1988 annual report [1988]

TABLE OF CONTENTS

Director's Report . . . . . . . . . . . . . . . . . . . . . . . . . .. 2

Financial Analysis

........................ 4

Statement of Income and Expenditures . . . . . . . . . . . . . .. 5

Rental and Exhibit Utility Services Income. . . . . . . . . . .. 6

Food Services Income. . . . . . . . . . . . . . . . . . . . . . . . . .. 7

State of Georgia Economics Benefit Summary.

8

Economic Impact of Georgia World Congress

Center-Fiscal Year 1987-88

Five Year Summary of Economic Impact

10

Event Attendance

11

Staffing ..

. . . . . . . . . . . . . . . . . . 15

Labor Force Analysis and Affirmative Action

15

GWCC Authority Board of Governors/Legislative Overview Committee ..... 16

EXHIBITS

A. State of Georgia Economic Benefits Graph

.

B. GWCC Sales Graph

.

C. GWCC Functional Flow Chart

.

DIRECTOR'S REPORT

Fiscal year 1987-88 may best be remembered by Atlanta and particu-
larly members of the hospitality industry as the year we geared up for the convention. After a 56-member Democratic National Committee chose Atlanta over four competing cities as the site for the 1988 Democratic National Convention, the city and state instantly started planning ways to ready Atlanta for its first national political convention.
The convention is expected to bring 35,000 visitors, between $40 million and $60 million in spending and the limelight of international press coverage. While the actual assembly will be held in the Omni Coliseum July 18-21, the Georgia World Congress Center will play host to 15,000 journalists and thousands of other invited guests. Three of the exhibit halls will be utilized for media workspace and the remainder of the facility will be used in an ancillary capacity for general overflow from the convention floor. The presence of the world's press corps in Atlanta will give 2 the city an unprecedented opportunity to increase its exposure around the globe.

The Georgia World Congress Center continues to gain exposure throughout the nation as an innovative leader in the conventionltrade show industry. This success is reflected by our consistent occupancy and rebooking rates. The Congress Center is booked at 95 % of its practical maximum occupancy for the next five years. Over the next decade, occupancy rates are in excess of 90%.
An unsurpassed number of out-oftown visitors attending events in the Georgia World Congress Center resulted in a tremendous economic impact and generated millions of tax dollars for the State of Georgia. In total, over 1.6 million persons attended activities in the World Congress Center. This represents a 7 % increase in attendance over the previous year. Of this number, 577,275 were out-of-town visitors who spent over $525 million, creating an economic impact of over $871 million and injecting over $50 million in new tax revenues.
Such evidence is what has fueled the Georgia World Congress Center to proceed with requests for another expansion. In February, The Georgia General

Assembly appropriated $18 million for land acquisition and design development for the second expansion. Approximately 30 acres of land will be purchased for expanded exhibition space, truck marshalling areas, parking and future expansion developments. The expansion will add approximately 300,000 square feet of exhibition space and will be connected to the three existing exhibit halls in the west building.
When the legislature convenes in 1989, we will request construction funds and if approved, construction on expansion facilities will begin in spring 1989 and be completed by fall of 1991. This expansion will position the Congress Center as the second largest conventionltrade show facility in the nation.
More importantly, we will not risk losing our competitive position if expansion is completed in the early 1990s. Two of the Congress Center's largest trade shows have already outgrown our 1.8 million square foot facility. In addition, approximately ten events which are currently booked in the Center have expressed interest in using the expanded

space. Expansion will allow these shows to continue returning to Atlanta and the Congress Center is projected to attract an additional 200,000 visitors each year. Estimated delegate and exhibitor spending attributable to expansion is over $234 million in 1992. Additional tax revenues from expansion are expected to total $14 million.
Another project on the horizon is the Georgia Dome, a multi,purpose

approved allowing the World Congress Center Authority to issue such revenue bonds. If the private sector financial package is successfully completed, the 72,OOO-seat stadium will be built adjacent to and managed by the World Congress Center. It will serve as an important adjunct to our convention center allowing Atlanta to attract major sporting events such as the NCAA tournament and bowl games, as well as large

Above-average industry growth nationwide is another factor that contributes to Georgia's success as a convention destination. Findings indicate that exhibit space requirements for trade shows grew 5.8 % in 1987. Moreover, the number of exhibiting companies increased 7.2% and professional attendance rose 7 % . A Laventhol & Horwath report concludes that the demand for exhibition space at primary convention

facility spear-headed by the Georgia

religious conferences, concerts and

centers is growing at an average annual

Stadium Corporation, which has been responsible for marketing executive

perhaps even the Olympic Games. Looking to the future, the potential

rate of 10%. Fiscal year 1987-88 was indeed a

suites and club level seats in the proposed for further development in the conven-

most successful year highlighted by

domed stadium. Charged with raising

tion and trade show industry appears

record business activity and continued

70% of the estimated $158 million project, Dome officials began their pre-

tremendous for Atlanta, which has established itself as a business and

development toward exciting new horizons. We sincerely appreciate the con-

leasing campaign in October by opening

transportation center. With the world's

tinued support of the Georgia General

an office in the Georgia World Congress Center. Subsequently in March, the

busiest airport averaging 2,200 daily departures, Atlanta's accessibility will

Assembly, State and local officials and the business community throughout the

Georgia General Assembly appropriated

continue to be an important key to the

State of Georgia.

funds for the purchase of land and

city's growth. The addition of

included in the supplemental budget

MARTA's rapid rail line to Hartsfield

$2.8 million to provide for the first

International Airport in June makes

year's debt service on the public sector's

Atlanta one of a few cities in the country

portion of industrial development bonds

to link the city with the airport via this

Dan Graveline

3

required to finance construction of the

type of transportation system.

stadium. In addition, legislation was

FINANCIAL ANALYSIS

We are pleased to report the Georgia World Congress

In addition to regular operating income, $2,800,000 is shown on

Regular operating expenses decreased over the previous year.

Center continues to be a sound

the statement page beside State of

Unlike fiscal year 1986/87, the

investment for the State of Georgia,

Georgia. This represents part of the

World Congress Center did not have

requiring no state appropriation

public sector commitment for fund-

the extra cost of materials and sup-

for operation.

ing the Georgia Dome. It should be

plies associated with expansion. In

During fiscal year 1987/88,

noted that this is a non-operating

addition, regular operating expenses

the World Congress Center gener-

account through which money was

decreased because of energy conser-

ated $12,817,143 from various

directly appropriated from the State

vation programs implemented two

revenue producing activities. This

of Georgia. Hotel/Motel sales tax

years ago.

was up 16 % over the previous year.

also falls under non-operating

During the past year, the World

Net operating profit for the World

revenue. During fiscal year

Congress Center continued its

Congress Center was $1.3 million

1987/88, the hotel/motel tax

energy management program with

and was achieved primarily from

doubled from 3 % to 6 % to enable

Georgia Power Company. Under this

healthy trade show growth, gaining

Atlanta to host the Democratic

program, special rates are established

more corporate business and booking National Convention and to increase for" off peak" power consumption

additional consumer shows.

income for the Atlanta Convention

which when carefully monitored

On another positive note, rent,

and Visitors Bureau. Non-operating

results in substantial savings. Even

utility services and food service

income from hotel/motel taxes cor-

though energy consumption was

income all increased over the previ-

responds directly to non-operating

high due to increased exhibit hall

ous year and exceeded projections by expenditures. The Georgia World

usage and record-breaking tempera-

23 %. Rental and exhibit utility

Congress Center merely acts as a

tures, actual costs under this pro-

services income both increased 10%

"conduit" for hotel/motel tax funds. gram were nearly $300,000 below

over last year and food service

Overall operating expenses were original budget estimates.

income escalated a phenomenal 4 5 % within .04 % of budget projections,

"Other" expenses are categor-

over fiscal year 1986/87. Parking

with an increase of 6 % over last year. ized by computer and telecommuni-

4 revenue, which constitutes a small

Personal services, which account for cation costs, as well as leases

portion of total income, also

62% of total operating expenditures, on equipment, travel and printing

increased, rising 39% over the

rose 11 % overfiscal year 1986/87.

expenses.

previous year.

This increase can be attributed to

new staffing and normal payroll

INCOME

increases.

EXPENSES

EXHIBIT UTILITY SERVICE
23%

PERSONAL SERVICES
62%

HOTEL/MOTEL 8%

MISe. 5%

PARKING 2%

CONTRACTS/FEES 4%

OTHER 3%

EQUIPMENT 2%

STATE:MENT OF INCO:ME AND EXPENDITURES

INCOME Beginning Adjusted Balance Rent Exhibit Utility Services Food Service (MGR) Parking Hotel/Motel Tax (GWCC) Miscellaneous
SUB-TOTAL State of Georgia Hotel/Motel Tax (ACVB/ATL88) Special Projects
TOTAL
EXPENDITURES: Personal Services Regular Operating Equipment Contracts/Fees Other
SUB-TOTAL Special Projects Hotel/Motel Tax (ACVB/ATL88)
TOTAL

FY 1986-87
$ 881,443 5,215,994 2,628,009 1,485,834 240,428 931,271 528,122
$11,029,658 -0-
2,172,965 191,833
$13,394,456

FY 1987-88
$ 1,091,732 5,748,529 2,893,128 2,149,147 334,489 1,011,708 680,142
$12,817,143 2,800,000 9,257,207 -0-
$24,874,350

$ 6,404,264

$ 7,095,843

5

3,527,657

3,305,000

123,299

290,321

448,892

409,337

299,756

367,471

$10,803,868 167,492
2,172,965

$11,467,972 2,826,212 9,257,207

$13,144,325

$23,551,391

NET PROFIT RESERVE FUNDS FUND BALANCE

$ 250,131
-0-
$ 1,131,574

$ 1,322,959 1,730,000
$ 684,691

RENTAL INCOl\1E

Building rental income, which totaled over five million dollars, represented 45% of the Center's total operating revenue. A large portion of this revenue came from exhibit hall rental which accounted for 83 % of all rental income. Rental of the six exhibition halls showed an 8 % increase over the previous year.
In addition to exhibition space

rental, meeting room rental represented 13 % of total rental income. The World Congress Center features a 33,000 square foot Ballroom, an Auditorium that seats 1,976 and 70 meeting rooms which offer more than 215,000 square feet of meeting space in the east and west concourses.
In most instances, meeting rooms are utilized in conjunction with exhibit hall events. Further-

more, they can be used separately for conferences, exams, receptions, fashion shows, banquets and special events.
Miscellaneous rent, representing 4 % of rental income, was generated from the guest service areas in the Entrance Concourse, equipment rental and permanent displays in Georgia Hall.

Exhibit Hall Rent Meeting Rooms/Ballroom
Auditorium/Conference Center Miscellaneous Rent
TOTAL RENT

FY 1986-87 $4,400,567
611,970 203,457 $5,215,994

FY 1987-88 $4,741,266
757,833 249,430 $5,748,529

6 UTILITY SERVICES INCOl\1E

Revenues from utility services continue to be very profitable for the World Congress Center. In fact, over the past several years, the revenues generated from utility services have amounted to almost one-

third of the total income each year. During FY 1987/88, utility services operation realized a net income of 76% before allocation of overhead.
Providing in-house electrical service, gas, compressed air, steam

and drains continues to be extremely helpful in maintaining a reputation as a facility free from exhibitor installation problems. Also, it ensures that exhibitors will receive the most efficient service possible.

GROSS INCOME EXPENSE
Labor Materials & Supplies
TOTAL EXPENSE
NET PROFIT

FY 1986-87 $2,628,009
$ 539,665 167,899
$ 707,564 $1,920,445

FY 1987-88 $2,893,128
$ 503,675 188,053
$ 691,728 $2,201,400

FOOD SERVICES INCOl\1E

Georgia World Congress Center Food Services, operated by MGR, Inc., provide all food and beverage service in the World Congress Center. In addition to the elegant full-service Terraces Restaurant, over a dozen permanent facilities and countless portable buffets, bars and concession stands are available for major events. MGR specializes in receptions, banquets and special events for groups ranging from 20 to 7,000 persons.
Fiscal year 1987/88 was a year of continued substantial growth for MGR. This year, MGR concentrated heavily on marketing to local corp or-

ate groups and increasing their sales effort in the peripheral market of trade show exhibitors. These efforts enhanced existing sales programs and combined to generate an income level to the World Congress Center in excess of $ 2.1 million or 59% over initial projections and 47.6 % over last year.
MGR's outstanding reputation for quality of product and service is further enhanced by its position as a trendsetter in the convention industry. MGR prides itself as being unique by offering unexpected niceties within a convention center, such as fresh baked breads and

pastries from its bake shop, bouquets of wild flowers designed by the staff florist, a custom designed "thank you" cake for show management and even the crispest of linens from its in-house laundry. Through these types of programs, MGR is successful in maintaining the best in terms of customer satisfaction and appropriate financial performance.
Figures shown here are operational and do not reflect year-end adjustments to reserve accounts as do figures in the Statement of Income and Expenditures.

INCOME Food Sales Beverage Sales Miscellaneous
TOTAL INCOME
EXPENDITURES Cost of Sales (Product) Wages, Salaries & Related Other Operating Expense
TOTAL EXPENSE NET INCOME
DIVISION OF NET INCOME MGR, Inc. Georgia World Congress Center

FY 1986-87

FY 1987-88

$5,377,456

$6,587,842

963,253

1,207,884

103,898

156,118 7

$6,444,607

$7,951,844

$1,678,410 2,079,235 1,022,529
$4,780,174
$1,664,433

$1,883,273 2,366,924 1,245,533
$5,495,730
$2,456,114

$ 174,665 1,489,768
$1,664,433

$ 270,611 2,185,503
$2,456,114

STATE OF GEORGIA ECONOMIC BENEFITS SUMMARY

62,000,000

60,000,000

58,000,000

56,000,000 54,000,000

TOTAL INCOME

TOTAL EXPENSE

52,000,000 50,000,000 48,000,000 46,000,000 44,000,000 42,000,000 40,000,000

Operating
Income Tax Income
D

Operating Expense
D
Debt Service
Expense

38,000,000

36,000,000

34,000,000

8 32,000,000 30,000,000

28,000,000

26,000,000 24,000,000 ---_._._.

__ ._..._._._-_._------------------------

22,000,000

20,000,000

18,000,000

16,000,000

14,000,000

12,000,000

...'2
It)

10,000,000 -------

8,000,000

I

~

~

0.........

6,000,000

I

4,000,000

2,000,000 ------

NET PROFIT

FY77 $3,409,904

FY78 $5,347,501

FY79 $7,861,093

FY80

FY81

FY82

$8,779,693 $11,907,408 $13,430,628

FY83 $3,959,108

EXHIBIT A

When conventioneers come to Atlanta to attend a meeting,

convention, trade or consumer show,

they contribute to the local economy

by spending money on transporta

tion, lodging, food, entertainment,

shopping and other services during

their stay in Georgia.

By "importing" these new

dollars, the Georgia World Congress

Center has become a major source of

income for both the city and the

state.

Most delegates that visit the

World Congress Center are likely to

.'2..

stay an average of 4.25 days and spend approximately $214 each day.

The numbers shown go

beyond operation figures to include

the State of Georgia's annual invest-

ment and tax benefits resulting from

World Congress Center activity.

On the following page, you will

note the amount of "new dollars"

generated increased from $415

million in FY 1987/88 to $525

...It)

million for the current year. This

9

dollar amount can be attributed to

o"....t.....

increased delegate spending per day. According to a report recently pro-

duced by Laventhol and Horwath,

delegate spending has increased and

is now estimated to be $214.00 per

delegate per day. In contrast, a figure

of only $145.00 has been used over

the past several years to determine

delegate spending.

FY84

FY85

FY86

FY87

FY88

ll,653,301 $16,983,204 $22,598,689 $21,159,806 $37,214,418

ECONOl\1lC IMPACT

Category Personal Income Retail Sales
Total Dollars

Employment

Taxes:

Retail Sales

Concessions

Hotel/Motel

Personal Income

10

Corporate Income

Total Taxes
\,,

FISCAL YEAR 1987-1988

World Congress Cen ter Acti vi ty "New Dollar"
Impact $ 97,130,849
427,900,763 $525,031,612
6,202

Secondary Impact
$225,343,567 121,177,297
$346,520,864
10,109

$ 21,395,038 256,740
14,425,939 2,039,748 462,133
$ 38,579,598

$ 6,058,865
4,732,215
729,366 $ 11,520,446

FIVE YEAR SUMMARY

Total Economic
Impact $322,4 74,416
549,078,060 $871,552,476
16,311
$ 27,453,903 256,740
14,425,939 6,771,963 1,191,499
$ 50,100,044

Economic Impact
"New Dollars" Generated
Total Impact of New Dollars

FY 1983-84 FY 1984-85 FY 1985-86 FY 1986-87 FY 1987-88 $298,946,340 $367,703,998 $412,069,680 $415,055,028 $525,031,612
$496,377,790 $610,544,682 $684,035,669 $688,991,346 $871,552,476

Tax Revenues Georgia State Taxes Atl. Hotel/Motel Tax
Total Tax Revenue

$ 20,774,190 $ 25,552,254 $ 28,611,699 $ 28,818,271 $ 35,674,105

4,517,340

5,556,328

5,972,774

6,208,471 14,425,939

$ 25,291,530 $ 31,108,582 $ 34,584,473 $ 35,026,742 $ 50,100,044

EVENT ATTENDANCE

It was a record-breaking year for attendance at the Georgia World

Congress Center, increasing 7 %

over the previous year. In total,

1,622,4 77 visitors passed through

the doors of the World Congress

Center. Of this total, 577,275 were

out-of-town guests.

Attendance figures represent

not only conventioneers attending

major events, but also visitors

attending smaller functions which

attract social, cultural and business

groups.

During fiscal year 1987/88, 71

major trade shows, conventions and

public shows were hosted. In addi-

tion, over 480 food functions,

smaller seminars and meetings were

held in the facility.

A number of events attracted

from 20,000 to 80,000 attendees.

These include the Elks' 123rd

Annual Grand Lodge Convention;

Bobbin Show/ AAMA Convention;

National Home Health Care Show;

American Academy of Orthopaedic

11

Surgeons; The Super Show; Ameri-

can College of Cardiology;

COMDEX; American Newspaper

Publishers Association Technical

Exposition and Conference; and

International Music and Sound

Exposition.

Many of the public expositions

drew record crowds also. The Boy

Scouts Show on November 21

attracted 86,000 to the Congress

Center and the five-day, inaugural

International Flower Show boasted

over 150,000 in attendance.

ATTENDANCE

FY 1983-84 827,320

FY 1984-85 1,066,641

FY 1985-86 1,091,708

FY 1986-87 1,343,821

"OUT OF TOWN" ATTENDANCE

423,180

520,300

593,740

598,062

TOTAL DAILY ATTENDANCE

2,202,655

2,757,616

3,021,363

3,287,522

"TOTAL DAILY ATTENDANCE" is calculated at 4.25 visits per out-ol-town attendee plus one visit lor area residents attending seminars or public shows.

FY 1987-88 1,622,477
577,275
3,498,621

GWCC SALES GRAPH
1100
1000
900
tI)
~ 0 .....:l .....:l 800
--<:r:
~ ~
:r: 700
><:
~
600 12
500
400 f--._-_._.
I
300
200
100

1988

1989

1990

1991

1992

1993

1994

EXHIBITB

Original Exhibit Halls
I

1095
ABSOLUTE MAXIMUM BOOKINGS

Expansion Exhibit Halls ..

EXPLANATORY NOTES

(1) "Exhibit Hall Days": 365 days x 3 exhibition

halls = 1,095 potential "exhibit hall days" available

per year.

(2) "Practical maximum bookings." Based upon Exhibit

813

Hall Days in full year less deductions for major

PRACTICAL

national holidays, weak seasonal periods in July,

MAXIMUM

751

August and December, plus three days per month for

BOOKINGS

scheduling gaps between major shows.

13

1995

1996

1997

1998

1999

2000

GEORGIA WORLD CONGRESS CENTER AUTHORITY

BOARD OF GOVERNORS

John E. Aderhold, President Rayloc Atlanta, Georgia

Chairman

James S. Livingston, Vice Chairman Chief Executive Officer The Central Bank Swainsboro, Georgia

Joseph W. Robinson, Sr., Secretary President J.W. Robinson & Associates, Inc. Atlanta, Georgia

Emily May Richards, Treasurer President The Richards Group, P.e. Atlanta, Georgia

I.Owen Funderburg President Citizens Trust Bank Atlanta, Georgia

Perry Hudson State Senator, Retired Hapeville, Georgia

Luke H. Morgan

Area Supervisor

16

ITT Rayonier

Eastman, Georgia

Don W.Sands President and Chief Executive Officer Goldkist Atlanta, Georgia

Jack H. Cole President Cook & Ingle Plastics, Inc. Chatsworth, Georgia

LEGISLATIVE OVERVIEW COMMITTEE
Senator Jim Tysinger, Chairman District 41 Atlanta, Georgia
Representative Tom Triplett, Vice Chairman District 128 Savannah, Georgia
Representative Lauren McDonald District 12 Commerce, Georgia
Representa tive Kenneth Waldrep District 80 Forsyth, Georgia
Senator Paul C. Broun District 46 Athens, Georgia
Senator John C. Foster District 50 Cornelia, Georgia