A quarterly magazine of urban affairs, published by the Manhattan Institute, edited by Brian C. Anderson.
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Convention Wisdom « Back to Story
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Add Philadelphia to your list. Circa 2002 they already had a very large convention center that wasn't kept particularly busy. Why not? "Because it's not LARGE enough," went the line for expansion. Arguments for expansion also appealed directly to civic pride. We have to be better than this or that rival city--and bigger equals better. The expansion was completed I believe in 2007. Has it made some big difference to Philadelphia? Well, now we have a LARGER convention center that isn't much used...
All city officials are absolutely certain that new convention facilities will be the panacea for whatever ails their town. As an Economic Development Advisor to five state governors years ago, I saw the accelerating decline in conventions and the accelerating increase in the number of new, city-owned hotels and larger convention facilities. Advice to each state to rely only on private funding proved futile. Private funding, even on a collaborative basis, was unavailable. Corporations know what will make money and convention hotels haven't been on that list for many years. Cities and states were convinced that they had to "do it themselves" to prove that their divine insight was unalterably correct. Even now cities and states still are building new facilities even as the old ones stand empty. And the taxpayer continues to pay, and pay.
Help! Your article of 12/31/11 in the WSJ rang the bell here in Savannah. The County Commissioner's have issued a preliminary OK for Hilton Hutchinson Hotel group to move forward for a favorable vote for a $50M bond issue to finance a new(and unnecessary) hotel & convention center. Savannah is a lovely city with routine occupancy rate of 67%. Current convention center operates in the black but is a joint State, City & County controlled Authority. Any suggestions on how to artfully dodge this bullet?
I'm an architect who designs convention centers, so it's fair to paint me as the barber in favor of weekly haircuts, but Mr. Malanga sounds like an echo of convention industry gadfly Heywood Sanders, who has made a career of badmouthing convention centers. Boston may be a bad example (or a good one, depending on which side you're arguing), because it was very expensive to build in 2004 and will be very expensive to add on to. But most of the cities where I have experience are happy with the centers they have built, and happy with the room nights generated by those centers. It's not just hotels, obviously, that benefit: restaurants and retailers also enjoy the money that conventioneers bring to town. And in my experience, projections of economic impact by reputable consultants tend to be reliable, though the 2008 to today recession has without question put some of their projections to the rosy side. All told (and a few cities excluded), convention centers represent a defensible investment in public infrastructure that can pay off in a community even while running an operating deficit.
Ah, yes the convention center. Here in Northwest Indiana, we are stuck with the disaster of a city, Gary. In the early 1970's when things were really getting awful in Gary, they decided they needed a convention center. So the ironically named "Genesis Center" opened for business. It was hugely over budget already in the design stage, so it was downsized. They downsized it so much that it is virtually useless for just about any kind of convention. The redesign also made the matching hotel not connected to the center (there is a sky-bridge to nowhere). The hotel only stayed open for about five years. It couldn't even keep an hotel operator even with taxpayer money!! It is now an abandoned hulk and has been that way for thirty years, that the new mayor is hoping someone will DONATE the money for the demolition of it, lol.
The center has few to no conventions, it has hosted a few basketball teams over the years that have gone bankrupt (leaving unpaid bills. Outside of a few city banquets and the like, sits dark. It drains big money from the city budget every year. It has never made one cent.
Meanwhile the tourism board president of Lake County wants to build a NEW convention center somewhere else. These dimwits never learn.
"The Dummies Guide to Urban Revitalization".
This is the book that's required reading for lazy political hacks.
Don't bother doing things like reducing crime, improving schools Etc. Don't help start small businesses that don't require baristas or artisanal bakers.
Noooo...just read the easy to follow directions from "The dummy's Guide to Urban Political hackery:
Build a new stadium.
Build a convention center.
Build a casino.
Build up the waterfront - with clubs, bars, strip joints, etc.
Then sit back and wonder why violent crime, prostitution, drug use and public inebriation are on the rise.
Philadelphia has a convention center and both it's building and day to day operations are a boon to union hacks. Try assembling your booth at the yearly craft show! One union to assemble the frame, another to hang the curtain, then yet another self-entitled
union flunky to plug in your lamp.
Who buys the muni bonds for these things one wonders and what happens to muni credit ratings? Surely financial markets will do a thumbs-down here and the piece is negligent in not addressing this.
Perhaps the hubritic City Fathers and Mothers of Los Angeles should read this article, in view if their proposal to revamp LA Convention Center and build a downtown football "event center" all for AEG
And the convention center authorty was the home to many 'hacks' (local term for public employees who are beneficiaries of the patronage system) under the infamous Billy Bulger.
As ever, following the money trail will reveal who REALLY benefits from these projects. Any city that decides to spend public money for such things should soon experience a sudden turnover in those who manage that city, in result of the voters turning out all those promoting such profligate spending. It indeed IS telling private enterprise are not investing in such facilities. They answer to shareholders to whom they are directly accountable. Lose money for the shareholders/investors, you WILL lose your job. Too bad such city dwellers aren't as smart. Or involved.
In Wenatchee, WA., their center just defaulted . See http://www.tri-cityherald.com/2011/12/31/1770360/wenatchee-toyota-center-losses.html
Politicians love big construction projects, the more gold-plated, the better. The building make it look as if they are doing something, creates 100s of construction jobs (temporarily) and leave a physical legacy of themselves.
Remember the first things Mayor Carcetti of Baltimore discusses in The Wire? Building something downtown. Doesn't really care what it is, something, anything. A convention center was one of his options.
The current Mayor of my city - London - who is otherwise a smart chap has the same bug. Instead of showing leadership is taking the hard political decisions to expand Heathrow or Stansted airports, he wants to build a brand new airport in the middle of the Thames Estuary. Billions and billions of pounds spent to the same results but they, he gets a legacy.
The after-effects of these poor long-term "investments" are felt years down the road after the pol has left, so who cares?!
Published the day before Governor Cuomo's State-of-the-State speech...
Here in Cleveland, we are building both a convention center and a "MedMart" -- because any time a doctor wants to buy a new medical device, he isn't going to have the sales reps come to him, no, he is going to fly to Cleveland and go to a glorified shopping mall where such new equipment is on display. Yeah right. I'll be surprised if anyone at the even the Cleveland Clinic will be willing to make the 15 minute drive after the ribbon cutting.
Oh, but we're getting a convention center out of it, too. So we've doubled down on the plan. All paid for out of a sales tax increase, passed by the county commissioners without a vote by the people.
My city is in the middle of building a new convention center right now. I wonder how useful it will end up being
LaneyB- Here in Dallas it was a "pro-business", "free market" Republican mayor, Tom Leppert, who pushed through the city-financed convention center hotel that no private investors would build. It's not a partisan thing, it's a politician thing.
Spending money is the mantra of Democrat mayors across the country. Without a hint of connection to reality, they think that spending money they don't have will improve the life within and the standing of their cities. This, as thousands of residents flee every year to get away from the fiscal madness and perfidy of municipal leaders.
Steve ! Luv luv absolutely luv your stuff . But these deals are not about hotel rooms or tourism dollars . These deals are about how much loot can be shook out of the planning , approval and construction process . All the accountants , architects ,lawyers all of them , kick up to the pols who control the process and they all make big dollars on these projects . Even if they are never built . So forget the lousy economics ,it's all about paying off and until you really really follow the money, have a beer and a dog and enjoy the show .
Are there examples of convention spaces that AREN'T considered white elephants?
Ah, you forget local politics! "The main value of such nebulous concepts..." actually is putting money into the pockets of the city, county and state supporters of the city's office-holders. Ah-hah!! See, it isn't irrational, merely corrupt and imprudent.
Steve Malanga responds;
Yes, this could absolutely be applied to stadiums, arenas and other sports facilities. In fact, I have already done so. Here are a few examples:
The citizens need to get more engaged - and vote for people who won't spend taxpayer money as if it is a limitless resource.
Or those most closely involved could do as the Green Bay Packers do and issue stock that is worth nothing, gives no dividends and gives you nothing but the right to attend a stockholder meeting once a year at Lambeau Field to vote on inconsequential items. It does raise millions of dollars, though.
This is an amazingly well-timed article, given that Gov. Cuomo announced plans to build the country's largest convention center, at 3.8 million square feet, at Aqueduct racetrack in Queens. Will somebody please send this article to Albany? I like Queens as much as anybody, but I can't see convention-goers flocking there. Isn't the road congestion getting to JFK bad enough now?
Good points, but the overlooked X factor is that Convention Centers can achieve a new-age destiny as OCCUPY-WHEREVER all-year protest venues, following the post-Katrina Louisiana Superdome model.
Why wait for spring? Let the First-Amendment be honored throughout the land.
On a less exciting tangent, this country has way too many homeless people, many of whom will endure miserably cold winters. Every bloated-budget convention center can be reconfigured into a cold-weather shelter, since the winter convention business is mostly in warm-weather cities.
Mr. Malanga, fellow C-J readers - agitate for this "alternate use" fo existing facilities. There is little value in tart-tongued conservative principles without an occasional foray into Christian compassion. (All Abrahamic religions have similar core values, and since ARIS 2008 assures us that ~80% of the populace are Abrahamic, incuding Islamics and Jews, this should be a popular idea.)
Call the movement CONVENTIONAL COMPASSION. At the very least, you have an excuse to address your city council, and call them out.
Alas, my hometown has only 40000 residents, but neighboring San Jose has many more, and, I'm told, a long line of homeless fellow Americans at opening time every day at SJSU's MLK library.
Try it; see what happens. I'm hoping you will be pleasantly surprised
The problem with comparing these boondoggles to Footbal Stadia is that football is limited by how many teams the NFL has. It's a known quantity, and if you can attract a team, you can generally sort of predict how much revenue you're going to get. Yes, projections are probably overly optimistic, but you do typically get the rent from the team itself, and that's a known quantity. With a convention center, on the other hand, you get whatever business you get, and conventions are notorious for wanting to go where they can have fun for as little money as possible. If you build a new center and have lots of hotels around, the city down the river has a larger, newer center next year, and the hotels are even nicer...
Mr. Malanga ~
I suspect your thesis could be applied to football stadiums, etc. as well.