As Baltimore gets down to hard negotiations with the developer proposing a taxpayer-subsidized, 750-room hotel a mile from the Convention Center, some competing cities are well ahead with plans to open hotels much closer to their convention centers.
The most dramatic and threatening example of the flurry of hotel development aimed at snagging a bigger slice of the intensely competitive $83 billion annual meetings business lies just about 100 miles north, in Philadelphia.
There, newly approved plans to add 2,000 rooms within two blocks of the Pennsylvania Convention Center by 1999 -- a 1,200-room Marriott already is connected by walkway to the center -- give the city a major advantage over Baltimore, convention experts here and elsewhere say.
Alarm over the prospect of the lack of a convention headquarters hotel costing Baltimore millions in potential business at the under-booked Convention Center has intensified here since Mayor Kurt L. Schmoke chose the $112 million hotel proposed by a team led by John S. Paterakis Sr., the politically connected baking magnate. Granting Paterakis exclusive negotiating rights in February for an Inner Harbor East hotel, just south of Little Italy, Schmoke rejected the recommendation of his economic development agency's staff, its chairman, the city's convention bureau and an expert panel appointed to study the proposals.
All of them favored an 800-room, $173 million Westin Hotel proposed by New York's Schulweis Realty on the former News American site that Schulweis controls about four blocks from the Convention Center.
Carroll R. Armstrong, president of the Baltimore Area Convention and Visitors Association, reiterated the marketing agency's stand that the city desperately needs such a hotel -- with 800 to 1,200 rooms -- as close as possible to the newly expanded, ailing center. Hotel development in Philadelphia and other competing cities underscores the need, he said.
"Philadelphia will eat us for lunch if we don't play catch-up quickly," Armstrong said. "They'll take all our business. It's a major red flag."
In Philadelphia, final plans announced last month will bring six new hotel projects, all developed by converting vacant buildings, the largest a 600-room Loews inside the historic PSFS Building, said Tom Muldoon, president of the city's convention bureau.
But Philadelphia, where the convention-oriented projects are part of a citywide boom in hotel development, is not the only competitor rushing to add rooms for conventioneers amid a nationwide boom in construction and expansion of convention centers.
Second tier
San Antonio, one of the hottest "second-tier" cities -- those, like Baltimore, a rung beneath the perennially popular convention heavyweights such as Chicago, San Francisco and New Orleans -- just announced a 1,200-room Sheraton to be built next to its convention center.
In Milwaukee, a $25 million expansion of the Hilton will bring the hotel to 750 rooms and add a skywalk to the convention center. In St. Louis, which recently snatched a major convention from Baltimore because of a lack of rooms for conventioneers here, a developer plans a 900-room Hilton linked to the convention center.
In Salt Lake City, officials just unveiled a two-tower, 905-room convention hotel, and a 515-room hotel is proposed. Both will be within a block of the convention center. And in Tampa, Fla., a developer is negotiating for a 700-room, $93 million Sheraton across from the convention center.
Baltimore's hotel choice mystified many of those who book billions of dollars in business.
"Unacceptable, totally unacceptable," said Barbara Nichols, a meeting planner for numerous large organizations. "Not matching the Convention Center's expansion with hotel expansions has been Baltimore's major problem."
The need for such a "headquarters" hotel -- typically connected to or within a few blocks of large convention centers -- has moved to the forefront amid serious doubts about whether the Baltimore Convention Center's just-completed $151 million expansion would ever deliver its promised payoff: direct convention-related spending totaling $340 million a year, generating $30 million in annual revenues, about 8,000 jobs and other development.
Source of the doubts: Alarmingly low Convention Center bookings, despite the tripling of its size through one of the costliest publicly financed projects ever in Baltimore. In an industry where major conventions typically reserve space three to five years in advance, Baltimore's bookings drop off precipitously by 1999 and 2000, far short of projections -- and well below current levels. As of December, the convention bureau reports, the center had booked 17 major conventions for 1999; 15 for 2000; 14 for 2001. By comparison, the number of such "citywide" conventions -- those that fill at least 900 hotel rooms on peak nights -- numbered 41 this year.
