Business

Comments | Recommended

Dunkin’ development

01:13 PM EDT on Thursday, March 22, 2007

By Benjamin N. Gedan

Journal Staff Writer

The Dunkin’ Donuts Center is in the midst of a $62-million overhaul that will include luxury suites for the first time. At $50,000 a year, the suites will bring in $900,000, more than 20 percent of the arena’s annual revenue. Below, Michael Tanguay, right, of Lincoln, outside superintendent for Capco Steel of Providence, confers with general foreman Dan Kraniec of Attleboro.

The Providence Journal / Bill Murphy

PROVIDENCE — Top corporate executives will soon sip martinis on polished granite counters and recline in lavishly upholstered seats, nestled inside luxury suites at the Dunkin’ Donuts Center, for a Providence College basketball game.

But the bigwigs of banking will not be the only ones riding the private elevator to the new suites. The pioneering occupants of these carpeted rooms will also include trash haulers, busboys and plumbers — a surprising potpourri of high rollers and the hoi polloi.

“We are going to have quite the variety of people,” said John Colletto, who marketed the suites for SMG, the management company that operates the Dunkin’ Donuts Center for the Rhode Island Convention Center Authority.

The companies that have leased suites range from Citizens Bank and CVS to New England Construction and Gem Plumbing.

Two months after the authority began advertising the 18 suites, 17 have been leased for 42-month contracts. The 18th has been reserved and two companies have signed a waiting list, according to authority spokeswoman Kerrie L. Bennett.

At $50,000 a year, the suites will generate $900,000, more than 20 percent of the Dunkin’ Donuts Center’s annual revenue. That money will support the facility’s operations budget and help pay back the $62 million the authority borrowed, in taxpayer-backed bonds, to finance a massive overhaul of the arena.

Authority officials say they are not surprised by the success of the marketing campaign, although consultants from Minnesota-based CSL International had recommended setting the price at $40,000.

The Dunk, as the facility is known, has little competition in the state, said James P. McCarvill, the authority’s executive director. “There’s nothing like this in Rhode Island,” he said.

“We are thrilled the new luxury suites sold so quickly,” added David A. Duffy, chairman of the authority’s governing board. “This validates the decision to add luxury suites to the arena.”

The early success goes against a national trend.

Sports complexes in Manchester, N.H., Boston and Foxboro, Mass., have profited from luxury suites, as has the Ryan Center, in South Kingstown. But nationally, the demand for corporate boxes has diminished, with some professional sports stadiums removing suites that had once generated more than $200,000 a year.

New federal tax laws have forced some executives to pay taxes on money spent entertaining clients. Locally, demand for suites among corporations that lobby government officials may have been dampened by strict state ethics laws governing gifts to politicians, Colletto said.

In May 2005, Governor Carcieri agreed to pay a civil penalty of $750 after charges were brought against him for allegedly violating the state ethics code by accepting tickets from Fleet Bank to watch a New England Patriots game in December 2003 from a luxury box at Gillette Stadium.

The luxury seating at the Dunkin’ Donuts Center attracted a broad sampling of Rhode Island businesses.

Five banks, including Sovereign, leased suites. But one of the largest in the state, Bank of America, was not among them. Nor were several of the state’s major employers, including GTECH Holdings Corp., Amgen Inc. or Fidelity Investments.

No law firm is on the list of 21 companies that leased space (several are sharing suites), and even Dunkin’ Donuts passed on the opportunity. (The company already receives eight tickets per event at the arena.)

Instead, when the suites open next January, there will be some odd pairings. Credit Union Central Falls, for example, will be sandwiched between Wright’s Farm Restaurant and Gem Plumbing Inc. “It’s about sending my employees to a lot of games they wouldn’t otherwise have been able to go to,” said Frank T. Galleshaw III, who oversees the chicken dinners at Wright’s Farm with the aid of his sister, Tammy Galleshaw Forgue. “Let them go and enjoy themselves.”

The 15 seats in the restaurant’s shared, 200-square-foot suite will be made available to busboys, waitresses and line cooks, Galleshaw said.

Colletto, the sales manager for the authority, pitched the suites as ideal locations for entertaining valued clients or for holding business meetings or charitable events. “A luxury suite is the type of a venue where business gets done,” he said.

But at The Dunk, the new suites, with their private flat-screen TVs and wet bars, will also play host to more informal gatherings.

Representatives of CVS may find themselves mingling in the arena hallways with executives from Medioxx, a Lincoln-based sleep therapy company with a staff of 15. Or sharing a moment with an employee of Pond View Excavating whose job involves transporting construction debris for recycling.

“It’s a good business tool,” said Kenneth J. Foley, who owns the trash-hauling business in East Providence.

Foley was not contacted by the convention center authority to lease a suite, and when he visited the sales office, he dressed in a plaid shirt and suspenders.

“They probably thought I was the cleaning guy,” Foley said. “I’m not much for suits and ties.”

bgedan@projo.com

Advertisement

Reader Reaction