Half of the Gas South District, including its ballroom, was closed in 2022 due to a major renovation. But the convention center still managed to have its best financial year in its three-decade history, according to center officials.
The Gwinnett County Convention and Visitors Bureau Board of Directors received an update on the 2022 Southern Gas District financial situation as well as event attendance last Wednesday. What they heard from Jennifer Silas, who is the center’s chief financial officer, is that net income hit an all-time high last year.
Even if the grant funding that the Southern Gas District had received during the pandemic were removed from the equation, the center’s revenue last year would still be one of the best financial years in its history.
“It’s a little bit skewed because we rolled over some of the operating grant money in 2022,” Silas said. “But, even if you discount that, (it was) still a top-5 year since the arena opened.”
The Gas South District, which will open the newly renovated portion of its building on Wednesday, had net income of nearly $5.1 million last year.
The Gas South District generated $8.3 million in event revenue and nearly $6.8 million in other operating income, for a total of nearly $15.1 million in gross revenue. When center officials were budgeting for 2022, by comparison, they only planned to raise $9.6 million last year.
On the expense side, the Gas South District had $10 million in expenses last year.
And that was with only half of the Gas South District open to the public, while the other half, including the ballroom, was dismantled and rebuilt. The renovated part of the center will reopen to the public with a grand opening celebration this week. The first events in the renovated ballroom will take place on Thursday and Friday.
Gwinnett Convention and Visitors Bureau executive director Stan Hall said it stands in stark contrast to the fact that the center almost had to close its doors during the COVID-19 pandemic.
“For 2022 to be the best financial year we’ve ever had in our history is quite a remarkable statement,” said Gwinnett Convention and Visitors Bureau Executive Director Stan Hall.
Gwinnett County Commission President Nicole Love Hendrickson said the fact that the Southern Gas District did well speaks to how the convention industry views Gwinnett County. Hendrickson was appointed by the county commission to fill one of her two seats on the CVB board this year, making last Wednesday her first meeting.
“It’s absolutely amazing because when I hear that, I hear that people choose Gwinnett as a destination and that, in turn, generates income,” Hendrickson said. “I’m thinking (special purpose local option sales tax revenue).
“That goes back to our SLOST fund, and those go back to investments in the community that translate into real investments: our roads, our parks, our libraries, our facilities.”
As a step?
Hall said South Gas District staff came up with some new ways to generate revenue in 2022. The center launched a new speaker series in the fall, for example.
Filming projects and stadium events also helped generate some revenue for the center last year.
“They really came together and created income opportunities that we’ve never sought or experienced before,” Hall said. “The film industry was a great partner of ours, as it is today.
“And, (film location scouts) love our campus because, whether it’s the theater or it’s the arena or whether it’s our convention center, our lobby, our plazas, there’s a movie scene waiting to be seen on almost any one of them. So when things have darkened on certain weeks, we intentionally schedule those weeks for things like that.”
Hendrickson said his counterparts in other metro Atlanta counties have also been trying to see how they can keep up with what Gwinnett has done, which has doubled its convention space due to renovations. Cobb County officials have just announced, for example, that they are planning investments to upgrade the similarly aged Cobb Galleria.
The expansion and renovations of the Southern Gas District will also be the focus of the main presentation at the International Association for Facilities Management meeting in March.
“They are a model of how to get things done and how to continue operations in the midst of a lot of development and construction,” Hendrickson said. “I know that some of my peers in the metropolitan area are now looking in their communities to see what they need to do to raise the tourism piece.”
Event attendance declined during renovations despite higher revenue
The higher-than-expected revenue came despite attendance at the center, including the Gas South Arena, remaining below pre-COVID-19 numbers.
But, officials said attendance in 2022 wasn’t too far off the 2019 numbers.
There were 383 events in the Gas South District last year, up from 486 in 2019. That’s largely because there were fewer events in the convention center area due to renovations.
The convention center hosted 200 events last year, up from 307 in 2019. Similarly, the Gas South Theatre, which was closed for the entire month of August for renovations, hosted 55 events last year, up from 66 in 2019.
However, the Gas South Arena saw an increase in events. It hosted 128 in 2022, while it hosted 113 events in 2019.
As a result, 879,584 people attended campus-wide events in the South Gas District last year, up from nearly 1.1 million in 2019.
Southern Gas District officials hope big-name concerts will return
While some of the lower attendance numbers can be attributed to fewer events at the theater and convention center, the arena also had fewer attendees.
Hall said that’s a result of bigger acts that could have come to the arena before the pandemic chose to go on their first tours after having to be off the road during the COVID-19 pandemic as they tried to recoup lost revenue by going to bigger venues, like State Farm Arena.
“Some of these acts haven’t toured for two years and it makes a lot of sense that you’d try to go somewhere that gives you more opportunities for ticket sales just based on the numbers,” Hall said.
The center’s staff took a different approach to make up for the fewer big-name acts that came to the stadium last year. They scheduled smaller acts that, while not expected to draw as many people as the larger acts, still drew some attendees and revenue for the arena.
“On the concert side, maybe we had fewer Class A events that you knew would sell out, we went out and approached groups that probably wouldn’t sell 13,000 (tickets), but would sell 7,000, and then we’d do two or three of those in a row,” Hall said. “So you’ve found what you lost in that Class A event.”
In the long run, though, Hall hopes that once artists have finished recouping losses from the pandemic, those tours will start to return to the arena because of the experience it provides artists.
“They’re going to start to branch out and they’re going to think about things like acoustics and they’re going to think about customer service and the experience they had with the staff, and that’s where all our strengths are,” Hall said.
In fact, the arena is already seeing the return of some big acts this year.
Brooks, Dunn and Sam Smith are all set to perform in the arena this year. Hall teased that other major announcements about artists coming to the arena are expected to be made within the next month or two.
“Our reservations manager is very well established,” Hall said. “He’s one of the top booking agents in the Atlanta area, well known in the entertainment industry and I’m very comfortable about where we’re going to go on that.”
An upcoming act in the arena that Gas South District officials are looking forward to is Zach Bryan. Tickets have yet to go on sale for the country singer, who got his start on TikTok, but officials are hoping it will be a great series of shows.
“They think he can sell out two shows,” Hall said. “That’s not even out yet and our calls we’re getting about it are just phenomenal. It’s a very hot act right now.”
Hendrickson said he’s looking forward to big-name artists coming to the Arena again.
“I remember coming here and seeing Beyonce in concert, and seeing Sam Smith in the lineup, I absolutely love Sam Smith,” she said. “Having artists like those shows the region and the state that Gwinnett is a player when it comes to concerts and events. We want to be seen as the ultimate destination.”
But, with renovations to the convention center now complete, big acts beginning to return, and a Westin hotel on site expected to open late this year or early next year, Hendrickson hopes to continue setting financial records in the Southern District of Gas.
“The bar is set, now is the time to raise it,” he said.
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