Friday, May 8, 2009
40 Jealous Whores / Kotz / Politics / The Economy Convention Center: Nashville Should Learn from Austin's Blunder
Posted by Pete Kotz on Fri, May 8, 2009 at 5:50 AM
So much like Nashville, they commissioned a consultant's study that said an expansion of their convention center -- plus the erection of an accompanying, city-owned hotel -- would boost their annual hotel stays from 150,000 to 300,000. And much like Nashville, these civic leaders treated this study like it was real science.
But much like Nashville, they didn't understand -- or didn't want to understand -- that consultants will say anything you want them to say. That's how they keep getting hired. So much like Nashville, they went ahead with their plan and spent hundreds of millions to attract new tourists.
But when it was done, they didn't exactly reach that 300,000 goal. Their new hotel stay figure a mere 160,000. And it's difficult to say if that huge investment made any difference in that marginal hike. It's just as easily attributable to Austin's gradual rise as a music and vacation spot.
Next month, the Metro Council will vote on whether to purchase land for a new convention center and city-owned hotel. And if it passes, we'll be much like Austin, throwing good money after bad.
Comments (10)
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Dean is speaking to the Green Hills Rotary Club this morning. Hope he is nicely grilled over this.
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"Austin may fare better in some respects than the other Texas markets. Visitors continue to pour into the state capital for business and pleasure. In fact, hotel occupancy for the metro area was 69.6 percent year-to-date as of September, which is considered healthy by industry standards. The average daily room rate, or ADR, is $110.50, according to Smith Travel Research. Downtown Austin’s occupancy is 73.3 percent year-to-date, with an ADR of $142.72."
http://austin.bizjournals.com/austin/stories/2008/11/10/daily5.html
Let's remember also that Texas is a state with 3 or 4 times our population. Many, many conventions are primarily only statewide functions. While this mayor based solely only what the convention bureau has told him states we've lost 293 conventions because of size. I wish someone would challenge the bureau to reliver just 100 of those that could be verified Nashville was not selected because of size. To constantly use these figures without such facts is bunk.
You neglect a very important fact, Nashville is a centrally located drive-to state. Austin is a fly-to town for a convention. Thus, its a lot harder to get conventions to Austin than it is to Nashville, especially shows like Summer NAMM that THRIVED here and massively outgrew this town, only to go to Indy and Austin and bomb, and why? Nashville. People WANT to come to Nashville for a trade show for other reasons than just the show itself, which brings tourism dollars on top of the rest of the income. Don't be short-sighted and compare Nashville's need for a new convention center to Austin's overbuilt facility and hotel. I have not heard anyone propose the city here own a hotel, yet you don't mention that while writing this story either, only that Austin built one, leaving the reader to assume it must the be same here. Nashville needs a bigger, better convention center. NAMM alone will make it pay off since it has returned here (FINALLY), but more will come if we build it, and they will stay in our hotels, eat at our restaurants, shop at our businesses and more.
VJ, just because you haven't heard anyone propose the city own a hotel doesn't mean it hasn't happened.
The land acquisition vote that's coming up specifically mentions certain parcels that would be used for the hotel. A new convention center without a 1,000 room hotel right next door is a non-starter in the industry. Look at Indy, look at Dallas, look at St. Louis. Look anywhere else that has had rebuilt or built anew in the past decade. The problem: hotel companies are too smart to use their own money to build them. So they let the city figure that out, then come in on the back-end and sign a 15-20 year lease.
And, I'm sorry, but "NAMM alone will make it pay off"? One convention a year is going to offset the millions in operating costs and likely shortfalls from tourism taxes? Yikes. Even the most Pollyanna of convention center advocates wouldn't dare make that claim.
Nashville being a "drive-to" convention city flies in the face of all the new taxes enacted on the 99% of people using the airport who do not attend events at the convention centers. You can't use taxes as a justification then point out that the users will be avoiding the payment of those taxes. That is unfair for the locals and the regular tourists and business travelers having to pay through the nose for the honor of driving (or spending the night or riding in a cab) in a city with and brand new convention facility.
I pay these taxes and I am against this thing.
Follow the money and then you'll find out why they want this money trap so bad. Who stands to make the most money if the project goes forward? And if they even say it will be an open bidding process, they must think we are stupid.
If you are opposed to Music City Center we are gathering for a protest on the first and third Tuesday of each month (when Metro Council meets)on the public square near the fountain at 5:30 p.m. Bring signs and let council know this is a bad idea. Also please walk the are where the center is to be built and talk to businesses in the area to see what they think. For a 101 reasons not to build Music City Center please visit www.lpmndc.org
Daniel
Opryland Hotel has a chokehold on most large conventions in Nashville. Exceptions are gatherings such as the boat & car shows, the annual Women's Show, etc.
To think that the city can run a convention center at a profit is about as likely as Vandy winning a National Title in football. IOW, when hell freezes over.
Let the developers build their own center, much as Opryland did theirs. Ain't capitalism wonderful?
