.
  However, we noted strong support for the
  convention centre among community organizations
  and potential users.

38
Overall Conclusions

• Executive Summary
• Introduction
• Market Justification
• Facility Assessment
• Community Impact
• Overall Conclusions

• Our study into the potential market support and
  other implications of a convention centre arose
  from a proposal to the City to enter into a
  private-public sector partnership
• As a result of our review, we have arrived at a
  relatively clear estimate of the benefits
  resulting from the establishment of a convention
  centre, specifically the contribution towards the
  local economy. If the projected levels of
  convention activity are achieved, this
  contribution would be significant.
• In light of the above, we would suggest that the
  City continue with the next stage of the
  public-private partnership process that being
  the development and issuance of a request for
  letter of interest and qualifications.

39
Appendix A
kpmg
Local Demand Assessment

• Local government agencies
• City of Greater Sudbury Community Development
  Corporation
• Sault Ste. Marie Economic Development Commission
• North Bay Economic Development Commission
• Development Thunder Bay
• Chambers of commerce
• Greater Sudbury Chamber of Commerce
• Sault Ste. Marie Chamber of Commerce
• North Bay Chamber of Commerce
• Senior levels of government
• FedNor
• Ministry of Northern Development and Mines

40
Appendix A
kpmg
Local Demand Assessment

• Local hotel establishments
• Howard Johnsons
• Ramada Inn
• Holiday Inn
• Quality Inn
• Educational institutions
• Laurentian University
• Cambrian College
• Cambrian Foundation
• College Boreal

41
Appendix B
kpmg
Oraclepoll Research Report
42
Appendix C
kpmg
Local Organizations Surveyed

• Government
• Greater Sudbury Police Service
• Ministry of Northern Development and Mines
• Ministry of Natural Resources
• Ministry of Municipal Affairs and Housing
• Indian and Northern Affairs Canada
• Healthcare
• Sudbury Regional Hospital
• Northeastern Ontario Cancer Centre
• Labour organizations
• Sudbury District Labour Council
• Canadian Union of Public Employees
• United Steelworkers of America

43
Appendix C
kpmg
Local Organizations Surveyed

• Community organizations
• Greater Sudbury Chamber of Commerce
• Sudbury and District United Way
• Canadian Red Cross
• Victorian Order of Nurses
• Education
• Laurentian University
• Cambrian College
• College Boreal