Convention Center Follies. Heywood T. Sanders
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dramatic change in convention center financing. During the 1950s, 1960s, and into the 1970s, new convention center proposals generally had to run the gauntlet of voter review and approval. But by the 1980s state and local governments were able to adopt new financing and development mechanisms that effectively insulated center plans from local voters. The shift to public authorities or state governments from general purpose local governments, and from general taxes to dedicated visitor-based revenues, also put the choice to invest in a massive convention facility in the hands of business interests usually focused on sustaining and boosting property values and development prospects in the downtown core. The result has been to privilege convention center spending over other, alternative public investments.
At the same period as convention center finance was being reshaped and eased, the arguments and rationale for convention facilities as major sources of economic development and job creation were gaining wider visibility. The same consultant who assured Chicago and Illinois officials of the benefits from a larger McCormick Place, Charles H. Johnson, had provided much the same advice earlier to St. Louis. He would go on to offer a justification and set of forecasts for new convention centers in Charlotte, and Richmond, a bigger one in Austin, and one in Boston. The same consulting firm that advised the Georgia World Congress Center Authority on expansion in the mid-1990s would provide remarkably parallel advice and economic impact forecasts to Cincinnati, Cleveland, Indianapolis, and New York City. The consistent finding was that more space would bring more business, and more jobs.
Much as consultant forecasts of demand and center performance have proven faulty, the basic assumptions about convention and tradeshow attendees, their visitation and spending patterns, have proved unrealistic. Consultants and convention center backers have routinely assumed that convention attendees stay in a city some 3.5 days, with attendees assumed to come from out of town. Yet convention and tradeshow events often draw a substantial volume of local attendees, or those who simply visit for the day. In 2009, more than half the convention and tradeshow attendance at New York’s Javits Center (excluding events like the New York Auto Show or similar public shows) was made up of “day-trippers” or other local attendees. Or take the case of one of the largest annual events at Orlando’s Orange County Convention Center, the PGA Merchandise Show for the golfing industry. For the 2008 edition, 31 percent of the attendees came from Florida—many of whom likely just attended for the day. And one measure of that phenomenon is the volume of hotel room nights used by PGA show attendees. The 43,000 estimated attendees actually booked only 29,178 room nights—rather less than three, or even two, room nights per attendee. With more day-trippers and fewer out-of-town attendees, the economic impact produced by centers like these, and others, is actually far more modest than backers claim.13
Even as convention center building has boomed in American cities, these centers have proved remarkably unproductive as public investments, failing to provide the benefits that justify their construction. Yet even in the face of failure—a new center in Boston generating less than half the hotel room nights promised by consultants, an expanded center in downtown Atlanta yielding fewer convention attendees in fiscal year 2010 than it saw in 1989—local officials and consultants continue to argue for more space and more building. Why are center consultants not held to account for their forecast errors? How is it that these failed public projects are followed not by expressions of outrage and apology, but by calls for even more? Why is it that governors and mayors, business and civic leaders, have promoted, built, and continue to call for more convention center spending, in the face of nonperformance and an evident glut?
Though the phenomenon of the boom in convention center development has been widely recognized, there is no agreement among scholars on its roots and causes, on the interests of the elected officials who sustain it, or the interests of the business and civic leaders behind it. For some academic observers, it represents an unalloyed positive in enhancing the local economy. For others, it is a necessary adaptation to central city decline or the product of political pressures from narrow interests such as hotel owners and developers. Still others point to the existence of business-dominated coalitions or regimes or “growth machines.” Yet all point to the role of local business interests and the organized business community as central to the initiation and promotion of these projects.14
If these academic analyses all point to some—perhaps the most central—role of local business in promoting and supporting convention centers and related public projects, the central paradox of center development remains. Why would business interests—narrowly focused ones such as hotels and restaurants, or broader ones such as department store chains, local utilities, and locally headquartered corporations—embrace public projects that appear to have such a modest and uncertain economic return? And why, when these convention centers produce far less activity than had been forecast and assumed, do supporters invariably call for more space, or a new publicly financed hotel or entertainment district next door? The answers to these questions, and to the fundamental interests and expectations that drive convention center investment, require a focus on local business and business interests, the apparently essential element in pressing and realizing the major public investment in convention centers.
For business leaders like “Cubby” Baer and Leif Sverdrup in St. Louis, the public investment in a new convention center offered the opportunity to remedy “property decay” and provide an “effective barrier against further deterioration.” For Atlanta’s business leaders, a convention venue on an urban renewal site could yield “protection of the Uptown area.” And in these cities and others, a major public investment project would provide development “momentum,” evidence of the public commitment to the downtown core, and a means to be “a big-league city.”
In this context, the dual imperatives of land value reshaping and momentum creation have led many cities to replace one modern convention center with another as the frontier for development and investment opportunity shifted. Thus Washington, D.C., replaced one convention center opened at Mount Vernon Square in 1983 with a far larger one to the north in the Shaw neighborhood, completed in 2003. New Orleans replaced its 1968 Rivergate with the Morial Convention Center in 1985, then expanded the Morial in 1991 and again in 1999. Houston replaced the Albert Thomas Convention Center, opened in 1967, with the new George R. Brown Convention Center on the opposite side of downtown in 1987. Boston opened its second publicly owned center, the Boston Convention and Exhibition Center, in 2003, in an underdeveloped zone of south Boston. And New York City first replaced the 1950s-era Coliseum with the Javits Convention Center in 1986, only to see Governor Andrew Cuomo call for a new convention center at a casino in Queens in early 2012, proposing that the Javits Center be demolished and its site sold for new private development. Pressed by business leaders seeking to sustain downtown property values or boost the development fortunes of an old warehouse district or railroad yard, state and local officials have embraced one scheme after another for new or expanded convention centers.
Building Boom
The last two decades have seen a remarkable boom in convention center building across American cities. From 36.4 million square feet of exhibit hall space in 1989, the total center exhibit space reached 70.5 million square feet in 2011—an increase of 94 percent. In one sense, that building boom represents a triumph over the host of political, fiscal, and economic constraints and conflicts that routinely face state and local governments. Faced with public resistance to increased taxes, center promoters could, and did, invent alternative financing schemes. City governments often successfully shifted much of the cost of convention center development to state governments or independent authorities.
In another sense, the boom also provides ample evidence of the “me too” character of local public investment decisions. Chicago expanded to keep up with Las Vegas, Atlanta expanded to stay competitive with Chicago and New Orleans, and Boston, Philadelphia, Washington, and New York each competed to win a larger share of the convention business in the Northeast by building more space. Each and every city that successfully developed a new or expanded center appeared to believe that it was uniquely suited to win that competition and see a steady stream of new visitors. And those expectations were given a very specific and seemingly scientific justification and forecast produced by one or more of a very small group of industry consultants.
For Phoenix, convention center development efforts in the