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Elgin mayor: Grand Victoria not building entertainment venue

The GrVictoriis commissioning study about turning Festival Park (lower left) inan arts center where ElgSymphony might play.
January 27 2012 |

The Grand Victoria is commissioning a study about turning Festival Park (lower left) into an arts center where the Elgin Symphony might play. January 27, 2012 | Michael Smart~Sun-Times Media

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Updated: August 23, 2012 10:40AM

ELGIN — Despite intimations made earlier this year, there appears to be no plan by the Grand Victoria Casino to partner with Elgin to build an entertainment venue adjacent to the downtown riverboat gambling facility.

Mayor Dave Kaptain said that is the impression he and city staff were left with after a July 10 meeting with casino representatives and a consultant at the Grand Victoria.

“They told us they weren’t going to build it, that at this time it doesn’t meet their future needs,” Kaptain said. “This is just my gut feeling talking, but I think it might have something to do with the state’s gaming bill increasing gambling and taking a wait-and-see attitude about what happens with that.”

Kaptain said he, City Manager Sean Stegall, Assistant City Manager Rick Kozal, and Corporation Counsel Bill Cogley met for more than an hour that day with casino general manager Jim Thomason, director of marketing Suzanne Phillips, and John Repa, president of Hospitality and Gaming Solutions of Palm Springs, Calif. — and that Repa did most of the talking.

Repa and his company put together a 44-page report entitled “Market Analysis for a Proposed Multi-Purpose Venue & Entertainment Center in Elgin” for the casino. The city council had agreed to put money toward this work, for which it would be reimbursed, but Kaptain said the casino wound up funding it all by itself. According to reports, the study was to run $45,000 plus travel expenses.

That report makes no recommendation one way or another about the casino building an entertainment venue but noted the area has an above-average potential for drawing classical music and pop-rock music fans, with the pop-rock fans more likely to gamble than the classical ones.

Cost projections

It mentions a prior report the city and the Elgin Symphony Orchestra commissioned several years ago about renovating or replacing the Hemmens Cultural Center. That document put the tab at $75 million for expanding and fixing up the facility, and at $100 million for a new 1,750-to-2,000-seat hall. Hemmens now seats 1,280.

Kaptain said Repa noted that a 1,500-seat venue would cost about $50 million. The city already has put $10 million or so into Festival Park next to the casino.

The site apparently was being considered for the entertainment venue, but Kaptain said the city has no plans to convert it alone.

The report suggests finding corporate sponsorship, creating full and partial subscription series, and doing cooperative cross marketing with the Grand Victoria.

According to the report, down the road such a venue could gross $8.4 million a year, with $3.5 million of that generated by the Elgin Symphony and $3.6 million from other shows, with a net of $583,000 from those projections. The numbers assume 134 performance dates annually with 87 percent of all seats sold.

The report notes that the Hemmens Cultural Center operated at a $553,000 deficit last year and has been running similar deficits for years.

ESO Interim CEO David Bearden said the symphony was contacted in the spring for specifications it would need for a performance venue. But at this point, the ESO plans to continue to play at Hemmens, Bearden said.

Despite shortcomings of the 43-year-old Hemmens, for the 2010-2011 season, ESO sold more than 80 percent of the 1,150 tickets it offered for it shows there, Bearden said. The symphony also performs a handful of shows in Schaumburg at the much-smaller Prairie Center for the Arts.

Operation change

While the symphony calls the Hemmens home, the city council has changed how the center will otherwise operate this coming season. The city will not sponsor shows, is not giving breaks on rentals to nonprofits, and is looking for more outside bookings.

Kaptain said the casino study does point to a need for a community conversation about operating the Hemmens and a “need to change the business model to run the thing. We still need to have a discussion about what to do with Hemmens.”

The casino study came about after discussions that began last September, Kaptain said. At the time, the casino was exploring the possibility of closing off Grove Avenue so it could expand the number of gambling seats.

For a long time the state’s biggest money-maker, the Elgin casino has seen big declines in its gate since the recession and then the opening last year of Rivers Casino in Des Plaines. In June, Grand Victoria’s revenues dropped by 25 percent to $17.5 million, less than half of the revenues it generated on a monthly basis five years ago. Admissions fell 16 percent, to 136,549 between June 2011 and June 2012, records showed.

Kaptain said he suggested that any casino expansion might include an entertainment venue of some sort. A convention hall was another option mentioned in discussions. Talks also included a meeting last Christmas Eve about bringing a country music-style venue like Gilley’s in Las Vegas and Dallas, but Kaptain said casino research ruled out that possibility.

Kaptain said he was surprised that nothing moved forward, “but that’s not their plan. Apparently, they’re going to stand pat.”

Messages left for casino representatives and Repa were not returned.

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