Has Convention Center delivered on its promise?
By Chip Drago
Mobile Bay Times
Twenty-five years ago, prompted by general disgust and a federal court order, Mobilians rallied to a renewed civic pride behind a more inclusive mayor-council form of government. The fall of 1985 was a pivotal moment in Mobile's 300-year history. How would that enthusiasm come to express itself in practical terms that reflected the community's desire for positive change?
Mayor Arthur Outlaw and that inaugural City Council came to settle on the construction of a waterfront convention center on the site of the old banana docks at the foot of Government Street as the centerpiece of its vision for revitalizing downtown and the city itself. A sparkling facility on the river and a commitment to the convention and visitor industry would bring people and dollars, "heads in beds," to downtown which would flourish with new hotels and restaurants, the thinking went.
Outside of City Hall, however, not all were sold on the wisdom of the convention center or the additional one percent sales tax on prepared food, i.e. "the hamburger tax," and hotel rooms that was adopted to pay for it. Ultimately, the convention center and a related battle over an interstate connector at Water Street combined to sap Outlaw's political strength and usher in Mike Dow's 16-year run as mayor. Dow was able to finesse the issue so that he was voted in with the backing of the anti-convention center crowd but evolved in office to adopt a view similar to Outlaw's -- the convention center would be the vehicle that reversed decades of decay that had virtually destroyed downtown Mobile.
So the question that Mobile Bay Times has put to many of the players in that drama from yesteryear as well as interested modern day parties: To what degree has the
convention center and the city's annual appropriation to compete in that industry succeeded or failed in bringing about a revitalized downtown Mobile through convention business and new investment in the downtown district?
"I think you have to look on it from a couple of different perspectives. Strictly from the standpoint of developing the City's tourist/recreational economy, the Convention Center has been a huge success. Has it lived up to it's potential? Not at all; but it has allowed us, a city that has always been in the convention/meeting business to a greater or lesser degree, to remain competitive and has grown that segment exponentially. You would not see ANY hotels (of the standard we now enjoy) Downtown without it.
From the more general standpoint of 'downtown redevelopment,' I don't think it has had such a great impact. I mean, it is a big piece of the puzzle, but in no way the dominating or controlling piece. Having a comprehensive hotel base Downtown is important to overall civic health, but not the determinant. If the City had been more successful in convention recruitment, it would have been a much more significant piece of the equation, with the conventions feeding more hotels, retail, restaurants, bars, and other entertainment venues which would have intensified the regional consumer draw of Downtown to the larger community. But at the rate it has performed to date, it is merely one of many factors driving the Downtown market. Improve the convention recruitment success rate, and the positive effects on Downtown would increase exponentially."
commercial real estate
"Without a 400-room Convention Center Hotel, the center itself is like an eight-cylinder engine with a two barrel carburetor. We will do no better than the bottom end of the 2nd tier conventions. The Battle House now draws a lot of State Employee conventions and group meetings because of the RSA ownership. But we continue to miss the big boys, like American Medical Association Regional meetings. etc."
"The construction of the Convention Center has been a very significant engine for downtown redevelopment. It was the catalyst that signaled that downtown might turn around. Until then, downtown was in a death spiral. It needed a major jolt to attract private investment.
Thanks to (Mayor) Arthur Outlaw and then (Mayor) Mike Dow, the convention center was constructed and the transformation of the downtown over the last two decades has been remarkable. The irony, of course, is that the convention center defeated Arthur and elected Mike. But it is a classic example of unintended consequences. Mike was elected in large part by voters who resented what Arthur was doing in downtown and liked Mike's anti-convention center rhetoric, and the voters ended up with a Mayor even more committed to downtown than Arthur. But that's another story."
"(Construction of the convention center) was clearly the start. But, the convention and visitors bureau has never had the budget, or maybe the people to do what was intended -- bring in major conventions and events to Mobile."
"I think the Convention Center put a new emphasis on how downtown looked and functioned to visitors. There has been tremendous progress in development and quality of life issues down there as a direct result. Surely the renovation of the Battle House and the building of the RSA wouldn't have happened without that initial commitment.
On the other hand the city has not continued to invest the needed dollars in Marketing and 'selling' the city to potential visitors and conventioneers. Instead the emphasis shifted to industrial development and industrial job growth. There needs to be more resources devoted to promote Mobile and thereby support the historic infrastructure and our attractions, that are positives to our quality of life."
"Much money, time, and effort has been wasted at Mobile Convention & Visitors Corporation, the Mobile Area Convention & Visitors Bureau, the Mobile Bay Convention & Visitors Bureau, or whatever the name is this week. Yes, it is a great idea, but has yet to flourish as desired since all the Directors have figured out how to play politics for their own self-gratification rather than booking business.
but the real
culprit is the
fact that there
is no measurement standards. Tradition has it that whenever a new leader comes in, they do whatever necessary to discredit the visitor counts and meeting/delegate counts from the previous administration. You know, nothing like saying your predecessor was trying to pull the wool over the eyes of the Mayor and Council, or to lower the bar so you can have a few years of limited production.
Then you factor in the hotels’ contribution to soliciting/booking meetings and events into Mobile for which the CVB naturally takes some form of credit, whether deserved or not. Like it or not, the leads and bookings by the hotels contribute to more meetings and delegates than the CVB, year after year. This naturally fuels the fire when the CVB claims otherwise.
Since its inception in 1988, the CVB Board has contained a majority of non-hospitality industry members, all appointed by one politician or another. Add to that a few members who are dead set on resisting any public comment on how good or bad things really are in the organization.
It’s certainly hard to figure out if real efforts are ongoing to increase business in Mobile despite the CVB having some very good employees over the years as well as some really bad ones. All you’ve heard in the last several years is Carnival. When a real meeting is booked, like the upcoming Marine Corps League in a few years, it makes the front page. Isn’t that odd?
The last I heard, the CVB still doesn’t have a contract to operate (in its customary manner). I suspect that’s why the Mayor and the CVB were trying to get $3 million from BP so that would fund the CVB for the coming year which is about the amount of their annual budget or so I understand since the CVB doesn’t make budget figures available.
I understand that bragging rights in the industry center around how big your budget is so you can continually move up to bigger CVBs with bigger budgets. Of course, sometimes the search committees actually look at results posted by their applicants and some applicants get stuck, or rather, their town or city gets stuck with a non-producer who probably has no measurement standards in their contract, so it’s tough to get rid of them.
The Mobile CVB is an organization like BayFest, a private organization primarily funded with public funds and a lot of them at that. The big difference is at least BayFest puts on a show for Mobile. Come to think of it, that pretty well explains the CVB as well. After 20 plus years, smoke and mirrors and little else."
"I personally think the construction of the Convention Center in Downtown Mobile has been the major catalyst for revitalization there. Without it Mobile would not have had the major hotels built like the Riverview and The Battle House (Mobile's Living room) which led to increases in tourism industry which led to the 16,000 jobs created by Tourism and Travel. Over the last 20 or so years Mobile has gone from something like 25,000 room nights to recently 90,000 plus. The money the city and county give to MACVB more than pays for itself. A vitalized downtown also shows well to companies analyzing our area for Economic Development."
commercial real estate
"I think the convention center was the catalyst for the development of the waterfront, Cooper Riverside Park, and now the Maritime museum. This also spilled over into the development of downtown Mobile. We have several new or renovated hotels downtown directly because of the convention center. This also brought new class A office space to downtown. This was made possible in large part because of the creative financing of the convention center by State legislation that capped the amount of state tax the city would pay, with the over-ride going to pay the bond issue. If there is a negative , its the convention center was slow to prompt the aforementioned developments."
"It goes way back. The reason we had so much trouble was because of that court case (Greenough, Juzang, Gwin auditorium trial). The industry became infuriated with Mobile and didn’t want to have anything to do with us. The city contracted with a management company to get around those problems. They had contracts with all these other municipal civic centers and auditoriums and we thought they’d include Mobile. Spectacor Management Group gets $1 million. But they aren’t doing much good. I thought the idea made sense back then. But it goes back to Greenough and the others and that time. That business just showed out how the industry worked. All the testimony about under-the-table payments. If I were calling the shots now, I’d use the money to let the hotels market their own properties. They could work it out through their hotel association however they wanted under contract with the city and county. They could use the funding to hire the productive convention and visitor employees. I’m all for the convention and visitor industry. Just at this point, I think we need to re-think what we’re doing. There’s talk about demolishing the civic center. Folks are going out to the Mitchell Center anyway, except for Mardi Gras stuff that has to be downtown. Leon’s got a huge staff. I cast no aspersions toward Leon. I like Leon. I just think we need to re-assess and make adjustments and that is no criticism of the employees working there. The convention center is an asset for Mobile. It’s time to reassess the situation in regard to these downtown venues. That $1 million for SMG I referred to might include salaries so I may be in left field without all the information. But I’m thinking that $1 million could go toward marketing. We are not bringing in enough business so I think you’ve got to ask why we aren’t bringing in the business. Again, I’m not criticizing the employees. Do they have the tools they need to bring the business in?"
"The revitalization of Mobile's downtown has been significantly impacted by the Convention Center. Along with the other projects that were part of the 'String of Pearls,' the Convention Center brings local and out of town visitors to events within the Henry Aaron Loop, an area that was considered blighted not so many years ago. The real key, though, residential living, is the 'string' to hold those pearls together. The City of Mobile needs to do more to encourage residential development through tax incentives, ease of permitting, and specially zoned areas.'
"In my opinion the Convention Center has been a very successful catalyst for downtown redevelopment. Most important however is the fact hat other facilities have also developed, such as the new Maritime museum, Cruise terminal, Cooper Park and Exploreum.
The Visitors Bureau has been less successful, due largely to a lack of hotel space. This being overcome, larger conventions can be scheduled. Visitors bureau needs more aggressive approaches and vision. Altogether, the two have helped greatly."
"How will we ever know the answer to that question? The whole arena of what we used to call tourism and conventions has changed over the decades. First there were families touring the country and seeing sites like Bellingrath Gardens. Then came the era of big time conventions with the men attending working sessions while the wives shopped and toured places like historic homes and Bellingrath Gardens. Then conventions and the idea faded until we got them only by buying them with such expenditures as the costly building of bowling alleys for that convention. Then came trade shows. And now if we are to believe what we read tourism is a matter of how many drunks you can get on the beach at Gulf Shores or in downtown Mobile or on the Mardi Gras parade
"I believe it has been very successful in helping the effort of revitalizing downtown by bringing in conventions and visitors to Mobile. I believe that one problem that may exist is that it does not help as much the other hotels in our city and county. The tax revenue to fund this is based on the entire county. So some hard feelings may exist for people not benefiting directly."
"I can't comment on what part it played in revitalizing downtown ... is downtown revitalized? Of course, there has been massive hotel construction, a new FBI/Federal building, a new commitment from county and city government.
Still, would you walk two blocks either side of Dauphin Street after 10 p.m.?
All this hotel construction and what will their financial condition be a year from now? If the oil spill hadn't happened this summer, the hotel business here would have been a nightmare. The RSA projects pay no property taxes. Those buildings self-insure so their operating costs are a great deal less than their competitors. My taxes and insurance are over $150,000 per year. Go figure what the two RSA hotels and the AmSouth building would be. The negative operating costs for the convention center itself are a nightmare. Without the tax supplement, the center and the MCVC would be nightmares. April through August have injected a tremendous amount of money into the economy (as BP-related visitors descended on the Gulf Coast) Hotel revenues were off the charts. Most hotels here have already exceeded their annual budget revenues. Compare (hotel) occupancy taxes from last year to this. An example of oil spill influx: Our ATM machine processed approximately $12,000 a month prior to oil spill; for the last four months (June-September), it has been averaging $32,000 a month. Workers were being paid with debit cards and they burned up the money on entertainment and food.
The MCVC's contract was supposed to have been redone to give them a guaranteed amount plus an override on the actual tax collected, right? The last financial statement i saw from them, their salaries and benefits were 57 percent of their revenues. We, as hotels, have to pay membership dues, are charged extra for any publications that we want to participate in, and are given a bare minimum listing in one publication. Check their website. They list hotels in Gulf Shores, Daphne, Fairhope because they are 'members.' Now the county commission is supposedly going to give some $250,000 to a fund to be used to help market the city. The county commission gave some $260,000 last year to establish the Mobile County Sports Association. It has a director and secretary. To date has booked nothing worth mentioning. So we have the MCVC and the sports outfit and the $250,000 fund will be managed by the MCVC. If it is set up as before ... given the current federal, state and local people in government and their commitment to re-election and that goal only ... we will continually see monies spent with no accountability. Employees employed who make salaries way over what they could get in the private sector, not to speak of the unbelievable benefits ... holidays, paid vacations, retirement, and health benefits.
Summed up? A good idea in the abstract, poorly executed in practice."
"When it was built, the benefit/cost ratio was estimated to be 11 to 1 by the consulting firm, which definitely was over-estimated. My guess is that we have paid off the construction debt, but are still paying the (added) one-percent sales tax on restaurant meals."
"When the Mobile Convention Center (MCC) was built some 20 years ago, in my opinion that really launched the convention and meeting business in Mobile. We now had a state-of-the-art unique building in which to attract those conventions and meetings that we couldn't think about going after in the past due to meeting space limitations. We had to think big in order to build the MCC. And in those 20 years, we HAVE lured some of those big meetings to Mobile because of this facility. And I'm sure lately, the tough economy has hurt the convention and meeting industry, too. But it doesn't seem to me that we've gotten a good rate of return back on the multi-million dollar investment made in the MCC based on the revenues generated from the sporadic number of those big meetings which have been held at the MCC. At least not yet.
There are two issues at work here. First there is the question of Mobile's hotel room inventory. In order to attract the very large conventions, we need to have more available hotel rooms. But we can't build more hotel rooms if we don't get those big meetings. That's a conundrum many cities and counties have to deal with. I may be wrong, but there doesn't seem to be enough hotel rooms in Mobile to be able to go get those big national conventions on a regular basis. Second, I'm not sure having SMG run the facility is the most effective way to manage that building. I've talked to groups who'd love to use the facility, but the costs for doing so were outrageous. It HAS to be affordable to be fully utilized. Now maybe that has changed, but I doubt it.
In reality, I don't believe we can fully answer the question, even 20 years later, on whether or not the cost of the building outweighs the benefits of the building. If this was a report card, I'd give an 'Incomplete.' But stay tuned."
"To answer your question, I have no idea. Well, actually, that’s not true. Once a windbag politico, always a windbag, so here’s my answer:
I think that the construction of the convention center --that public investment in downtown -- spurred on private investment. And little by little with successes and failures, downtown is becoming a thriving area for the arts, restaurants, bars and entertainment.
It took all of the 60’, 70’s and 80’s (about 30 years) for downtown to downturn, so I’m very pleased to see that since the early 1990’s that our heart and soul, downtown Mobile, is once again a destination for Mobilians and tourists. And I think Mayor Outlaw would be pleased that you can now buy an apple downtown. Arthur Outlaw deserves so much more credit than he was ever given."
"From being on the beltline, we have rarely felt any business overflow from the downtown area (from events and conventions) in the past decade. I don't really count Mardi Gras because it's been here forever and increased naturally after Hurricane Katrina because of the destruction in New Orleans. The last city-wide event I remember due to conventions would be the Fraternal Order of Police (2000?). The Nicholas and Alexandria exhibit brought in business (2001?). So did the Dead Sea Scrolls (but that was more the Exploreum). Most of the revitalization in the downtown area seems to have come from new hotels and hotel renovations (Battle House, Riverview, Holiday Inn, Hampton Inn, etc..)."
"Unless something has changed without my knowledge, the convention center has never shown a profit to the city. It was a questionable venture from the beginning. Its location, design and operating expense has made it a burden on the community.
There are those who would argue that it was the City's commitment on this project which eventually brought about the RSA Tower and other improvements. However, the auditorium nor the convention center are utilized to their capacity which leads me to question the wisdom of the project.
I believe a waterfront facility of some nature could have been built in conjunction with a non-waterfront facility at a much lower residual cost to the taxpayers, while still being a catalyst for growth. It is my hope that we will eventually get it paid for and be able to eliminate the added tax on (prepared) food which was imposed to pay for it."
"It seems that the convention center was a needed requirement if Mobile was to have any chance competing for regional business. With that said, I expect the individual numbers on the center are probably at break even (or worse) but the overall economic impact is shown through hotels, restaurants, retail, etc. and any opinion based in fact should be informed by those numbers."
"The convention center alone was not enough to revitalize downtown. Downtown Mobile was a ghost town 20 years ago. Not so now. It has made dramatic improvement in the last five years. RSA investment, Business Improvement District, new construction and new attitude by City and County have all contributed to the revitalization of downtown. The convention center has played a part, but was never enough by itself. If the economy had not tanked two years ago there would have been more investment and more revitalization. In spite of the economy downtown has continued to move forward and will continue to do so as long the commitment remains."
"I think the convention center has done wonderful things for Mobile. Because of the facility many thousands of people have visited Mobile that may never have come. We might not have the hotels, nightlife or downtown activity without the convention center being built.
I think it was the right time. Where would we be with just a civic center or auditorium as those of us who have grown up here call it?
Could we have done a better job? With an organization funded by lodging taxes and city funds, you have to believe Mobile politics have gotten in the way. I am not sure we always had the best leadership guiding the organization responsible for selling the facility. We may have gotten farther sooner."
"Mayor Outlaw knew that he couldn't educate the entire voting population on the need (and location) of a Convention Center. He also knew that without an anchor convention and meeting facility downtown 'on the waterfront' we could not distinguish ourselves from other inland cities. It was more than a risk ... it would result in his DEFEAT in the upcoming election, but Arthur was willing to make yet another sacrifice for the good of the city. He did want one more term, however, to ensure it's completion and success. That was not to be. Fortunately, Mike Dow attended many of those same leadership trips and knew of its importance.
Without the waterfront Convention Center we would not have the Riverview Hotel, the renovated Battle House Hotel and RSA skyscraper office building, the Cruise Terminal, Cooper Park, the Maritime Museum, and I suspect that 'all of the above' played a huge role in attracting Thyssen-Krupp, Berg Pipe, the Container Terminal, EADS and many other businesses indirectly. Selfishly I hope my saving of Ruth's Chris in 1997 played a small part in attracting these companies to Mobile and I know that Felix's is often mentioned by their decision makers in Europe.
Well ... how do you measure success? Is it numbers of meetings or conventions? Is it numbers or room nights? Is it direct revenue expended? Is it exposure to our beautiful and historic city? I maintain that it is 'all of these.'
Yes ... we would like to have more conventions. Yes ... we would like to have higher profile groups and associations visit Mobile. And the staff and leadership of the MCVC are constantly aware and attuned to that goal. BUT ...in the meantime... our accomplishment is Arthur's dream of cleaning up, renovating, and putting vibrant life back in Downtown Mobile. The Waterfront Convention Center was the start of it all and played (and still plays) a major role in the success you see everywhere. I speak on behalf our city's unsung hero, Arthur Outlaw, a mayor who put our city's best interest above his own."
-- David Cooper, Sr.,
"It appears that this facility, which I believe is a tremendous asset, has been seriously under-utilized. I do not know Mobile to be a huge convention town which it could or should be. The only obstacle to the Center is the train track and traffic. From events I have attended there, and personally been trapped by extremely uncaring train engineers, I feel this is an issue which should not go a day longer without reaching some solution ..."
"As you are aware, twenty years ago there was much opposition to building the Arthur R. Outlaw Mobile Convention Center on the waterfront in downtown Mobile. So many people said it would fail. The success truly vindicates the decision by the city to build the facility.
The convention center was the catalyst for complete access to the Mobile Riverfront and the centerpiece for revitalization of the entire downtown Mobile. It's working. Next door to the center is Cooper Riverside Park. Mobile Landing is now a cruise ship home port and soon to add a Maritime Museum. Now citizens of Mobile and visitors have access to the waterfront. Before the convention center opened, there was no Gulf Coast Exploreum and I-Max Dome, there was no Renaissance Riverview Plaza Hotel and no thought of restoring the Battle House Renaissance Hotel and erecting a high rise office tower adjacent to the Hotel.
Through the combined sales efforts of SMG, the management firm for the convention center, and the Mobile Bay Convention and Visitors Bureau, the Mobile Convention Center has had nearly two decades of enormous success. The Mobile Convention Center has won numerous awards for the aesthetics of the facility and its superb service.
... for Mobile to fully reach its potential in the convention and visitors industry, its essential to have better airline service and more hotel rooms in one property. In addition, there is a dire need for unique shops, more retail shopping and quality night life on the waterfront or in the downtown area."
-- Bob Brazier,