A first-of-its-kind economic impact report on the Queen Mary released Tuesday says the historic attraction generated more than $93 million in spending in Long Beach last year and supported more than 1,300 jobs.
The report from the Los Angeles-based research firm Beacon Economics comes as the ship has temporarily halted its operations amid the coronavirus pandemic. The report was issued earlier this year by the ship’s operator, Urban Commons, which is facing a string of financial troubles that began before the coronavirus pandemic hit the hospitality industry.
Among the findings, the report noted that the Queen Mary in 2019 generated $1.4 million in Transient Occupancy Tax, which is a percentage of rent charged by hotels. Urban Commons, however, still owes hundreds of thousands of dollars in unpaid occupancy taxes to Long Beach and other cities, it was revealed last week.
Urban Commons, a Los Angeles-based real estate development firm, signed a 66-year lease to operate the city-owned ship in 2016.
The firm has until June 1 to pay the taxes it owes Long Beach, or the city could take legal action. Long Beach City Attorney Charlie Parkin this week said the city is exploring its legal options if Urban Commons doesn’t comply.
Meanwhile, the report, billed as the largest study of its kind on the Queen Mary’s economic benefits, paints the picture of a popular attraction that has generated significant economic activity for Long Beach. The report says the ship attracts more than 1.5 million visitors a year.
“We’re incredibly proud of what the Queen Mary means to the City of Long Beach and what she contributes to the City and beyond,” Taylor Woods, founder and principal at Urban Commons, said in a statement. “While COVID-19 has impacted every hotel globally, we look forward to travel restrictions being lifted so the Queen Mary may continue to boost economic output, jobs and taxes for the City of Long Beach and the surrounding region in the process.”
The findings include:
The Queen Mary generated $93.7 million of spending in Long Beach and $205.3 million in economic output for Los Angeles County in 2019. That comes largely from attendee and vendor spending at 50 events last year and spending from Queen Mary Hotel guests.
The ship raised $3.3 million in tax revenue for Long Beach and $6.1 million for all of Los Angeles County.
The ship supported 2,224 jobs in Los Angeles County, including 1,374 in Long Beach.
Overall, expenditures totaled about $115.2 million, with event attendee and hotel guest spending accounting for 97%.
It’s not clear when the Queen Mary will be able to reopen under the state’s economic plan under the coronavirus pandemic.
The closure means a significant loss in funding for Urban Commons and has highlighted growing concerns about the company’s ability to fulfill its contractual obligations with the city, which includes making critical structural and safety repairs to the aging vessel.
It has also pledged to build a $250 million entertainment complex on the surrounding land and water.
As part of its lease agreement, Urban Commons was to invest revenue from Carnival Cruise Line passenger fees and other income sources, including the many music festivals held near the ship, to fix critical problems. However, some of that revenue has now been lost as Carnival has halted cruises at all of its terminals and music festivals are on hold.
Urban Commons in a statement Friday said it is resolving the outstanding balances and has pledged to pay the city its owed taxes within 10 business days.
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