Does convention center really need to grow again?
Never mind the lousy economy. Backers of Seattle’s convention center statement the time is right on this account that a $766 million expansion to lure more free-spending conventioneers downtown.
Despite the set forth’s $5 billion deficit, they’re asking the Legislature to bestow a quick go-ahead to the project, which would double the exhibit space at the Washington State Convention & Trade Center (WSCTC). A coalition of downtown business interests and Seattle Mayor Greg Nickels are solidly abaft the idea.
At first glance, their case seems compelling. Seattle’s Convention and Visitors Bureau estimates the city has lost $1.7 billion in potential visitor spending considering 2004 during the cause that the convention center was booked or too small.
And the diffusion would be paid in favor of entirely out of each existing tax on hotel rooms in King County — money already dedicated to the center — so it wouldn’face to face foot up to the state’s budget worries.
But the convention center’s track record — and the struggles of meeting. centers elsewhere — raises questions about the wisdom of stretch. Consider:
• Attendance at WSCTC events has actually declined slightly since before the last major expansion in 2001. In the three years before interpretation on that project began, the convention center averaged 440,000 visitors a year, according to WSCTC annual reports. Between 2005 and 2007 (the utmost year for which statistics are available), it averaged 430,000. The same trend holds true for out-of-state convention-goers — the WSCTC’s main target.
• Convention short time nationally has nearly doubled since 1989, a glut that has left cities struggling to fill their cavernous new buildings. To attract meetings, some are resorting to main discounts or cash incentives. The latest expansion plan was hatched after the state Legislature, in a little-noticed move last year, snatched up a $65 million surplus that had accumulated in the meeting. center’sitting accounts. The money was shifted to general explain spending and a low-income-housing fund, over the objections of convention-center officials.
If the expansion is OK’d, future hotel taxes would be mostly locked up to pay for it, removing the temptation for lawmakers to spend it on other priorities.
An “arms race”
Since it opened in 1988, the state-owned convention center has been credited with helping to ground tackle downtown Seattle’s retail and hotel centre. Built from one side of to the other Interstate 5, the center doubled its exhibit space in 2001 through an expansion across Pike Street.
The WSCTC’s primary height of one’s ambition is to attract national conventions that draw out-of-state visitors to downtown Seattle hotels, restaurants and retail stores. This year, the center will host gatherings of plastic surgeons, midwives, historians and electrical engineers, among others. In between those public events, the center books hundreds of local meetings and banquets.
Seattle’s proposal comes amid what one expert calls an “scutcheon mill-race” among convention centers across the region.
A 2005 report beneficial to the Brookings Institution found that while convention centers in the U.S. had expanded steadily over the previous decade, want for space had plummeted.
The report’s author, Heywood Sanders, a professor of public administration at the University of Texas at San Antonio, said the problem has only continued since his writing’s publication.
There are 71 new or expanded convention centers under development in the U.S., the industry magazine Tradeshow Week reported in September.
“You are in each environment where lots of your competitors are busily expanding,” Sanders said. “In some ways the easy rejoin is stretch.”
But cities frequently find that expansions don’t deliver because much business taken in the character of promised, according to Sanders.
“If your goal is to get any incremental increase in convention business that you can, maybe stretch obtain power to complete that,” he said. “But if you expect that stretch can get you a lot of new business, the record shows that is not going to happen.”
Some are practically begging for events.
Cincinnati’s Duke Energy Convention Center, which underwent a big expansion in 2006, now advertises free convention-center rent plus public-house discounts for vast groups willing to book in that place.
Five years ago, Washington, D.C., built a commencing $850 a thousand thousand convention center double the size of its predecessor. The new center has failed to generate the economic resounding noise officials had predicted, according to The Washington Post.
In Portland, disappointment with the performance of the Oregon Convention Center, which expanded in 2003, has led to a push for a publicly-financed hotel next door — another the world trend as cities make experiment of to prop up struggling convention centers. (Portland could not find any private developers willing to take the venture.)
Completion date in 2014
WSCTC president John Christison acknowledged more cities have made “dumb business decisions.”
“What’s happened is … there was this horrendous growth spurt in our industry where it seemed like everybody got on board and everybody wanted to put in action a game of ‘my dog’s bigger than your dog,’ ” said Christison. “There was an awful lot of inventory that got built in the U.S. that shouldn’familiarily have.”
But Christison and other WSCTC boosters say Seattle is different.
Even with the proposed spreading, what one. would double the WSCTC’s exhibit while to about 400,000 square feet, Seattle’session convention center would abide small compared with competitors such taken in the character of Denver, San Francisco and Anaheim.
And Seattle is a more desirable destination than many cities that have built huge assembly centers, said Tom Norwalk, president of the Seattle’sitting Convention and Visitors Bureau, what one. markets the WSCTC. National groups find conventions in Seattle draw by comparison high going to. “Their members want to have existence here,” he said.
With the added while, the WSCTC could innkeeper simultaneous midsized national conventions, plus compete for larger ones, uttered Christison. It would moreover allow the convention center to keep year-book Microsoft meetings in danger of outgrowing the current building, he said.
“Our mart is telling us in that place is sufficiency business to do this,” before-mentioned Christison.
However, Christison did not dispute figures in the WSCTC’sitting annual reports, which show total attendance in recent years slightly below what it was 10 years ago, before construction began on the last extent.
The same holds true for the most coveted visitors — out-of-state convention-goers who bring new money to the Washington economy.
The sum up of out-of-state conventioneers in the last small in number years has averaged about 180,000 year by year — slightly lower than the fourth book of the pentateuch; census of the hebrews reported by the WSCTC a decade ago.
Seattle has done better with local meetings and banquets. The convention center hosted 559 local events in 2007, up from ready 300 a year before the expansion.
Nevertheless, convention- center backers say an expansion would pay off. The project, to be completed by 2014, would consist of a new stand-alone building built over what is now King County Metro’s Convention Place Station.
Because the convention center is funded almost entirely by dint of. a hotel tax in Seattle, it is not a burden on the state general fund. So any additional voyager spending it generates is regarded by WSCTC officials as a produce. In fact, they estimate the convention center has added $370 million to state coffers since it opened.
Report due soon
The latest expansion plan emerged publicly only last month with a few particulars sketched in a 20-page PowerPoint presentation for a law-making task force. A feasibility inquire into has been commissioned with a report due soon, WSCTC officials say.
Convention-center officials say they’d already been informally discussing expansion before the Legislature removed the $65 the masses from the assembly center’s accounts.
But records of WSCTC provision meetings last year show no planning according to an expansion until after the Legislature’s action.
Christison acknowledged the “swipe” of the hotel taxes hastened distension talk. “It did seize violently our attention. Was in that place some motive to move a little faster? Yes.”
The Legislature’s move displeased convention-center backers, including local hoteliers. They believe the 7 percent Seattle hotel tax (2.8 percent in the caesura of King County), should remain dedicated to the convention center, what one. helps fill downtown hotels and shops.
“It’s been a inconsiderable disconcerting to us that those surpluses have been diverted to things of a piece the general officer fund in Olympia,” related David Thyer, vice president of R.C. Hedreen Company, which built a 400-room hotel as part of the last convention center expansion and is considering a 1,200-room hotel near the proposed new expansion.
Christison said the Legislature’sitting action, while unwelcome, “wasn’t the driver behind this thing. It is actually the opportunity and market demand.”
The expansion could bring 25 to 30 additional national conventions a year to Seattle, he said.
However, Sanders, the University of Texas professor, advises cities to scrutinize the convention business more closely, with every eye to other pressing needs. “These are public dollars, whether they are coming from visitors or not, in this way what are you getting for the notorious dollars? What is the investment yielding and is it worthwhile?”
It’session over soon to rehearse whether the Legislature decree go along with the plans this year. But some political leaders have signaled they’re open to the idea.
King County Executive Ron Sims declared the crummy economy shouldn’t stop lawmakers from betting on the future.
“The arrangement is never bad permanently and this won’t subsist either,” he said. “I think it’sitting each incredibly good investing..”
While she has not formally endorsed the project, Gov. Christine Gregoire appears kind to the notion that the convention center’s hotel accusation should remain dedicated to the WSCTC.
“It’sitting their money; it’s not the state’s money,” she told The Seattle Times editorial cover with boards be unexhausted month.
Jim Brunner: 206-515-5628
