Competing for conventions

Plan to expand Baltimore Convention Center and add arena gains traction

May 28, 2011|By Lorraine Mirabella and Jessica Anderson, The Baltimore Sun

If Baltimore manages to build the $900 million convention center expansion and arena proposed for the Inner Harbor, business and civic leaders say, the city will join a growing list of destinations competing to woo lucrative convention business with bigger, better facilities.

If it cannot, they warn, the city could fall off the map as a potential convention choice.

Those are the stakes officials likely will weigh in considering the proposal, which has appeared to gain momentum with the announcement last week that more than half the project cost could be privately financed.

The Greater Baltimore Committee, the private business group that first floated the idea last fall, is recommending building a new sports and entertainment arena at the Inner Harbor that would connect to an expanded convention center and a new, larger Sheraton hotel. But the GBC had not determined how the project could be financed.

The committee offered a partial answer Wednesday, when it said construction magnate Willard Hackerman, president and chief executive of the Whiting-Turner Contracting Co., had offered to finance and build an 18,500-seat arena, estimated to cost $325 million.

Hackerman, who owns the 320-room Sheraton now on the site, would also finance and build a 25-story, 500-room replacement hotel, at an estimated cost of $175 million.

The offer appeared to increase the likelihood of the project getting built at a time when convention business has begun to rebound after the recession. Cities with which Baltimore competes for visitors, including Washington, Philadelphia and Nashville, have added or are in the midst of adding meeting and lodging space.

Baltimore's convention center was last expanded in 1996, which made it the 28th-largest center in exhibit and meeting space in the country. Fifteen years later, it has slipped in the rankings to 73rd.

"One of the things we need to do is move toward an expansion," Greater Baltimore Committee President Donald C. Fry said. "Once people see there is the seriousness of an expansion effort, that's going to attract a lot of interest and new conventions looking to come here. It gives you a chance to compete where we couldn't compete."

He added: "You constantly have to keep pace or eventually you'll become a non-factor, or less of a factor except for niche markets. If we don't move forward, we are falling back."

The committee's proposal would more than double the ballroom, meeting and exhibit space in the convention center to 760,000 square feet. Fry said the new space could accommodate as many as 300 new convention groups for which there is not enough room now.

Local tourism officials say they know the business is there to be had, based on the business Baltimore has lost to rivals.

Baltimore can already accommodate large groups at city-owned Hilton Baltimore Convention Center Hotel, which opened next to Camden Yards in August 2008. But the city has lost more than 700,000 hotel-night bookings because the convention center was either too small to meet a group's needs or the dates requested for the convention center were already taken, said Tom Noonan, executive director of Visit Baltimore.

Noonan says the expansion would allow the city to accommodate more than one large show or meeting at a time.

Convention attendance in Baltimore has shown improvement, according to a report on Baltimore tourism by Sage Policy Group Inc.

Attendance at meetings, conventions and trade shows at the Baltimore Convention Center plummeted 28 percent in 2009 from the previous year, according to the Sage report. But the decline slowed last year, to 2.5 percent. And the first three months of this year show gains, according to Anirban Basu, chief executive officer of Sage.

Basu said the unreleased numbers from the first quarter of 2011 show significant improvement in convention center attendance.

"There is every reason to believe that performance will continue to improve because Baltimore's offerings have so greatly expanded with the [Hilton] convention headquarters hotel," Basu said. "We are beginning to see some of the potential impact."

Analysts say convention business has improved nationwide.

"Everyone is seeing an increase in their meetings," said John H. Graham IV, chief executive officer of the American Society of Association Executives. "Association business is not back to 2007 or 2008, but it is 90 percent back."

Cities, meanwhile, are rushing to expand their facilities.

Washington, which had already expanded its convention center, is building a 1,175-room Marriott Marquis with 100,000 square feet of meeting space to open in 2013. Philadelphia completed an expansion of its convention center to more than 700,000 square feet and is renovating a Marriott hotel.

Nashville is building a 1.2 million-square-foot convention center and convention headquarters hotel, both scheduled to open in 2013. Dallas just added a new convention center hotel.

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