The convention centers we have is a significant contribution to the US economy under normal conditions. But what about now and what’s to come? Business events, whether they be conventions, conferences, congresses, trade fairs, or any other type of corporate event, sustain almost 26 million in employment in more than 180 countries across the world. According to the analysis, the business events industry has a $621.4 billion direct influence on global GDP, making it the world's 22nd largest economy. The impact of the meetings industry is sometimes overlooked because corporate events are so decentralized. But it's more than simply the expense of a few nights in a hotel or the reservation of a conference center. The sector supports jobs in airports, cafés, bars, restaurants, and retail, as well as tourism destinations that many conference attendees visit in addition to the events. For example, take the OCCC. Every dollar spent by a convention attendee or exhibitor supports and develops employment in the local community, raises finances for critical services, and puts money in the hands of tens of thousands of residents. According to research conducted by PFM Group Consulting, the typical OCCC visitor has a $2,229 economic effect on the local economy; this figure is used to assess the entire economic impact of events held at the OCCC's rentable 2.1 million square feet of exhibit space. How has the pandemic affected this industry? Overall negatively, due to the fact that being face to face with someone can put you in danger, but many places have been having recovery protocols to ensure help to everyone. The silver lining is though is that it has forced innovation. The recent omicron surge has impacted the 2022 schedule wherein 4 shows in Orlando have been cancelled including the NAFEM show which attracts 10,000 plus attendees. It’s estimated that these show cancellations will cost Orange County more than $40 million in economic impact. The OCCC is dedicated to recovering from the epidemic and developing new methods to meet safely today for a stronger tomorrow. Since announcing its comprehensive Recovery and Resiliency Guidelines in June 2020, all eyes have been on Orlando to ensure the success of its clients, employees, community, and convention sector. Local residents have been able to keep their jobs as a result of the Center's recovery efforts, and the OCCC has been able to secure future bookings, which will result in even more economic possibilities from tourists, attendees, and exhibitors who support local companies. We’re seeing a lot more comfortability with going out and being around each other, masks are still available and vaccination is becoming more adopted and with the pandemic becoming more of a flu like occurrence the outlook for Orlando’s economy in regards to conventions seem brighter. It seems like more and more places are having the duality of in person and online factors because while cities will undoubtedly want to see in-person events return as quickly as possible, hybrid conferences, in which some people attend in person while others do so online, may help bridge the gap if they don’t want to attend in person. We’ve even seen DMC and other meeting support services adopt new ways of doing business. One such business is ETHOS Event Collective: "Over my 25 years in the industry, I've experienced all types of circumstances and occurrences that can have a significant impact on meetings and events," said Joe Fijol, ETHOS Principal, Florida. "The events of the [2020] are a wake-up call. They have signaled the vital need for a business to enhance personal connections through technology and research at all levels while also accepting the social responsibility to align the needs of its meetings and events with those of their host communities." Orlando is projected to have more than 135 conventions during 2022, which moving closer to the 200+ in 2019 pre-pandemic number boosted by pent-up demand. Orlando hotel revenue is still down 14% https://www.costar.com/article/2142550603/hotels-in-major-us-markets-unlikely-to-get-convention-boost-in-late-2021 but still far better than Chicago (32%), New York (48%), and San Francisco (63%). CAP rates for urban markets and those with convention heavy travel will remain a trouble segment. In Orlando where it’s both leisure and professional travel, our hospitality market is not as starkly bifurcated like other markets especially those areas with health precautions which may dissuade some visitations. https://thinkrealty.com/hotel-outlook-remains-bifurcated-in-2022/ All in all, the industry is bouncing back faster than we can imagine positively impacting the commercial real estate hospitality market; however, the need for innovation and technology persists to smooth out disruptions.
January 24, 2022