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MARKET AND FEASIBILITY STUDYPerforming Arts CenterCOEUR D'ALENE, IDAHOSeptember 21, 2018SUBMITTED TO:PREPARED BY:Ms. Nicole KahlerExecutive DirectorCDA 2030, Inc.105 North 1st Street, Suite 100Coeur d'Alene, Idaho [email protected] 1 (208) 415-0112HVS Convention, Sports & EntertainmentFacilities Consulting205 West RandolphSuite 1650Chicago, Illinois 60606 1 (312) 587-9900EXISTIN GApril 27, 2018

Convention, Sports & EntertainmentFacilities ConsultingChicago, IllinoisSeptember 21, 2018205 West RandolphSuite 1650Chicago, Illinois 60606 1 312-587-9900 1 312-488-3631 FAXwww.hvs.comMs. Nicole KahlerExecutive DirectorCDA 2030, Inc.105 North 1st Street, Suite 100Coeur d'Alene, Idaho, [email protected]:AtlantaPerforming Arts CenterCoeur d'Alene, IdahoBostonBoulderChicagoDallasDenverLas VegasMexico CityMiamiNassauNew YorkNewportDear Ms. Kahler:Attached you will find our Market and Feasibility Study of a Performing ArtsCenter in Coeur d'Alene, Idaho.We certify that we have no undisclosed interest in the property, and ouremployment and compensation are not contingent upon our findings. This study issubject to the comments made throughout this report and to all assumptions andlimiting conditions set forth herein.San FranciscoTorontoVancouverWashingtonAthensBuenos AiresDubaiHong KongIt has been a pleasure working with you. We look forward to hearing yourcomments.Sincerely,HVS Convention, Sports & EntertainmentFacilities ConsultingLimaLondonMadridMumbaiNew DelhiSao PauloShanghaiThomas A Hazinski, MPPManaging DirectorSingaporeCatherine Sarrett, MBASenior Director

Convention, Sports & EntertainmentFacilities ConsultingChicago, IllinoisTable of ntroduction and Executive SummaryMarket Area OverviewIndustry Trends and ParticipationComparable VenuesBuilding Program RecommendationsSite EvaluationDemand AnalysisFinancial AnalysisEconomic ImpactFinancing and Implementation StrategiesStatement of Assumptions and Limiting ConditionsCertificationAppendix - User Questionnaires

Convention, Sports & EntertainmentFacilities ConsultingChicago, Illinois1. Introduction and Executive SummaryNature of theAssignmentCDA 2030, Inc. engaged HVS Convention, Sports & Entertainment FacilitiesConsulting (“HVS”) to conduct a study assessing the feasibility of developing aperforming arts center in Coeur d’Alene, Idaho. The proposed performing artscenter could provide a state-of-the-art performing arts venue for variouscommunity uses, including cultural performances, educational programs, civicevents, and private rentals. In addition, the proposed performing arts center couldenhance the demand potential of touring concerts and theatrical productions inCoeur d’Alene.This study assesses the feasibility of a proposed performing arts center based onwhether it will 1) satisfy the venue needs of the local arts community, 2) generatea sustainable financial operation, and 3) create new and positive economic impact.MethodologySeptember 21, 2018In accordance with the Scope of Services, HVS performed the following tasks:1.Thomas Hazinski and Catherine Sarrett traveled to Coeur d’Alene, Idaho onFebruary 26-27, 2018 and conducted a series of meetings and interviews.During this visit, they met with the CDA 2030 Board, toured severalpotential sites for the development, interviewed several potential usergroups and other key industry participants, and gathered relevant data.2.Analyzed the economic and demographic data that indicate whether, andthe extent to which, the local market area supports the proposedperforming arts center.3.Performed an assessment of industry trends and participation in theperforming arts,4.Interviewed and surveyed potential user groups to assess their venueneeds and potential event demand they could generate.5.Compiled data on 31 competitive and comparable performing arts centersto test the reasonableness of the building program recommendations andinform event demand projections.6.Recommended a market-based facility program based on the above steps.7.Prepared an evaluation of 12 possible sites for the performing arts center.8.Prepared event demand and attendance forecasts based on theimplementation of the program recommendations.Introduction and Executive SummaryPerforming Arts Center – Coeur d'Alene, Idaho1-1

Convention, Sports & EntertainmentFacilities ConsultingChicago, Illinois9.Prepared a financial forecast for the proposed performing arts centeroperations.10.Identified alternative methods to own and manage the proposedperforming arts center.11.Identified alternative methods used to finance the construction ofperforming arts centers in the United States.12.Assessed the economic and fiscal impacts the performing arts center wouldhave on the City of Coeur d’Alene.HVS staff collected and analyzed all information contained in this report. Wesought out reliable sources and deemed information obtained from third parties tobe accurate.Role of Performing Artsin CitiesThe presence of performing arts opportunities in a community directly affects theindividual residents, as well as the quality of the community as a whole. A thrivingperforming arts culture increases the propensity of residents to participate in thearts, which in turn increases the attractiveness of the community to residents,tourists, businesses, and investment. Since an interest in the arts is highlycorrelated to education level, the people that are attracted to live in communitieswith a strong arts presence tend to be well educated and highly-skilled.Communities with a robust arts identity tend to have a more favorable image andstatus while also enjoying reduced crime rates and a greater degree of culturaldiversity. The arts also foster creativity among community residents that can spureconomic growth in creative industries.Quantitative impacts of a performing arts center include the spending on culturalevents by visitors and residents who keep their spending in the community ratherthan exporting it. In addition, this spending generates fiscal impacts fromassociated tax collections.Cultural facilities can also provide several qualitative benefits to the surroundingcommunity. September 21, 2018The presence of a high-quality performing arts center in Coeur d’Alenewould create additional opportunities for residents to attend andparticipate in cultural activities. Participation and arts spending analysessuggest that Coeur d’Alene households are spending less on artperformances than the average U.S. household and that significantpotential in the arts exists. A new performance venue would help the artsgrow and reach its market potential.Introduction and Executive SummaryPerforming Arts Center – Coeur d'Alene, Idaho1-2

Convention, Sports & EntertainmentFacilities ConsultingChicago, Illinois Workforce development is an important driver of economic growth inCoeur d’Alene. A new performing arts center could increase theattractiveness of Coeur d’Alene to people considering relocation. Likeeducation and recreation opportunities, the availability of entertainmentoptions is an important lifestyle consideration. A well-educated andcreative workforce is a major selling point that differentiates Coeur d’Alenefor corporations looking to relocate to the region. A Coeur d’Alene performing arts center could afford arts groups a moresuitable venue for their performances, allowing them to potentially expandprogramming and increase attendance.The following figure identifies the various ways that performing arts can improvea community.FIGURE 1-1MECHANISMS OF PERFORMING ARTS IMPACTAudience ParticipationIndividualMaterial/ HealthCognitive /PsychologicalIncrea s esopportuni ti e s forenjoyme ntI ncrea s es cul tura lca pi ta lRel i eve s s tre s sEnha nces vi s uos pa ti a l re a s oni ng(Moza rt effe ct)CommunityInterpersonalIncre a s estol e ra nce of othe rsEconomicPresence of Performing Arts in CommunityMaterial/ HealthCommunityInterpersonalEconomicCulturalIncre a s es propens i tyof communi tyme mbers topa rti ci pa te i n the a rtsIncrea s esi ndi vi dua lopportuni ty a ndpropens i ty to bei nvol ved i n a rtsSocialBui l ds communi tyi denti ty a nd pri deBri ngs toge therIncre a s es s pe ndi ng a tpeopl e who mi ghtl oca l bus i nes s es a ndotherwi s e notmul ti pl i e r effectsIncrea s e s di ve rs i ty,i nte ra cttol e ra nce a nd fre eexpres s i onIndividualCognitive /PsychologicalCulturalIncrea s e sa ttra cti venes s of a re ato touri s ts ,bus i ne s s e s , a ndpe opl eFos te rs crea ti ve s pi ri ttha t s purs economi cgrowthGre a te r l i ke l i hood ofne i ghborhoodre vi ta l i za ti onSocialPromotesne i ghborhoodcul tura l di vers i tyImprovescommuni ty i ma gea nd s ta tusReducesne i ghborhoodcri me a ndde l i nque ncySource: Center for Arts and Cultural Policy Studies, Princeton UniversitySeptember 21, 2018Introduction and Executive SummaryPerforming Arts Center – Coeur d'Alene, Idaho1-3

Convention, Sports & EntertainmentFacilities ConsultingChicago, IllinoisMarket Area AnalysisCoeur d’Alene and surrounding Kootenai County enjoy high population growthrates and a strong and growing economy. The market benefits from encouragingemployment statistics and a well-diversified employment base with a number ofcorporations in a variety of industries. Coeur d’Alene is a popular touristdestination that regularly attracts visitors from surrounding cities and largepopulation centers in the region. A performing arts center would likely draw aprimary base of attendees from a drive time market of up to three hours.Coeur d’Alene’s existing entertainment and event infrastructure lacks a state-ofthe-art mid-size performance venue suitable for theatrical events, music, and otherperformances. Future planning and development efforts in Coeur d’Alene shouldconsider the interrelationship between a performing arts center, other tourismamenities, retail and dining establishments, and parking and work to improve thepedestrian connections among them.Comparable VenueAssessmentHVS analyzed 31 performing arts centers in cities throughout the western andmidwestern United States. This analysis provides a basis for building programrecommendations by comparing the function spaces and other amenities in each ofthe facilities along with other characteristics of the markets relevant to the successof the venue.HVS divided comparable performing arts centers into three categories. Performance centers in Idaho or within 300 miles of Coeur d’Alene that couldcompete with the proposed performing arts center for touring concerts andshows. Performing arts centers in small markets throughout southern Idaho andneighboring states that may compete with the proposed facility for touringconcerts and shows. New performing arts centers in smaller markets throughout North Americathat are similar to Coeur d'Alene in population and presence in their greaterregional market.HVS analyzed comparable venues shown in the figure below.September 21, 2018Introduction and Executive SummaryPerforming Arts Center – Coeur d'Alene, Idaho1-4

Convention, Sports & EntertainmentFacilities ConsultingChicago, IllinoisFIGURE 1-2COMPARABLE VENUESName of VenueLocationYearSeatingOpened/ CapacityRenovatedNearby CompetitorsINB Performi ng Arts CenterMa rti n Wol ds on Thea te r a t the FoxGeorge & Ja ne Denni s on Thea treBi ng Cros by Thea terWhi te fi s h Pe rformi ng Arts Ce nterBi gfork Center for the Performi ng ArtsSpoka ne Ci vi c The a terSpoka neSpoka neMi s s oul aSpoka neWhi tefi s hBi gforkSpoka neWA1974WA 1931/2007MT 1935/1998WA 5336Competitive Regional VenuesMorri s on Ce nterIda ho Fa l l s Ci vi c CenterMa ns fi el d Thea treAl berta Ba i r Thea treBl a ckfoot Performi ng Arts CenterMother Lode Thea treStephe ns Performi ng Arts CenterWi l l s on Audi tori umCol oni a l Thea te rCol l e ge Southe rn Ida ho Fi ne Arts Ce nterJe wett Audi tori umEmers on Center for Arts & Cul tureNa mpa Ci vi c Ce nterNumeri ca Performi ng Arts CenterEverett Performi ng Arts CenterArgyros Pe rformi ng Arts Ce nterBoi s eIda ho Fa l l sGrea t Fa l l sBi l l i ngsBl a ckfootButtePoca tel l oBozema nIda ho Fa l l sTwi n Fa l l sCa l dwel lBozema nNa mpaWena tcheeEverettKetchumID1984ID1952MT1935MT 1931/1987ID2008MT1923ID2004MT2015ID 720630550512450Comparable National VenuesWa s hi ngton Ce nter for Performi ng ArtsLens i c Performi ng Arts CenterPerformi ng Arts Center of Ra pi d Ci tyEs pl a na de Thea treCovey CenterCl a rk Ce nter for Performi ng ArtsWeber Cente r for the Pe rformi ng ArtsCenter for Vi s ua l & Performi ng ArtsOl ympi aSa nta FeRa pi d Ci tyMe di ci ne Ha tProvoArroyo Gra ndeLa Cros s eMuns terWA1985NM 1800700670617450435Source: Respective VenuesTheater seating in competitive venues ranges from around 400 to 2,700 seats withan average of just over 1,000 seats. In addition to entertainment and theatricalperformances, most venues offer their stage and lobby areas for private rental forSeptember 21, 2018Introduction and Executive SummaryPerforming Arts Center – Coeur d'Alene, Idaho1-5

Convention, Sports & EntertainmentFacilities ConsultingChicago, Illinoisweddings, receptions, expositions, corporate meetings, and other group events.Several of the comparable venues house additional function spaces which allowthem to book private rentals and create a higher amenity level for patronsattending their performance events. Additional function spaces include meetingrooms, black box theaters, and art galleries.Approximately half of the comparable venues serve the needs of an educationalinstitution (college or school district) as a primary tenant. Many of the comparablevenues have a local symphony orchestra tenant. The next most common tenant is acommunity or professional theater group. Broadway theatrical series typicallybring three to six shows to a market each season. A handful of venues also serve alocal opera, ballet, or chorus.Local residents comprise a significant portion of a performance center’s primaryattendee market. Local population characteristics, therefore, can provide insightinto event and attendance potential and also provide evidence of a community’soverall economic size and ability to support public services and visitor amenitiesthat are important for theater users. For the purpose of this comparable analysis,HVS considered the one-hour drive time market surrounding each of thecomparable venues as the primary market served by the venue. When comparedto the comparable markets, the size of Coeur d’Alene’s one-hour drive-time marketpopulation is about average. Other market indices suggest that Coeur d’Aleneresidents are slightly older and have an average percentage of college graduates.Coeur d’Alene residents have below average income but spend an average amounton live entertainment events which could be presented at the Coeur d’Aleneperforming arts center.When programming the venue, primary consideration should be given to the localcultural groups that would use the proposed performing arts center. Seatingcapacity recommendations should also consider the types of touring events thatthe facility may host with the understanding that competitive venues in Spokaneand other neighboring communities would limits events booked in Coeur d’Alene.If possible, programming of the performing arts center should consider theinclusion of complementary function spaces and integrated development toimprove the event demand potential, expand the possible uses, and enhance theoverall visitor experience.User & StakeholderInterviewsSeptember 21, 2018HVS conducted a focus group with representatives from several localorganizations who could use the proposed performing arts center for their events.We also distributed a questionnaire to potential users to understand their venueneeds and potential use. These interviews and surveys helped inform buildingprogram recommendations and demand estimates.Introduction and Executive SummaryPerforming Arts Center – Coeur d'Alene, Idaho1-6

Convention, Sports & EntertainmentFacilities ConsultingChicago, IllinoisA representative from the following cultural organizations participated in thefocus group meetings: Chorale Coeur d’Alene Coeur d’Alene Arts & Culture Alliance Coeur d’Alene Summer Theatre Coeur d’Alene Symphony Handshake Productions Human Rights Education Institute Laura Little Theatricals Live After 5 Lokahi Dance North Idaho Youth Orchestra Out of the ShadowsRepresentatives from the following organizations completed the questionnaire: Chorale Coeur d’Alene Christian Youth Theater of North Idaho Coeur d’Alene Arts & Culture Alliance Coeur d’Alene Summer Theatre Handshake Productions Human Resource Education Institute Lokahi Dance Out of the Shadows Sorenson Magnet SchoolKey findings from these interviews and our focus group meetings include thefollowing. September 21, 2018Coeur d’Alene’s primary strengths in the arts include its relatively largenumber of cultural organizations, strong local talent, and communityinterest and support. There is also great diversity in the arts and the abilityto attract regional talent.Introduction and Executive SummaryPerforming Arts Center – Coeur d'Alene, Idaho1-7

Convention, Sports & EntertainmentFacilities ConsultingChicago, Illinois Coeur d’Alene’s arts organizations face the challenge of a lack of suitablevenues for their performances. Many organizations have difficultyscheduling dates and rental fees are often too high for some groups. Rehearsal space in Coeur d’Alene is extremely limited, causing manygroups to rent office space and other non-ideal locations. Arts organizations recognize the ongoing competition from groups inSpokane as well as competition within Coeur d’Alene for funding and otherresources. Arts organizations agree a new performing arts center should have stateof-the-art acoustics, lighting, and other technical capabilities. Organizations would like to have a venue with multiple performancespaces that can accommodate varying types of performances and audiencesizes. Ample wing space, fly system, and orchestra pit are also key featuresrequired for performances. On-site rehearsal space, classrooms, and smaller studio spaces would alsobe welcome features. Other desired features include easy access, ample parking, and the abilityto generate additional revenue through food and beverage sales and otherleased spaces.Through our user questionnaire, we also asked groups about their production,audience, performer, and technical needs. Their responses help determineappropriate seating capacity, back of house, and other technical and supportsystems.To augment local group needs, we also assessed the potential for touring concertsand other entertainment and identified the types of touring shows that couldpotentially book in Coeur d’Alene.Building ProgramRecommendationsHVS developed building program recommendations for a proposed Coeur d’AlenePerforming Arts Center. The recommended facility program can serve as a guidefor subsequent physical planning aimed at providing the desired programelements.If implemented, HVS’s program recommendations would place the proposed Coeurd’Alene Performing Arts Center in a position to attract a variety of small tomedium-sized touring concerts and theatrical productions to Coeur d’Alene thatSeptember 21, 2018Introduction and Executive SummaryPerforming Arts Center – Coeur d'Alene, Idaho1-8

Convention, Sports & EntertainmentFacilities ConsultingChicago, Illinoisexisting venues cannot accommodate. The proposed venue could also serve localarts groups allowing them to present their performances in a venue with ampleseating capacity as well as superior acoustics, staging systems, back of houseaccommodations, and attendee amenities. In addition, a smaller, studioperfo

performing arts culture increases the propensity of residents to participate in the arts, which in turn increases the attractiveness of the community to residents, tourists, businesses, and investment. Since an interest in the arts is highly correlated to education level, the people that are attracted to live in communities ...