Adrift With No Anchor

Rachel Wimberly -- Tradeshow Week, 4/30/2007

On a recent trip to Chicago for an industry event, I shared a cab with a woman who works at the Springfield (Mo.) Convention & Visitors Bureau and asked her how business was going in her city.

Based on what she told me, Springfield seems to be suffering from an affliction that has become all too prevalent in the tradeshow industry: The city built a convention center without an anchor hotel, making it extremely difficult to book tradeshows of significant size.

When I got back to the office, my colleague, Stephanie Corbin, coincidentally mentioned that she had been keeping a list of cities that had existing convention centers without anchor hotels and the problems it was causing.

Don't worry, Springfield. Apparently, you're far from being alone.

The Los Angeles Convention Center's lack of an anchor hotel has long been a thorn in the city's side. You'd think the second-biggest city in the United States would have thought of that.

Los Angeles is ranked eighth on the 2007 TSW 200 list of cities by share of the top shows. With only six of the top 200, it's behind its smaller sister city to the north, San Francisco.

Yes, I know the situation is being rectified with the planned construction of a 55-story hotel run by Hilton as part of the $1 billion L.A. Live project to be completed by 2010, but still, one has to wonder how many tradeshows the city has lost, and will lose, in the meantime.

Knoxville, Tenn.; Virginia Beach, Va.; and West Palm Beach, Fla., are three cities that decided to shell out the dough to build convention centers, then learn the hard way that not planning a hotel at the same time can cause big problems.

In Knoxville, taxpayers refused to part with the money for a flagship hotel next to the Knoxville Convention Center. As a result, only 6 percent of the center's bookings are conventions or tradeshows. And the future isn't looking any brighter. The city hoped private investors would step in and bail them out, but that hasn't happened yet.

Virginia Beach spent $207 million to build its convention center, but the hotel next to it, the DoubleTree, doesn't have enough beds available for a tradeshow of significant size. There's a proposal on the table to add an Embassy Suites Hotel and connect it to the center, but there's been some grumbling about the brand not being upscale enough for conventioneers, so for now the VBCC's still losing business.

West Palm Beach also built its convention center a decade ago without an anchor hotel. The sun is shining brighter there since a deal was recently reached between hotel developer Ocean Properties and the Palm Beach County Commissioners to build a $100 million hotel and condo complex. Local news reports quoted Commissioner Mary McCarty as saying, "Now, let's get this sucker built."

The moral of all these stories is simple: If a city can't afford to build an anchor hotel with its convention center, maybe it should consider waiting. Otherwise, the project could wind up costing more in lost business than taxpayers bargained for.