PROVIDENCE – Oak View Group LLC, a Denver-based venue management and hospitality services company, is officially the new manager and operator of the R.I. Convention Center, Amica Mutual Pavilion and the three adjacent parking garages, the R.I. Convention Center Authority announced Monday.
Oak View Group, which started managing the authority’s properties on Monday, takes over for Los Angeles-based ASM Global as manager and operator of the state’s largest arena and convention center.
“Providence has always been an outstanding market for live entertainment. Some of our executives have come up through the industry through Providence and this will be an exciting time for many of us as we reignite the market and make it a must-play stop, as well as a popular destination for meetings and convention,” Oak View Group President of Venue Management Greg O’Dell said in a statement.
RICCA Executive Director Daniel P. McConaghy told Providence Business News on Monday that the initial five-year agreement between the quasi-state authority and Oak View Group to manage and operate the facilities includes the option for two additional five-year extensions if RICCA is satisfied with Oak View Group’s performance. There is an annual $200,000 fixed fee the state will pay Oak View Group, but the agreement is also full of performance-based incentives for the management group to meet for the AMP and convention center “that pay a certain percentage above” what the facilities are currently doing to increase activity there and “take them to the next level,” McConaghy said.
McConaghy said the AMP and R.I. Convention Center have generated a combined $7 million in gross margin over the last couple of years from events. With the new agreement, McConaghy says Oak View Group is willing to “put their money where their mouth is” and bring in additional events that will financially benefit both the management company and the state.
Additionally, Oak View Group subsidiary OVG Hospitality will become the R.I. Convention Center’s new food and beverage provider, and caterer. The authority says OVG Hospitality will create “new and exciting dining experiences,” including partnering with local food vendors and purveyors with “a specialty menu” highlighting New England delicacies.
McConaghy noted that Oak View Group, per the agreement, will earn a percentage of the authority’s parking gross margin, food revenue and net food expenses. Regarding the food, McConaghy said the authority in the agreement put a “smaller piece” of the incentive on the net operating expenses because the authority did not want to create an environment where Oak View Group was compromising food quality.
“All of these incentives are geared toward to help us grow,” McConaghy said. “We feel we have all these incentives placed on reinforcing positive behavior from them. They more they do, the more the authority and the state of Rhode Island does better.”
McConaghy also said other agreements the authority has with other event groups, such as the Providence Warwick Convention & Visitors Bureau and the Providence Sports and Entertainment Agency – which handles the Providence Bruins – will not be impacted with Oak View Group coming on board.
Back in May, ASM Global filed a Worker Adjustment and Retraining Notification, or WARN notice, with the state indicating that it would lay off 1,029 employees effective Sunday.
However, Oak View Group – which was unanimously decided on by the authority’s board back in March to become the new manager and operator – on Monday stated that it will retain the current staff at the authority’s properties and “utilize the synergies” of its other New England-area properties to help attract new events into Rhode Island’s capital city. Oak View Group provides management services for 12 other New England-area facilities, including at the Ryan Center on the University of Rhode Island campus.
McConaghy says Oak View Group has a “very strong relationship” with Live Nation, the prominent national events promoter. By adding Providence into its portfolio, the AMP and convention center folds into Oak View Group’s ability to route various acts into the area, McConaghy says.
“Just the fact they have the leverage an act saying ‘hey we want to you to hit Hartford, Conn., but also want you to hit Providence as well’, that put us in line to get that action,” McConaghy said. “It is our desire for [getting more acts] here. Everyone is moving in the right direction in terms of everybody having an interest to have more acts and concerts in our buildings.”
(UPDATED throughout to include comment from Daniel P. McConaghy.)
James Bessette is the PBN special projects editor, and also covers the nonprofit and education sectors. You may reach him at Bessette@PBN.com. You may also follow him on Twitter at @James_Bessette.