Big Centers Are Planning For Future

With 4.6 million square feet of exhibit space between them, Chicago's McCormick Place and the Las Vegas Convention Center are two of the three largest convention centers in the country. McCormick Place just opened its new West building this summer, and the LVCC is set to kick off an $890 million renovation at the beginning of next year.

You'd think they'd be happy, but all that is not stopping the pair from already making plans for their next growth spurts, five, maybe even 10 years, down the road.

In early August, Chicago's Metropolitan Pier and Exposition Authority board of directors hinted it might use its eminent domain authority to take a city block next to the newly built McCormick Place West. This month, the board followed through with an ordinance at the Sept. 10 MPEA meeting.

The property is on Cermak Road between 21st and 22nd streets, directly north of the West building. According to Juan Ochoa, MPEA's CEO, it was the last available block anywhere close to the McCormick Place campus.

He spoke to TSW when the possible land grab was announced and said, "It's an issue of take now or pay later."

Ochoa and MPEA Board Chairman Ted Tazloff said in a joint statement: "This lot is key to the future development and operational needs of our convention industry business. Our actions are intended to protect and preserve those public purposes, so that we can put this land to the best use for the convention industry and the facility's needs."

According to MPEA, the board's actions are in accordance with Illinois state law, which gives the authority the right to condemn (which, in this context, means "take over") land adjacent to it within a designated geographical area.

MPEA Spokesman Jon Kaplan said it had not yet been decided how the land would be used.

Ochoa and Tezlaff's joint statement said the MPEA would look at different options, "including the possibility of an additional hotel expansion or other forms of mixed-use land development, including more amenities, parking and green space, but there is no master plan in place at the moment."

The most pressing need is for more hotel rooms.

McCormick Place currently only has one attached hotel, the Hyatt Regency McCormick Place. Even with the planned expansion of 600 more rooms in the works, several Tradeshow Week 200 shows that call Chicago their home, such as the Intl. Manufacturing Technology Show, drew more than 90,000 attendees in 2006. A lot of people had to stay in downtown Chicago, a taxi or bus ride away.

But a hotel might not be in the cards, according to Ochoa. "Depending on the budget, it could just be surface parking," he said.

With new developments popping up around McCormick Place and the price of real estate steadily rising, Ochoa and Tezlaff said, "We determined this would be the right time to take this action, as it allows us to exercise our options as we see fit in the future."

Land is not any cheaper to the southwest in Sin City and, although land is abundant in the Nevada desert, prime real estate around the Las Vegas Strip, near the LVCC, is harder and harder to come by.

A vision plan approved in 2005 by directors of the Las Vegas Convention & Visitors Authority (owner and operator of the convention center) dictated that staff locate and acquire property adjacent to the facility for future expansion.

Easier said than done. As LVCVA President and CEO Rossi Ralenkotter pointed out, the LVCC is landlocked to the north, east and west by property that's inaccessible, either because it's occupied or too expensive. The only remaining chunk of land big enough to hold an exhibit hall addition is the 10-acre Gold Lot, used for parking and outdoor exhibits, across Paradise Boulevard, west of the center's North Hall.

Take that out of commission, Ralenkotter said, and you'd have to find somewhere else to put all the cars and exhibits that use it year-round.

That was the impetus for a patchwork of acquisitions the Authority has made over the last year south and east of the LVCC's existing campus, along Desert Inn Road, Joe W. Brown Drive, Swenson Street and Sierra Vista Drive. By snapping up apartment complexes, the American Payroll Assn.'s White House and other property, the LVCVA has grown the LVCC campus to 147 acres.

And counting. This month, the Authority board approved the near-$50 million purchase of another 8.44 acres, this time next to the existing Green Lot. (In case you're not near a calculator, that's $5.9 million per acre.)

The land now holds an apartment complex that owners have agreed to raze as part of the deal.

LVCVA Senior Vice President of Operations Jim Gans said the acquisition fits neatly into the Authority's vision for the future, because it would allow the Green Lot to replace the Gold Lot when the latter is used to expand the convention center.

When will that be? "Five, maybe 10 years from now," Ralenkotter said, at the board meeting where the acquisition was approved.

In the meantime, the larger Green Lot will provide a handy staging area for tradeshow delivery trucks and the construction vehicles that are expected to begin humming around the renovation site early next year.