Stepchild Convention Center Unequal To Competitive Threats
Written by Michael Lewis on October 6, 2011
By Michael Lewis
Nothing is booked at the Miami Beach Convention Center for four days next week. That might be the start of a trend.
Other than the four S’s — sun, sand, surf and South Beach — the center has been the magnet to fill the Beach’s hotel row since the 1950s. But the magnet is losing its pull. Even the Greater Miami Convention & Visitors Bureau has branded it an embarrassment.
Now the city is rolling the dice that a consulting firm to be paid $200,000 tops can recharge the center just as mainland gambling firms are proposing larger convening space that’s even glitzier than the Beach center is dowdy.
It’s a classic case of waiting too long and spending too little. No fewer than four studies over the past decade have shown that the city-owned center can’t stand up to newer and better sites in other regions.
Now, well-funded competitors from Malaysia and Las Vegas are knocking on the door across the bay in downtown Miami, in the process preparing to slam the door of opportunity in Miami Beach.
Malaysia’s Genting Group alone claims it will spend $3 billion on a casino resort that will offer more convening space than the entire Miami Beach facility. Its drawings put the Beach center farther behind in design than its chronological half century.
Meanwhile, downtown Miami, with new luxury hotels, is talking about its own conference center to grab a chunk of the business that Miami Beach has called its own.
Miami Beach has a plan for a $640 million revamp to raise its convention center to this century’s standards but hasn’t a penny of its own to pay. The county promises $55 million from bonds but has overcommitted funds, so getting cash could be slow even if the Beach were ready to go today.
It isn’t. It’s still negotiating a contract with Atlanta-based Strategic Advisory Group to make a new center design fly. All the consultant must do is the near impossible: find a partner to provide $600 million to do the project.
A business partner, unfortunately, would have to deal with the city as owner. That’s the same city that hasn’t upgraded its center for decades while it bickered about whether to do so and how, as the convention center became a contention center. There was always a reason to delay.
While the city delayed, a baseball stadium grabbed tourism taxes that could have been keys to a revamp. Then a bill in this year’s legislature to increase tourism tax rates to fund a convention center upgrade failed because it was tied to funding a football stadium roof too.
Now, as wealthy businesses seek separate opportunities, the Beach is preparing to act.
Not a moment too soon to protect a vital industry.
We’ve enjoyed growth in hospitality jobs, which as of August paid 105,700 Miami-Dade workers versus 94,200 ten years ago, a 14% gain. Hospitality employed 9% of all county workers in August 2001 but 9.4% now, outpacing average job growth.
Hospitality jobs rely primarily on tourists, but many out-of-towners come for business meetings and conventions. Shrink conventions and Miami Beach hotels suffer — and full hotels mean more jobs.
But to fill rooms, the convention center must draw from beyond driving distance. This isn’t peak season, but the center isn’t helping much now.
From Friday through Sunday the center hosts the Higher EducationEd Expo, a college fair targeting driving-distance attendance, though exhibitors might book rooms. Of the 39 four-year schools coming, we’d heard of 18. Such fairs aren’t a visitor magnet.
After the education fair the center has four days not booked, followed for three days by the Antique Jewelry and Watch Show, again no bonanza for hotels, overlapping with the start of another jewelry show.
Downtown Miami casino resorts wouldn’t aid Miami Beach hotels, either. Genting plans 5,250 hotel rooms in its resort casino. That would leave at best crumbs of the feast for Miami Beach.
Even if Genting builds its planned 750,000 square feet of conference floor space, an upgraded Miami Beach Convention Center has market potential beyond drive-to shows.
First, it retains Art Basel Miami Beach, a global draw creating one boom week a year.
Many other solid conventions wouldn’t pick a casino resort but still need high-quality space that Miami Beach today can’t offer. They love the four S’s as amenities, but the convention hub itself must stand out.
Fortunately, the industry is out from under the pall President Obama cast when he castigated corporations for meeting in luxurious sites. Miami Beach has glitz; Omaha doesn’t. That was a strong but short-lived impediment.
Now we still face the roadblock we’ve battled for years: the city can’t or won’t put up money, no new taxes are ticketed for the center and we lack a plan to get private enterprise to do the job for us.
For minimal pay, we’re sending out an Atlanta consultant armed with convention center plans drawn by Arquitectonica — ironically, the firm that just drew the competing Genting plans — to find $600 million or so to do the job we’ve been unable to do locally for a decade.
The need is great — as it has been for a decade. The opportunity is great — as it has been for a decade. But the door is closing — and we don’t have another decade to dither.
Far too much is riding on the health of our current convention center to rely on a $200,000 roll of the dice in Atlanta.