Private company to manage Mesa’s convention center, amphitheater

A private company will now be managing the Mesa Convention Center and the Mesa Amphitheatre.

On Monday, the Mesa City Council voted 5-0 to approve entering a public-private partnership for management and operations services at both facilities with Legends Global Convention Center Management LLC.

Mayor Mark Freeman and Councilmember Rich Adams were absent from the meeting.

The item was on the council’s consent agenda in which all matters are dealt with through one motion and vote. However, the item was pulled, and Vice Mayor Scott Sommers read a statement from Freeman before the vote.

“The Mesa Amphitheater is one of our city’s jewels, and together with the convention center, it has been a tremendous potential,” according to Freeman’s statement. “I believe this new direction will help us build on that legacy, bring renewed energy and investment to these facilities, and contribute to an even stronger and more vibrant downtown Mesa.”

The city owns and currently manages the Mesa Convention Center and Mesa Amphitheatre, located around Center Street and University Drive. The convention center opened in 1974, and the amphitheater opened in 1979.

“Over time, the city has evaluated alternatives to improve utilization of the facilities, enhance customer experience, plan and implement facility improvements, and increase revenue opportunities,” according to a staff report. “The city determined that engaging an experienced venue-management company would provide specialized expertise while allowing the city to retain ownership of the facilities.”

The proposed initial term of the agreement is for 62 months, consisting of a two-month transition period followed by a five-year management period. There can be up to three additional five-year renewal terms. The contract is expected to be effective on Sept. 1, with transition set to be completed by Nov. 1.

Under the proposed agreement, Legends Global will assume on-site operations, including ticketing and sales, food and beverage, security, information technology, facility maintenance, personnel, finance and marketing, the staff report continued.

City employees currently working at the venues will have the option to move to Legends Global or remain with the city in another capacity.

Under the agreement, the city’s costs include:

•  Monthly base management fee of $14,000 ($168,000 annually).
• Food and beverage fee of 4% of gross sales and 8% of net sales.
• Annual performance incentive fee of up to $50,000, based on key performance indicators.
• Sponsorship commission of 20%.

“Legends Global costs and contributions include a one-time $500,000 capital contribution amortized over 10 years, a $10,000 annual community contribution for five years to a not-for-profit or community-based organization, and estimated transition costs of $50,000 to $75,000 for system setup, travel and lodging,” the report stated.

New York City-based Legends Global is one of the world’s largest venue-management companies and operates more than 450 venues worldwide.

“Early on, I began conversations with the city manager, Scott Butler, about how we could reinvest in these facilities, strengthen their future and explore a public-private partnership that could bring new opportunities to downtown Mesa while protecting the interests of the taxpayers,” Freeman’s statement continued. “I’m excited about what lies ahead and confident in the future of these important Mesa destinations.”

Janet Perez can be reached at jperez@iniusa.org. Please send your comments about this article to AzOpinions@iniusa.org. We are committed to publishing a wide variety of reader opinions, as long as they meet our Civility Guidelines.