by Michael Lowrey
For years, the powers that be in this city have bought into the convention center as an economic development tool. The theory was that it draws in so much visitor spending that the convention center more than pays for itself. Or that it would it the convention center were just bigger. Or if we just had more hotels. Or a bigger hotel. Or something. And, of course, the missing element, whatever it might be at the moment, must be provided with tax payer dollars.
The Charlotte Observer pretty much demolished this line of reasoning a couple of months back. The reality is that the economic impact of the convention center is vastly overstated and likely negative, Charlotte is a second-tier destination, and the convention market is awash with capacity.
Now comes word that there’s suddenly been a change of plans by the Uptown crowd. The most desired item as of late, a 1,000 room hotel, is suddenly no longer the most desired item. As the UPoR reports:
Charlotte tourism officials have for years said a 1,000-room hotel could bolster the city’s convention business.
As the city prepared to host the Democratic National Convention last year, the head of the Charlotte Regional Visitors Authority said a 1,000-room hotel could help the city land up to seven large conventions a year, which would bring thousands of visitors uptown. CRVA chief executive Tom Murray said a hotel of that size would have to be subsidized by taxpayers, as the 700-room Westin was a decade ago.
But Murray now says this isn’t the time for a mammoth 1,000-room hotel, or a subsidy, and that the uptown hotel market should instead focus on midsized projects, with hundreds of rooms instead.
“Bringing in a 1,000-room hotel could have a disruptive effect on our existing hotel inventory,” Murray told the Observer last week. “That’s probably not the strategy that we would be working moving forward.”
Which is nice to hear. But don’t get too excited — it seems that this new found embrace for the market seems to have been brought about by another need for the pile of money that would have been used to subsidize a 1,000-room hotel. As the UPoR notes in the same article:
If the city ever did subsidize a 1,000-room hotel, the money likely would come through two taxes that fund the city’s convention center: a 1 percent tax on prepared food and beverages, and a tax on hotel and motel rooms. The fund comprised of those taxes currently has enough money to finance up to $110 million in debt, the city has said. Charlotte Deputy City Manager Ron Kimble said that money should be reserved for an expansion or renovation of the existing convention center, which opened in 1996.
So instead of doubling down on a failed convention-driven economic development model by throwing public money at a big hotel the city instead wants to doubling down on a failed convention-driven economic development model by by remodeling or expanding the convention center. That isn’t really an improvement.
Bonus observation: Note the group think involved here, how suddenly all the major players are on the same page.