Filming and parking fees help power LA Convention Center operating profit of $4.1m

AMERICAS – The Los Angeles Convention Center (LACC), managed by AEG Facilities, claims to have exceeded its revenue and operational expectations for the 2014-2015 fiscal year. The LACC posted an operating profit of US$4.1m for the year ending 30 June 2015, out of which it must reimburse the City of Los Angeles $1.5m for the Department of Convention & Tourism Development (CTD) overhead. Since it took over management of the venue in December 2013, AEG Facilities has generated a total operating profit of approximately $5m. AEG Facilities is also aiming to build a financial reserve of $2.1m within the five years of its initial management agreement. This goal looks likely to be achieved well before the five-year mark, as AEG Facilities has added $2m to the reserve within 19 months of managing the LACC. Financial achievements during fiscal year 2014-2015 include a 43% increase in filming revenue compared to the previous fiscal year, a 4% or $369K increase in parking revenue, and an increase of 11% or $727K in rental revenue compared to the prior year. The profit, management says, will allow it to reinvest further in the LACC; a total of $1.284m has been spent on additional Capital Improvement Projects (CIP) and Alteration & Improvement Projects (A&I). “For the second year in a row, the LACC has concluded the fiscal year with an operating profit. This is important for the improvement of the facility because it leads to direct spending on vital A&I projects and aligns with our shared goal of transforming the LACC into a truly world-class destination for meetings, conventions, and special events,” said Bud Ovrom, executive director of the Los Angeles Department of Convention & Tourism Development. The CIP and A&I projects include purchasing lobby furniture; replacing 700 toilets with low-flush technology units to further reduce water consumption in the height of California’s drought; upgrading kitchen equipment; and updating concessions areas with new furniture and video boards. Overall $10m in Capital Improvement Projects are set to be completed this year and the city has also approved approximately $10m in Capital Improvement Projects for the next fiscal year (FY ‘15-16). Budgeted projects include replacing the South Hall lighting system, additional carpet replacement, upgrading security ramp gates, and restroom remodelling.