Business Excellence Awards
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Burt Jagolinzer, general manager of Access Tours of Newport, never hides his pride when he recounts the celebrities who’ve climbed into his company’s vans and executive cars to see the city’s mansions, or to look out over the sea from scenic Ocean Drive.
His guides have shown their city to Bill Cosby, Sophia Loren, Tony Bennett and Barbara Streisand, among others.
But while he enjoys telling folks about his famous customers, he’s more concerned about the less well-known ones, the everyday visitors who pay the bills. Most years a large percentage of them are the people who come to Newport for conventions, conferences, seminars and company outings. “Before the recession, we used to get a lot of corporate America,” he said. “We keep hearing they’ll be back this year. We’ll wait and see.”
Jagolinzer can relax. While some parts of Rhode Island’s economy are still mired in the Great Recession, the slowdown has ended for the convention industry. And that’s good news for hotels and restaurants and hundreds of other businesses as well, from tour companies and limo services to downtown retailers and theaters.
“We’ll see an increase in convention business in Providence this year,” said Martha Sheridan, president and CEO of the Providence-Warwick Convention & Visitors Bureau. “The conventions we had in 2011 were booked two or three years earlier, when the recession was taking hold. As the economy started to recover, conventions went up nationally. We’re close to pre-recession levels now.”
Tim Walsh, vice president for sales at the Newport & Bristol County Convention & Visitors Bureau, said the area is “on track to beat all the numbers from last year. The economy has started to come around.”
For the hospitality business, the recovery has actually been building for a couple of years. The numbers tell the story. Last year conventioneers spent 77,000 room nights in hotels in Providence and Warwick, according to Sheridan. This year, that number is expected to rise to 90,000 room nights. The total occupancy rate of area hotels has been rising, too – from 56.5 percent in 2009 to 64.9 percent in 2011.
Newport doesn’t have the same sort of convention facilities as Providence, so the focus there is on smaller events, such as mini-conventions, seminars, sales-incentive meetings, and VIP gatherings. Nonetheless, that city has some impressive numbers, too. Last year Walsh’s agency generated 240 meeting inquiries, and booked 124 of those callers. This year, with a month still left on the booking calendar, they’ve fielded 237 inquiries, and 121 have gone to contract.
“We were happy with last year’s conversion rate,” he said, “But this year we’re going to beat those numbers.”
At the R.I. Convention Center, General Manager Tim Muldoon is talking up an impressive list of conventions booked for this year. “I’m showing 19 over the next 12 months, and some of them are very big,” he said. “We’re optimistic.”
Top events on the list:
• Alpha Kappa Alpha, the college sorority, gathers in Providence in April, with 2,700 attendees expected.
• More than 2,500 are expected at the June convention for Netroots Nation, an organization for liberal bloggers and activists seeking to build an Internet presence.
• In July Providence will play host to 2,200 members of the National Strength and Conditioning Association.
• In February 2,000 people attended the American Choral Directors Association’s Eastern Conference.
The financial impact of such events is impressive. The convention industry was still recovering in 2010, the last year for which numbers are available, but even then the estimates of the direct-spending impact came to $90 million for the state.
That’s especially important when the local economy is weak. While locals might be hanging onto their dollars, conventioneers from out of state have money to spend. They’re shopping in stores, going to shows, hailing cabs and bar hopping. Hundreds of businesses depend on that windfall.
“About 40 percent of our business comes from the hotels in town, so when they’re occupied things really pick up,” explained Terry Sanborn, general manager of Hemenway’s Seafood Grill & Oyster Bar, an upscale eatery at the foot of College Hill in Providence. “Everyone in the hospitality business will tell you the same thing. Hotels, restaurants, bars and retailers are definitely affected.”
Sanborn is quick to add the upswing in conventions is already lifting the restaurant: Business was up 20 percent in January and February.
At McGrath Clambakes & Catering in Newport, owner T. R. McGrath shares the optimism. The beach-side feasts his company serves up often feed those attending corporate events. “Our bookings are up,” he said. “Last year was pretty good, too. I’m not saying the recession is over, but we are seeing a greater willingness by companies to entertain, and that’s a positive indicator.”
Showing off the local arts scene, the state’s beaches, or other attractions can have a boomerang effect that continues to boost the state’s economy long after a convention has gone. “The people who come for conventions become next season’s tourists,” said Walsh. “They get a taste of the state and they want to come back. The repeat visitation rate is enormous.”
Why do conventioneers come to Providence? The culinary offerings, the arts scene, and the city’s historic character are all attractive to visitors, of course, but there are other reasons as well. “Convention planners typically choose Providence because of our location,” said Sheridan. “We’re accessible by air, train, and auto. A large percentage of the country’s population lives within a three-hour drive.”
Newport offers the same accessibility and its own unique attractions as well. “Everyone’s heard of Newport,” said Walsh. “It’s not hard to convince someone they have to attend a meeting here.”
This year some corporate gatherings will also land in Westerly, at the Ocean House, an upscale hotel on the beach.
“We forecast a 20 percent increase in group business over last year,” said Daniel Hostletter, the hotel’s president and general manager. “One reason for the big jump is that we’ve had a full year to sell. We opened in June 2010, so we didn’t have the same opportunity last year.” •