Fredericksburg Standard Radio Post, Mar 11, 2009
A local wine and culinary center could draw as many as 34,000 new visitors to Fredericksburg each year and contribute more than $11 million to the local economy, according to an economic study completed last week by New York-based Fairweather Consulting.

“The typical culinary visitor tends to stay longer, tends to spend more money, be better educated and have an interest in touring museums,” Ernie Loeffler, director of the Fredericksburg Convention and Visitor Bureau, said. “They are really somewhat of an ideal visitor for a town like Fredericksburg.”

The report, which suggests that a wine and culinary center could be economically viable if properly managed, makes the assumption that 85,000 people would visit the facility each year, including about 34,000 people who would not have traveled to Fredericksburg otherwise.

“The center is kind of a gateway for tourists coming to the area,” Peter Fairweather, owner of Fairweather Consulting, said. “We’ve made an assumption that these travelers would stay in town for three days and spend $115 a day.”

Initial planning for a center, referred to in the report as the Texas Center for Wine and Culinary Arts, began in 2004 and continued as a joint project of the visitor bureau and the Gillespie County Economic Development Commission.

The center, which would be located at the Hill Country University Center, was originally envisioned as a tourist destination, but Loeffler said that current plans suggest that the center would serve more as a training location for visitors in the wine, culinary and hospitality industries. Fairweather said that these demographics have been factored into the 34,000 new visitors accounted for in the report, though tourists will also make up a large portion of the center’s estimated visitors. Though Fairweather’s report is optimistic about the center’s potential success, there is no current model for an economically self-sustaining wine and culinary center.

Similar facilities in New York and California have experienced organizational restructuring and high financial losses, according to the report. Local success depends on early fundraising and debt-free construction.

“We’re looking to minimize overhead costs so it is more likely to be self-sustaining,” Fairweather said. “There are always things you can’t anticipate, and the idea is to have a strong plan going in.”

The report assumes that initial costs of a wine and culinary center at the HCUC site would be around $10 million. With four percent growth over 10 years, the center is projected to accumulate a deficit exceeding $1 million. If these losses can be covered through fundraising prior to construction, the center is estimated to post a profit in its 11th year of operation. The report also calculates scenarios where the center could post a profit after six or four years.

“I feel like this was prepared from a relatively conservative perspective, which I appreciate,” Tim Lehmberg who has recently been named executive director of the EDC said. “I don’t like to be hit with the ‘best case scenario.’ Then if it doesn’t work out, it’s all downsides.”

According to the report, success of a center will also depend on aggressive marketing toward tourists and those in the wine, culinary and hospitality industries. Loeffler said that some of this marketing has already indirectly begun.

“The center will be able to launch off of what we’re already doing to position Fredericksburg as a destination for wine and culinary activity,” he said. An initial draft of Fairweather’s report did not include a specific marketing position at the center. Loeffler saw this as an oversight and recommended that the report’s final draft specifically call for a marketing director.

“I thought it would be important to have someone marketing this center every day,” he said. “It will have to be marketed as a stand alone attraction.” The report now includes a position for a marketing director who would potentially make $75,000 a year. Another crucial step in assuring the center’s success will be the hiring of a knowledgeable executive director.

“I think it’s important to get the best possible person,” Fairweather said. “It’s key to not only get the center established but also to really get the momentum going.” Attracting a strong director, Fairweather said, will depend on adequate financial compensation, with a salary listed in the report as between $100,000 and $125,000. The center is intended to include culinary education, wine tasting and restaurant facilities along with exhibits that promote food and agriculture from across the state. More specific plans are speculative at this point, but proving the potential success of a center is a strong first step, Loeffler said.

Fairweather presented his final report to about 50 local leaders on March 3. His contracted work on the project has been completed and any further involvement depends on the needs of a project steering committee which Lehmberg and Loeffler hope to form by May 1.

Any decision to move forward with construction of a center will be up to that committee which will likely be made up of local representatives from the food and wine industries.

Fairweather’s study, which cost $51,500, was jointly funded by the EDC and visitor bureau. With a report now in hand, Loeffler and Lehmberg said they can now focus on early fundraising and marketing. Initial reaction to that document has been positive locally and Lehmberg and Loeffler said they hope to talk to more industry representatives and set up appointments with interested officials in the Texas Department of Agriculture.

“Ernie and I have talked to our contacts there,” Lehmberg said. “We’re kind of on standby and ready to run to Austin as soon as we hear that we have an audience.”