The 2015 Louis Vuitton America’s Cup World Series event held October 17-18 in Bermuda generated an estimated $8.6 million – some $6.9 million more than projected – in economic activity according to an impact study.
The Economic Impact Analysis Report was produced by a consultant seconded to America’s Cup Bermuda Lt (ACBDA) by a local accounting firm and represents direct investment into the Bermuda economy.
Approximately $6.1 million, or 70 per cent of the spend was generated from overseas sources.
Speaking at a press conference earlier today, Minister for Economic Development Grant Gibbons said: “The actual returns far exceed initial projections. This is clearly a very good result that builds on the overall benefit of hosting the America’s Cup, the teams and all related events.
“We have only focused on economic activity that can be directly attributed to this event and have not considered any secondary spending or indirect economic benefits that might ordinarily be accounted in a full economic assessment. In that light, this assessment can be considered conservative.”
The types of services consumed included hotel rooms; restaurant meals; corporate hospitality events; transportation; other boats; and shopping at the event village and other retailers.
What’s more, the international media coverage reached a global audience of $14.1 million, described by Dr Gibbons as: “A huge positive contribution to Bermuda’s international visibility in major tourism markets.”
Where the total economic impact was underestimated. so too were the net costs — an additional $135,000 was spent by government.
The economic impact was generated from a variety of sources including spending by travelling fans; competitor teams; America’s Cup commercial partners and sponsors; the international media; the general public; the ACEA; the ACBDA; and the Bermuda Government and other taxpayer funded amenities.
Peter Durhager, chairman of the ACBDA, provided additional detail on the breakdown of the report.
Local banks reported an additional $4.7 million in spending during the World Series week compared to an average week in October. To ensure a “fair and prudent” estimate, only $1.3 million of this spend was not included in the final figure of $8.6 million.
More than 10,000 people attended the event village on Front Street throughout the weekend and on the Sunday an estimated 550 boats, carrying about 5,000 spectators, watched the racing action from the Great Sound. About 1,499 visitors, including media and team members came to the island specifically for the event. Hotels enjoyed a 43 per cent increase in revenue compared to a usual October week while some $1.5 million was generated in retail sales.
Mr Durhager acknowledged the volunteers whose contribution was estimated to be worth $600,000 in volunteer hours plus waived fees and charges. The figure was not factored into the final impact but represents a reduction in operating costs.
Mr Durhager said: “This activity, coupled with $14.1 million of value in media exposure, illustrate the significant impact of the event and represents an excellent return on investment.”