Mesa City Council Advances Two Major Hospitality Deals: Legends Global Venue Partnership and Canon Beach Luxury Hotel

Good morning. Welcome to the Mesa City Council study session for August 13, 2026. Mayor Freeman is out of town and is excused. All other council members are present, although Council Member Heredia is attending by Zoom. I don't see him on yet. Okay. So, Council Member Heredia is running a few minutes behind, so we'll just note when he uh he calls in. Item number one is to review the agenda we have for our Monday, August 17th council meeting.

Let's go through that agenda if council has any questions. Mr. Butler, I know we have presentation set for 5 A and 5B. We do. Yeah. Okay. So, we'll skip 5 A and 5B for now. Does anybody have any questions or comments on the remainder of the agenda? Seeing none, why don't we start with 5A? All right.

So, staff have come up and uh vice mayor, council, we're uh really excited we're we've made it to this day where we're bringing um contract forward for your consideration with Legends Global uh for management of the convention center. And I know u this is one uh opportunity that we had discussed um as sets the stage for bringing in uh all the types of uh hospitality and uh maximizing the use of the convention center in in ways that um we as an independent operator were not uh able to do.

And so um so we're really glad that we've after a competitive process gotten to this point for your consideration. I'll turn it over to Candace and she can walk you through everything that's led us to this point. Good mayor, good morning uh vice mayor and council. Um I Candace Candace, deputy city manager, and I'd like to um introduce the team that we have up here with us today. So to my right is uh Brad Gnner.

He is our consultant that we used on this particular project since this is the first time we've looked into this type of a public private partnership. He is a a former senior vice president of AEG um global previously and about and decades of experience in this industry. So we were very help um glad to have him on this project. Uh to my left we have uh Harry K.

He is the senior vice president of business development for Legends Global, which is the contractor we are proposing to enter into an agreement with. Um, and to his left is Tyler Oin. You, some of you may have remembered him from last year. So, he uh is with CSL. CSL did the feasibility study for us um when we were looking at what improvements we would need to modernize the convention center in the amphitheater. And so, he presented to you last March of 20 um 25.

Um so with that we will start into the presentation. All right. And council member Heredia is online. Okay. Great. Um this just gives an overview. What we're talking about here is the Mesa Convention Center and the Mesa Amphitheater. It is all on one campus um situated near center and university. This is kind of an overview of that. Also gives an overview of the timeline. So we did put out a request for proposals um back in February.

uh we've worked through that over this last uh over the spring and into into summer. Now we had the top two proposals come in and give presentations to staff so we could ask them questions about their management style and how this particular type of partnership works. Um we are here now proposing to enter into a contract with Legends Global who was the the top proposal. Why are we why are we going into this?

This is a public private partnership and I want to explain that a little bit in the fact that the city will still retain the ownership of all of the facilities. Um we still fund the operations of this. So this part of it doesn't change. The part of it is coming in with a partner who has industry specialty and expertise to come in and do the actual management. Um that management doesn't mean just the daily management but also where we have access to now their network.

So they're an international company. um they have access to acts and other other entities and um contracts and so forth and so that can really bring that to it. They'd be coming in with strategic management. Where do we want to go with this campus? Where do we want to go with these facilities? Um they would take over the daily operations of it, meaning it would be their employees [clears throat] who actually work on this site.

They would be responsible for the marketing and advertising um for any type of sales, ticketing, rentals, um everything that we currently do today.

And then we all they also bring with them um because CSL is an affiliate organization with Legends Global, they bring that expertise that we already tapped into last year, which is what do we need to modernize, what do we need to monetize, um what type of capital improvements would we need to make, how do we really put a a strategic plan around this particular campus and what we want to see out of it for our downtown and for our residents.

This is just gives you an overview and I apologize this should be intent of management contract not contracted. Um but these just gives you a highle view of what we requested as part of our of the proposals we were looking for and what we were judging the proposals on. Could they develop and deliver these particular things? We want to continue to hive have and elevate um the quality of experiences and the event management we have there. We want to maximize that utilization.

how how can we best maximize that? Are there capital improvements that we can make that would allow us to extend our season for example at the amphitheater uh when we know that it gets pretty hot in the in the summer. Um what is the economic impact? How can we use this campus to drive people into our downtown? How do we get them here and then get them into our onto our main street and into our our shops and our hotels?

Also, how do we boost our our effectiveness with all of the other partners that we already have here in downtown? that includes the visit Mesa, downtown Mesa Association and the local hotels that we have here and how do we pull that together and also integrating as we continue to work on our downtown arts and innovation district. How do we amplify that? Um, and so that we're all working together.

So, those were the things that we asked for when we went out for proposals is how could you help us with this? Uh, yeah. Yeah, please. On that slide, um, this is for fun. Is that the Weezer concert? [laughter] I'm pretty sure it is. I just want everyone know exactly which concert. I went to that concert and it was awesome. Berg has confirmed it is it is Weezer. So good. Vice Council member Taylor, you have very good eyes. If [laughter] you can see who's on stage there.

Um [clears throat] it was awesome. It was like Christmas Weezer. Who says no to that? So anyway, [laughter] just wanted to throw that out there. And I'm glad you enjoyed that. I know. As we move forward, one of the things as we really kind of talk about what does this partnership look like and what does this partnership mean? Um, again, the city of Mesa continues to hold the ownership of the campus. So, it is our campus, it is our facilities. We will also continue to fund the operations.

So, this is not like so it's not similar to the golf course when we did that where they actually run the entire golf course for us. Um but it's their operation that they're running. This is still our operation. They are running it on our behalf. What that means is that we are still funding the daily operations for everything that happens on the campus. So that part doesn't change.

So when we talk about the cost cost to the city or cost to the contractor, I want to be very clear that um the cost of running of actually operating the operating expenses will still be funded by the city of Mesa. Um and they will be doing it on our behalf. So, what are the actual costs um out the door costs? The city cost to Legends Global um as an entity is a monthly base fee for a monthly management fee of $14,000 a month.

Um they will also receive um on food and beverage 4% on the gross sales and 8% on the net sales. There is an annual performance incentive. So, each year there will be performance measures that will uh benchmarks and targets that will be set um with both entities. And at each year we'll review those to see if they've met those and there's a um incentive fee of up to $50,000. It is based on each benchmark. There's an annual quantitative incentive fee.

And what that is is in our adjusted gross income each year, um Legends Global will put together a budget and targets that they will give to us. We'll review them. We need to approve them. So it'll be between the city of Mesa and Legends Global what our targets are for next year, what we hope to accomplish. um if they accomplish those that does not go into this incentive fee.

It's only if they go above and beyond those then they would receive 20% of the AGI over whatever benchmark we had set for that year. And then for sponsorship commissions, which is this is an industry standard um as they go out and receive um advertising sponsorships for particular things could be possibly be naming rights um they would receive a 20% in essence finders fee or commission on those.

Um, Legends Global has agreed to um help us and and contribute to the capital portion of this by doing a one front a onetime upfront payment of $500,000 that would go towards some type of improvement on the campus. Those are to be determined as we go through and start talking about what is the priority for us.

um what is the the thing we can do right out of the gate um that could help us increase our revenues or increase our number of shows while we continue to work on larger plans of the campus what it would look like and maybe a larger capital improvement. These would be things we could do within the next year. Um they've also they they are all about community.

So they would like to um contribute $10,000 a year for the five years of the term toward a not for-profit or a community based organization of the city's choice. And so that'll be something we would talk about as we move forward where we would like those funds to go. They will also be covering the transition cost of actually setting this up.

So the way this is organized is there's actually a two-month transition period where they need to set up all of the infrastructure in order to take on this management and they would be covering those costs. It would be no cost to the city for that setup. Um at this time I'm going to hand it over to Harry so he can talk a little bit. you can get to know Legends Global a little bit more. So, thank you, Candace. First of all, let me start by saying thank you for the invitation to be here today.

Um, very much appreciated. This is a partnership we are very excited about. We're ready to get going. Um, and again, so thank you for this opportunity and uh we know it's going to be successful for all parties moving forward. Um, you've got on your screen there just a quick overview of Legends Global. Uh we are a worldwide industryleading company that specializes in much more than just venue management and content and booking.

We provide all of those specialized services a 360 degree suite of services that you see there on the right hand side. Tyler who will speak here in a minute represents feasibility and consulting with our with CSL our affiliate. We provide owners rep um services for uh and project management services for renovations, expansions, new construction. Um premium sales more so on the arena stadium side in terms of your your VIP spaces um your suites, your loies, your club seats.

We have expertise in in those sales efforts. Um partnerships is as Candace just said, naming rights, sponsorship, advertising, entitlements. Uh we have a whole division on a worldwide scale that specializes in that area. Hospitality, which is food and beverage, which will be part of our scope here. Uh merchandise probably not so much, but we do have the the access to those individuals. We do merchandise for NFL teams, for the Olympics, for the RDER Cup.

So again, worldwide experience with the sale of merchandise, both uh retail and and online. And then venue management and content booking are really the core services um that we're providing here for the Mesa Convention Center, the amphitheater. So what does this all mean for the city? It means access to um and the support of the resources and the expertise of all these divisions as we move ahead together um to grow these venues, to grow the city, and to grow the destination.

Um just real quickly, uh drilling down on venue management, we manage 450 venues worldwide. About 70% of those are North America. Uh we do have a fairly significant international footprint as well. Um the majority of our um uh venues that we manage are municipally owned. Um so we are in essence a government contractor.

We understand the basic tenants of public administration and transparency and bidding requirements and all those things that are important to our municipal partners as you over oversee and manage these venues on behalf of the taxpayers. So that's our wheelhouse. We do manage some very large um a market uh venues, seven NFL stadiums, large convention centers.

But if you look at our resume, we really specialize in smaller venues, whether it's convention centers, arenas, theaters, um equestrian centers, um conference centers, um whether they're in a secondary market, a tertiary market, or in a very crowded a market where Mesa sits here in in the Phoenix market. Um, and we've had tremendous uh success using our resources, our visibility, our branding, our best practices to elevate the operations of those venues.

Um, and many of our clients have been with us for a long time. We've we've succeeded in achieving their goals. We've earned renewals and we're hopeful that'll be the path here with the city of Mesa moving forward. The other thing I'll say before we leave this page, Candace, this is kind of our wheel of resources.

We have over 100 people um just in the venue management silo of our company that support the operations of our local staff here or will be supporting day in and day out um across all these disciplines and more all these departments. To me this is the real value of our company is um you know I've been doing this a long time. Brad's been doing this a long time but we don't know everything. And operating in this in this world this specialized world for almost 50 years.

You live and learn trial and error. You take everything that we're learning every day and what we do is condense that and distill it down into usable programs and systems and best practices um to elevate the operations and the support for our local staff and achieving your goals. That is the real power of our company is that shared worldwide experience from doing this for for many many years.

And on the local level, while we are a large international company, we have a presence here in the market already. Um um I'm sure you're all familiar with State Farm Stadium, Desert Diamond Arena. We also have some food and beverage operations um in the market. We run the the uh the food and beverage at Talking Stick, the amphitheater uh for Live Nation.

So um so we're coming into this engagement with the Mesa Convention Center and the amphitheater in the city which is a perfect complimentary venue to uh the footprint we already have in the market. Existing relationships and understanding of the market, community relationships, business relationships, um operators and programmers that sit in this market that know it very well. Um again to support our operations here, no learning curve. Um and we're ready to hit the ground running.

I'll turn it over to Tyler. Great. Well, excited to be back here. Um, excited to remain a part of the planning of of these facilities, the convention center and amphitheater. Um, some of you may remember me probably from a year and a half ago as we concluded our feasibility study. Um, fortunate timing from the CSL side, our organization became uh uh joined with the former ASM uh organization. We are now Legends Global. We are now the global planning arm for Legends Global.

And the great news here is we have a wealth of data and research that we conducted over the course of the second half of 2024, first half of 2025, looking at the opportunities for the convention center and amphitheater to increase business, to increase economic impact. um both in terms of of what can we do capital investment wise, but there's also opportunities to think strategically about those buildings and diversify and increase the programming that that go to those facilities.

This is a recap of the work that we did um looking at your building versus the 50 potentially competitive facilities throughout the valley. Uh benchmarking you against similar facilities around the nation. We also collected input from 65 event planners representing more than 300 events.

we have the real world data uh about what we could do here from a marketing standpoint, from a scheduling standpoint and capital investment standpoint uh to help guide the future of of this facility and downtown Mesa. Um on the next slide is just a quick recap of what we saw as as as key opportunities and issues for the the convention center.

Um there has been increased convention activity and meetings activity certainly following the COVID pandemic in in the valley area and at the same time we're dealing with a very competitive field of hotel conference centers, various ballrooms that are that are around the the area. This is a building that has been used for local shows, public consumer shows, and but has increased conventions uh in recent years. How do we build on that momentum?

not necessarily by uh trying to be the next Phoenix Convention Center and and greatly expand our footprint, but by differentiating and by thinking strategically of what types of groups and meetings could fit here.

And then over time thinking, okay, what can we do uh uh uh from a physical investment standpoint to increase that business and support that growth because I think there's an exciting opportunity for this building and the amphitheater to be a big part of a really exciting future for downtown. We certainly talked about that in the report last year. Um similar for the amphitheater.

Um I think what what Legends uh brings to the table is is the network um relationships not just with Live Nation but a number of promoters nationally and regionally uh to help bring a diverse set of programming to this building. They also bring a lot of creative thinking and ideas for how can we use the amphitheater, not just for concerts and performances, but in unison with the convention center.

So, I think there's synergies that we're we're going to work together to to identify to to greatly maximize the use of that building and again think of the future um over the next 5 10 years. How can we improve the experience of that not just for attendees but for the artists and make sure that we're we're growing our calendar of events that that are going to the facility.

um CSL, you know, our our role here is is to continue uh uh to look at the future of these facilities to advise the legends team and provide real market data. You know, that's what really sets this relationship apart in in this world of live sports and meetings and conferences and entertainment. We're here to actually give them the voice of the consumer. We're here to give them data on competitive venues.

And we're here to think strategically about from an economic and financial perspective what are the the wisest moves we can make with both of these facilities over time. Over on the right are just some of the trends we identified in the report last year. But immersive experiences, technology, local and authentic food and beverage.

also looking at the amphitheater and thinking of when from when you get there to when you leave, you know, engaging the the attendee and and giving them the best experience possible and creating as many opportunities for for revenue generation as possible for for major concert concerts that are going there. So, we we are here to be an ongoing adviser.

um look forward to to working with you all in the future and working with Harry and the team um to help think uh uh not just of of near-term planning and strategizing in these venues, but starting to think also, okay, what's a schedule of of projects we can think about over the next five years and what gives us the greatest return. So, very excited to continue to be here. Um and uh I think I'll pass it back to Candace. Facility improvement planning.

you sorry uh facility improvement planning um um you heard Tyler talk about that a little bit those are that that's the expertise that they bring right is what is it that we can monetize what is the best effort that we can put forward in the next year two years five years um in order to really um elevate that entire campus and so we'll be working together all three you know two entities but CSL is is part of legends global now as we really go through those so they will be providing that expertise to us similar to what they did with the feasibility study taking it to that next level, that next step.

Um what is the first priority, the second priority, and what is it we're actually trying to drive to? Um and how do we implement that over this time? Um the transition itself. So the transition the the contract we have proposal for you is a 62-month initial term. The reason why it's 62 is so that there's a full 5-year management period um following the two-month transition period.

Um, so transition period right now we are looking for a September 1st start to the transition period and a November 1st start to the actual management. That's when they would then be the on-site managers effective on November 1st. Um, there are three uh five-year renewal administrative renewals that we could do for a total of 20 years on this and it would go through our normal administrative processes for that.

Some of the things that we do want to talk about is that um there have been questions about our staff and the transition and how does that work because these will again these will be legends employees that will be on this campus. Um all of our employees have known this. We have been very transparent over the last year that this was a a direction we were going in.

Um, and once we do have a signed contract, we'll be working with each employee to see if they would like to move over to the Legends Global team and continue on that site or if they would like to stay with the city of Mesa and we will assist them in finding another location within the city for them to work. So, it'll be an employee by employee basis. No employees will be laid off as part of this process.

they will all have a home and it's up to them where that home is um on what side if they want to continue in that industry which we have some who are very industrydriven and this would be a great opportunity for them and there are others who are long-term employees and like to stay with the city of Mesa and we'll and we will make space for them as well so they will all be taken care of. Um there will be a general manager on site that would be our prime contact for the the city side.

So we'll have a city contracts administrator that will be the contact on our side and the general manager will be the contact on their side. Uh we will continue to have access to all financials uh into the financial records as well as monthly reports, quarterly reports, uh projections, those types of things. So this is truly a partnership between the city of Mesa and Legends Global in their management of that. So we will be in every step.

This isn't something that at the end of the year we find out how they did. Um, this is being with them at every step, knowing what's happening this month, what's in what's coming up in the next few months, how are bookings going, how are shows going, um, and those types of things, as well as the feedback that we have on, um, surveys, whether it's artist surveys or, um, customer surveys, those types of things.

So, this is truly an integrated partnership u between the city of Mesa and Legends Global. And with that, I will I think that was the smoothest presentation that has ever gotten through council. Well, however, I'm sure there are questions at this part. Mr. Adams, would you like to begin? Well, thank you, Vice Mayor. Uh, thank you for that presentation. Um, I am I'm just curious about a couple things.

Um, as as you have had a chance to look over our venue, what do you see as its limitations and in in comparison to uh venues in similar size cities and what are your plans to try to address those? I mean, I I won't repeat what we've heard from different sources as limitations, but I'd [clears throat] be curious to know how you see it. How do you think we move beyond those? How do we attract um maybe some more A-list acts, that type of thing? So, that's that's my my first question.

And second part is um can you describe similar venues in other municipalities that you've stepped into and what have the result what have the challenges and the results been there? Do you want to grab that? Mhm. Physical. Let's go. From from you know the the facility standpoint and you know some things that put a ceiling I think on on potential for for the facilities. You know from the convention center side it it is it is dated. Um the hotel package could be grown.

Um that's probably a longer term issue. um technology um and some of the services that certainly some of the corporate sector and and some higher value associations are looking for out of venues. We we don't have those currently. So that's certainly the something to look at over time. From the amphitheater standpoint, um we've talked about similar issues, things with the modern attendee experience, uh premium seating, more points of sale for food and beverage aren't aren't quite up to standard.

Um maybe there's opportunities to expand capacity over time as well. Um it's a great unique boutique experience. I I love that that venue. Um but is there potential to slightly tweak it? Um you know to to maximize the value that that we get from the community. Um and then I think just thinking strategically and and you know just just even even looking at the calendar and maximizing the value of the events that we get with the facilities we have today.

I think there's still potential uh uh you know to to grow the event calendar um even before we begin the physical planning. But I I'll let Harry speak to just similar venues that they've been a part of. Yeah, just to piggyback first on on what Tyler said regarding the amphitheater. Um and and we al also had some recommendations for the convention center, but we certainly during the course of this RFP process, we we we shared some aspirational uh thoughts around um where these venues could go.

Realize a lot needs to come together with the financing end and how that we all pull that together. But um again I mentioned we've got a a pretty good knowledge of this market and we we we drew upon that experience of operating the market to drive kind of our recommendation specific to the amphitheater. If we can get to the point where we can increase capacity, make an investment into that amphitheater both in the back of house and the front of house. increase the the the rigging capacities.

U I think Tyler mentioned um the event experience, food and beverage, right? Points of sale, meeting and exceeding customers expectations in today's world. Um it's great to get the events, but then you want to maximize the experience as well as maximizing revenue with a commercial mindset. But um it's all about the event experience at the end of the day, right? Every event is an opportunity to to wow people, right? And create cheerleaders and ambassadors for the venues and for the city.

you don't want to you don't want to people leaving with a terrible experience. So, it's managing every step in that process from the time they leave home to the time they get home and making sure that that experience um as I said creates those ambassadors for for the venues in the city.

um in terms of maximizing I mean I I think of again we manage so many venues I think of Grand Rapids I think of Baton Rouge I think of Florence um Sagenol Michigan um theaters in in Ohio Toledo Ohio where operating at a significant deficit we've turned that turned those into profitable buildings or significantly decreased um the required subsidy each year um Tyler touched on a little bit which I didn't I don't didn't think we had time in this in this session but to drill too deep um But the shared data and analytics that we have as our company again pulling all that information together to inform our local staff to help them do the best deals right and doing the shows to help them advance the shows properly.

Um if we know there's a tour that's played six other of our venues we have all that shared information from those events um what people like to eat, what people like to drink so we can plan effectively again maximize their experience and maximize revenue. So what we're doing in that world with a program we have workday and AI down the road and all of that technology and and shared data um um again drives that experience and drives more revenue um to the venue.

But um you know we've grown to the size we have because we've achieved our municipal partners goals and that's that's financial and otherwise. Yes.

the the mission and the goals for many of these venues the same bottom line performance economic impact right quality of life for residents attracting new residents bringing people downtown um as a complimentary venue to the other assets that's in the community all those things but they vary a little bit it's not cookie cutter every every city every state every county authority they have different goals working within those broader u set of of typical objectives and and missions so we customize to our individual municipal partners goals which we will do here um with a demonstrated track record and again I I go back to using the scale of the company and the experience and the data that we have and the information um but maximize the opportunities and the events when we get them also the marketing the branding the vis visibility in two separate industries the live entertainment industry and and the convention meeting hospitality industry uh which these venues play in and having those relationships on a national level on a regional level um and a comfort level for users um and and our partners that if they come to a a Legends Global Managed building, they're going to receive great service and u there's a level of expectation that they have comfort with.

Good. I appreciate that. Just one other quick question. How many outdoor venues similar to ours do [clears throat] you currently manage or operate? We manage I think 20 some amphitheaters. Okay. Um Council Member Adams. Um various sizes. We just opened uh the Aquaore Amphitheater in Grand Rapids. That's about 12,000 seats. Okay. Um just a few months ago.

Uh we managed down to boutique amphitheaters, 5,000 capacity, 7,000 seat capacity capacity in Raleigh, North Carolina and Kerry right outside of Raleigh. Uh 15,000 seat uh amphitheater in Syracuse, New York. Um so we have a a fairly significant footprint um in the amphitheater world. So I imagine you face the uh the opposite seasonal problem in Grand Rapids that we face here. So okay, good. Thank you so much. Yeah, thank you.

That actually works out because once they're done over there, they can come right over here and book. But I think ours is only 5,000 5,000 capacity. So it's on the smaller end. Council member Duff, I know you've been waiting. Thank you. Yeah, I have quite a few questions. Um apologize for the long list. it took a little while for all the information to be uploaded.

[clears throat] Um so a couple of years ago we did a whole visioning of the convention center and look at at capital improvements and I think there was two or three selections depending on how much we want to invest and what the ROI is this related or is this a separate exercise or I mean it is that work related to the future of what Legends is working on.

So, Vice Mayor and Council Member Duff, it is um it is related in the fact that this is the next step towards trying to achieve those goals, right? So, what we came to council with a year and a half ago was this is the feasibility of the the actual facilities themselves, like what would we need to do physically at the campus in order to elevate the n the artists, the the acts we get, the things that we book at the convention center, the food and beverage, that type of thing.

So, that was a feasibility study and it left us with some really great ideas. Um and the next question is how do we fund those? How do we how do we invest? We know we want to invest in this campus. How do we go about doing that?

So this is that next step of actually bringing in an international partner um in this industry who has done this before and can figure out how to elevate what we currently have and monetize it in a manner that allows us to invest then back in all of those revenues back in to larger capital improvements which then increases our revenues and allows us to invest again. So the goal of this is actually to monetize as much as we can as it sits today.

Um doing some minor modifications as much as we can and then reinvesting and reinvesting so that we're constantly reinvesting back into the campus. It is it is investing the revenues from the campus back into the campus and not asking in the future for general funds in order to fund a capital improvement. The capital improvement would be funded by the revenues coming from the campus itself. So that is the goal.

This is this is the step one into that [clears throat] goal which is to bring in a partner who has that expertise and that breadth of experience and resources that allows us to truly maximize what we can do on this campus. So this is really that it's this is that next step from that feasibility study. And and maybe I can just add, vice mayor and council member.

Um that's why I'm so excited this morning because um I love seeing Tyler this morning in this perspective because now we have a path forward to actually make some of that those visions that um we had when you were presented uh their findings a year and a half ago an actual reality that's not going to burden our overall uh taxpayers.

Because what what this partnership uh allows us to do is maximize revenue that's generated on site by bringing um more lucrative shows by by maximizing our return on investment uh that we make both in the amphitheater and the convention center to bring high value acts and bring highv value conventions and others that will uh further revenue that then we'll be able to invest back into the infrastructure and the capital side of this program.

I mean, we sat here a year and a half ago with the vision of what it was going to take to uh modernize our facilities, but we had no path forward on how we were going to pay for for those as Candace just said. And so, this partnership because of what um Legends Global brings to the table will allow us to maximize revenue at these centers that can be reinvested back in them.

So the users will be paying for the capital improvements of these facilities and not shifting the burden onto any of the general city taxpayers. And that is uh a fantastic development that we could not have foreseen if we had stayed with the status quo. And uh and we we have excellent staff. U to Harry's point about um other venues that might have been operating in the red, we're we're fortunate um and and maybe unique in some ways that we we paid for ourselves.

We were break even, but we weren't maximizing the opportunities. Uh, and it wasn't for lack of great staff. It's we're not part of the network that Harry just described. If you're a convention planner, um, you're taking the path of least resistance. You're not reaching out to independent venues to schedule your conventions. You're calling Legends Global because you have a relationship with them and you're saying, "I want to schedule my next four years. I want to be in the Northeast.

I want to be in the Pacific Northwest, in Florida, and then in in the Southwest." Where where are you going to put me, Legends Global? Where where are your venues? What makes sense for my um for my um conference or or my uh touring artist or whatever it may be? That's just access and opportunity that we haven't had.

and that these uh industry experts know how to maximize, know how to bring in that high value um into both the amphitheater and the convention center, which will then allow us to invest back into um into those facilities so that we can continue to um to elevate it um to to a modern facility to uh a high value facility like the amphitheater to bring in uh those experiences like Harry um had described earlier.

with um all the modern amenities and high value FnB and other uh opportunities that just reflect the reality of the market today and that um we we current we currently can't provide without substantially burdening the taxpayers um in a way that I I know brought a lot of hesitation to probably all of us and so uh this partnership will give us a path forward and that's one of the reasons I'm I'm so excited about because it was a daunting prospect of how are we going to get there.

So we had to change the model. We had to do something uh different to maximize private sector expertise and investment and so that's why this partnership is is a real I mean it's a it's a big deal. This is a real gamecher uh and will have a ripple effect. I I appreciate that the Delta uh hotel is here because again we're um this this will have a ripple effect into what we're seeing in downtown throughout the hospitality side of things.

I know you've received a letter from Visit Mesa um with their support. Um you know, the mayor I think I think the mayor left something with the vice vice mayor uh to express his support, but the mayor's been a big big champion of this because again, if we were going to change the status quo, if we were if we were going to find funding, we had to go out and and harness the private sector opportunities of partnership. And that's what um the Legends Global team um brings to the table.

That's why it's a big deal. Yeah, I appreciate that and I'm very excited about it. But I'm still trying to pull everything together because we've been on this road for quite a while. I was trying to decide what we're going to do with the convention center and I didn't know if Legends was involved at that time. Sounds like it was a separate feasibility study which led us to Legends. We're no longer looking at a bond opportunity in order to do improvements.

But I do say and you're you're experienced at this. It's kind of a chicken and egg thing, right? In order for you to get the revenue that you need to to improve the building, you have to have investment. But you can't get the investment until you, you know, until you do the improve. I'll leave that to you. Um, it's kind kind of tricky.

Um, are we expecting any revenue from this at from to the city or this is I imagine there's so much investment that needs to go on from the feasibility study that we saw. identified like at the bottom level is like $30 million. Um so are we paying for you said operations I don't know what that is and then do we expect revenues? So vice mayor and council member Jeff this is um so again they are operating on our behalf. So it is still city funds that are funding all of the operations.

So anything operational on that campus is still a city funded operations. So we're see keeping all the revenue and city keeping all the revenue. Right. And then the commission base and all that. That's where you're right getting your revenues. Okay. Correct. So Legends Global would receive exactly what was on that list. Anything above and beyond that are everything is city revenues. The only thing that comes out of those city revenues are exactly what's on that list based on formulas. Okay.

Then looking at the way we envisioned [clears throat] our arts and innovation district is a lot of development over property that is around the convention center on the convention center especially a lot of parking lots maybe could be built over or anyway we need to do some visioning on that. Is there anything that prohibits us from you know development?

We wanted to do the lightw walk and have development vertically along that up to the convention center making that connection from the convention center to downtown to activate our downtown from the convention center. Is there So we're still on the grounds. We have vice council member de we the ownership doesn't change.

Um all of the plans that we've done with the the future lightwalk and the partnerships with ASU and the rebuilding of that kind of post office area, the Serin House improvements that we're going to do, the natural history museum which is downtown. Anything that we do at the MAC, all of that stays the same. So all of the planning that we're putting in um with Jack Mufay's team and and JDonnell's team about how to really lift and boost the downtown, all of that is still in play.

All of that is still continuing. This actually elevates um by bringing another another team to the to the to the group, right? And another set of expertise about what we could we could do on campus. How does that fit into the lightwalk? How do we make that connection between because that's what the lightwalk is for, right? is to make that connection between the convention center and Main Street because we want people who come to a concert, we don't want them to get back in their car.

We want them to go to Main Street, right, and continue their festivities for that day and then um and then leave the downtown, right? We want people to come early and we want people to stay late. And so this all um all of this still continues. What this does is bring expertise to the table for this particular campus. Yeah. And we have on the campus of the convention center, we like I said, we have a lot of land that's not really producing anything and reworking that.

We still have that opportunity within the campus of the convention center to continue that vision of utilizing the property. Okay. Um we have um existing contracts especially with Mesa AMP and stuff like that. Does that all terminate or do you work with like I know Danny Leco? No. So yeah, Vice Mayor and Council Member Duff, all contracts um will continue. So this is a seamless transition at the end of the day.

Um we hope that our customers um just have a seamless transition with us as we work through the next two months in that transition period. Those are all the things that would be um identified. Yes, this is an industry that books out one, two, or sometimes three years ahead depending on how large um either the concert or the convention is. And so those would just be seamless transitions. The contracts would remain in place.

Any contract signed on behalf of the city of Mesa is still in place when Legends Global comes in to manage that particular contract. Um there may be some uh different subcontractors, those types of things. So they will have people who have contracted with us for a convention, let's say for next year. um they would now have um access to the new food and beverage um selections that they could work from, but the contract itself would remain in place. Food and beverage.

Yeah, we need to work on that, especially when it comes to the Mesa AMP. And I I love that you had the elevated food concepts there.

and like to encourage where appropriate using some of our local restaurants and beverage providers that are you know especially in the beverages they make their own products and stuff like that and do distribution to grocery stores they have the capacity to um sell and it keeps it unique kind of like airports right you go to airports and it's boring now if you go to an airport and they have the standard whatever you know you want to see some local fair I um Vice Mayor, Council Member Duff, um that is foundational to how we operate our food and beverage operations.

um incorporating technology, speed of sale, proper points of sale, graband go, all those things, elevated VIP club experiences, premium experiences, but um foundational is the use of local products, local vendors, local brands, local suppliers, giving local community businesses and entrepreneurs an opportunity um to elevate their operations, turn jobs into careers, right? And providing them an opportunity that that's central to how we operate municipally owned buildings.

I mean that to me that's a core mission is providing opportunities for local businesses and from an event experience standpoint I think whether it's a convention a meeting a concert um the locals are are they go to a show they want to experience brands and products that they're familiar with that they're comfortable with it's a feeling of this is our venue right a sense of equity in that venue and people coming from out of town and visitors um they want to experience Mesa right they want to experience local products and brands and um as part of the food and beverage operation which is central to the event experience as we all know um and revenue generation.

I mean that is that is core to to the success of any any venue. I appreciate that. It helps our businesses and our community by keeping those dollars invested locally, but it really helps us brand downtown as well as being that uniquely local experience by having it extended into the auxiliary um building so we have more of a presence. So, thank you for for that. Um, I just wanted to um put in there the arts and innovation district.

Of course, we're working with ASU and the creative technologies and um you know, augmented reality, virtual reality, filming, gaming, all these kinds of things. And I I saw in your presentation, which I like very much, is being able to do hybrid events as well as immersive events. And um I think that could really put us on the map for our convention center is being highly specialized to being able to do that, especially when we have so much talent that we'll even more with more ASU schools here.

um being able to integrate and be have that identity do for the arts and innovation district, being part of that, having that unique um venue that can do a gaming thing or things like that that really are kind of new in the space. And it helps us again with our identity and what we're trying to do in the economic development um the job creation side of it for the downtown area. Um, oh, and we're doing a a music scene and trying to get that going in downtown. I'm sure you've met with DMA.

And so, again, that's an extension of it. Now, um, we do use the convention center for city events, whether the grounds um, events and community events, United Food Bank, we usually do our turkey drives or whatever, those kind of things. Are we looking at continuing that? Do we have access and rights to working through those? Because it is kind of a vice mayor and council member Duff.

We actually have highlighted um as we go through the contract, we've proposed specific events that will continue um whether they're date specific like Celebrate Freedom, which is state specific, or if they're um dates that we can work in conjunction with Legends Global to find the right date, which is what we do with our our convention center staff today, is looking for whether they're revenue options versus an event that we need to do.

we have highlighted the United Food Bank uh food distribution, those two particular um uses of the parking lot on those days. So, there's those particular state of the city um um those types of things that we do on an annual basis. Um and also our departments use um a lot of the rooms and so forth for events or meetings and so we would continue with a fee structure for our department city use separate from the commercial use. Okay. Okay.

um you've touched upon it but you know do you have a vision over all of the evolving you know what that is you've t we've talked a lot about what's wrong with it not I'm not saying through you but over the years we've like realized we have some things that need to be remedied um but as you look forward and with your experience and knowledge working nationally with so many venues do you what's your vision of how this can fit into the national offerings and how we could stand out uniquely. Yeah.

Um, Vice Mayor, Council Member Duff, I I the vision is this is an asset. It's a centerpiece asset for the community, right? Um, and in many way, shapes, and forms, right? It's um you obviously there's the financial end of it that's driving the e economic impact, but in many respects these venues help shape or detract from the image of a downtown, right?

And we've seen that if they're well booked, if the service is good, um they are ingrained as part of the community, it elevates, it lifts all boats. Um if the event schedule is down, right, the facilities are not taken care of, uh they're in poor condition, it just not only detracts from that individual um operation and venue, but it reflects on the whole city. So um they're centerpiece assets, right? They they impact the brand, the image of the city as well as financially.

So in my mind it's um establishing venues that are um setting the trends or ahead of the trends of what's going out there um in going on out there in the industry. Uh which we feel we are we have our finger on the pulse of and in many cases we're actually setting those trends. Um again two separate industries.

Um but the bottom line is um having a venue and having it operated in a way that it is a complimentary centerpiece asset to all of all the assets and all the new stuff and improvements and investment and technology that's going on in the city of Mesa so that it's complimentary. It lifts all boats and we're all working together to do that. Um you know and it comes down to collaboration it comes down to knowledge.

comes down to um again bringing that that experience from a worldwide scale of managing v many venues just like this driving people downtown keeping people here as Candace I think mentioned for two or three days not just coming to a show and leaving but can we give them um a destination experience that is enjoyable that's going to bring them back that's going to spread positive word of mouth um and that that's goes beyond as I think we've touched on today just the venues the district around that the opportunities, the attractions, the safety, the security um um you know, the traffic flow, pedestrian and vehicular, does it all make sense?

Is it all coordinated? Um to provide the best experience, right? And it's all about, as I said, it's all about lifting all boats and working with stakeholders to to elevate the entire destination of which these are centerpiece assets for the destination. And yeah, I'll I'll add to that a little bit. Um, just kind of uh adding to a lot of the points Harry made.

Um, I think we're we're at at a time in both the live entertainment and convention industry where planners, promoters, attendees, they're looking for something more unique, more authentic. We know there's certain lines of businesses and in certain cities we're not going to compete with in terms of size, but we can very much differentiate in terms of experience, technology. um throughout the the uh report writing process.

I mean, I was really excited, genuinely excited for for the f future of downtown Mesa. So, there's paths we could go um in in terms of planning this this downtown, certainly for a city that continues to grow and the convention center and amphitheater could and should be a major anchor to to what does happen here. So aligning with uh these goals regarding technology um the the the lightwalk and and various public improvements we want to make throughout downtown.

Also aligning with economic development and going after highv value tech and other industries that can come to town. This can be the welcome mat, the showroom for those various industries. We're not going after 10,000 attendee conventions.

We're going after meetings gatherings conferences and certainly leveraging what Arizona State has here and other labor that we have here that's in the world of immersive experiences, which I think we're just, you know, starting to get past the tip of the iceberg about opportunities for there. Um, we're excited for that and it's a moving target. You know, I we made that report last year and we can't fully predict what this facility could and should look like 10 years from now, right?

But that's why we're excited to be part of the team uh to provide just data for decision-m on an ongoing basis as we plan this out in phases over the coming years. Well, I I appreciate your expertise. I look forward to working with you and also continuing the engagement with the entities in in the surrounding area with economic development.

I could see this, you know, having a great convention center in that museum being a cat catalyst along with the ASU schools for the economic development and job creation that we want to do um along the lightwalk and have, you know, um those opportunities. We have a great downtown, but we need the jobs. We need the professional jobs here, and that's what we're lacking. And that could really help.

but working with economic development and visit Mesa, we want to be the destination and our downtown and ASU so that we holistically leverage all the assets that we're all bringing to the table to um make each partner better. So, thank you. Do we know off top of our heads how many days the convention center is booked for the amphitheater currently? I do. Uh, Vice Mayor, we have that data, but I don't have it in front of me, but we can provide that data to the council.

We are we are heavily utilized, I will say, um, in that. And so, what we're really looking at is how to elevate what we're already doing. How do we get that next tier convention, the ones who stay for a few days, not just come in for the day and back out again? How do we get the people who travel for that artist, not across town, but across the state?

um you know how do we do so it's really it's not necessarily a utilization it's the type of acts and the type of conventions that create the bed bed nights yeah and you absolutely nailed where I was going with that because I was curious the second followup was going to be how many of those are multi-days as we want them staying at the delta so the delta could also continue to do the investments that they want to make right to upscale this uh at the same time yeah and vice that's exactly what we're looking at and for.

So, it's it's really never been a point of are we not utilizing the rooms? Are they not being booked? They are being booked. It's this it's not necessarily overnight stays. We're not. And that's what we're looking for is how do we encourage people to come to downtown for more than just the day, right? We want them to be here for the weekend or the week or um those types of things.

And I appreciate the discussion of the Mesa Celebration of Freedom because that's going to continue to be a a marquee event for our community. Uh, I see Chief Camelly in the background and one of the events I was thinking about is the Arizona Fire School comes in and that's a multi-day event that utilizes that facility. Beverage sale should be interesting, Mary as they improve. And you had a comment, Mr. Butler. Well, no, I mean, Vice Mayor, you you nailed it.

It's again it's back to to high value utilization of the facility because because we we do as I stated earlier we start off at a better spot than a lot of smaller convention centers or maybe Harry could maybe tell me even larger convention centers that we don't have to subsidize these facilities. They break even. But so that's great. That's a good starting point. But the reality is it it wasn't those high value conferences and shows that generate room nights that that allowed people to stay.

It it's great that we can book the venue and um people would get in their car in their morning in Glendel and drive to Mesa and be at a conference for four or five hours and then get back into their car and drive back to Glendel all without frequenting a downtown restaurant, without putting a head in bed at the Delta.

Um so those were just opportunities that we know with this partnership we'll be able to maximize for high value um opportunities that can generate that revenue and have that ripple effect not just through the the revenue that the facility brings in but what that means for restaurants and hospitality and and businesses in downtown Mesa.

I mean, we've we've all been to conferences, overnight conferences, and you know that impact that it has when people are going out at night and going to the restaurants and and getting up in the morning and going to the coffee shops and and and having those type of experiences. And so, that's what we um hope to generate through through this partnership.

Well, not only that, I think about how many conferences we go to and by the time we're starting to wind down, the next one is starting to wind up and and it's just an exchange. And that's the kind of thing that we want to see is just one right into the other. Um, where do we see our naming rights? At what point we might be be able to generate some revenue from naming rights? I'm Arizona Financial Theater, Desert Diamond Arena, State Farm. Um, Tempe Stadium is apparently sponsored by the devil.

[laughter] Maybe not that one, but Well, you know, depends on the check. Depress on the check. Well, I don't know. The White Socks did the Pope thing the other day. That might be closer to our kind of flavor around here. Um, Vice Mayor, we will be um we will be looking into those types of of things. All sponsorships to me are on the table. Um, there are certain ones that would come back if it's name, not the devil. Um, but um unless it's the Sunundevil.

Um, but it's uh naming rights, those types of things would come back to council. Something of that magnitude. any type of a naming rights. We already have a policy in place for any naming rights would come back to council for approval. Um but we'll be pursuing those as well as just general sponsorships and advertising and things. How can we monetize the campus? All right. That's good to hear it come back. There are a few I think that we would probably want to shy away from. I've never Sure.

We we would obviously be very cognizant of a public venue and and um wouldn't just Yeah, that would that would be forefront of our thinking and partnership. And I know Legends Global is very uh in any market that they're in dealing with a public private partnership. They're everyone would be cognizant and I I think the mayor is going to very much appreciate how many times he's heard elevate in this conversation. So maximize and maximize well it's mostly elevate me.

So fantastic questions from my left side. No pressure on the right side, but that's where we're going to head with I don't think there's anything left. [laughter] It was well done. Um really and truly they you know Council Member Duff and Adams covered most of my questions but I just do have a couple comments which you know I appreciate that we've set the stage here on um telling us where we are right now. I I didn't remember that we break even.

So, I'm glad that you mentioned that, Scott, and that the what the point and the goal and objective of this is for, which is to capture more of that economic value around downtown Mesa from the events at the convention center and amphitheater as well as generate revenue to reinvest in improving those facilities because I think to go out and to ask folks um to pay for that is is a lot there's a lot more risk and in this way.

We we sort of uh we prove that um we we do a test case and we prove that that it's necessary. And I think people are are a little bit more um apt to buy in and support um a capital improvement um program later on when we've shown um the increase in improvement that we can make by using what we have now. And I think that that's fantastic.

I think we'll be able to do that with your expertise and your network is to improve upon what we already have uh and then build on that with uh adding funding investment in at a later date. And and let me be clear, Vice Mayor and Council Member, I I do believe um and and we've you know, we've been working with with Legends on on this and and um Mr. Kennington and others.

We um we believe again that the revenue generated on site will produce uh enough that's going to allow us to make those capital investments. And so when we talk about proving it up for um the rest of the community, we we want to take the burden off the rest of the community. We want this to be userdriven and and that's what this partnership will allow us to do.

So I assume there's been discussions about what those targets are over and I over the five years um of the contract the initial five years. Uh and I I I don't I mean I see some some incentive in there but there's no quotas or anything like that. Do we have any we just have targets and we have some incentives. Is that correct? We have Vice Mayor and Council Member Go forth. Those will be um negotiated each year when we put together the annual budget and annual plan. Okay.

And so part of the contract is that each annual plan is approved. They will they will propose one and we will have to approve it. So there'll be some negotiations on what our targets are for that year and the following year. So everything we set up is because we have already put together targets before the year begins. Okay. And and this is you know Harry Harry's got a business to run, right?

And I appreciate that we can build into this the opportunity that the more business that's brought and the higher value business and the more FNB sells, they're going to win and we're going to win. And that's that's what's great about this is that they have those connections and those relationships that can bring that in. And the the better they do, the better they'll do financially and the better we'll do financially.

So it is it really is that that partnership incentive that um is is great about this relationship. Yeah. I was a little surprised about the five years, but is that sort of standard? Is that you know that I'm not in this industry obviously, so maybe it is, but when I saw five years, I was just a little surprised at the length. Um Vice Mayor, Council Member Goforth, um that is a fairly common term.

Um without getting too much in in depth um you know tax code kind of plays a role in when a when a facility is um uh built or expanded renovated with taxfree bonds. There's certain regulations that come into play with regard to how deal structures um um can be put together in terms of term and calculations of incentives. So um this is somewhat of a traditional um uh deal structure. It's performance-based to Scott's point. 100% performance based.

Yes, we get a base fee, but um we're incentivized to maximize quantity, quality, diversity of events in both venues. Um uh which if we're making more money than the city is much better off than we are. So um it aligns our goals, it aligns our interests. Um so again, this is a fairly common structure that we see with many of our municipal clients.

Um, so um it's it's pedal to the ground every day to to maximize opportunities and to maximize revenue with a commercial mindset and and vice mayor um council member Go forth and and we also have to avoid the whiplash as as well. Obviously we are um we are working with our employees to um to relocate those employees whether they choose to continue in the hospitality industry or whether they um want to move to another position within the city.

But this isn't something that can be done lightly, right? You can't stand up your own operations and then ratchet it down um you know overnight. And so that's why five-year terms really um reasonable. They they have to staff up.

they have to make their assumptions of their ROI um on on a relationship like this and and smaller terms would be difficult for us and for them to really make pencil out and and practically be able to to ramp up hiring and and everything that's needed to sustain that operation under shorter term. though. And that's why I I think, you know, as as Candace, we're we're very proud of this relationship now that we're entering into with with Legends.

But this was a competitive process and I I think that speaks to the market. Um some of their major competitors in this space were um competed for this and and again, so I think that really shows I mean they're this is their business. They know what they're doing and and and their competitors know what they're doing.

And so the fact that they looked at these venues, uh, they toured the facilities, they they saw the good and the bad of of these facilities, and yet it was a very competitive process, I think, speaks to the opportunity that's there. We've got facilities with good bones.

That good opportunity well situated in this metro area that can be better maximized with with these strategic strategic investments on the capital side, but strategic partnerships on the type of users that we're bringing into to these venues. Well, I for me I think given the age of the facility and what we've experienced and what we know we want it to be having a partner willing to be here for five years, they need the longer runway to to make put the heartbeat back into this place.

So, you know, it's performance-based, which is important, but also it doesn't let them escape us. So, they're they're dedicated to us at this point. Yeah, I think this is I'm I am excited for this. I think this is the right first step in in the long future of these facilities is to um partner with you all who know what you're doing um who have the expertise in the network.

I think this is a great first step and again like I said to to make the case that we should invest um more financially um and make huge in capital investments. So, I I I am happy that we're going this route first, and I'm excited because I think we all knew there was there was room for improvement. Um, not that, you know, it was okay, but there was definitely there's definitely room for improvement.

You obviously see it as well um in its existing state with a few with a few tweaks um before we get to some of the bigger investments. So, anyway, appreciate it. Thank you for the um presentation. I look forward to seeing all the great things. I going to more concerts. [laughter] More wheezer. Yeah. Council member Taylor, your button cleanup. All right. Thank you. Thank you for the presentation. Thank you for the time that you've spent answering all of our questions.

Um I understand the pretty high level goal. Correct me if I'm wrong, but really what we're looking to do is refresh these spaces. The hope is that we'll obviously drive more business into downtown Mesa and hopefully encourage additional businesses to look at opening up in downtown Mesa. Really activating the entire area is what I know activating is like the new buzzword everywhere. So, I get that, but I tend to be a little more socratic, so I ask a lot of questions.

The technical details just help me understand the bigger picture more and it highlights it generally for the general public. So, um I know that you have all of your projects listed, at least the big ones, in the presentation. So, thank you. That actually answered quite a few questions of where else do you have Arizona locations that you're currently doing business in? Um, are those in the feasibility study?

Did we use those additional locations that they're doing business in to help bolster their their bid for this project? You know, the success rates that you have in Tempe or the Diamond um uh stadium or the State Farm Stadium, like have you presented those so that you don't I can get that information? Um, yeah.

uh Vice Mayor and Council Member Taylor, part of the request for proposals did require that they give us case examples of areas, things that they do that are similar in our size and nature. Um also, um just, you know, what is their history over time? What are their, you know, what have they what have they driven? So, it might not be the the examples they used in their proposal might not be the ones that was in Arizona. They might be ones that were more comparable, okay?

uh number of seats and and square footage and ballroom size and so forth because those are more comparable. But those those were all provided as part of the proposals from all proposers were required to bring that in. They were required to have expertise in this industry um you know multi-year expertise in this industry and and prove it up through their proposals as well as talk to us about anything that may have gone ary in the past.

Were there anything that were cancelled um and those types of things? So those that type of background was part of that proposal and part of what we reviewed as a team um for the selection committee and have the have you experienced with more boutiquesized locations? I know our amphitheater is obviously not huge but I think it's pretty cool but per capita our city is quite large.

So that's a weird kind of tenuous relationship with how many people we have here, how many people we want to bring in on top of how many people we have here. and the culture of our city is very unique in that I'd say Mesa is very very family friendly. So that would kind of form and shape the types of events that we may offer um additional to events that we might want to draw people in from outside cities or locations.

So do you have experience with that very unique relationship between the per capita size, the size of the venue and then the culture of the city? Um, yes. I mean, there look, there's um Philadelphia comes to mind, Pittsburgh comes to mind, Grand Rapids comes to mind. Um, you fairly larger markets, maybe not top tier, but that that next tier where you have to find the right niche, right, in in that marketplace.

Um, as I mentioned before, this this venue, this venue size is kind of in our wheelhouse. Um uh if you look at our network and in some cases um it is the main centerpiece venue in that community. Um in other cases it's in a very competitive market where you've got to find that niche, you've got to establish that niche.

And that's part of what we talked about with the city during the process um in terms of the types of events, in terms of things we could do with improvements to position us a little bit better um within that marketplace. But um every situation's different. Um we've been doing this for 45 47 years I think now just a little bit of experience. So it it's um you know again it it's a situation where we've worked hard to achieve the goals of our municipal partners. It's finding that right niche.

Um it's it's utilizing the resources we have customized to their needs. um the cities, the states, the counties we work for um all have different goals um objectives and um it's our job to be kind of the day-to-day worker bees to use our our resources to maximize those venues while um in this case the city of Mesa sets the miss and sets the goals, approves the budget, approves major contracts as Candace said.

Um so yeah, I mean we've got we come in here with thoughts out of the gate as to what we can do right away. um sharing of of leads and opportunities given the other venues we have in the marketplace, business relationships that we have with with premium seat holders at the other venues or sponsors where they might be look looking to do a meeting or a conference and we could rotate that into Mesa.

So, it's that sharing of of opportunities and leads um that's central to our thinking here that are a good fit for this venue. Um, so yeah, preconceived thoughts, what we can do right out of the gate, a little bit of living and learning over time as we're on the ground here working with stakeholders, um, learning more about the venue. Um, so but confidence we can Thank you. We can be successful here. That's very helpful. Thank you. Um, so [clears throat] I had a few other questions.

Uh, I was curious to know just I'm just going to trail off that one. What would you consider a premium act of entertainment coming to the Mesa Amphitheater that might also share over to the convention center for this particular size? Because I I was thinking about I was thinking about Glendale Swift City as everyone called it. And I'm like, man, that brought in literally hundreds of thousands of people. It was wild. And I was I was trying to imagine that's huge entertainment.

What would that look like here in our I know that's not who I'm thinking of, but just what would something like that look like? Is that even feasible? Well, um, Vice Mayor, Council Member Taylor, um, look there the if you're talking about live entertainment in the amphitheater events and concerts, um, you've got to focus on what makes economic sense, right, for for the tourists, for the artists. Um certainly there's a niche that a 5,000 seat amphitheater has in in that industry.

Um we've talked about expansion a little bit that's come up. Again, we've got a live entertainment one of our uh Ralph Marquetta who's an industry veteran who's based here in in the Phoenix market, knows all the venues, knows the market very well, what genres work, um what doesn't work. um and he and others in our live entertainment division were central to our focus on um some thoughts initiatives aspirational thinking that we brought to the table during this process.

Expanding capacity of the amphitheater if we can get to that point is central to it. um adding another couple thousand seats, elevating the premium experiences, addressing the back of house positions you much better um with the key decision makers in that world artists agents promoters managers um to bring a higher level of act to to the venue. So um look, we've got we've got our relationships.

We've got um our successful promoter partners um Live Nations, the AGs of the world, but also the smaller independent regional promoters. Um, we operate all of our amphitheaters with an open venue policy. We don't want to turn away opportunities. Um, some some don't operate that way where they're more exclusive to one promoter. Um, but we want to work with all promoters. Um, and we have proven success doing that, bringing all genres opportunities to the table.

U, but it's got to make economic sense all the way around. And that's why you've engaged us to be a voice in the room as we plan for the future and the phasing and what's most important. What can we do out of the gate? what's going to take a higher level of investment, a little bit more time to plan out. Does that lead to naming rights opportunities, other opportunities? So, um um so we're we're you know, we're we're looking at all that and and look to work work with the city moving forward.

But I think there's also just maybe this doesn't answer your question. There's the opportunity to do events that utilize all the spaces, right? You maybe do those already. Um where you've got a convention or a meeting that's going to have a trade show element, it's going to have a banquet element. It's going to be there's going to be a VIP party or that element that could be hosted at the amphitheater.

There could be a live entertainment or speaker, a comedian that could be part of that convention that you utilize the whole and what can we do going forward whether it's outdoor spaces or other opportunities again working with other stakeholders to elevate that destination cell for those types of groups so that they're not yes they can use the whole campus.

we're providing the technology, the space, the service, the food to meet their expectations, but are there broader opportunities outside of the outside of the complex that would appeal to the meeting planners and the decision makers? Um, and the live entertainment side, not to kind of ramble here, is no there's very few decision makers. It's not it's a pretty tight ecosystem of people that determine what shows go where and how they're routed. Um, and we're ingrained in that world.

We're we're at the table in that world. So, um, but you got to have the ammunition and the and the, uh, the arrows and the quiver to shoot to land those shows. Um, so our our thoughts are around, yes, we can elevate what you have now, but we also need to be thinking about the future and where we see a niche in this marketplace that we can take advantage of and that's part of that five years. Yes. Yeah. Okay, that's helpful.

Um, will the targets and goals that they're setting, will that come to council or that will remain just with staff? Vice Mayor and Council Member Tenner, that would be with staff. That's the administration of the contract. Okay. And I hate to be like the Debbie Downer, but if they fail to meet their targets and goals within that 5-year period, what does that look like for us as a city? Do we have an out in the contract?

If it's just not the engine is running, but we're not [snorts] going anywhere. Mayor and Vice Mayor Chandler, we have we have the out. We always have an out in contracts if they're not going the way we want them to go.

Um, and we're not talking about just the overall normal contract of of default on either side type of a thing, but if just the partnership is not working um, going forward with with pri proper notice and so forth and obviously we would have worked on it for a long time before we would have made that decision. Um, but there's always that opportunity um to make sure that we are protecting ourselves, our staff, our our facilities and so forth.

So, we always have that in every any contract we negotiate. Okay. It's a big pitch to the public, you know, and I think it's wonderful that we're looking at obviously using the revenue to reinvest in those facilities. That's excellent. I was super excited to hear that. Um, and that it's not displacing the burden of all of this refreshing onto the taxpayer in general. So, that was wonderful. I just, you know, I have to think through all the moving pieces.

Um, I'm skipping some of these were already answered, which was wonderful. Uh, I did have one important [clears throat] question on slide eight. I know this might be part of your in-house operations. Um, I'd love to hear what you consider DEI uh in human resources. Yeah, I think it's um you look we have specialists in DEI in our in our human resources department.

So um that could go into greater depth than I can but um you know as a baseline our focus is on developing our people right um we have training programs we have over 120 different training programs different languages from customer service training leadership training um online training that all of our full-time people um and in some cases some of our contractors will be uh will be expected to participate in.

Some are some are required, some are more optional, but developing our people um is central to to our approach here. We've got um you know, we talked about the transition here. What we've seen over the years um is a track record of um you we talked about the transition and coming in here and we expect that some of the employees are going to stay on as our employees. We give them more tools, more resources to help them do their job better. Um, and I'm sure that will play out here.

Um, you know, people want to be a part of something special. People want to be contributors. They want to be part of a team that's successful and contribute to it. So, um, you know, we will provide them that opportunity. Um, so I'm not sure I'm answering your question, but um, do you receive ESG funds? I don't know if I can answer that question, but I can get that answer for you. Councilman Taylor, thank you. Yeah, I'm excited to see where it lands. I think it's going to be great for the space.

I I think the public will be excited to see the amphitheater and the convention center a little more lively. I do get asked quite frequently, do we use our convention center? Like, yeah, we do. We do. I I think the east side doesn't tend to traverse over to this area frequently. I'm here. Okay. Do you go to the convention center often? Uh I used to go for fire school. Yeah. [laughter] Okay. So, not for a while. Um I think it'd be good to see some more events happening there.

I'm I'm I'm imagining big events and I'm hoping we get to that point at the end of that maybe fiveyear period because I've been to some pretty cool events at some pretty awesome convention centers and I can see where it can go. So, thank you so much. Thanks for answering my questions. I appreciate it. Great. Also, the state of the city is also fun to come to. Nice. Yeah.

So, so Vice Mayor, I I do as as we're wrapping up on on this, uh, it seems I I just wanted to thank Brad Gestner, who's gotten off easy this morning. He hasn't had [laughter] it, but when you when you go into something and you don't know what you don't know, um, you have to go out and find people who can shepherd you through that.

Um Brad Brad's history um has been in this industry uh on the other side of the equation, but we went out and and Brad's been working with us to to help us navigate and understand this process because we needed that uh we we needed someone who understood that that side of the industry to help us guide our RFQ, our negotiations, our understandings of industry best practices and norms as we had our our conversations um with with all the folks who applied for this and so just want to thank thank Brad.

He's he he's been indispensable in this process and so we've we've appreciated his uh stewardship throughout all this. So thank you. You okay [sighs] Mr. Heredia suggested the Purina Pro plan convention center. [laughter] That was me. It was me. Mr. Heredia, do you have any questions? It's always finding the mute button that's the hardest. No, appreciate it, Scott. No. Um, no, this is exciting and appreciate, uh, all the questions have been asked. Uh, great.

I I I also look forward to, um, you know, great events happening there at the amphitheater and the convention center. So, thank you. Agreed. I think the fact that we've been talking about this for an hour and 20 minutes shows the importance of of [snorts] this for the heartbeat of downtown. uh but as an asset that we really want to maximize. So, thank you so much for your time. Thank you. Look forward to working with you. Thank you. Anybody need a break? Are we good? Buckle up.

I think we just have one more and then we have one more and then we have an e session. So, we can let's see uh we can plow through. Yes, sir. I have 9:30 meeting offite. Okay. Mr. Adams has a hard stop at Sure. And and I I think Jay can be very brief on this. It it's um so we can run through this very quickly and then um it it's really just answer any questions that council may have about um about the agreement with Canon Beach and and um Okay. Glad to answer that. Uh so Mr.

Adams has to leave at 9:30. he has a hard stop. Okay. What does that mean for the e session? We we can continue. I I I also think if we can plow through this, uh, you know, the e session probably shouldn't be very long, um, either. So, I I think we'll be in good shape. We'll we'll see how that works.

We will miss council member Adams if he does have to leave but I think we can [laughter] vice versa economic development director for the city of Mesa and joining me today is Sarah Steedman assistant city attorney attorney and then on my right is Ben Snow deputy director for the office of economic development.

The purpose uh of what we're doing today is to talk about the Canon Beach Hotel project, which is an upscale hotel project with a minimum of 130 rooms and various amenities including a rooftop deck, an event space, ground level, hot tub, and lawn area, a bar and lounge connected to an outdoor terrace overlooking the surf pool with a fullervice upscale restaurant. This is something that we've been very anxious for in Southeast Mesa.

So, we'll be discussing the major terms of the development agreement, but we'll go fairly quickly. So, if you have any questions at the end, there will be time for that. Um, the location is just south of Warner Road on the east side of of Power. The total site for the entire development is 35 acres and the hotel site is just over 1.3 acres.

The proposed development area uh development agreement project area again is only for the hotel development and it's a property that's owned by Canon Beach Hotel. We also have a member of their executive team in the audience today, Joe Codddle here. So if you have specific questions for the developer, he's happy to pop up and answer those. This is a sales tax reimbursement for public infrastructure that's related to the hotel and restaurant. So, the overview of the DA structure is as follows.

It again, it's a reimbursement of the taxes up to $950,000 for dedicated public infrastructure if the developer completes all of the following conditions. 18 months from the DA effective date, they will obtain building permits for the public infrastructure. 36 months from the effective date, they'll complete the public infrastructure, which must be designed, bid, and built per applicable law. and they'll dedicate the public infrastructure as well as the right of way to the city.

Um, plus they will also construct the upscale upscale hotel which is currently a planned tapestry by Hilton and they must complete construction of that and be open to the public within 36 months of the effective date of the DA. So reimbursement for the public infrastructure is using uh construction sales tax that's generated from the project and a portion of the retail sales tax generated by the hotel and restaurant. And I'll turn it over to Sarah. Oop, excuse me. Um, one more slide.

Uh the proposed property again the the p the public infrastructure that's on Warner Road will include all of the public improvements which is pavement, turn lanes, curbon gutters, sidewalks, driveways, storm drains, signing and striping and and staking and testing. And now Sarah will go through the construction tax incentives specifically. And just looking at this to reiterate, the portions of dedicated sales tax for public safety, quality of life, and streets is not included in this deal.

Correct. Good morning, council. As Jay mentioned, the public improvements that developers required to install along Warner Road are eligible for reimbursement. The maximum amount of reimbursement the city would pay is $950,000. um that's based on the current estimate of the cost to install the public improvements. If it ends up costing the developer less to put in those public improvements, um the actual cost of the public improvements would be the cap that we would reimburse.

And the reimbursement comes from the transaction privilege tax that this project generates the which as you said, Vice Mayor, um it's at a 2% rate only the 1.2 to non-dedicated and unrestricted amount could be used for the reimbursement. The first portion of that TPT that we could reimburse from is the construction sales tax. Um 100% of that 1.2% can be used to reimburse the developer for the public infrastructure.

So, and that would happen as a one-time payment after all of those conditions are met and the city has accepted the public improvements. The second portion that of the TPT that we can reimburse from is the elig um the retail sales tax and we would reimburse 50% of that non-dedicated 1.2%. This these reimbursement payments would happen over the course of the development agreement which has a 10-year term although we anticipate they will reach the reimbursement cap in the first eight years.

And Ben will cover the economic impact analysis. see my light coming on here. There we go. Thank you. So, there are four statutory requirements. Um, and I will share those with you quickly here per Arizona statute section 9-5001.

Council must find that the proposed sales tax incentive of the project will raise more revenues than the amount of the incentive reimbursement during the term of the agreement and that the development [clears throat] would not locate in Mesa in the same time, place or manner in the absence of said tax incentive. The second uh requirement is the statute requires an independent third-party review of the council findings.

Third is that ARS section 42-610 requires that construction and sales tax incentives offered to retail businesses be provided only as reimbursement for public infrastructure dedicated to and accepted and controlled upon completion of the project by the city which which Jay had mentioned a couple minutes ago.

And there are also a requirement for there to be two city council meetings which include a notice of intent resolution and resolutions for approval of the development agreement and council findings requiring a two-thirds vote of our council. I feel like we've been done this before. So the third party economic analysis was performed by applied economics Sarah Merley as principal.

It includes an economic analysis and impacts uh summary with projected sales tax, city st city tax revenues, public improvements, total economic impact, job creation, annual labor income and construction activity. And the revenues to the city are forecasted that this project will generate significantly greater amounts of sales tax revenues than the total amount of this rebate that's being proposed um on the order of 10 times as much over a 10-year period.

and the final analysis report will be a companion document with the the resolution uh with the with the development agreement. So the next steps in the process here is on Monday there will be a notice of intent resolution that will be placed on the agenda for Monday's council meeting and then on September the 14th that's when the development agreement resolution and the city council findings resolution will be placed on the agenda. Okay. So, next meeting's notice of intent.

There are any questions or concerns? We have plenty of time to answer those. Vice Mayor, just wanted to amplify one point that Ben said because I kind of glossed over more than more than [laughter] that's all I that's all I Well, it's upscale luxury hotel first and foremost. This is the type of hotel development I know council is anxious to see. So we appreciate the partnership with Canon Beach on on bringing a high quality luxury brand high upper level.

I'm not sure of the industry term, but uh we would call it upscale. Sometimes people will refer to it in the four the fourstar arena. Those mean the same thing. Yeah. So so that's great. And again on the tax incentive side that this will generate more than 10 times the amount of of this uh investment that we're allowing back into this. So it's it's a great ROI. It's going to make a lot of money for the city and uh and and the hospitality industry um when this hotel comes to fruition.

So that's it's this is exactly the type of quality development we need same time period. Yes. I I'm Joe I know Joe's out somewhere. Um I I'll I'll tell you if you're going to back somebody uh it's Canon Beach. They've been putting their shoulder into bringing a higher level of quality here. I think they did. They steal First Friday from downtown or they just do a new one. We could do a D see who has a better uh First Friday and we're going to have a competition on First Friday.

No, they they stole from Phoenix, which is even better, you know. So, so uh the the level of restaurants are bringing in are all sit down restaurants, which is what's people in the entire city have been asking for, but particularly on the east side, you know, we've been asking for more of these things. And we have somebody that's just been running full full steam ahead on on delivering some of that.

Sometimes a little faster than you [laughter] perhaps you should, but I've really been impressed with what's been going on there. So when you when you look for a partner, um this this is one I think we would want to pick up on. Thank you, Vice Mayor. Any questions or comments from Yes, ma'am. I don't have a question, but I just I wanted to say I was looking up the Tapestry hotels and they are so cool. I was like, I want to go stay in all of these.

Like all of them have such unique looks and designs to them. You can tell they're pretty immersive. You get a different experience depending on where you are. So I'm I was just excited to see that that's going to be the style coming in. I think it's going to draw in a lot of excited visitors both locally and even from out of town. I mean, Canon Beach, it's pretty cool. We've been a couple times. So, just to look at a fake beach is awesome. [laughter] Have a beach.

That's a I'm going to sit on that rooftop and like I don't know, eat some French fries, live the life. Mr. Adams, I know you have a question. Yes. Thank you, Vice Mayor.

Uh I would just comment I think this is a great win by economic development the team there and uh what I'm recalling is probably somewhere between five and seven years ago when I was a member of the visit Mesa board and I believe it was Cole Cannon who came and presented his concept of what Canon Beach and the surrounding development would be and um I would say that from what I've observed is he has surpassed the vision vision that he presented at that time and um um I think Adam Saxs was uh I think Adam's still affiliated with that.

He was a very productive member of the visit Mesa board and continue to forward that vision. So I'm I'm very supportive of this. I think it's a great win for us and I think uh these these are folks who delivered above and beyond what which doesn't always happen and folks come and paint a picture for you. It doesn't always fill in, but this one is colored in really nicely. And I hear they have an absolutely perfect safety record for shark attack. Good point.

Seeing no other questions, uh, how many people by sharks? I don't know. That's uh information I think they can gather and come back with. We we believe that number is zero. But we did run some recent numbers and since Canon Beach has been open, I know today's topic is specific to this hotel project, but since Canon Beach has been open over the last 20 months, there have been nearly 1 million visits to the Canon Beach campus over that period. We need to get these hotels up. Yeah. Mr.

Heredia, did I hear you or No, no, I'm good. Thank you. All right. Thank you, Mr. Thank you so much for the presentation. We'll see you later in the week. Um, I'm going to fly through this because I know we're short on time. Item 2A, appointments to various boards and commissions. Do I have uh council member Duff, Council Member Adams? All in favor say I. I. Item 3A is acknowledge receipt of board minutes. Do I have a motion? Council member Adams and Council Member Duff. All in favor say I. I.

I. Any oppose? Hearing none. Motion carries. Did you get those? Yeah. Okay. Uh we we will talk about what we've been doing over our council break maybe at the next meeting on Monday so we can get through this. And um with that, I'll con u look for a motion to convene an executive session to discuss with the city attorney potential to engage uh with a lawsuit. So, Council Member Goforth and Council Member Taylor. All in favor? I. Any opposed?

Ignoring anybody that said no, we're going into executive session. Mr. [music] Smith, do you have my motion? I know you wanted me to memorize it, but I can I'll just read it and say just read it if you want. Okay, I'll just say that we're uh we are reconvened. We are minus uh council member Heredia was not able to uh was not able to rejoin us. So there's and mayor's uh absent excused.

So with that, is there a motion to direct the city attorney to file a lawsuit and pursue litigation on behalf of the city of Mesa against the fire apparatus manufacturers the city has purchased from and to retain legal counsel for that purpose as discussed in the executive session? Do I have a motion from council member Adams, a second from council member Duff? All in favor, please say I. I. Any opposed? Seeing none, the motion passes unanimously with council member Heredia and the mayor absent.

Very good. With that, do I have a motion to adjurnn? Council member Adams, council member Duff, all in favor say I. I. Any opposed? I didn't think so. We are ajourned. [music]