THE NONPROFIT AGENCY tasked with promoting San Jose’s hospitality and tourism industries just aced its annual performance audit. Boosters for local business are taking the high marks as a hopeful sign for the city as it heads into a critical year of major sports events.
The audit found Team San Jose, which also manages major city-owned venues, notched improvements across five performance metrics, including the organization’s economic impact, finances, theater occupancy and customer satisfaction. The City Council reviewed the findings for the 2024-25 fiscal year at its Jan. 13 meeting.
District 6 Councilmember Michael Mulcahy, who represents the city on Team San Jose’s board of directors, said the audit results should come as “welcome news to everybody.”
“I’m really encouraged by the overall gross revenue the organization is trending back to,” Mulcahy told San José Spotlight.
The metrics compiled in the audit all showed Team San Jose exceeding benchmarks set by the city during the last 12-month period. Team San Jose booked 133,500 hotel room nights or 14% over target. There were 545 days of events or 3% over target at its cultural facilities, and all of it generated an economic impact of more than $95 million or 22% over target for the city. As a point of comparison, during the 2020-21 fiscal year, the height of the pandemic, the same audit found the organization generated zero dollars in revenue.
Team San Jose receives $1 million in funding from the city each year. Since the organization hit its targets, it now qualifies for an additional $300,000 funding bump.
“San Jose is leading the Bay Area in downtown recovery,” John LaFortune, president and CEO of Team San Jose and a San José Spotlight columnist, told San José Spotlight. “Downtown San Jose has restored 90% of its foot traffic compared to 2019 — reaching nearly 100% in December 2024.”
San Jose’s hospitality and entertainment sectors took a beating in 2020 when COVID-19 lockdown orders closed down venues and sent tourism activity sputtering to a screeching halt. Since then, Team San Jose has played a key role in the economic recovery, given its work marketing San Jose as a destination for business and leisure travelers.
But for some, recovery has come at a frustratingly slow pace. Such frustrations bubbled to the surface in 2024 over the course of tense contract renewal talks, during which some councilmembers questioned Team San Jose’s efficacy and even floated the idea of breaking it up into three smaller organizations, according to the Mercury News.
But the latest audit findings have won the organization a round of praise from city leaders.
Mulcahy said he is particularly impressed by the convention activity taking place at downtown venues. Over the past year, such events have run the gamut from major tech shows, like the NVIDIA GTC sold out conference, to entertainment exhibitions such as the comic convention GalaxyCon San Jose.
“Those are huge important signs, and we’ve got to figure out a way to continue that momentum,” Mulcahy said.
Team San Jose’s venue portfolio includes the San Jose McEnery Convention Center, South Hall, the California Theatre and San Jose Center, among others.
Despite the across-the-board performance metric gains, some measures for Team San Jose still remain well below pre-pandemic levels. For example, “gross operating results,” which measures revenue from facility operations and other sources, came in at just more than $6.5 million. In the years prior to the pandemic, the organization consistently drew in more than $12 million annually.
In response to the audit findings, Leah Toeniskoetter, president and CEO of the San Jose Chamber of Commerce, offered a note of measured optimism about the trajectory of the city’s hospitality sector. While things are moving in the right direction, she said, the city’s recovery is still not complete.
“Operating costs remain high, events drawing regional audiences often do not translate into hotel rooms and midweek business travel has not fully returned, all of which continue to challenge margins and long-term planning,” Toeniskoetter told San José Spotlight.
LaFortune credited San Jose’s improving foot traffic figures to the launch of a marketing effort spearheaded by Team San Jose that has drawn together city agencies, San Jose State University, San Jose Downtown Association and San Jose Mineta International Airport. Over the past year, Team San Jose also helped support a bevy of other marketing campaigns and events, including the inaugural edition of TSJ BASH, a bi-annual hospitality summit, LaFortune said.
The audit findings come as San Jose prepares for a trio of major sports events expected to drive more activity to the city’s downtown over the coming year, including Super Bowl 60, NCAA March Madness and FIFA World Cup. Team San Jose is leading the marketing efforts for the year of events under the banner SJ26.
“We are primed and ready to be an activation venue for future events in 2026 and beyond,” LaFortune said.
Contact Keith Menconi at keith@sanjosespotlight.com or @KeithMenconi on X.
This story originally appeared in San José Spotlight.