Mid-America Center
Posted: Sun Nov 14, 2004 11:06 am
I'd like to see both of these facilities have great success. Â
Omaha World Herald wrote: Mid-America Center hopes to rival Qwest's draw
COUNCIL BLUFFS - When Cher sang "Believe" during two sold-out performances in the Mid-America Center 18 months ago, Council Bluffs leaders believed they had a winner.
That early success hasn't been matched since the Qwest Center Omaha opened, leaving many Bluffs officials singing the blues.
Now they hope to find money to help the MAC compete.
The Mid-America Center rang up $550,000 in operating losses in the fiscal year that ended June 30, raising total losses since the facility opened in October 2002 to $900,000.
The financial results at the MAC are worse than projected by SMG, the private company that manages the arena and convention center. SMG had forecast a $155,000 loss the first year and a $230,000 profit in the second.
By contrast, the Qwest Center generated a $1.1 million operating profit in its first 10 months after opening in September 2003, beating a projected loss in its first year.
The city-owned MAC got off to a fast start with Cher, Tom Petty, John Mellencamp and Pearl Jam. But that was before Qwest.
When the Qwest Center opened, it was expected to capture the large acts, with the MAC and Omaha's Civic Auditorium competing for those that might draw 4,000 to 8,000 people.
But the MAC has struggled to sign up even the smaller touring acts that might be a better fit for its 8,000-seat arena than for the 17,000-seat Qwest Center.
Bluffs city leaders and MAC officials want back in the competitive game and are requesting $1 million from the casino-funded Iowa West Foundation to finance incentives for concerts and conventions.
"We need these types of funds to keep us on an even playing field with Qwest," said Dick Wade, Council Bluffs city attorney. "We currently don't have those moneys available to us."
Such a fund, he said, could be used to guarantee profits to promoters or to lure conventions with financial incentives.
The Qwest Center, which has an annual subsidy of up to $2 million from the City of Omaha, has been aggressive in landing concerts, and not just mega-shows such as Shania Twain, Prince, Metallica, Simon and Garfunkel, Eric Clapton and Bette Midler.
But early on, even after both the MAC and Qwest had opened, Omaha was thought of as just an "OK market," said Roger Dixon, president of the Metropolitan Entertainment and Convention Authority, which runs the Qwest Center.
Dixon recalled that when he took the job in Omaha, a prominent concert promoter "flat out told me, 'Have fun, but you won't see me up there.'"
That promoter changed his tune.
During the first half of 2004, 193,259 concert tickets were sold at the Qwest, placing the Omaha arena at No. 7 on Pollstar magazine's list of the top 50 arena venues worldwide. Pollstar is the authoritative concert industry magazine.
One regional promoter recently described the Qwest Center as a venue that "continues to have a great run."
Perhaps most important in changing that perception was a concert last November.
To lure the pop band Matchbox Twenty, expected to sell far fewer tickets than the Qwest Center's capacity, arena managers offered a financial incentive: The Qwest Center would assume all financial risks.
It was an appealing offer. Promoters negotiate the rent for arenas and assume all the costs of promotion, staging and artist guarantees. The Qwest Center was offering to pay any losses if the concert failed to attract enough fans.
For Matchbox Twenty, the arena's top bowl was curtained off, turning the hall into a snug 8,000-person venue. The Omaha stop by Matchbox Twenty proved "one of the few in that tour that made money," Dixon said.
By opening promoters' eyes to the flexibility of the Omaha arena, the event helped put the Qwest Center on their Palm Pilots.
The Qwest Center has continued to pitch a curtained arena for smaller acts - with success - but without offering financial guarantees. For Dolly Parton's Oct. 30 concert, the arena was curtained off to 5,200.
The MAC hasn't had the money to risk being its own promoter, for whom rewards and losses can add up to six figures.
MECA is responsible for booking both the old and new Omaha arenas. Acts that are expected to attract 8,000 or fewer are first offered the Civic, Dixon said, but there have been few takers.
Renting the Qwest Center arena can cost up to $15,000 more than the Civic or the MAC. But rents are negotiated, and the differential can be a minor cost of putting on a show.
The Qwest Center's rental rates are scaled back when a performer needs only half the seats.
"We want to be competitive," Dixon said, "but we don't want to give the place away."
Charlie Schilling, the MAC's general manager, wants a chance to compete.
MAC officials say they have several advantages, including free parking and easy access off Interstate 29.
"The area should be very proud that Omaha's on the map right now," Schilling said. "We just want to figure out how to reap some of that benefit."
A pot of money to help lure acts to the MAC is essential to compete, he said.
"There's no doubt that we want to maximize the venue and put (in) as many entertainment pieces that fit," he said. "This entertainment grant (application) is a big step for us in trying to do just that."
Rascal Flatts, which will play the Qwest Center Thursday, would have been a good fit for the MAC.
A performer might have a number of reasons for preferring the pricier Qwest Center. The most obvious is that if performers want the Omaha market, they prefer to be in Omaha, Dixon said.
The Qwest Center also is state-of-the-art in terms of being able to pull multiple semis in to unload staging and equipment quickly.
Optimistic artists know that if they sell more tickets than expected, the Qwest Center can easily expand seating, Dixon said. Promoters and artists also feel that just holding a concert in Omaha's new arena results in increased ticket sales.
The more concerts, regardless of size, the more potential profits. The arenas make most of their money from their share of the food and beverage sales - $3 to $8 per concertgoer. Ticket income goes to the promoter.
Verne Welch, chairman of the commission overseeing the MAC, said the Council Bluffs venue faces competition in a tight market not only from the Qwest Center but also from other new and expanded regional arenas in Des Moines and Sioux City, Iowa.
"Everybody in the business is really struggling," Welch said. "Omaha was successful because they're new, and they did have the funding."
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Comparison
For the fiscal year ending June 30, 2004:
Mid-America Center, Council Bluffs
Revenue $4.4 million
Expenses $4.9 million
Operating loss $550,000
Qwest Center Omaha
Revenue $9.613 million
Expenses $8.498 million
Operating profit $1.115 million
Sources: Mid-America Center, Qwest Center