Consultant: Virginia Beach Convention Center generated $76M in local visitor spending in 2023; revenue covers 63% of operating costs

Adam Sachs of Tourism Economics (an Oxford Economics company) told Virginia Beach City Council that the city’s convention center generated $76 million in off-site visitor spending in 2023 and supported an estimated 814 jobs across the local economy.

Sachs, the consultant hired to benchmark the center, said his team limits the impact calculation to off-site spending by attendees — lodging, restaurants, shopping, transportation and recreation — and then models indirect and induced impacts through local supply chains and household spending. “$76,000,000 was spent by attendees to events at the convention center in the local economy in 2023,” Sachs said, adding the category breakdown included roughly $27 million in lodging, $24 million in restaurants, $10 million in shopping, $9 million in local transportation and $6 million in recreation.

Sachs said those direct impacts ripple through the local economy, producing about $10.8 million in additional economic activity and generating $9.8 million in combined state and local taxes; about $5.1 million of that tax revenue was local taxes, including roughly $2.5 million in hotel taxes. The consultant said the total economic activity the center catalyzed supported 814 jobs in 2023.

To evaluate the facility’s operating performance, Sachs compared Virginia Beach with 11 other convention centers and reported that the city’s center’s operating revenues covered about 63 cents of every dollar of operating expense. He said two commonly cited opportunities to improve the operating coverage ratio are (1) collecting parking revenue and (2) having a headquarters/attached convention hotel. Virginia Beach currently does not capture parking revenue at the level some peer centers do.

Sachs and staff emphasized that a broader fiscal lens — adding taxes generated by visitor spending — changes the arithmetic: when local tax revenue produced by the center is added to the center’s operating revenue, the facility becomes a net generator of tax revenue for the city. “If you add that [local taxes] to this calculation, to the revenue, you would be, well over 1,” he said, adding that “just the hotel taxes get you over 1.”

Council members and staff asked about the center’s mix of events (Sachs said consumer shows and sporting tournaments accounted for a large share of attendance and that trade shows/conventions represented about 12% of participant nights), utilization rates and strategies to increase convention- and trade-show business. Sachs said the center’s convention share is “on the low side” compared with many peers and that factors such as air access, an attached headquarters hotel and additional on-site food-and-beverage outlets can shape the facility’s ability to attract multi-day trade shows.

Staff committed to provide more granular utilization and “pickup” data in a Friday packet. Council members flagged short- and long-term operational challenges — particularly peak-period parking and shuttle logistics for large sporting and recreational weekends — and asked staff to return with options, which will be reflected in future briefings and budget conversations.

No formal council action was taken at the session; the presentation was provided in response to a December 2023 request for an economic-impact and operating-income analysis and to inform future decisions about facility management and resort-area planning.