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Booming Atlantic City, New Jersey Convention Business
Drives up Room Nights and Revenue

By Emily Previti, The Press of Atlantic City, Pleasantville, N.J.McClatchy-Tribune Regional News

July 20, 2011--ATLANTIC CITY -- Convention business boomed during the first half of this year, despite fewer people traveling to the resort, the most recent statistics from the Atlantic City Convention & Visitors Authority show.

That could mean visitors are staying longer -- or that trips unrelated to conventions have decreased, ACCVA Executive Director Jeffrey Vasser said.

The rise in convention business is the result of bookings made in 2008. At that time, the casinos -- faced with a national recession and regional competition -- became more willing to provide the rooms required to support conventions, Vasser said.

"I think you're going to start seeing a turnaround," said Vasser, noting that new offerings, such as restaurants, help drive the convention and tourism industry. "People feel better about long-term prospects of the economy. I think at the end of the summer, you'll see one of the best summers we've had in several years."

Atlantic City booked 26 percent more conventions during the first half of 2011 than during 2010. During that span, those conventions drew 72 percent more people who spent 75 percent more money and generated 60 percent more room nights, ACCVA statistics show.

"Conventions are here longest -- three or four days," Vasser said. "You might see a decline in the number of visitor trips, but you're replacing (daytrippers) with convention customers, and they're staying longer and spending more."

Casinos are more willing to partner on driving convention business, said Vasser and Brian Tyrrell, professor of hospitality and tourism at The Richard Stockton College. Previously, casinos blocked rooms they expected to give away to gamblers. Then the number of patrons started to dwindle, Tyrrell said.

"The shift in demand certainly is attributable to these conventions," Tyrrell said. "And now (casinos) are actually making money through room revenue rather than some formula that says, 'If you get them here to play, you'll make money.'"

From January through June, 5 percent fewer cars passed through the Pleasantville Toll Plaza and 14 percent fewer rail passengers came through the NJ Transit train station in Atlantic City than during the same time frame last year, numbers from the ACCVA and NJ Transit show.

Vasser thinks people simply stay longer. A sample of hotels within a 20-mile radius of Atlantic City verifies Vasser's explanation -- and shows gains in the local lodging industry beyond the estimated 45 percent of the market represented by ACCVA's convention data.

Occupancy rates went up 4 percent and revenue rose 7 percent during the first five months of 2011 compared to 2010, according to a survey of 3,680 rooms by Smith Thompson Research. The firm tracks occupancy, room rates, revenue and other performance measures, including casino and noncasino rooms, to generate business forecasts and other tools for its lodging industry clients.

Don Marrandino, eastern division president for Caesars Entertainment Corp., said the company has seen "positive results" for occupancy revenue at its Bally's, Caesars, Showboat and Harrah's casinos in the city, despite continued decreases in gaming revenue.

The same held true with dining, said Marrandino, who heads the fledgling nonprofit Atlantic City Alliance -- ultimately intended to be the marketing arm of the Casino Reinvestment Development Authority.

Marrandino also pointed to major events organized externally -- there have been 46 so far this year versus 35 during the same time period in 2010 -- such as boxing at Boardwalk Hall and the Dave Matthews Caravan held in June as sources of growth. They attract the under-55 set casinos have increasingly targeted, he said.

Convention business is a good complement to that, Vasser said.

"The convention market is midweek during the offseason, or shoulder season," Vasser said. "And the younger demographic so important to the industry -- they're here on the weekends to party ... and certainly in the summer season as well."

Contact Emily Previti:



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