20/10/05
London would benefit from having an International Convention Centre to make the most of Olympic benefits, concludes Mayoral Commission.
The independent Commission set up by Mayor of London Ken Livingstone on whether London should have an International Convention Centre announces its findings this morning with an unequivocal 'yes.'
An International Convention Centre (ICC) is a purpose-built venue designed primarily to host major international conferences and events - with a main auditorium capacity of between 3,000 and 5,000 - something that London currently lacks.
The Commission's report finds that creating a London ICC would cost some £250m - £300m to build, but would boost the UK economy by roughly £400m a year and create at least 5,500 new jobs in London and elsewhere in the country.
Speaking after the Board of the London Development Agency, which has funded the Commission's study, gave its backing to the Commission's report, the Chair of the Commission, Gerry Acher said:
‘There is no doubt in the Commission's view that an International Convention Centre for London is feasible, justified, necessary and overdue. This is the best opportunity that London has ever had to develop a world-beating International Convention Centre that will restore London to the top of the tree as a destination for major international events - the position it last held in the 1970s - with all the consequent benefits - financial, economic, employment and reputational - that will follow.’
‘In the past, the importance of the business tourism market has not been fully understood and previous projects lacked effective city leadership. Following this current study, the public sector has given its endorsement of the findings and the private sector is now expressing serious interest in participating in the development of a future London International Convention Centre and I hope this project will become a reality
‘The International Convention Centre Commission is of the unanimous view that the business case for developing an International Convention Centre in central London is clear and unambiguous. The next stages of the work will see the Commission being reconstituted to reflect the tasks of finalising the location options and the funding package and engaging the private sector in the project’
Mayor of London, Ken Livingstone, said:
'As this report makes clear London needs an International Convention Centre which would further enhance our role as a global centre for business, bring thousands of new jobs to the capital and provide a lasting stimulus to our economy. An International Convention Centre would consolidate London's position as the best European city for business and one of the world's greatest financial and business capitals. It will also help us take the fullest advantage of the fantastic opportunities offered to us by hosting the Olympic Games and Paralympic Games in 2012.'
The report's main conclusions are that:
• There is a strong business case for an ICC in London
• That it should be in central London, within the central tourist district
The Commission reports that one business tourist is worth more than three times the amount of one leisure tourist in employment and economic terms. Furthermore, business tourism is more resilient than leisure tourism in times of instability, such as post the 7/7 London bombings. The business visitor market is currently worth £3.2bn to London. Moreover, many business travellers extend their stay for leisure purposes, bring members of their families on to their business trips and return to visit the destination for leisure at a later stage.
The report explains that though London is a successful convention destination (indeed, in 2003, 15 out of 17 London's current venues for conferences turned away business) it is mainly for relatively small events of up to about 500 - 800 delegates. The business that London can handle is limited by the lack of large purpose-built facilities.
The number of leisure tourists visiting London is more than Paris, but according to industry statistics, Paris is four times as successful as London in hosting international association conferences. London's position in the league table of destinations for large international events has declined from number 1 in the 1970's to 19th currently (ICCA 2005). And according to the Commission's research, only 20% of key global professional convention organisers say they are satisfied with London's current facilities - but 80% say that they are likely to hold events in London with a new, larger ICC.
Gerry Acher added:
‘We have received very clear feedback from the world's leading professional conference organisers that a venue outside the central tourist area, whilst still attracting the same convention business, would not have anything like the attraction of a venue within the central area. The numbers involved highlight London's true potential. An ICC in London's central tourist district should be able to attract some 325,000 delegate-days each year, giving a similar performance to the Palais de Congrès in Paris, which is ten minutes walk from the Arc de Triomphe. These visitors would be a major boost to London's hotel, restaurant, theatre, shopping and tourism service industries.’
The Commission's research concludes that the new ICC would host over 330 meetings and about 70 major banquets each year. It would cost between £250m - £350m to build. As it will not be possible to fund the development entirely from the private sector, the development would need to be a partnership of some sort between public and private sectors. Once built it would not be a drain on public finance. Fully operational, if located in central London, it would achieve a significant annual operating profit on the back of mature annual revenues exceeding £30m. There would be a requirement for cash flow assistance in the pre-opening period, although this would be fully covered by later positive cash flows. The economic benefit would be nearly £400m in net incremental direct expenditure for the UK, each year. A minimum of 5,500 jobs would be created, in London and elsewhere in the country. Indeed, around a third of these jobs would be located outside London. It is thought unlikely that there would be any significant displacement to a new London ICC from other venues in London and the UK, and the little which does occur is likely to be only temporary. The increased marketing offered by a new London ICC should quickly grow the market in London and the UK to the extent that over the next 20 years additional facilities will be need, although pricing will remain extremely competitive worldwide.
The Commission's report also urges that an ICC cannot achieve all the benefits it promises on its own. It states that London will also need:
• ongoing development of the service provided to the business tourism sector by Visit London;
• increased hotel supply at all star levels;
• the willingness of the hotel industry to deal with long-term block bookings at marketable rates;
• continued improvement to transport and the marketing of London as a destination for business tourism;
• continuous monitoring of the competitive marketplace to ensure best practice in convention marketing and operation;
• consistency of service standards leading to a reputation for value for money;
• development of an effective conference subvention policy, to offer targeted financial and other support to secure specific major international events.
ENDS
For more information or to interview Gerry Acher please contact Greg Rosen on 020 7954 4552 0r 07881 552874
Notes for editors:
1. An International Convention Centre is a purpose-built venue designed primarily to host major international conferences and events. It has: A main tiered auditorium for 3,000-5,000 (flexible and divisible); Two or three additional meeting spaces of about 800 and 400 capacity; Immediately adjacent meeting and exhibition space (10,000sq m, flexible and divisible); A range of breakout rooms for 50-500 delegates; The ability to provide catered functions for the delegates; Hotel accommodation of varying standards on-site or nearby.
2. The Commission investigating the potential for a new International Convention Centre for London was set up in 2004 by Mayor Ken Livingstone to assess the feasibility of developing an International Convention Centre in the capital. A neutral and independent body, made up of international specialists experienced in the convention business, the Commission has the primary objective of determining the business case for a new ICC in London, and, if the decision is positive, to demonstrate the next steps in terms of taking the project forward. The establishment of the Commission followed representations to the London Development Agency (LDA) and Visit London from the Business Tourism Advisory Group (BTAG), the pre-eminent business tourism advisory body to the LDA and Visit London. BTAG is comprised of representatives of London's business tourism, hotel, venue, travel and ground handling organisations. At the BTAG annual meeting in 2003, the absence of a purpose-built ICC in London was considered the number one priority, out of all issues facing London's business tourism sector.
To view final report click here.