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224-1999 LTC '2bb 9o.~ 1 I I CITY OF MIAMI BEACH CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139 http:\\cLmiami-beach.f1.us L.T.C. No. 224-1999 LETTER TO COMMISSION November 18, 1999 ') ~ I."...... TO: Mayor Neisen O. Kasdin and Members of the City Co ission , --:--1 " C) ITI C,) ........J FROM: Sergio Rodriguez City Manager SUBJECT: ECONOMIC IMPACT OF SELECTED MIAMI BEACH INDUSTRIES AND SECTORS At Commissioner Liebman's request and in connection with item R5H on the November 17, 1999 City Commission agenda, attached please find a report delineating the "Economic Impact of Selected Miami Beach Industries and Sectors". This report denotes the major industry contributors and further breaks down the proportionate share of resort sales attributed to the South Beach nightclubs and bars. As depicted in the attached report, South Beach nightclubs and bars contributed $47,201,950 in resort sales, which represents 6% of the total Citywide resort sales estimated at $803,527,569, reflective of its limited impact on the City's total resort sales. If you have any questions or further comments, please feel free to contact me. SRlC~/rar F\CMGR\SALL\RAR\L TClECOIMPCT RSH attachment c: Christina M. Cuervo, Assistant City Manager Janet Gavarrete, Assistant City Manager Mayra Diaz-Buttacavoli, Assistant City Manager Matthew Schwartz, Assistant City Manager Ronnie Singer, Executive Assistant to the City Manager Patricia Walker, Finance Director Richard Barreto, Chief of Police Kevin Crowder, Business Development Specialist Economic Impact of Selected Miami Beach Industries and Sectors Revenues, Total Output, and Earnings ................. ................ ............ ... .................. ..... .........1 Resort Sales Non-profit Culture and perfonning Arts Entertainment Industry Miami Beach Hospitals ConstructionlDeve lopm ent Retail Trade Chart 1: Selected Industries Chart 2: Selected Industries and Sectors Chart 3: Total Output by Various Resort Sectors Revenues and Resort Tax...................,...............................,...........................................,.....5 Revenues and Collections by Area and Type of Establishment ..........................................6 South Beach Resort Sales South Beach Alcohol Sales Growth in Alcohol Sales, 1997-1999 Alcohol Sales in South Beach Nightclubs and Bars Chart 4: South Beach Alcohol Sales, 1999 Chart 5: Growth Portion of South Beach Alcohol Sales, 1997-1999 Chart 6: Miami Beach Resort Sales, 1999 Tourism........................................,......................,....................................................... ....... 10 Patterns of South Beach Visitors Impact of Tourism on Miami Beach Retail and Restaurant Sales Chart 7: South Beach Visitor Patterns, 1998 City of Miami Beach Resort Sales, 1997-1999 ............................................................... ..12 City of Miami Beach Schedules of Resort Tax Collections ..............................................14 Miami Beach Economic Impact Multipliers......................................................................17 City of Miami Beach Community/Economic Development Department 1700 Convention Center Drive Miami Beach, FL 33139 (305) 673-7193 fax (305) 673-7772 ECONOMIC IMPACT OF SELECTED MIAMI BEACH INDUSTRIES AND SECTORS Revenues Total Economic Total Earnings , , Output - Generated - Yorth Beach Food Sales 5 15'rli63-1 5 31J.{)36,rr] S -,988,3F .IIiddle Beach Food Sales S 65,I67,r5 5 In. 51-1,853 S 3]583, -38 South Beach Food Sales 5 ]]O,Slr,503 S -115,118,106 110,-103. -5] ,Vorth Beach Room Sales 5 ]3.501,1-13 5 -13, 9r.1 r 5 12, -155, 606 JIiddle Beach Room Sales 5 151,10-1,]]9 5 ]82,565,11-1 5 80,085,]00 South Beach Room Sales 5 195,]S3 --8 5 ] 65, 180,665 S IO],500,-I()2 Yon-Profit Performing Arts 5 r.191,985 5 69,]]9,562 5 F,6~-I. -9() Yon-Profit Special Evenls 5 l,3J.1.I-3 5 5,F9,ISI S 1,153,5-15 Yon-Profit other amusement activities 9,66-1,5]0 2(),--S, -IS S S, -9-1, -/3 Jlt, Sinai 5 136,OO(),()O() 5 -I62,56()()()O S South Shore 5 J-I9/8,F5 5 68, -13 9,673 5 7 1,998, -150 J/iami Heart S 1.l2,588,81r 5 .l-lO,.l--I.062 S --,no, 9-18 Miami Beach Hospitals (1996) 5 $ 393,506,982 771,273,685 $ 247,909,399 Construe Retail Trade (1998) 7 $ 251,085,700 907,461,691 $ 1,660,654,895 $ 490,029,313 City of Miami Beach Resort Tax Office, 1999 -' J/ultipliersfrom the "Economic Impact St1lt(t'jor J/iallll Beach, " Florida International eniverst!t', J/av 1999 , ,\Iiami Beach Cultural Arts Council. 1999 , Citv of,\/iami Beach Economic Development Dn'fsion ,lIId ('ilv of,\liami Beach O(Jice of 1rlS, Cul/ure and /:-n/errainmcnt ,)'olllh Florida /Jusiness Journal, "Book of Lisls" ('itl' 0/ ,\Iiami Beach S/ans/ical.t bs/ract, 1999 C,,)' Departmen/ o/Housing and Urhan DevelopmCntlincludes' But/ding .\Ia/erials, ffa"l1mre, Garden Stipp lv, General,\lerchamlise, Grocery, .LUfO und Gasoline. apparel and ,-lccessot}', flume Furnishings dilL! 1::(luipmen/, Jlisc. Ri!/ad. Pi!rsona! ,)'ervici!s. .-lutonlOlive Repair. .\Ii.,'c. Repair Servlces, .Hollon PiCllll't!...,', :ll1lllsemenl and Recreation St!r\'icesJ Retail Trade (1998) 7 t/) CI) N ';: '0 ~ Construction/Development Q) t/) 1ii ::::J (1998) 6 CDd " c: ,: Q) ,I C 0! ",I " ClI' C:d CI) "c :1 ~ ~I (.) ell I CI) UJ " m:1 CI) o'i tn ~, 'too Miami Beach Hospitals .' 0 (1996) 5 ~ (.) ca a. N E "5 a. (.) "5 0 E 0 'E 0 0 C <:: Entertainment Industry 4 0' 0 0 (.) UJ W n; <5 s:. ~ (.) [] ca CI) m E '" Q) .~ Non-Profit Culture and :l <:: Cll :E Performing Arts 3 > GJ 'too c::: 0 m ~ U Total Citywide Resort Sales 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 I EA- 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ex) CD ....:t N 0 ex) CD ....:t N """ """ """ """ """ EA- EA- EA- EA- EA- EA- EA- EA- EA- " --~---~ - -----.-------.---- - --_. ------------ .---....---- ~ o - (.) Q) rn "C s:: ns tn Q) 'i: - tn ~ "C s:: "C Q) - (.) Q) Q) rn - o - (.) ns c. E (.) 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CO Q) OJ E CO .- :E fi m (5 CD.c: o .c:.!.! 15 <{ z E g 0: -5 '" ~ CD .c: " o Z ." o ~ .c: " '" ~ CD ." ~ '0 8 ;;: {j '" ~ CD ." ~ E o o 0: .c: ~ ~ CD ." ~ ~ m <J) ." o o "- CD <J) E g 0: ~ - ~ ~ro O<J) :I: CD <J) c '" :; -0 ~~ 0:<( <Xl <J) '0 8 ;;: a; 15 :I: <Xl <J) '0 .c: 8 ;;: :* :E '" Z CD <J) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 I Ef)- 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 L[) 0 L[) 0 L[) 0 L[) 0 L[) "l::t "l::t C"1 C"1 N N ...- ...- Ef)- Ef)- Ef)- Ef)- Ef)- Ef)- Ef)- Ef)- Ef)- --- ----_..._~-_.. Revenues and Resort Tax South Beach Resort Sales Miami Beach resort tax is collected on the sale of rooms, food and alcohol. In fy 1999, alcohol sales accounted for 16.1 % of all resort sales city-wide and 21 % of all resort sales in South Beach. The types of establishments that sell alcohol are nightclubs & bars (nightlife), hotels and restaurants. South Beach Alcohol Sales · In 1999, alcohol sales in nightclubs and bars accounted for 42.7% of all South Beach alcohol sales. · In 1999, alcohol sales in hotels were 14.7% of all South Beach alcohol sales. · In 1999, alcohol sales in restaurants made up 42.6% of all South Beach alcohol sales. Growth in Alcohol Sales, 1997-1999 The fastest growing sector of South Beach alcohol sales has occurred in hotels, with alcohol sales in hotels growing by 115.6% from 1997 to 1999. Restaurant alcohol sales grew 29%, and alcohol sales in nightlife establishments grew 43.9%. The sale of alcohol in hotels accounted for 26% of the growth from 1997-1999. Nightclubs and bars were 43% and restaurants were 31 % of the growth in alcohol sales. Alcohol Sales in South Beach Nightclubs and Bars The sale of alcohol in nightlife establishments accounted for 42.7% of all South Beach alcohol sales and 36.4% of all Miami Beach alcohol sales. The sale of alcohol in South Beach nightclubs and bars contributed 9% of all South Beach resort tax and 6% of citywide resort tax. Activity Resort Tax Collected Nightclubs and Bars South Beach Alcohol Total South Beach Resort Tax Total Miami Beach Resort Tax $944,039 $2,210,383 $10,532,208 $16,070,511 Charts: South Beach Alcohol Sales, 1999 Growth Portion of South Beach Alcohol Sales, 1997-1999 Miami Beach Resort Sales, 1999 5 Revenues and Collections bv Area and Tvpe of Establishment From 1997-1999, South Beach accounted for 56.2% of all food and beverage (F&B) sales in Miami Beach. In South Beach, these sales are broken down into five areas: Ocean Drive, Washington Avenue, Collins Avenue, Lincoln Road, and all other areas. Ocean Drive leads all areas alcohol sales as well as all food and beverage sales. The chart below shows where South Beach alcohol and food and beverage sales occurred from 1997-1999. (F &B numbers are for alcohol serving establishments only). Area % SoBe Alcohol % So Be F&B Ocean Drive Washington Avenue Collins A venue Lincoln Road Other Areas 27.6% 24.5% 12.5% 8.5% 9.3% 20.1% 14.4% 10.5% 8.0% 8.9% Percent of City-wide Resort Tax Collections, 1997-1999 Area % of Total Resort Tax Ocean Drive Washington Avenue Collins Avenue Lincoln Road Other Areas 11.3% 8.0% 5.9% 4.5% 5.0% Total Revenues by Type of Establishment Type of Establishment 1997 1998 1999 Nightclubs and Bars Restaurants Hotels Non-Alcohol Serving Restaurants 37,600,000 129,276,900 149,483,805 50,832,371 40,789,550 152,294,350 172,044,50 I 40,627,449 55,496,600 181,095,650 240,010,078 50,008,103 1997-1999 Growth Rates and Percentage of Total Sales Type of Establishment 1997-1999 Growth % of Total Sales Nightclubs and Bars Restaurants Hotels Non-Alcohol Serving Restaurants 47.6% 40.1% 60.6% -1.6% 10.5% 34.4% 45.6% 9.5% 6 0 ..r::. 0 () en <( ':::R 0 en ~ N ..q en +oJ ~ ..r::. C) ~ Z tn (1) - to en - 0 0 .c ..r::. 0 0 () ':::R 0 <( 0 lO - T""" <( Q) +oJ 0 ..c::: I 0 to (1) m .c 0 ., ..r::. ~ 0 () 0 <( en +oJ ;::R C 0 CO ('f) ~ ..q :J CO +oJ en Q) a::: t/) 0) - co UJ - o oC o o - <C oC o CO 0)0) mO) oC~ ... I ~...... 00) UJO) ~~ o c o .- 1:: o D- oC i o ... C) o ..c o u <('#. ~~ +-' ..c .0> Z o ..c o () <( +-''CF. c co~ L...('f) ::J CO +-' en Q) 0::: o ..c o u'#. <(CO Q)N +-' o I 0 ..e (/) 0 u Q) <( ro ... en c E~ 0 ~~ o~ en 0 ..e ::J(D ON en ..e 0 ro 0::: 0 u ... en <( 0 (/) U Q) CO ~ <( -C>' 0:: en ... ~;:R 2N CO tn 0 ._ 0 I CJ) Q) :E(D - .2> CO CO en en z CO 1:: en 0 , tn Q) a:: .c (/) Q) 0 ro CO CJ) Q) "'O~ m of'-.. ON .- U. E CO CJ) CO ro .- ... :E 0 f- ..et:: u ro 0 ;:R Q) (/) 0 co~LO ..e ro t:: ... 0 O;:R Z I- 0 0 ..eM U ro Q) CO :'Q ~ Tourism Patterns of South Beach Visitors (1998) Visited South Beach... .... ............ ........ .... ............ ,....... ..... ............ ......... ......7,081,790 Visited the Beach ,... ..... ..... ..... ................ ... .... .... ... ........ ....... ..... .............. ....4,808,535 Visited Downtown Miami......... ...... ..... ........ ......... .... ,.... ..... ............. ...,..... .2,542,363 Visited A ventura Mall............... ........ ........... .................... ..... ........... ..... .....2,499,872 Visited Ocean Drive Cafes......................................................................... 1, 770,448 Visited Nightclubs................................,..............................,........................ 956,042 Visited Lincoln Road................... ........... ................ ...... ..... .... ..... .... ..............913,551 Engaged in Watersports ................................................................................5 38,216 Played Golf...................................................................................................5 31,134 Visited Museums..... ..................... ............. .......... ............... ... .... ........... ...... ..431,989 Went Scuba Diving...................................................................................... .311,599 (67.9%) (35.9%) (35.3%) (25%) (13.5%) (12.9%) (7.6%) (7.5%) (6.1 %) (4.4%) "1998 Visitor Profile and Tourism Impacl Study, " Stralegy Research Corpora/ion and the Greater Miami Convention and Visitors Bureau The Art Deco District and the Beach are the major attractions for visitors to South Beach. Other major activities that these visitors engage in are shopping (Downtown Miami, Aventura) and visiting the sidewalk cafes on Ocean Drive. Additional amenities that South Beach visitors engage in are nightlife, Lincoln Road, watersports, golf, museums and scuba diving. Although amenities such as nightlife, watersports, golf and scuba diving are not the primary reasons that most visitors come to Miami Beach, they are key enhancements to the quality of Miami Beach as a destination and must be maintained and enhanced. *The total impact on tourism by industries such as nightlife and the entertainment industry cannot be fully quantified due to the increased exposure and awareness of Miami Beach that they provide. Impact of tourism on Miami Beach retail and restaurant sales: Tourists account for 24,9% of Miami Beach retail sales Tourist retail sales in Miami Beach are 11.6% of all Greater Miami tourist retail sales Tourists account for 45.7% of Miami Beach restaurant sales Tourist restaurant sales in Miami Beach are 12.2% of all Greater Miami tourist restaurant sales Chart: South Beach Visitor Patterns. 1998 10 co Q) Q) ~ .. tn c: '- (1) .... .... co a. 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I"- ell ('I') 0 OJ 0) L() I"- ... ~ ..- 0) L() 0 ..- OJ ell 0) ..- L() '<t '<t '<to - (fi N I/) Q,) (fi a=: 3: - () M ~ 0 0 C! ~ 0 ~ 0 ..- 0 0 0 ..- 0 f- a::: '<t (0 ..- I'- 0 OJ .l: I/) L() ('I') 0) (0 L() 0) (J Q,) 0) ..- '<t ('I') ..- o. ell - '<t ('I') ..- '<t '<t Q,) 0 ('I') L() 0) CD :I: ..- L() CD .l: (fi (fi - ~ 3: 0 - () en 0 0 ~ ,.... "=t ~ ~ c (1) ~ N 0 N 0 0 It) (1) 0 f- I/) (1) a::: T"" ~ "'C ..- '<t (0 OJ (0 L() ell I/) en e .c 0) ..- L() '<t ..- N ell ~ (0 0 0 ('I') 0). O. 0 co (J I"- OJ ..- '<t L() I"- .c 0) - 00 00 I"- L.() 0) 0> 0 (1) .l: I"- 0 ..- ..- "!. (J T"" .2' (fi ..- N < ,... z (fi (1) - ~ c 0) I/) 0 T"" ... U ell I/) m I 0 l- e M a:: 0 ... .. Q,) Q,) (J .c "'C ~ E ~ (5 0 Q,) .c >- () - Q. .l: 0 ~ )( Q,) (J U ell en I/) (J < C ell .l: I- "'C 0 Q,) Q,) )( (J ~ Q,) .. ~ CD ell ell 0 "'C (J e en )( I- Q,) I/) c ~ Q,) ell - l- t: CD Q,) w Q,) > I/) a=: 0 ~ <( ell 0 t: 0 I/) U C "'C Q,) .c I/) E - ... Q,) C ell ... 0 Q,) ell 0 ell )( > Q,) 0 0 < 0 I/) a=: Q,) ell .~ > - a=: (J Q,) := ~ >- l- e < C) ... < a:: ~ ~ e e Q,) 0 - Q,) t: I/) .c N 0 "'C .l: C e .c (5 - Q,) - 0 ell I/) (J 0 ell ell ell >-.l: ... I/) Q,) - ell e - - - ~ (J 0 Q,) (J 0 ~ < 0 0 0 () en u.. a:: 0 u ...J l- I- I- Miami Beach Economic Impact Multipiers Output Earnings Employment Activities Multipliers Multipliers Multipliers Eating and Drinking 1.88 0.50 40.4 Hotels 1.87 0.53 28.1 Performing Arts 2.55 0.65 28.6 Special Events 2.30 0.49 25.6 Amusement 2.15 0.91 25.5 Fashion 2.23 0.76 14.2 Hospitals 1.96 0.63 25.3 Construction/Deve lopment 1.98 0.47 23.3 Retail Trade 1.83 0.54 30.3 Economic Impact is determined by the combination of direct expenditures and a multiplier effect, which takes into account the extent to which the fIrst round of spending ripples through the local economy and creates more spending. Source: "Economic Impact Study for Aliami Beach, .. Florida International University, May, 1999 17