Thursday, May 28, 2009

Convention Center: Dallas Mayor Begs Feds for Hotel Funds

Posted By on Thu, May 28, 2009 at 11:44 AM

click to enlarge begging-dog.gif
A friendly reminder: This Sunday, the convention center debate sponsored by Scene, half the Metro council and ALL GOD FEARIN' PEOPLES THE WORLD OVER will take place at Vanderbilt's Blair School of Music from 2-4 PM. In an effort to get you, Pith reader, off your butt and into the gloriously air conditioned Steve and Judy Turner Recital Hall, here's another remind of why this issue is like, uh, really important and stuff... Every city reads from the same playbook when it comes to building convention centers. So when you consider a city like Dallas, it's helpful to picture them about four pages ahead of Nashville. Whereas we've spent the past decade waltzing our way towards a new center, Dallas has spent roughly half that time trying to build an adjoining hotel. Earlier this month, the city finally reached an end point, shooting down a referendum that would have blocked the $500-million, publicly-owned* hotel. The only problem: It's almost impossible to finance. *Remember this in a couple months, when city leaders start pitching a hotel funded by a public-private partnership. Shit don't work that way no more. It's the cities money. Marriott, Hilton or Sheraton just sign the lease. Dallas Mayor Tom Leppert went to Washington last week to beg the House Financial Services Committee to help pass a bill that would make municipal bonds, like the ones he's trying to sell to build the hotel, more attractive. As it stands, bond investors don't see municipal bonds to be the safest bet (and they probably shouldn't, seeing as how cities like St. Louis have already defaulted). As a result, interest rates are prohibitive. The solution: Ask Congress for relief! Nashville gets wrapped up in this whole mess because we're dealing with the same market. And that's our dirty little secret. For all the talk about whether a new convention center is a civic priority at the moment (an argument in which we've offered our own opinion), little attention is being paid to the fact that you can't build something you can't fund. Dallas has high interest rates. As do we. Something our bond guy from Goldman Sachs even said as much at a council hearing last month. Something to think about for Sunday. See you there.

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