The Canadiana

"The Crystal Beach Boat"

Preface to Feasibility Study

The feasibility study, done while Crystal Beach was still a factor, provided many good reasons why the ship should sail. ~ An annual seven million dollar turnover in the Buffalo economy along with many jobs created and other benefits. ~ It may appear the beach closing was very negative but with a closer look, it will be seen the study limited trips to Crystal Beach to allow the boat to make better use of her time. ~ The beach is gone now and while certainly missed, its closing has made us even more aware it was an anchor to the Canadiana of today; the ship was tied to those back and forth trips. ~ Horizons for the boat have now been extended. ~ Many more can benefit. ~ The feasibility study, done today, certainly would look to what is happening today. ~ In concert with the reconstruction of the Buffalo waterfront, there are additional far reaching economic benefits to both sides of the lake.

Beyond those brought forth in the Feasibility Study, we are developing plans and activities that will bring people from all over the country into Buffalo to participate. ~ We envision trips across the lake to Canadian destinations such as Port Colborne, Port Dover, Port Maitland, Welland and Dunnville. ~ These towns have attractions similar to Niagara-On-The Lake, playhouses, summer festivals and many other exciting activities. ~ Carrying thousands of passengers, the S. S. Canadiana will regularly visit these communities to be a part of their summers, to participate in historic and other special celebrations. ~ The ship will be shared with and operated for the enhancement and benefit of those communities. ~ To broaden the horizons of all our peoples. ~ We see a grand three day weekend once a year to Toronto. ~ Upwards of two thousand people coming to Buffalo for that trip, many with overnight accommodations prior to and following the trip. ~ Passengers will spend two nights in Toronto, cruise both lakes and the Welland Canal going and returning. ~ They will see the locks in action and the ocean going vessels passing. ~ With music and food on board and people waving from shore, it will be an experience unlike any in North America.

We will be fully booked with many years worth of passengers just from previous riders wanting to re-experience their memories. ~ We will run many trips from Port Colborne into Buffalo bringing sport fans, shoppers and tourists. ~ These people will also be enjoying the before and after, two-hour lake cruises in the bargain. ~ The trips will be reasonably priced momentous entertainment and people will come into Port Colborne from all over the Niagara Peninsula to partake. ~ The ship will be booked years in advance by conventions, package tours, corporate parties and our own historic and educational efforts. ~ Throw in the occasional movie maker and our own summer playhouse productions and we just begin to examine the potential.

And lastly; we must cover one more item. ~ We are sometimes confronted with the fact that The Block Island Ferry, renamed Americana*, failed in the Buffalo Cruise market. ~ This is not a serious comparison but since boat has come and gone and least some uninformed reader consider that fact as significant, we must address it. ~ *{This was not the original Americana which was a sister ship to our Canadiana.}

The Block Island Ferry was brought in on the merits of the feasibility study done for the Canadiana and all that it is. ~ There were just too many factors the Block Island Ferry could not live up to. ~ Very much smaller and holding a fraction of the Canadiana's capacity, it could not meet fixed and other costs with a reasonable ticket price. ~ In addition; while a rather pretty ship, it was built to carry cars, not cruise passengers. ~ A stubby smoke stack belched large amounts of black, smelly and dirty diesel exhaust in close proximity to the passengers. ~ This and the oily film it laid down on the railings and elsewhere, caused much dismay. ~ The lower area was converted for dancing and entertainment but had little view of the water, the only reason for going on a cruise.

There were other factors such as being out of service for long periods during major holidays for repair and maintenance problems. ~ But enough said; it did not fail for lack of want.
 

Feasibility of Operating
The S. S. Canadiana on Lake Erie

by Economics Research Associates prepared for Western New York Economic Development Corp. and the Friends of the Canadiana, Inc. [Abstract]


Contents:

I____ Introduction.
II___ Executive Summary~~~~~~~~~~~~(expanded)
III___ Market Conditions~~~~~~~~~~~~(omitted)
IV__ Survey of Comparable Facilities~~~~(omitted)
V___ Ridership Projections.~~~~~~~~~~(omitted)
VI__ Financial Analysis.~~~~~~~~~~~~~(omitted)
VII__ Economic Impact.~~~~~~~~~~~~~(omitted)
App. ERA Project Descriptions.~~~~~~~(omitted)

 

Tables

 

III-1 Historic and projected Buffalo population.
VII-1 Incidental spending by Canadiana passengers.
VII-2
Total economic impacts.

Note... The full report is over 70 pages. For the sake of size we have omitted chapters III thru VII and the Appendix while making every effort to carry their full meaning in an expanded Executive Summary. We have bracketed the wording that has been brought in to the original summary. A complete copy of the Feasibility Study is available for a nominal copy and postage fee of $4.00.

Section I

Introduction:

Economics Research Associates (ERA) was retained by the Western New York Economic Development Corporation and the Friends of the Canadiana, Inc., to determine the feasibility of operating the vessel, once restored, as a cruise ship and passenger ferry on Lake Erie. Specifically, ERA was asked to:

-examine the potential markets for cruise ship operations;

-analyze the operation of comparable vessels;

-project ridership totals, by category;

-review and analyze financial aspects of proposed operations;

-prepare an operating statement; project the economic impacts of such as operation on the -City of Buffalo; and

-identify funding sources for restoration costs.

Four factors make this idea an interesting proposition. First, and most general, is the almost mystical appeal which ships and water seem to have to many people. Second, the Canadiana, when restored, will be a first-class experience, with modern equipment and furnishings, a number of amenities and a large passenger capacity. Third, the Canadiana is remembered by many in the Buffalo, Crystal Beach and Port Colborne areas and her restoration efforts have sparked considerable interest. Finally, and perhaps most important, the Canadiana represents a financially sound opportunity for the citizens of Buffalo and Western New York to invest in their economic future. While we have recommended some changes in the program, we find the basic concept fundamentally sound.

 

Section II

Market Considerations

Median household income, which had been declining in real terms, is currently keeping pace with inflation, and is expected to increase in real terms.
Tourist visitation to the area is high, due to the presence of Niagara Falls, one of the "natural wonders" of the world. (Casual estimates of visitation to the Niagara Frontier range from eight to twelve million persons per year.) Tourism to Buffalo however is considerably lower. A total of 750,000 visitors (250,000) overnight plus (500,000) day trip, came to Buffalo in 1986, a figure that is projected to increase by about 3-5% per year. Convention delegates to Buffalo numbered about 50,000 (plus 50,000 in smaller facilities throughout Erie county) and growth was projected at 10-15% per year, based on advance bookings, increased activity and an increased marketing budget.
There are a number of large corporations and trade associations in the Buffalo area as well. Buffalo as the state's second largest city, plays a role as regional government headquarters, a banking and communications center, an educational and medical center and a distribution area for the Western New York region.

(Conclusions:

Buffalo is a diverse market for an attraction such as the one proposed. The regional population, while declining, appears to be doing so at a lower rate than in the past. Other statistics, such as trends in effective household buying income, indicate that the economic downturn may have bottomed out. Tourism has increased over the past two years and is expected to grow at a modest rate. Convention bookings are increasing and the area remains a popular shopping destination for Canadian citizens, a factor which may be positively affected by the decline of the U.S. dollar relative to world currencies in recent months. The city is home to a number of major employers, public and private, as well as regional trade associations and organizations. With the exception of the Buffalo Zoo, the closest regional attractions are Niagara Falls and Darian Lake.)

 

Comparable Vessel Operations:

ERA examined the operation of six comparable vessels, five in the northeast and one in Louisiana. Operating characteristics, such as cruise offerings, amenities and ticket prices were fairly similar although some variations were observed. Ridership generally exceeded 50% of capacity.

(The vessels assessed were:

S.S. Natchez; a steam powered sternwheeler operating out of New Orleans. 265 ft long including wheel, 46 ft wide and a capacity of 1,600 people on three decks. Equipped with bar, gift shop, buffet dining room and galley and a dance floor.

S.S. Minne-Ha-Ha; also a sternwheeler, 103 ft long with 30 ft beam. Capacity 300 riders. Operates on Lake George NY.

S.S. Columbia and S.S. Ste. Claire; both propeller driven and operating in the Detroit area. Columbia is 200 ft long, a 45 ft beam and a capacity of 2,566 persons on three decks. The Ste. Claire is 181 ft by 50 ft with a capacity of 2414.

S.S. Chautauqua Belle; a reproduction of a Mississippi River paddlewheel steamboat operates on Lake Chautauque in WNY. It is 65 ft long with a 20 ft beam with two decks and a capacity of 120 persons.

S.S. Trillium; a side-wheeler with a length of 150 ft and a 30 ft beam. Operated by the City of Toronto, Ont.

S.S. Belle of Louisville; oldest operating steamboat on the Mississippi River. A sternwheeler, 168 ft long by 41 ft beam with a capacity of 800 persons. She is equipped with a bar, a souvenir shop, a bandstand and a dining area.

 

Conclusions:
 

As can be seen, there are a number of comparable vessels throughout the eastern United States and Canada. Although each has its own unique operating characteristics dictated by local market conditions and the physical limitations of the vessel itself, cruises and steamship rides remain a popular pastime as a recreational activity and a profitable venture for operators.)

Ridership Projections:
 

Based on an analysis of available markets and comparable systems, ERA proposes:

~~~~~90 day operating season;

~~~~~a week-day schedule of an afternoon cruise for two hours, from 2:30 to 4:30.

~~~~~a sunset cruise, from 7:30 to 9:30; and

~~~~~dock-side luncheon service from 11:30 to 1:30.

(1995 update. On week-ends, ERA suggested two round trips to Crystal Beach. Weekends can now be used for a variety of other purposes as described in the preface and else-where in this book. We believe this new circumstance will affect all previous estimates of the ERA in a positive manner.)

Using this schedule, ERA has projected total ridership of 208,350 to 238,100 persons.

(As noted in the prior section concerning market conditions, there are several factors which make Buffalo a good market for the proposed venture. first, there is a high percentage of persons 65 and over in the resident population. This age bracket tends to have more leisure time and, increasingly, tends to participate in organized activities.

Second, average household disposable income has increased in recent years, so that it is now keeping pace with inflation, and is projected to grow in real terms by 1990. This will mean that more residents will be predisposed toward recreational activities such as the Canadiana.

Third is the projected growth in tourism and convention business. According to the New York State Department of Commerce, approximately 40% of all tourist travel to the Niagara Frontier occurs during the summer months. Border crossings also increase proportionately in the summer months, in both directions. Thus approximately 325,000 tourists and 25,000 convention attendees are available as potential customers, in addition to one million residents.

Fourth, the Erie Basin Marina attracts high numbers of people during the summer season, indicative of an interest in the waterfront.

Fifth, the waterfront development plans as proposed by the City of Buffalo and the Niagara Frontier Transportation Authority include provisions for the Canadiana.

Finally, this concept has been proven successful in other markets. The Minne-Ha-Ha for example, a vessel with a capacity of only 300 persons, carries approximately 100,000 persons per season. In a similar situation, the Columbia and the Ste. Claire carry 450,000 passengers per year. Thus it is anticipated that the Canadiana will be equally well supported.)

 

Financial Analysis
 

ERA proposes a ticket price schedule of $7.50 for adults, $4.00 for children, $6.00 for adult groups, and $3.00 for children in groups. Based on observed ridership on other vessels, ERA has projected that 50% of all ridership will be full-fare adults, 30% groups, 10% full-fare children and 10% free. Using these allocations, ticket revenues of $1.2 million will be achieved. Spending on food and beverages on board will generate $1.25 million; the dockside restaurant, $160,000; and the gift shop $52,000. Total revenues will be $2.67 million.

Operating expenses will include salaries, wages and fringe benefits; supplies; maintenance, janitorial service, fuel, insurance, marketing, administrative costs, and cost of goods sold. A contingency has also been allocated. Total expenses will be $2.23 million. An operating profit of $436,000 will be realized.

 

Funding Sources:
 

In addition to funding from the EDC, public sources for the restoration of the vessel and for infrastructure and waterfront improvements at the terminals will include: the Economic Development Administration; the Department of Housing and Urban Development's UDAG program; the Community Development Block Grant program; the New York State Department of Commerce Job Development Authority; the City of Buffalo; the New York State Legislature; and the Province of Ontario. It is emphasized, however, that the public funding is highly competitive and should not be depended upon.

Private sources include foundations, corporations and individuals. Each source has associated costs and requires a different strategy.

 

Economic Impacts:
 

Direct impacts of the Canadiana will be $2,800,000 annually. Total impacts (direct plus indirect spending) will be $7,000,250. Of this total, $3,654,500 will remain in Buffalo.

(Approximately 210,000 persons per season will ride the Canadiana. Of these, about 156,000 will be non-stop cruise passengers; that is, there will be no place of debarkation other than Buffalo. Spending by these people in conjunction with their cruise will include transportation costs (gasoline, taxi fare or public transit fees); parking expenditures and incidental purchases en route such as visits to retail establishments and restaurants.)

Approximately $145,000 in tax revenues will be generated by direct spending. No attempt has been made to quantify taxes generated by indirect spending.

Operation of the Canadiana will create a total of 77 full- time and 35 part-jobs. (The Canadiana will require six full time and 35 part time (nine full-time equivalent) personnel. In addition, a number of other positions will be created by the spending for operations and incidental purchases. At an assumed rate of 1 job for every 100,000 of direct spending, another 20 full-time positions will be created. Incidental spending will result in 5.7 full-time jobs and indirect spending will create 45 jobs.)

Approximately 30 of the full-time, and all of the part-time jobs will be in Buffalo

Finally, it must be noted that the Canadiana will have a positive effect on the overall waterfront development effort, and on visitation to the waterfront, as it demonstrates successful rehabilitation of the City's coastal areas and adds to the "critical mass" of visitor activities and attractions. No attempt has been made to quantify this impact.)

 

Table III-I

Historic and Projected Population Trends In Buffalo

         
             1970      1980      1990
Buffalo     463,000   358,000   329,000
Erie C.   1,113,000 1,015,000   954,000
SMSA*1    1,113,000 1,015,000   954,000

*1 Erie and Niagara Counties
Source:  U.S. Census Bureau, New York State 
Department of Commerce, 
Sales and Marketing Management and 
Economics Research Associates.

Table VII-1

Incidental Spending By Canadiana Passengers

Category                  Trans.  Parking   Retail    Total

Single-Destination Cruise 78,000  156,000   39,000  273,000 
Buffalo-Crystal Beach     19,500   78,000        -   97,500
Crystal Beach-Buffalo          -        -  195,000  195,000

Totals                    97,000  234,000  234,000  565,500    
Allocated to Buffalo      32,500  234,000  208,000  474,500

Source:  Economic Research Associates.

Table VII-2

Total Economic Impacts:

Category        Dir/Impact  [x]   Tot/Impact 
Canadiana Oper.  2,234,600  2.5    5,586,500
Transportation      97,000  2.5      243.750
Parking            234,000  2.5      585,000
Retail Sales       234,000  2.5      585,000

Totals           2,800,000  2.5    7,000,250
Amount allocated 
to Buffalo *1    1,461,800  2.5    3,654,500

*1  It has been assumed that 50% of the Canadiana's 
operating expenditures will be made in the 
City of Buffalo.
Source:  Economics Research Associates

 

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