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WHITE THE FUTURE OF

PAPER THE LOS ANGELES CONVENTION CENTER


September 2015
TABLE OF CONTENTS
INTRODUCTION.........................................................................1

THE CASE FOR EXPANSION.....................................................2

DRIVING THE ECONOMY..........................................................4

PROPOSED CAMPUS DESIGN................................................10

Cost Estimate & Finance..................................................18

SCHEDULE.................................................................................19

HOTEL DEVELOPMENT...........................................................20

CONCLUSION...........................................................................24

CREDITS.....................................................................................25

This report may be electronically downloaded from www.lacclink.com/about/la-city-department

The view from the ballroom terrace looks north, offering views of L.A. LIVE, Downtown and beyond.
introduction

When I began my term as your Mayor, I made it clear The Department of


that my top priorities would be rebuilding our economy Convention and Tourism
and job creation. During the intervening two years, we Development is now
have made great strides, particularly within the tourism proposing an expansion and
and leisure and hospitality sectors: modernization of the
Los Angeles Convention
• The number of visitors to Los Angeles is up Center which, when
6.8%, from 41.4 million in 2012 to 44.2 million in combined with the
2014 — well on the way to our goal of 50 million phenomenal success of our
visitors by 2020. neighboring partners at L.A.
• Those 44.2 million visitors infused $19.6 Live and Staples Center,
billion directly into Los Angeles’ economy in will make us the premier
2014, up 12.6% in just two years. sports, convention, and
entertainment center on the Mayor Eric Garcetti
• In fiscal year 2014-15, for the first time in the
West Coast.
City’s history, hotel taxes on visitors earned
over $200 million for the City’s General Fund, The City Administrative Officer has been directed to
up 20.9% from just two years ago. develop a financing plan for this nearly $500 million
project. This unique timing allows the Convention
• Perhaps most importantly, the average number
Center to undertake a major renovation while still
of jobs in the leisure and hospitality sector has
living within its existing means. One option not under
grown to 474,700 in FY 2014-15, an increase of
consideration is raising taxes — I will not support any
11.3% from two years ago. This is the fastest rate
new taxes to pay for this project.
of growth among the ten super sectors tracked
by the California Employment Development The time is ripe for expansion, especially with
Department. Downtown Los Angeles currently experiencing a
Taken together, all of these figures confirm my belief monumental surge in growth and development.
that investing in our Los Angeles Convention Center These circumstances will help the LACC to increase its
(LACC) is an investment in our future: bringing more potential as an economic engine for the region while
revenues, more visitors and more jobs to Los Angeles. transforming into an international icon worthy of our
great city!
Increasing the number of tourists and conventioneers in
our city is one of the most impactful forms of economic I encourage readers to thoroughly review this important
growth. These national and international visitors stay report and project. A decision by the City Council
in our hotels, eat in our restaurants and shop in our and me is scheduled for early November 2015. I look
stores — generating significant revenue for our City’s forward to your input. Please leave me your thoughts at
vital public services and benefiting local residents and mayor.garcetti@lacity.org.
businesses.
Very truly yours,

Eric Garcetti
Mayor
City of Los Angeles

1
the case for expansion
Setting the Stage
The Los Angeles Convention Center (LACC) is at a
historic crossroads. For many years, it has been viewed
as an underachieving City asset, or even as a “white
elephant,” but now there is a tremendous opportunity
to change that perception.

In 2012, the City and AEG developed a plan to


construct an NFL stadium on a portion of the LACC
site and to integrate that stadium with a modernized
Convention Center. Despite all the efforts of the City
and AEG, no NFL team committed to the Downtown
location. Fortunately, the Mayor and City Council had
the foresight to begin work on a plan to expand and
modernize the Convention Center without a stadium.

On June 4, 2014, the City Council approved a design


competition to develop a new master plan for the
LACC. The City recently selected the winning design
and in November 2015, the City Council will determine
the next steps in the process of expanding and
modernizing the LACC. At that critical moment, City
Council will consider the following items:

• An architectural service contract between the


City and the winners of the design competition;
• A financing plan by the City Administrative
Officer;
• An economic impact report, prepared by
Conventions, Sports & Leisure, International;
• And a request for interest administered by an
outside consultant regarding an on-site, 1,000- The LACC is strategically located at the southern entrance
room hotel. to Downtown Los Angeles.

This proposal does not assume, as convention


center proposals in other cities have, that a dramatic Expanded transit will provide improved access to
physical upgrade alone is enough to turn around a the beaches, LAX, Hollywood, and Universal Studios.
struggling convention center. Instead, it builds on Thousands of new hotel rooms within walking distance
a data-driven, rational approach to the convention are in the development pipeline, and South Park is
business, implemented two years ago by the City when experiencing a revitalization, especially with notable
it privatized daily operations and instituted an entirely mixed-use developments right across the street from
new governance structure, more entrepreneurial than the LACC. Furthermore, by connecting with the Staples
before and less dependent on City bureaucracy. Center, Microsoft Theater, the JW Marriott, and the
many restaurants, clubs, and other entertainment
Under the management of AEG Facilities, the LACC venues at L.A. Live, the LACC is in a unique position
generated its first ever operation profit, two years in a to become a more powerful asset in the Los Angeles
row, since privatization. The 2014-15 fiscal year ended economy, competing in regional, national, and
with $2.6 million in profit, which is being reinvested into international markets for convention business.
the LACC.

2 white paper: the future of the los angeles convention center september 2015
Competition COMPARISON
Comparison of sellable OFspace
SELLABLE SPACE
COMPETITVE AND COMPARABLE FACILITIES
As the second largest city in the competitive & comparable facilities
United States and a gateway 1 19,167
CHICAGO, IL 3,164,800
to the rapidly emerging Pacific 17,020
ORLANDO, FL 2,537,200
Asian market, Los Angeles 10,709
already benefits from many of LAS VEGAS, NV 2,183,200
10,676
the ingredients necessary for a ATLANTA, GA 1,651,100 9,091
successful convention and tourism 1,294,900 8,243
NEW ORLEANS, LA
industry. The City is home to 2
1,138,100
8,224
ANAHEIM, CA
the second busiest airport and 2
5,179
the busiest port complex in the SAN FRANCISCO, CA 1,151,600 3,172
nation. Moreover, Los Angeles’ HOUSTON, TX 1,002,700 2,692
3
charms go beyond matters of NEW YORK, NY 933,000 1,700
infrastructure and geography. LOS ANGELES, CA 870,000
3

In 2014, the Guardian rated Los 4


816,100
SAN DIEGO, CA
Angeles the most powerful city
brand in the world—beating out 500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000 3,500,000
SQUARE FEET OF TOTAL SELLABLE SPACE
New York, London, and Paris —
Reported by CSL, 2015
thanks to a competitive edge in “cultural variety and
1- Figure includes currentReported by CSL, 2015
expansion projects
sheer glitter.” The 44.2 million visitors to Los3-Angeles
2- Figure does not include1- Reported
upcoming by CSL,
expansion 2014
project
Reported by CTD Department
2- Figure includes current expansion projects
in 2014 enjoyed a dynamic and vibrant city featuring 3- Reported by CTD Department
great weather, beaches, and a flourishing restaurant 4- Figure does not include upcoming expansion project
and entertainment scene.

Despite its inherent potential, the LACC underperforms have been scheduled in future years. The combined
in attracting conventions, meetings, and corporate value of those 271 events amounts to 3.3 million room
events among its competitor facilities across the nation. nights, $750 million in room revenue, $105 million in
Los Angeles should expect more — the LACC is a Transient Occupancy Tax (TOT) revenue, and a total
billion dollar asset, which should serve as a long-term economic impact of $4.9 billion.
economic engine for the entire region.
Meanwhile, cities like San Francisco and Anaheim are
For the LACC to fill a more fitting role in the local currently under construction with expansion projects.
economy and to better compete with peer cities, San Diego is expected to resolve political and legal
it must address a lack of facilities and infrastructure debates and move forward with its own expansion
required by the contemporary convention and event project. The convention center investments made by
planning industry. According to a lost business other West Coast cities should cause alarm in
analysis by the Los Angeles Tourism & Convention Los Angeles, because these facilities already
Board (LATCB) from 2010-2014, inadequate hotel outperform the LACC — they are simply moving the
or convention center space contributed to 16% (271 curve that much further ahead.
events in total) of lost citywide conventions that would

CONVENTION CENTER ROOM NIGHT GENERATION COMPARISON


immediate competitors

CALENDAR YEAR 2014 LOS ANGELES SAN FRANCISCO ANAHEIM SAN DIEGO
CITYWIDE EVENTS 26 59 64 76
ROOM NIGHTS SOLD 197,037 1,018,422 471,256 673,955
AVG ROOM NIGHTS/EVENT 7,578 17,261 7,363 8,868
Reported by LATCB, 2015; Visit San Diego, 2015

department of convention and tourism development city of Los Angeles 3


driving the economy

Economic Impact
This proposal for the future of the LACC is one LACC could potentially generate over 400,000 room
component of a larger economic development strategy nights from citywide events per fiscal year by its sixth
for the City of Los Angeles. Although there is no “silver year of operation — those projections therefore
bullet” to ensure the City’s place in the 21st century estimate that the expansion could increase the
economy, a redesigned and reinvented LACC can average number of room nights per year generated
become a significant component of that economic by the LACC by 42% over the past five year average.
development strategy. Continuing to neglect the LACC by investing nothing
into expansion or improvement would precipitate a
To develop a clear picture of the LACC’s role and 20% decrease in room nights, down to an average of
potential impact in the City’s economy, Conventions, 229,600 room nights.
Sports & Leisure, International (CSL) prepared a market
and economic analysis report in August 2015. The In terms of total room nights generated per year,
picture that emerged from that analysis estimates that including events other than citywide conventions, an
an expanded LACC would tap significant potential for expanded LACC would increase room nights by 33%
generating new hotel room nights and increasing TOT — up to 536,700 from 403,200. Conversely, CSL also
revenue, among other additional direct and indirect considered the cost of inaction over the same span of
economic impacts. time. In this scenario, CSL estimates that the failure
to invest in the facility would precipitate a 14% loss of
Perhaps the most obvious projected benefit would total room night generation compared to the historical
come in the form of increased numbers of hotel room average, which amounts to 191,400 room nights less
nights, resulting from additional bookings and larger per year than if the LACC is expanded.
events. CSL’s analysis estimates that an expanded

lacc events & room nights


historical & projected
5-YEAR HISTORICAL WITH WITHOUT
AVERAGE EXPANSION EXPANSION
CITYWIDE CONVENTIONS
CITYWIDE EVENTS 23 34 19
ESTIMATED TOTAL CITYWIDE ROOM NIGHTS 287,400 408,100 229,600
OTHER EVENTS
OTHER EVENTS 117 130 117
OTHER EVENTS ESTIMATED TOTAL ROOM NIGHTS 115,800 128,600 115,700
TOTAL EVENTS
TOTAL EVENTS 140 164 136
TOTAL ESTIMATED ROOM NIGHTS 403,200 536,700 345,300
Reported by CSL, 2015

4 white paper: the future of the los angeles convention center september 2015
economic impact projections & analysis
ECONOMIC IMPACT
PROJECTIONS & ANALYSIS ECONOMIC IMPACT
total roomTOTAL
nights
ROOM NIGHTS total output
PROJECTIONS & ANALYSIS
TOTAL OUTPUT
550,000 $500M
536,700 $486.2M

TOTAL OUTPUT IN MILLIONS OF DOLLARS


500,000

INCREMENTAL
$400M $173.4M
ROOM NIGHTS

450,000 191,400 TOTAL IN TOTAL OUTPUT


ROOM NIGHTS
$359.4M
DIFFERENTIAL

403,000
400,000 $312.8M
$300M

350,000 345,300

300,000 $200M
HISTORICAL WITH WITHOUT HISTORICAL WITH WITHOUT
AVERAGE EXPANSION EXPANSION AVERAGE EXPANSION EXPANSION
Reported by CSL, 2015 Reported by CSL, 2015
Reported by CSL, 2015 Reported by CSL, 2015

The impact of the Convention Center is maximized In effect, CSL projected that the potential expansion
when out of town event attendees make purchases and enhancement of the LACC (along with increases
in the City while attending an event at the facility. in hotel inventory that will be described later in this
Therefore, the LACC also provides significant report) will help capture additional event activity and
benefits in terms of net new spending and associated better accommodate peak demand periods. Without
employment, earnings, and tax benefits. As estimated these improvements, however, competitive pressure
by the CSL economic impact analysis, an expanded will continue to erode the room night, economic
LACC would increase direct spending, output, impact, and tax generating effects of the LACC.
earnings, and employment by an estimated 35%. The
same indicators would decrease approximately 13%
if the City made no expansion or improvement to the
campus, representing a loss of approximately $173
million per year in total output.

department of convention and tourism development city of Los Angeles 5


Event attendees line up to enter South Hall on opening day.

Increased Revenue
The CSL report also projected the amount of fiscal CSL estimates that revenues would drop to $12.2
impact to the city government, producing figures for million. The resulting net difference in tax collections
the current revenues generated by the LACC, revenues between an expansion and no expansion scenario is
generated by the expansion scenario, and revenues approximately $6.7 million.
generated without expansion or improvement of
the Convention Center. This analysis assumes the Note, however, that these estimates do not include
continuation of a robust economy. various property and other taxes that can be affected
by the convention industry, and do not break out the
According to the CSL report, the LACC generates significant private sector impacts that could also be
approximately $14 million in revenue for the generated. These private sector impacts include the
City of Los Angeles, derived from local sales, transient significant hotel, restaurant, and other industry profits
occupancy, business, and parking taxes. With the generated as a result of convention industry activity.
expansion of the Convention Center, these revenues
could increase to $18.9 million. With no expansion,

fiscal impact generated by the lacc


analysis and projections
DEVELOPMENT SCENARIOS
EXISTING LACC
EXPANSION NO EXPANSION
LA SALES TAX $864,574 $1,169,786 $752,644
LA HOTEL/MOTEL TAX $12,556,987 $16,989,859 $10,931,337
SALES TAX - INDIRECT SPENDING $265,286 $358,937 $230,942
LA BUSINESS TAX $13,114 $17,744 $11,417
LA PARKING USER TAX $295,075 $352,423 $275,505
TOTALS $13,995,037 $18,888,749 $12,201,844

Reported by CSL, 2015

6 white paper: the future of the los angeles convention center september 2015
Job Growth
“Los Angeles is a
Leisure and hospitality is the fifth largest
employment super-sector in the world-class city, and it
Los Angeles County economy, with total deserves a world-class
jobs averaging 474,700 during the fiscal Convention Center that
year 2014-15 (source: the California
Economic Development Department). complements and builds on
the successful redevelopment
Average employment generated by
conventions and events hosted at the
of our Downtown.”
LACC currently stands at 3,900 full-time 9th District Councilmember Curren
and part-time jobs, according to the D. Price, Jr. — Chair of the City’s
CSL report. That number would grow Economic Development Committee
to 5,300 as a result of an expansion and — is a strong supporter of the
improvement project — or it could drop Los Angeles Convention Center,
to 3,400 if the City makes no investment. which is located in his district.
Furthermore, the construction activity
associated with expanding and
modernizing the LACC is estimated to AVERAGE LEISURE & HOSPITALITY JOBS
PER FISCAL YEAR
generate 1,800 full-time and part-time AVERAGE LEISURE & HOSPITALITY JOBS
jobs for the duration of construction. PER FISCAL YEAR 474,700
Locating a large, growing number of 452,692
jobs at the LACC and its surrounding 450,000
AVG NUMBER OF JOBS PER FY

entertainment and hospitality district 426,617


420,000
makes additional sense when considering 401,000 403,558
the proximity of existing and future 394,542
389,050
390,000 382,725
rail lines, high-frequency bus routes
operated by city, county, and regional 360,000
transportation agencies, and a potential
streetcar line. These transit lines make 330,000
it easier for diverse populations from
around the City and County to access this 300,000
FY07-08 FY08-09 FY09-10 FY10-11 FY11-12 FY12-13 FY13-14 FY14-15
employment base.
Reported by the California Economic Development Department, 2015
Reported by the California Economic Development Department, 2015

LA County Employment
LA COUNTYby industry BY INDUSTRY
EMPLOYMENT
average jobs per fiscal year
AVERAGE JOBS PER FISCAL YEAR
19,167
TRADE/TRANSP./UTILITIES 811,258
17,020
EDU./HEALTH SERVICES 761,692
10,709
PROF./BUS. SERVICES 614,500
10,676
GOVERNMENT 562,575
9,091
8,243
474,700
LEISURE & HOSPITALITY
8,224
MANUFACTURING 363,733
5,179
FINANCIAL ACTIVITIES 210,583
3,172
INFORMATION 196,850
2,692
OTHER SERVICES 153,958
1,700
CONSTRUCTION 123,733
MINING/LOGGING 4,608
0 300,000 600,000 900,000
Reported by the California Economic Development Department, 2015
Reported by the California Economic Development Department, 2015

department of convention and tourism development city of Los Angeles 7


During fiscal year 2014-15, over 2.5 million people passed through the doors of the LACC.

Regional Economic Engine


The economic impact of a convention center is not been enough to cover the annual debt service
measured solely within the confines of the facility payment, requiring the General Fund to offset the
itself. The full financial gains ripple beyond the center’s difference. However, in only the last two years has the
four walls and into the hotels, restaurants, stores, and City allocated less than the 3.5 points to the LACC,
entertainment venues throughout the city. Indeed, because the TOT has been growing so fast that the
many cities run their convention centers as “loss full 3.5 points has not been needed to meet the debt
leaders” and measure their true success by the total service obligation. For fiscal year 2015-16, the 3.5 point
revenues and jobs created citywide. The financial allocation is projected to amount to approximately $58
return and positive gain to city revenues are also million, exceeding the $48 million Convention Center
made evident by the fact that major cities throughout debt service payment.
the country have committed to convention center
expansion projects, including San Francisco with a Throughout this planning process, the Los Angeles
project budget of $508 million, and Anaheim with a Department of Convention and Tourism Development
project budget of $300 million. (CTD) has been committed to the concept of
maintaining a project budget that would necessitate
Other major benefactors include the hotel and tourism no more than the LACC’s allocation of 3.5 points of
industry, which are typically in strong support of TOT. Unlike other cities that have encountered legal
convention center expansion projects. The hospitality and/or political problems with their convention center
industry usually anticipates that an improved and financing plans, which have included levying new
expanded convention center could drive the number taxes or raising existing tax rates, the CTD believes the
of out of town guests and have a direct impact on the Project Cost and the refinancing of the old debt could
Transient Occupancy Tax (TOT), which is the revenue be accomplished within existing levels of funding.
most commonly linked to funding convention center Although the bonds issued for West Hall, which
expansion projects. opened in 1971, have been paid off, the entire LACC
property, including South Hall, which opened in 1993,
In Los Angeles, the TOT is a 14% tax charged to is encumbered against approximately $253 million in
guests staying at hotels located within City boundaries. outstanding principal as of September 2015.
Historically, 3.5 points of the City’s TOT has been
allocated towards LACC debt service. There have
been years when the 3.5 point allocation has not

8 white paper: the future of the los angeles convention center september 2015
Los Angeles transient occupancy tax
contributions to general fund per fiscal year
TOT TO GENERAL FUND IN MILLIONS OF DOLLARS PER FY
$275M
3.8%
4.8%
$250M 5.0%
6.1%
$225M 6.5%
10.0%
$200M
9.9%
$175M 10.6% 261.8
252.2
240.6
$150M 10.3% 12.5% 229.2
216.0
6.0% -8.2% 13.8% 202.9
$125M 184.4
-13.1% 167.8
148.5 151.7
134.6 136.3 134.8
$100M 118.5

$75M

(f)

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(f)

(f)
7

5
-0

-0

-0

-1

-1

-1

-1

-1

-1

0
06

07

08

09

10

11

12

13

14

-1

-1

-1

-1

-2
15

16

17

18

19
FY

FY

FY

FY

FY

FY

FY

FY

FY

FY

FY

FY

FY

FY
Reported by Los Angeles Office of Finance; 5-year Forecast, Fiscal year 2015-16 Los Angeles City Budget

From its earliest inception, and with the support of the Although the TOT was raised during these years for
hotel industry, the debt service for LACC construction other General Fund purposes, one-quarter of the
financing has relied on increases in the TOT. A 2011 current 14% TOT, or 3.5% of taxable hotel sales, was
report prepared by the City Administrative Officer increased to assist in financing the construction of the
(CAO) in consultation with KNN Public Finance Convention Center. However, there is no ordinance or
traced the history of the TOT: the tax was raised four other requirement linking the amount of General Fund
times from 1967 to 1990, specifically to cover costs revenue the LACC receives and the 3.5 points of TOT
associated with the Convention Center (denoted by that was raised to help finance the construction.
blue in the chart below). These increases to the TOT
rate occurred prior to the passage of Proposition 218 In addition to the 3.5 points historically allocated for
in 1996, which requires voter approval of such tax convention center debt service, one point is set aside
increases going forward. to pay the LATCB for advertising, promotional, and
booking services, and one point is budgeted to pay for
costs associated with the Cultural Affairs Department.
EVOLUTION OF TOT The remaining 8.5 points are budgeted for other
General Fund purposes.
DATE TOT RATE
With the overall economic recovery, and with the
08/01/64 4.0%
particularly strong growth in the Leisure and Hospitality
11/01/67 5.0% Job Sector, TOT is now one of the General Fund’s
03/01/72 6.0% fastest growing revenues — up over 107% during the
07/01/78 7.5% last 11 years, while still at the same rate of 14% and
despite the intervening Great Recession. For fiscal year
07/01/83 10.0%
2015-16, the TOT is projected to generate $216 million
01/01/86 11.0% — up 82% since fiscal year 2009-10. This of course
01/01/88 12.0% could change if there is a downturn in the economy.
12/01/90 12.5% That is why the entire General Fund is responsible for
the LACC and associated costs, and not just the TOT.
08/01/93 14.0%
Reported by the Los Angeles Office of the City Clerk

department of convention and tourism development city of Los Angeles 9


PROPOSED
CAMPUS DESIGN

Aerial view of the reimagined Los Angeles Convention Center.

Per the City Council’s instruction in June 2014, the A very important goal for the proposed design is to
Bureau of Engineering (Engineering) spearheaded a provide superior functionality that accounts for the
design competition for the CTD Department, to select future needs of the LACC. That functionality requires
an architectural team for the proposed renovation and spaces that are flexible, adaptable, and versatile. The
expansion of the LACC. design team identified trends in the meetings industry
and responded with a cutting edge design proposal
Engineering received 11 responses, and following an that positions the LACC at the forefront of innovation in
interview process, selected three finalists to submit the field. Throughout the proposed renovated campus,
drawings, renderings, models, and cost estimates for internal and external circulation elements and an
consideration. The winning team, led by Populous, emphasis on the flexibility of the meeting room spaces
includes HMC Architects, landscape architects from allow for settings that facilitate networking, socializing,
Olin Studio, interior designers from Chu+Gooding and a more intimate and personal convention
Architects, engineers from Syska Hennessy and experience. These kinds of spaces are considered a
Magnussan Klemencic Associates, and other specialty long-term need for the convention center business of
consultants. The team is a collection of local and the future.
industry-leading talent in convention center design and
construction. In addition to the important matters of functionality, the
facility’s civic prominence will be key to its success. The
design proposal aims to create a facility and a site with
a civic presence derived from an authentically
Los Angeles cultural perspective. Design inspirations
were drawn from the vocabulary of Southern
Californian Mid-Century Modernism, which emphasizes
the continuity of indoor settings and the outdoor

10 white paper: the future of the los angeles convention center september 2015
environment. At all times, the experience in the new All of these program elements are essential to elevate
LACC will create a feeling of being one step away from the LACC’s space inventory to levels that can attract
sunshine, the burgeoning South Park neighborhood, and capture more market share by accommodating
and the rest of Downtown. The result recognizes the larger conventions and simultaneously hosting multiple
freedom and joy intrinsic to the California climate, and large-scale events. The highly desired additional
reinvigorates glamour and grandeur into this public space inventory, combined with the modern design
asset — the kind of experience only available in Los and superior functionality and flexibility, positions
Angeles. Los Angeles to truly elevate its standing as a first-tier
destination in California, the West Coast, and the rest
The core programming elements of the expansion of the world.
and modernization proposal, as submitted by the
design team, include expanding the West Exhibit Hall The expanded and renovated West Hall will be able to
to approximately 355,000 square feet; the creation divide into smaller arrangements and formats, as well
of a new, approximately 75,000-square-foot exterior as combine with the other spaces in the Convention
ballroom and exhibition space; a net addition of Center to accommodate multiple, concurrent events.
approximately 78,000 square feet of prime meeting By combining the primary exhibit space with the
room space, easily accessible from all areas of the additional meeting and ballroom space, the LACC is
campus; a new, approximately 97,000-square-foot positioned to offer two simultaneous packages, each of
Grand Ballroom located above the new exterior which would cater to the requirements of nearly 90% of
ballroom space; and a proposed, on-site headquarters the convention and tradeshow market.
hotel with at least 1,000 rooms.

department of convention and tourism development city of Los Angeles 11


The Meeting Room Core, stacked vertically above the Pico Promenade and open to natural light, will provide an active setting for
networking and social interactions.

The new Meeting Room Core is vertically oriented The centralized location of these meeting rooms is
above Pico Boulevard, as a bridge between the key for booking and stacking simultaneous events.
renovated West Hall and the existing South Hall. Breakout sessions utilizing this space is convenient
By making strategic use of operable wall systems, for general sessions based anywhere in the facility,
arrangement options for these rooms allow the including both the South Hall and the West Hall.
possibility of 1,800-square-foot meeting rooms,
5,400-square-foot rooms, and larger rooms. At least The 97,000-square-foot ballroom, currently referred to
two larger rooms at approximately 10,000 square as the “Grand Ballroom,” would create an “Authentic
feet each will also be a part of the new meeting room Los Angeles Skylight” with a ceiling of coffered
inventory. skylights that can let in daylight when desired, or
be blacked out for a dark room. As conceived, the
Grand Ballroom will become one of the most stunning

12 white paper: the future of the los angeles convention center september 2015
This approximately 97,000-square-foot rooftop ballroom will be the largest convention center ballroom in California.

experiences in the event business, with views out to and service access for a variety of full-scale events,
the Downtown skyline and an adjacent, outdoor space including social gatherings and exhibits.
that capitalizes on the City’s consistently pleasant
weather. From a pragmatic perspective, the internal In effect, the expanded program enables the LACC
arrangement of the Grand Ballroom can be customized to offer a variety of world-class event and meeting
to accommodate any configuration desired by the packages by reconfiguring the connections to the
convention industry, even serving a wide variety of uses South Hall, refurbishing and expanding the West
for multiple, concurrent events. Hall, adding a Grand Ballroom, adding a Meeting
Room Core, adding an outdoor, covered ballroom
An outdoor ballroom and exhibition space — an and exhibition space, and improving the overall
entirely unique, first-of-its-kind facility in the industry functionality of the campus.
— is located beneath the Grand Ballroom. This
75,000-square-foot space showcases California’s stellar
climate while providing lighting, utilities, pre-function,

The Grand Ballroom pre-function space blends the indoors with The outdoor ballroom and exhibition space connects guests
the Los Angeles skyline through expansive glass doors. to the destination experience.

department of convention and tourism development city of Los Angeles 13


The outdoor ballroom can be accessed by ascending the stairs from Pico Boulevard.

OPEN SPACE CONCEPTUAL PLAN


Just as important to consider are the spaces and places design tradition to structure the spaces and identify
located between the new buildings. Exterior spaces, various functions, such as large areas for event program
including a collection of unique paths, gardens, and and public gatherings, and shade and quiet for smaller
open space, create an active and flexible outdoor groups. Open spaces will include seating, pervious
setting throughout the landscaped areas on campus surfaces, stormwater capture systems, and native
and along adjacent streets. These open spaces vegetation.
naturally complement the increased programming
made possible by expanding and modernizing the The proposed Pico Promenade would become one
buildings on the LACC campus. The open space design of the most publically visible components of the
is also intended to strengthen the connection with the modernized campus, providing a pedestrian-focused
growing community of South Park by creating vibrant experience at the street level of Pico Boulevard that
and flexible public spaces available to the constituents connects visually to the vertically stacked space in the
of an emergent area of the city. heart of the campus serving the Meeting Room Core.

Each of these landscape and site planning components


considers architectural and regulatory elements, such
as building access points and emergency vehicle
access, but also works to achieve a more welcoming,
inspiring public realm. The patterns of the open space
areas also call on the rich mid-century Los Angeles

14 white paper: the future of the los angeles convention center september 2015
The re-designed Gilbert Lindsay Plaza, running alongside Figueroa Street and the side of the Convention Center, will serve as a zocalo,
or public square. Its park-like features will naturally lend itself to be valuable public space for the growing Downtown community.

This proposed design greatly improves the integration Pico Union and other neighborhoods to the west. Site
between the LACC campus and the larger urban circulation prioritizes the multiple modes of access to
experience of Downtown Los Angeles. The removal the campus: light rail, local and regional bus routes,
of the existing West Hall Lobby and the West Hall and bicycle and pedestrian routes. The plan also offers
Meeting Rooms creates a direct, gracious pedestrian automobile access that does not conflict with the
link between the Convention Center campus and L.A. human-scale experience of entering and leaving the
Live to the north. Moreover, major loading and service campus. The result will be an active, urban district that
vehicle access has been removed from Pico Boulevard, accommodates a multi-modal environment.
creating a safe pedestrian environment that links to

Site circulation of the project design greatly improves integration with and access to the surrounding neighborhoods.

department of convention and tourism development city of Los Angeles 15


YARD
JW COURT CE INN OLYMPIC
N
EXPANSION RESIDE BLVD

REGAL L.A. LIVE


CINEMAS
JW MARRIOTT
JW/RITZ CARLTON RITZ-CARLTON
MEETING ROOMS L.A.
LIVE

MI PLAZ
GEORGIA ST

CR A
JW

OS
EXPANSION MICROSOFT 11TH ST

OF
Y

MEETING THEATRE
WA

T
ROOMS
REE
F

CHICK HEARN CT
10

A ST
POTENTIAL

FIGUERO
ON-SITE HOTEL STAPLES

R ST
CENTER

FLOWE
LACC
LA LIVE WAY

WEST HALL

PICO BLVD

LACC
SOUTH HALL

POTENTIAL
ON-SITE HOTEL

VENICE BLVD

110 FR
EEWAY

16 white paper: the future of the los angeles convention center september 2015
An artist’s concept rendering looking south from L.A. LIVE toward the Convention Center’s Georgia Street Entrance and outdoor ballroom.

lacc + L.A. LIVE Campus space offerings


With the proposed design’s improved circulation
EXHIBIT HALL SPACE 865,000 SQ FT
between the LACC and L.A. Live, transitioning between
the two campuses could be more seamless than MEETING ROOMS 206,000 SQ FT
LACC

ever before. Convention and hotel guests will have BALLROOM 97,000 SQ FT
convenient access to the full range of amenities offered OUTDOOR BALLROOM 75,000 SQ FT
at L.A. Live, including world-class restaurants, Regal
FUTURE ON-SITE HOTEL 1,000 ROOMS
Cinemas, the Grammy Museum, Lucky Strike Lanes &
Lounge, and its popular live sports and music venues. ENTERTAINMENT VENUES 45,000 CAPACITY
The campus hotels also deliver additional meeting OUTDOOR VENUES 165,100 SQ FT
L.A. LIVE

room space, which could supplement larger shows at


OTHER VENUES 5,000 CAPACITY
the LACC, allowing for even greater market capture.
HOTELS 1,394 ROOMS
NEW L.A. LIVE HOTEL (2018) 755 ROOMS
HOTEL EVENT SPACE 100,000 SQ FT

sustainability
The LACC, City Council, and Engineering have such as solar thermal and photovoltaic panels,
committed to a Leadership in Energy and stormwater capture and reuse, greywater harvesting,
Environmental Design (LEED) Gold Certified project, and upgraded heating and cooling systems. Other
ensuring that the modernized LACC will continue its sustainability strategies include a “Green Gateway”
commitment to environmental stewardship. façade adjacent to the 110 Freeway that would double
as a public art installation and a living wall that removes
The winning design proposal includes suggestions to carbon dioxide from the atmosphere.
go beyond LEED Gold, if funding can be identified.
The proposal includes pathways toward net-zero
energy and net-zero water, utilizing optional features

department of convention and tourism development city of Los Angeles 17


Cost Estimate & Finance

Cost Estimate Finance


The City’s design competition estimated construction The Mayor and City Council have charged the CAO
costs of $350 million, plus an additional $120 million with the development of a financing plan for this
for “soft costs,” such as architecture, engineering, project, which is one of the deliverables due to the City
permitting, etc., for a total project cost of $470 million. Economic Development Committee in November. The
The actual project budget may vary, pending deeper CAO will look at conventional as well as alternative
analysis of program goals and desired outcomes during financing strategies.
the concept refinement phase of design.
Direction on a financing plan will depend upon the
To ensure the feasibility of the program and project CAO’s findings when reporting back to the City Council
goals stated in their design competition submission, in November 2015. At that time, the CAO will report
the design team engaged two professional estimating on all available options, but will not rely on only
organizations: C.P. O’Halloran Associates, a one General fund tax as the entire General Fund is
construction cost estimator, and Clark Construction responsible for the debt service of the LACC.
Company, a general contractor. Both organizations
indicated that the conceptual design with the
assumptions made by Populous could be built at just
under the $350 million target.

18 white paper: the future of the los angeles convention center september 2015
schedule
LACC EXPANSION PRELIMINARY PROJECT SCHEDULE
2016 2017 2018 2019 2020
TASK Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
ENVIRONMENTAL IMPACT
REVIEW & APPROVALS

CONCEPTUAL DESIGN
(REFINEMENT)

SCHEMATIC DESIGN

DESIGN DEVELOPMENT

CONSTRUCTION DRAWINGS

CONSTRUCTION PHASE I

CONSTRUCTION PHASE II

Provided all necessary approvals for project delivering a strong continuity of business plan for LACC
commencement are obtained in November 2015, clientele. Current thinking has an early construction
the project would begin in earnest in January 2016, package starting mid-2017, with two additional
beginning with the concept refinement phase of phases that will prioritize the early completion of the
design and the Environmental Impact Report effort. new meeting rooms over Pico, with ultimate project
Project design is estimated to take approximately two completion in December 2020. The phasing schedule
years overall, until late 2017 or early 2018. Phased will adjust and solidify as the project is clarified during
construction is anticipated to maximize the availability the early stages of the design process, and with the
of the LACC’s existing operating space inventory while input of a general contractor.

Looking toward the northwest, the new meeting rooms span the transformed Pico Boulevard.

department of convention and tourism development city of Los Angeles 19


hotel development

Hotel Indigo
2016 2017
350 ROOMS 900 ROOMS
interContinental
Los Angeles Downtown

2020 2018
W Hotel Hotel Cavalli

250 ROOMS 183 ROOMS

20 white paper: the future of the los angeles convention center september 2015
hotel rooms within walking distance
of convention centers
Competitive and comparable facilities
19,167
SAN FRANCISCO, CA 18,925
17,020
LAS VEGAS, NV 17,092
10,709
ANAHEIM, CA 11,383
10,676
ORLANDO, FL 10,803
9,091
8,243
8,996
SAN DIEGO, CA
8,224
8,614
NEW ORLEANS, LA
5,179
ATLANTA, GA 8,317
3,172
HOUSTON, TX 5,179
2,692
1
LOS ANGELES, CA 3,172
1,700
NEW YORK, NY
1
2,764
2
CHICAGO, IL 2,692

0 5,000 10,000 15,000 20,000


Reported by CSL, 2015
1- Reported by CTD Department, 2015
2- Reported by CSL, 2014

hotels
The existing and planned hotels in proximity to the largest and most lucrative conventions, such as: the
LACC are critical to the success of the future LACC. Orthopedic Surgeons Association (32,000 attendees),
For years, the LACC has struggled with the “chicken the American Society of Hematology (35,000
or the egg” problem of not having the convention attendees), the American Heart Association (28,000
center business to drive the development of new hotels attendees), and the American College of Cardiology
— and the opposing problem of not having sufficient (28,000 attendees). Each medical event of this size
hotel stock to drive convention center business. The could generate approximately 50,000-58,000 room
booming Downtown hotel market, including large nights and $55-65 million in economic benefit to
investments in the immediate area around the LACC Los Angeles (source: LATCB, 2015).
campus, has completely redefined that dynamic.
The LACC needs approximately 8,000 rooms within
According to a 2014 report by CSL, the number of walking distance to be in a position to accommodate
hotel rooms within walking distance of the LACC can about 90% of the convention market. As of September
accommodate only 74% of the national convention 2015, the LACC has 3,172 hotel rooms within walking
market’s hotel room requirement. Convention centers in distance.
San Diego, Anaheim, and San Francisco can meet 92-
99% of the market’s needs. By lacking sufficient hotel
stock in the area of the LACC, Los Angeles immediately
forfeits 26% of the national convention business.
Moreover, that portion of the market represents the

department of convention and tourism development city of Los Angeles 21


The JW Marriott Expansion, offering 755 new rooms in 2018, will make this headquarters hotel the largest
hotel in Los Angeles with 1,633 total rooms.

The inaugural fiscal year 2012-13 CTD Department regional competitiveness, and should be considered a
Action Plan set an initial goal of 4,000 new hotel rooms fundamental component of this proposal for the future
by 2020 (in addition to the supply of 2,597 rooms at of the LACC. A request for interest (RFI), administered
the time of the Action Plan). In the 2013-14 fiscal year, by Strategic Advisory Group, LLC, and the City
575 rooms opened and another 1,767 are currently Economic and Workforce Development Department,
under construction. An additional 1,130 rooms are in will survey hotel developers and operators regarding
the pipeline and expected to start construction in the this project. The RFI will be reviewed by City Council in
near future, for a near-term total of 3,472 new rooms November, and will help inform the design refinement
and a new grand total of 6,069 rooms. of the Convention Center expansion.

Adding 4,000 new hotel rooms by 2020 remains an It is also important to note that additional sites within
essential component of the CTD Action Plan. The the immediate area remain available for future hotel
LACC campus offers enough land, as shown in the development. Upcoming transit access to Santa
design proposal, to build a large, 1,000-room hotel, Monica, LAX, and other parts of the region, as exists
which would include an additional 100,000 square feet in Chicago and New York City, would further enable
in ballroom and meeting room space. That addition will Los Angeles to compete for convention business at a
put the LACC into a whole new level of national and national level.

22 white paper: the future of the los angeles convention center september 2015
hotels within walking distance of the lacc

EXISTING AS OF JULY 1, 2013 UNDER CONSTRUCTION


13 InterContinental Los Angeles Downtown 900
1 JW Marriott Los Angeles L.A. LIVE 878
14 Hotel Indigo (Metropolis) 350
2 Sheraton Los Angeles (The Bloc) 485
15 Empire Hotel 183
3 Figueroa Hotel 285 16 Cavalli Hotel (Oceanwide Plaza) 183
4 Stillwell Hotel 232 17 Case Hotel 151
5 Mayfair Hotel 215 Subtotal 1,767
UPCOMING
6 Luxe City Center Hotel 175
18 JW Marriott Expansion 755
7 Ritz Milner 137 19 dtLA South Park 300
8 Ritz-Carlton, Los Angeles 123 20 W Hotel (Figueroa North) 75
9 O Hotel 67 Subtotal 1,130
OPPORTUNITY SITES
Subtotal 2,597
21 LACC 1,000
OPENED FISCAL YEAR 2013-2014 22 Pico Blvd + Figueroa St 750
10 Residence Inn Los Angeles L.A. LIVE 219 23 Olympic West 600
11 Ace Hotel 182 24 Genting Property 600
25 9th Street Sites 400
12 Courtyard Los Angeles L.A. LIVE 174
26 Pico + Hope/Flower 350
Subtotal 575
Subtotal 3,700
TOTAL EXISTING 3,172 TOTAL FUTURE 6,597

TOTAL ROOMS EXISTING & FUTURE: 9,769

department of convention and tourism development city of Los Angeles 23


CONCLUSION

The outdoor exhibition and ballroom space could accommodate a wide variety of programming, including award ceremonies.

The simple truth is that the Los Angeles Convention Similar investments in the future prosperity of
Center is at a historic crossroads. Over the last 20 years, Los Angeles in the global economy are well underway
the LACC has made no major physical improvements, at the Port of Los Angeles and the Los Angeles
while over the same period, cities like San Diego, International Airport. As the second largest city in the
Anaheim, and San Francisco, as well as many other nation, the U.S. capital of the booming Pacific Rim,
cities around the nation, made significant investments and one of the most recognized urban brands in the
in their convention centers. world, Los Angeles should boast a convention center
commensurate with its global status, or it will yield its
If Los Angeles continues to do nothing while market share to smaller cities with fewer assets.
competitor cities continue to do more, the LACC will
fall into irrelevancy as a national and international All of the pieces are in place — political support,
convention center. The LACC could simply become a a world-class design proposal, a steadily growing
big hall for hosting consumer shows — routine events economy, and a vibrant neighborhood and city — to
that attract local residents, but not the thousands of out redefine the future of the Los Angeles Convention
of town conventioneers who inject millions of dollars of Center.
new revenue and thousands of new jobs into the City
and region.

24 white paper: the future of the los angeles convention center september 2015
credits
board of Los Angeles convention and tourism
development commissioners

Jon F. Vein Ray Bidenost Otto Padron Stella T. Maloyan Jeremy Bernard
President Vice President

Los Angeles convention and exhibition Center authority


From left to right:
Ingrid Hutt
Courtney Reum
David S. Cunningham, Jr.
Martin Cooper
Peter J. Gravett
Cheryl C. Turner, Vice President
Wayne Avrashow, President
Jason Seward
Majib Siddiquee
Keith Martin
J. Richard Leyner
Raymond Bishop

not pictured:
Robert R. Mallicoat

Los Angeles Department of


Convention and Tourism Development

Robert “Bud” Ovrom Thomas Fields Diana Mangioglu


Executive Director Assistant General Manager Assistant General Manager
Operations Finance & Administration

white paper production


Kim Nakashima, Editor James Brasuell, Writer Stephen Sampson, Art Director

Cristine Villorante, Executive Administrative Assistant Adria Ybarra, Commission Executive Assistant

department of convention and tourism development city of Los Angeles 25


www.lacclink.com
1201 S. Figueroa Street
Los Angeles, CA 90015
Ph: (213) 741-1151
Fax: (213) 765-4441

Special thanks to Los Angeles Tourism & Convention Board and AEG Management LACC,
LCC for their support of this publication

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Printed by YWCA Greater Los Angeles Digital Learning Academy, a jobs training program

means from the forest to the printer, this paper is produced following Reduce. Reuse. Recycle.
the most sustainable practices currently available. It’s Our Responsibility.

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