Big Convention Center Dream Is A Path To More Prosperity
Written by Michael Lewis on March 8, 2012
By Michael Lewis
A meeting aiming to redevelop Miami Beach’s aging convention center could trigger a shot in the wallet that revitalizes all of Miami-Dade County.
But that bullet will hit home only if developers heed Beach City Manager Jorge Gonzalez’s clarion call to "dream big." If not, a convention center upgrade will remain a perpetual big dream.
The city asked 200 people last week to take a 52-acre swath including the convention center, the Gleason/Fillmore Theater, city hall, a parking garage and more and design a project focused on an upgraded center.
Beyond an 800-plus-room hotel and an entertainment hub, the sky’s the limit — even construction height ceilings could rise.
The catch is that the project must rise at developer’s expense. The city has only land and buildings, plus $55 million promised in county funding that’s been waiting eight years for a convention center upgrade.
So a deal must repay the developer’s risk. Then, the developer must run a gauntlet: city voters would have to approve any plan for their land.
A smart developer will subtract from potential returns the cost of gaining voter approval plus a multiplier based on odds that voters wary of any government proposal will reject even a great plan they should jump at.
Voters will be jaded by a deal the county and City of Miami cut in 2009 with the Marlins to develop the Orange Bowl site in Little Havana. That deal will eat up about $3 billion in public assets over four decades with no return from the team — ever.
Most of that ballpark money came from convention development taxes that, as the name says, might otherwise have redeveloped the convention center.
Voters might also be soured by a deal that promised the county a payback from AmericanAirlines Arena when profits hit a fixed level. Though arena sales are among the nation’s top seven at performance sites, it has never hit the threshold for paying the county anything and probably never will.
Failure to strike a fair deal to redevelop the convention center would eat into wallets in Miami-Dade in general and Miami Beach in particular. The need is great and timing is crucial.
The city last expanded its center in 1989. It’s small, out of date and non-competitive for the type of meetings and conventions central to our visitor industry and taxpayers.
We once lacked enough good hotel rooms for major meetings. We’ve filled that gap — though the center needs an attached hotel to compete — but now the center itself has fallen far behind even second-tier venues.
We wasted vital decades as we planned to catch up and never did. Place the blame where you will, the fact is that plan after plan to upgrade the center fell apart.
Most recently, the city paid $573,000 for a design tied to a 1% sales tax addition that also would have added luxury seats and put a partial roof on privately owned Sun Life Stadium. That failed in last year’s legislature.
Out of funds and options, the city is logically looking to a developer for cash and a plan that accomplishes city aims as well as the developer’s.
An off-target aim would tie in a casino. That’s a bad bet anywhere, especially in a city tainted by illegal gambling decades ago. A casino would turn dreaming big into a big nightmare.
A deal must also replace city hall if it becomes part of the redevelopment. The city needs to wind up with either a city hall or money from the developer to build one elsewhere.
All should support the city’s effort to cut a fair deal because a modern, appealing convention center is vital countywide. A 2011 study found the center upgrade proposed then would have added 6,208 direct jobs and 12,183 total in the county.
Vital as those jobs are, total economic impact of a center upgrade is even bigger. The study found direct economic impact plus added tax income would total $1.8 billion a year.
As perspective, $1.8 billion is 90% as much as today’s annual impact countywide of all overnight visitors who come for business and meetings. It’s a huge jolt.
Those who aren’t in Miami Beach need to support the center’s revitalization for a reason besides the rippling economic wave that would nourish us all:
If Miami Beach doesn’t soon get adequate convention space, mega-casino owners will promise instead their own modern convention hubs with massive casinos attached. They would have in their corner the ever-growing threat to our convention business as the Beach center ages out of competition with everywhere else.