Monday, June 1, 2020

Convention District Authority reinvents itself to face new COVID-19 reality

By on May 22, 2020

(Screen capture of www.prconvention.com)

SAN JUAN — The new reality of social distancing imposed by the COVID-19 pandemic that has been affecting Puerto Rico since March has led the Convention District Authority to contemplate a new business model for the use of its facilities, which were designed to hold massive events that are now prohibited.

Authority Director Noelia García explained that what started as an initiative to give the island’s population a breather amid the confinement orders, has become a new model that will allow the agency to continue operating and generating income while large gatherings are banned.

After holding the first virtual concert in the José Miguel Agrelot Coliseum, officials at the Authority—which is a public nonprofit corporation established to promote, finance and grow facilities—realized the market was ripe to sponsor this type of event, which could become a new way to hold concerts and present other types of entertainment.

The first of these events was a concert by urban music performer Rauw Alejandro, held last weekend as part of the Quarantine Live Concert series of live-streamed performances.

“This concert began trending #1 in ten countries (in Latin America). So while the Coliseum has a capacity of 18,000 people, this show managed to reach half a million live viewers, not counting those who have seen the recorded show,” Garcia said.

The official said several producers have approached her to rent one of the three venues under the District’s purview—the Convention Center in Miramar, the José Miguel Agrelot Coliseum in Hato Rey and the Bahía Urbana waterfront park in Puerta de Tierra—and perform their shows from there to broadcast virtually.

“We can provide producers and artists the platform to do their shows with the sound quality, lighting and technical effects they need,” she said, explaining that the reach these virtual events can have makes them attractive for brands to use as a platform to promote their products.

At the same time, an opportunity is created for the development of a pay-per-view market.

“The interesting thing about this model is that it can be marketed globally,” García said. The business for the District, however, is limited to renting the space, but it fosters economic activity for a sector that would otherwise be limited in its ability to generate income while the pandemic forces the avoidance of crowds.

In addition, García said the agency they requested a waiver from the Chief of Staff’s Office to allow them to celebrate graduations next month in Convention Center property with the graduates in the cars.

Capital improvements

She explained that during these months that the District’s facilities have been empty, an $8 million allocation was authorized to make capital improvements. Among the tasks to be carried out are repairing the Convention Center’s iconic fountain; performing maintenance on the Convention Center and the Coliseum’s air conditioning system; and waterproofing the facilities’ roofs.

Repairing the large fountain area, as well as improvements to the Convention Center District’s infrastructure, have been on the agenda since 2018.

Both the coliseum and the Convention Center are being equipped for when they can start receiving people with cameras that can measure temperature, tunnels to spray disinfectant and hand-sanitizing stations. In addition, masks will be provided to visitors of all the facilities.

García indicated that the emergency has allowed prioritizing initiatives that considered greater use of technology, saying that they are working on the development of an application to order food and beverages at the coliseum kiosks.

In the red

Despite these initiatives, García acknowledged that the Authority will close this fiscal year, which ends June 30, in the red by millions of dollars due to the cancellations of events since the beginning of this year, first because of the earthquakes and then the pandemic.

“This year, we have a deficit of $5 million, so we are going to require a special allocation. We have already made the request and it is being considered,” García said. The request was made to the Office of Management and Budget (OMB), the Fiscal Agency and Financial Advisory Authority and the Financial Oversight and Management Board.

“Our goal is to break even,” she said.

The Authority’s annual budget is $38 million and includes $4.5 million of the hotel room tax. The rest of the operating funds come from the rent of space for events and shows.

García anticipated that for fiscal 2021, they will also request a special $10 million allocation because they do not contemplate resuming regular operations until after October.

“We have not sent the final number but the verbal request has been made” to OMB, García said.