1. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 1 Fort Monroe Tourism Feasibility, Marketing and Development Analysis May 28, 2008

2. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 2 I. Tourism Market Overview II. Marketing Strategy III. Development Plan Options IV. Questions and Discussion Agenda

3. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 3 Tourism Market Overview  There were 35 million visitors to Virginia in 2007  Virginia tourism has been in a no-growth pattern since 2003  Average party size is 1-2 persons, indicating childless couples  78% are overnight visitors  57% utilized hotel/motel accommodations  40% visitation was leisure-oriented  Tourists to Hampton today are regional 25% visitors are from Virginia 12% visitors are from North Carolina 7% visitors are from Maryland

4. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 4 Cultural Attractions Overview  11 historic sites and battlefields and 3 wildlife/wilderness National Parks within 200 miles of Fort Monroe  2007 attendance was 7.8 million persons  Colonial National Historic Park is the most heavily visited  Historic sites and battlefields have the highest total visitation throughout the year

5. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 5 Recreational Tourism Market Overview  There are 3,151 hotel rooms in The City of Hampton  Average annual occupancy is 58.1% Annual occupancy declined from 66% in 2002 to 58% in 2007  Average daily rate is $73.89; VA average is $93. Summer room revenue is nearly 4 times winter room revenue  More than 1/3 annual stays were between June and August  There are 27 marinas within 30-minutes of Fort Monroe  50% maintain a wait-list  Demand exists for new facilities or 40 ft. + slips  Amenities and services are important attributes  Average Hampton Slip Rental Rates: Nightly: $1.35-1.85 per foot. Long-term: $6.25 to $8.00 per foot per month Semi-annual: $8.50 to $10 per foot per month.  There are 14 RV spots at Fort Monroe today  Average nightly rate: $24.50  Most RV Parks offer swimming amenity, some charge premium for views  Facilities must be larger and offer more amenities to demand premium rates; expansion potential exists

6. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 6  Fort Monroe has strong tourism potential  Historic significance attracts several submarkets Military Historians African American visitors Preservationists  The site’s natural beauty, beach, recreation facilities, marina, and campgrounds draw resort and recreation visitors  Projected Market  Estimated visitation (conservative, stabilized year) 100,000-150,000 annual cultural attractions visitors 115,000-125,000 beach visitors 225,000-275,000 total visitors  If a brand is obtainable, 130-150 room resort can be supported  Seasonality will mirror beach destinations High season will be three summer months A two month shoulder season will bring additional visitors  Initially, regional visitors will be price sensitive Tourism Market Potential

7. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 7 I. Tourism Market Overview II. Marketing Strategy III. Development Plan Options IV. Questions and Discussion Agenda

8. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 8  A cultural museum cluster anchored by a Civil War Museum told from three perspectives will draw visitors and highlight historic significance  A link to “America’s historic triangle” will elevate Fort Monroe’s visibility on a regional and national level  The Fort Monroe hotel, if designed to evoke the historic Hygeia Hotel and nationally branded will enhance the area’s national exposure, draw recreational travelers and link to the area’s history  Recreational areas like the beach, marina and RV park can be marketed and functioning in short order support and promote Fort Monroe through its development Marketing Strategy Components

9. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 9 Marketing Strategy Timeline  The Museum/Cultural/Historical cluster will likely take 7-10 years to develop and facilities should not be marketed until the year prior to opening  Incremental/existing cultural attractions (i.e. a retained Casemate museum, fort and historic driving tour) can be marketed much earlier  Recreational amenities can be marketed as soon as improved facilities are completed  Public beach, marina and RV park can be marketed when available  Incremental improvements and enhanced access and parking will be necessary to attract visitors to recreational components

10. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 10 Cultural Attraction Cooperative Agreement  Expand “History Triangle” to “America’s History Quadrangle” to include Fort Monroe  A regional/national/international joint marketing agreement with Williamsburg, Yorktown and Jamestown will require funding and strategy compliance among four partners  An agreement may take several years to craft  Fort Monroe’s interpretive direction will heavily influence the scope and benefit of this agreement  Will broaden the appeal to cultural visitors coming to the Hampton Roads Area  Can extend the stay and spending of existing visitors with enhanced attractions options and marketing

11. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 11 Marketing Funding Sources and Plan  Each component should be included in a comprehensive marketing program to promote Fort Monroe as an addition to attractions in the Hampton Roads region  The VTC, foundations, special interest groups and other donors could financially support programs and facilities  Educational programming and school trips costs  Tourism marketing could be sourced through VTC  Donors may sponsor special exhibits and events  Exhibits and programming sponsorships  Connections with area Universities can be beneficial  Promote educational materials and research without extensive funding required by FMFADA  3-5% of overall operating budget should be dedicated to marketing programs/costs

12. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 12 I. Tourism Market Overview II. Marketing Strategy III. Development Plan Options IV. Questions and Discussion Agenda

13. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 13 Development Plan  Both a private (FMFADA) and public 501(c)(3) non-profit will be needed to maximize revenue/contributions  Both organizations could manage non-profit and for- profit/commercial activities  Costs and revenue allocations to be determined by future phasing, capital investment requirements and partner capacities  Several management and development options exist for both entities:  Concessions contract  Direct Management  National Park Service  Ground Lease  Sale

14. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 14 Development Options Pros/Cons  Concessions Management  Pros: Highly experienced, efficient, well-funded, easily obtain necessary financing, steady franchise fee income stream  Cons: Institutional, high overhead, will limit control, may be hesitant to take on non-revenue producing components  Direct Management  Pros: Maintain complete control, cohesive plan, strong revenue potential  Cons: Require high capital investment from FMFADA, may be difficult to obtain financing/funding, lack experience in management of hospitality operations, take on complete project risk  Ground Lease  Pros: Steady rental income stream, Maintain ownership of sites, no capital investment requirement, long-term value enhancement  Cons: Limited development control, can be difficult to finance, may lack cohesion with introduction of sub-leasing and various management agreements for separate components  Direct Sale  Pros: Large immediate capital income to fund non-profit initiatives  Cons: Complete release of control, lack of cohesion, no long term income potential; will not address long term guarantees for quality and protection  National Park Service  Pros: Will ease linkage to “America’s Historic Triangle”; guarantees some government funding, maintains site cohesion, guarantees site’s protection in perpetuity; NPS is a ‘brand”  Cons: Bureaucratic, under-funded, restricted income potential, tax exemption limits fiscal and economic benefits for surrounding community; lease terms limit use of historic tax credits

15. ERA No: 17793 – Fort Monroe Tourism, Marketing and Development AnalysisSlide 15 Questions and Discussion