ANDREW JAGGERS MR CREST NICHOLSON MARINAS LIMITED DEVELOPING AND GAUGING THE BENEFICIAL ECONOMIC IMPACTS OF BOATING AND BOATING FACILITIES

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1 ANDREW JAGGERS MR CREST NICHOLSON MARINAS LIMITED Mr Jaggers is Harbour and Marina Manager at Bangor N. Ireland, Ireland's largest marina. He holds regional responsibilities for other marina sites in the Crest Group. DEVELOPING AND GAUGING THE BENEFICIAL ECONOMIC IMPACTS OF BOATING AND BOATING FACILITIES 82

2 BACKGROUND: Bangor is situated on the south side of Belfast Lough on the northeast coast of Ireland, some 14 miles from Belfast. The population in the area is currently in the order of 70,000. Bangor Harbour's history goes back to 1757, and around this time the town enjoyed a brief period of industrial activity until the early 1800's. The coming of the railway from Belfast in 1865 was a major factor in Bangor's evolution into a popular seaside resort. Cheap transport for the city masses, allied to a more pleasant environment for the wealthier to set up home - water, drainage and lighting were all improved around this time - meant that expansion began, with the building of the handsome terraces of Victorian villas which still stretch round the bays and headlands. Yacht clubs were established, sea bathing thrived and quickly the necessary improvements to promenades, piers and other facilities were affected to draw back the crowds each summer. By 1901 the population stood at 5,903 as opposed to 2,850 in The peaceful Edwardian years - a time of golden summers - were the zenith of the resort. Ward Park and the Marine Gardens were opened and for the permanent residents" needs a new hospital, Grammar School, golf club, library and Technical School were all built within a few years. After the First World War the pace of improvement slowed for a time and major Council projects such as the building of a new pier were shelved, but the 1930s was another memorable decade, the era of the Tonic Cinema, Pickie Pool, and Caproni's Dance hall. Many new avenues were laid out and in 1930 the population had leapt to 14,000. World War Two again impeded progress, but gradually a new and very different post-war world emerged, where cars and aircraft made people more mobile. Thus on the one hand Bangor became even more of a `dormitory town' for Belfast while at the same time fewer holiday-makers came to stay, preferring day trips or cheap foreign travel. Whilst the population of Bangor continued to expand rapidly with the development of new housing around the town, the town centre and seafront failed to attract the commercial investment required to match the competition from other modem shopping centres. Changing trends in tourism in the post-war era had led to both economic and physical decline in Bangor, and by the late 1960's it was clear that a major public sector initiative was the only way to arrest this decline. The Seafront Development Scheme was conceived as an ambitious strategy to revitalise Bangor as a tourist resort, to create jobs, and to improve the built environment. The scheme had as its main elements, the construction of breakwaters to enclose the Bay and protect the seafront, the development of a major marina, proposals to upgrade Pickie Pool, and the provision of seafront car parking, gardens and promenades. It was never intended simply to provide a "boat park" but rather that the marina should act as a "pumpprimer" for seafront and town centre redevelopment by both public and private sector interests. The construction of the scheme lasted over a period of 12 years, and the various phases, elements and costs were not to the liking of all traders, residents or indeed Councillors. The overall cost was in the region of 18 million, and grant aid from the European Regional Development Fund and the Tourist Board played a big part in offsetting these costs. 83 The first phase was completed in 1989 and subsequent phases were completed in 1991

3 and 1994/5. ECONOMIC BENEFITS The response to the various phases of the development scheme soon became apparent. Employment on the seafront increased as a result of marina, harbour and associated businesses developing and expanding. New businesses such as Chart Agents and Chandleries opened and also later expanded. Tourism activity increased along the seafront with promenaders enjoying new and sheltered views and the new Pickie Family Fun Park became Ireland's second biggest tourist attraction in The tourist trends therefore were broadly in line with those experiences noted at similar developments in other locations worldwide. Satisfyingly other grant aid agencies provided funding for the redevelopment of a number of derelict properties and the construction of a new hotel at the seafront provided a significant boost to the town centre. Other projects included a new shopping mall, new restaurants and a new road layout provided by Central Government funding. The last section of seafront property has been purchased by Council with a view to attracting private funding to provide a conference centre, tourist centre and winter garden area. Although this partly run down area includes some existing businesses, purchase was achieved by consent, although a compulsory purchase order was within the power of the Council. The improvement in the built environment and the increases in tourist activity, bed nights and town centre activity quickly became visible to all. In the meantime the marina and harbour operation had continued during the period of construction and development. Expansion of facilities had taken place and the number of visiting yachts was noted to increase year on year, particularly after the completion of all the construction phases, and with the outbreak of peace in 1995, and increasing operating profits were being recorded. However it had become apparent that there was a need to accurately determine the spending power of the visiting yachtsman and women for a number of reasons. (a) to counteract continual criticism from various quarters concerning the real benefits of the marina to the town's economy regardless of other obvious factors (b) to be able to compare this income figure with the well-established statistics developed by the Tourist Board for other (land-based) tourist sectors (c) To encourage seafront traders and associated marine businesses to advertise with the marina, by demonstrating the benefits accruing (d) to increase the perception of added-value of the marina site to all the people of Bangor, rather than to a small number of yacht owners Although there exists a wide range of literature and papers on the subject of economic benefits, including the excellent 1996 compilation by ICOMIA's Boating Facilities Committee, we had found that too often the figures referred to were described as estimates or projections, or they related to areas completely different from our own sites. We wanted to achieve a simply, basic, cheap and continuous method of establishing and 84

4 then monitoring visitor spend, over a period of time rather than by a snapshot survey. It was decided to use the Marina Yearbook as a vehicle for a standard questionnaire which had been introduced in 1992 and which gave all marina users the opportunity to record their observations on service facilities and the like. Because a large proportion of long-term "resident" bertholders lived "locally" this was adapted to focus on visiting boat owners only and it asked specific questions on spending, as follows: Visitors to Bangor Marina Boat Name Home Port Date Last Port Next Port Days in Bangor We would be grateful if you would take a few minutes to let us know how you found your visit to Bangor 1 How many people on board? Adults Children 2 Did you find all the Marina facilities satisfactory? Yes/No 3 Did you find the Marina staff helpful? Yes/No 4 Did you shop at all in Bangor? Yes/No If yes did you buy: Where value (approx.) Food Drink Chandlery Other 5 Did you visit any of hotels/pubs/restaurants? Yes/No Approximately how much did you spend? Under 50 Over 50 6 Did you visit any local yacht clubs? Yes/No 7 Did you visit any Tourist Facilities in Bangor?Yes/No 8 Have you visited or used services of any of our advertisers? Yes/No 9 Please make other relevant comments on any of the marina services or facilities 85

5 An incentive was provided in the form of a prize each month, and the numbers of returned completed forms soon reached the levels required to derive accurate statistical data in the same form as used by the Tourist Board. During the implementation of this exercise it became clear that there was little accurate statistical data of this kind already available in this region and the results of our surveys over the early years therefore assumed some importance. We were firstly able to establish that each crew member's average spend on items other than marina berthing and fuel, i.e. spend ashore, was in the order of 25 per day. Quite coincidentally this figure almost exactly matched the Tourist Board figures for the average land-based day-tripper or overnighter in the area. Using figures derived from the Marina Management system we were delighted to be able to show that the annual seasonal spend around Bangor seafront was in excess of 500K or some $825K. This was simply calculated from derived figures, i.e visiting boats, in 1995 for instance, staying 3.7 nights on average, with a crew of 3:= 2028 x 3.7 x 3 x 25 = 562,770. We soon discovered that the publication of these statistics greatly assisted in dampening criticism about the economic benefits directly achieved by the marina and harbour, as well as increasing the perceived value of the operation by the Chamber of Commerce, potential advertisers, seafront traders and sponsors of events held at the marina. Publication of these statistics on a regular basis in our operational reports to Council and the Chamber of Commerce, in grant aid applications for events, in sponsorship appeals, in support of advertising sourcing and eventually in Tourist Board publications, has provided a wide scope for showing the direct benefits of the marina at Bangor to traders in the area. FEASIBILITY STUDIES & IMPACT ASSESSMENTS As a Company we have always been able to draw on our experiences of developing, managing and operating a wide range of sites. We now always refer to direct economic benefit statistics when we are engaged in feasibility studies on our projects and on those for third parties. As part of a property development group we are very aware of the "waterside" premium on property values. This "waterside" factor is a well-established fact among all involved in such developments, but accurate statistics such as those we have produced have not been available before in our region. 86 We have therefore been greatly assisted in our economic impact assessments by being able to refer to them and to quickly develop new statistics for a new site by using such a simple mechanism. It had been our experience outside our Group until fairly recently that some developers of potential projects had sought to investigate the engineering feasibility and costings of a site with no direct reference to the experience of a Marina Operator. We felt that by doing so, they failed to see the whole picture, and we have been aware of the shortcomings of a number of sites as a result. The feasibility studies so produced often did not include any accurate direct economic benefit figures or nor did they refer to the detailed kind of customer service requirements that can only be provided by those who have actually operated and managed sites on a day to day

6 basis. As operators and developers of our own sites we have been pleased, over recent years, to see a trend developing where operators have been invited to become involved in studies on major projects at an early stage perhaps as part of a development team that includes engineers and architects. We have found that the results of such co-operation have been better balanced between the elements of engineering, service and finance requirements than otherwise would have been the case. In some cases savings on capital costs have resulted, or a higher level of service provision has been possible for the same level of investment. We have also recently noted that where potential development sites are in public ownership there is often a requirement under law for a tender process to be put in place. This will apply to studies, development briefs or lease opportunities for example, and prequalification now often requires marina development and operational experience. This trend points to an awareness of public bodies, of the need to strive to achieve an overall and balanced "best value" particularly where grant aid or public finances are involved. CO-OPERATION BETWEEN PRIVATE ENTERPRISE AND PUBLIC BODIES Until quite recently co-operation between public bodies and private companies has often been on the basis of a Client/Contractor, Landlord/Tenant or Owner/Manager relationship. We are now seeing the emergence of initiatives encouraging real partnerships between public and private finance and resulting in the formation of "joint venture" companies to source, develop and operate facilities. Private finance initiatives are not confined to waterfront developments and there has been a move towards Design Build Finance and Operate (DBFO) arrangements on schemes involving roads, bridges, housing, hospitals, schools and the like. We are already involved in arrangements such as these, and there has been a need to produce an innovative and flexible approach to financing rather than the simpler mechanisms in place with a more conventional relationship. The underlying principles will however remain the same - public sector assets mainly in terms of land, are being used to attract private funding so as to develop facilities at a minimum cost to the public purse. 87 However, no matter the type of development, or the type of funding or co-operative mechanism used to create it, the ultimate aim can be to improve the value and structure of the built environment, and increase economic benefit, for the greater good of the greater part of the local populace. 88