Miami: Global Spectrum 1, SMG 0

Gregg Caren, SMG's vice president of strategic development, said he had few worries when he walked into a meeting of the City of Miami Beach Commission July 16. His company's contract to manage the Miami Beach Convention Center was up for renewal. SMG had run the center for the past 17 years and a selection committee earlier had voted 8-1 to recommend it over rival Global Spectrum.

“I don't mean to sound cocky, but we thought we had it,” Caren said.

Ignoring the selection committee's recommendation, Miami Beach commissioners voted 5-2 to give Global Spectrum the first chance to negotiate a contract.

“I was shocked and stunned,” Caren said. “It (was) an unbelievably bizarre day in our world. ... There's not anybody in that room that wasn't shocked.”

Global Spectrum came to the table with an offer that piqued the city's interest. The company has joined forces with Messe Schweiz, the Swiss company that owns Art Basel Miami Beach, one of the center's – and the city's – biggest annual events, and the duo said it had a plan to bring more business to the city.

If negotiations between the city of Miami Beach and Global Spectrum are successful, a three-year contract (with an option to renew for two more years) worth a base fee of $280,000 a year will become effective Oct. 1.

Despite SMG's history with the center and its success with the selection committee, Global Spectrum officials said they weren't going to take no for an answer.

Global Spectrum Senior Vice President Frank Russo Jr. said he did not believe the process that had led to the selection committee's recommendation had been fair. He said he had been “appalled by the highly prejudicial, wrong and inflammatory statements” that were made.

Russo told Tradeshow Week, “We said, 'What can we do?' We were told we could make a presentation to the council and mayor.”

Each company had 30 minutes to make its presentation, followed by two hours of questioning by the mayor and commissioners.

“The city commission was able to hear firsthand how Global Spectrum had a superior marketing plan,” Russo said. “They were totally convinced we could run a center of this size.”

If Global Spectrum's negotiations with the city are successful, it would be the first time a European messe – Messe Schweiz owns 20-plus shows and 2.1 million square feet of venue space in multiple Swiss cities – had more than a tradeshow-organizing role on U.S. soil.

And that rubs some managers who already have shows at the Miami Beach CC the wrong way.

“It has been our opinion that it's never been a good idea for them to be a part of the center,” said Cathy Rick-Joule, show manager of the Natl. Marine Manufacturers Assn.'s Miami Beach Intl. Boat Show, which brings an estimated 145,000 attendees to the center each year.

Rick-Joule said she felt Messe Schweiz was willing to do whatever it takes to get ahead.

“I believe (Messe Schweiz) came to Miami Beach kicking and screaming, and they want things done their way,” Rick-Joule said. “It makes me nervous about the precedent here and what it sets in the industry.”

In response, Russo previously told TSW, “Global Spectrum is the entity that would be solely responsible to Miami Beach, and Messe Schweiz would be advisory ... at arm's length. There would be no special treatment for dates or integrity of dates for other show managers there.”

As for the potential for the European messe model setting a dangerous precedent, he added, “I think that is a totally manufactured argument by SMG. The commission was unimpressed with the argument that Messe Schweiz and our team was a conflict.”

According to Thomas Mobley Jr., Global Spectrum senior vice president, even though Messe Schweiz plans to bring some of its shows to the Miami Beach CC, none of them will compete with existing shows.

“One of the things we committed with this alliance (with Messe Schweiz) was no events would be brought into the building that will cannibalize any other shows,” Mobley said.

What Mobley and Russo both said Messe Schweiz brings to the partnership is the enhanced ability to market Miami overseas, particularly in Europe.

“It's a great opportunity to bring more international attendees to Miami (and existing and new shows),” Mobley said.

Rick-Joule wasn't convinced. “If a European show wanted to come here, they would have already,” she added.

Other show managers are less worried about Messe Schweiz, and more worried about working with a new convention center manager.

“We are very upset (by the commissioners' decision),” said Tim von Gal, a partner in Urban Expositions, which has three shows in the center, including two editions of the Miami Beach Gift Show.

“We felt the management team that was in place there was exceptional, and we expressed our concern about changing from an exceptional team,” he added. “Clearly, our concerns were not taken into account by the city council. The people responsible for the center are not listening to their biggest customers.”

Von Gal said his company also was concerned about Messe Schweiz, but since he never had dealt with them in any way, “it would be inappropriate to comment on their abilities.”

Russo said show managers had “nothing to worry about” with Global Spectrum and Messe Schweiz. “(Show managers) are a nervous group of people (concerning changes). ... If they are nervous about things being run better, then they have something to be nervous about.”

Caren, on the other hand, has not given up yet. “We've been there for 17 years, and we've done a really good job,” he said. “It's not over until a contract is signed successfully.”