The Convention Follies, Part 4: An Interview with Heywood Sanders
by Hank Bromley

[This is the fourth in a series of articles about the convention center controversy. Previous articles in the series are available at http://www.gse.buffalo.edu/fas/bromley/CCS/.]

Heywood Sanders is Professor of Urban Studies in the Department of Political Science at Trinity University in San Antonio, Texas. His area of expertise is urban policy, and for nearly two decades now his work has concentrated on the issues surrounding construction of new convention centers. Prof. Sanders will be speaking in Buffalo on Tuesday, March 28 (see adjoining advertisement). We had a chance to speak by telephone earlier this week.

In the early 80’s I had a grant from the 20th Century Fund—since renamed the Century Foundation—to research the politics of urban infrastructure. There was a lot of concern over the deteriorating condition of bridges, sewers, and the like, in many cities. My study’s purpose was to determine where deterioration happened and why. It was thought that urban infrastructures were crumbling because cities had no money for repairs, or because no one cared enough about these public resources. But I found that the same cities with the worst unaddressed infrastructure problems were spending money on other public projects. There was money for some things but not others. What got funded depended on what worked politically. Big, central-city projects with powerful backers—specifically stadiums, arenas, and convention centers—were happening despite limited fiscal resources, and infrastructure repair was not.

I continued to work on the question of what got built and what did not, and by 1991, when I wrote a paper called "Building the Convention City" for the Urban Affairs Association, examining Denver, St. Louis, and San Diego, I was starting to hear from reporters around the country. They would call and say "Some people want to build a convention center here, and they have a study showing it will make us a lot of money. How do we know how reliable those figures are?". So they would send me the feasibility studies, and I became familiar with what was going on all around the country.

Foundations also began to call, asking if I would do independent studies of proposed convention center projects in their cities. That’s how I came to do the work in Boston, with the Pioneer Institute.

Right. It turns out the conservative/liberal labels don’t work very well at the local level. The same business leaders who scream about taxes at the state and federal level are the ones pushing for construction of convention centers at public expense in their own cities. In this case, working with Pioneer made sense, once I confirmed that they were committed to respecting the integrity of the study. In the midst of a debate over a proposed new convention center, they wanted to know whether the promised benefits of a recent major expansion of the existing center (the Hynes Auditorium) had been delivered, how well the results matched the projections in the feasibility studies, and they were able to provide me with the resources I needed to do the work.

There had been a slew of studies—piles of studies, boxes of studies—justifying the Hynes expansion. And the project was done well. Architecturally, it’s good work, the renovated center is functional and pleasant to be in. But on essentially every major indicator, it produced basically nothing. Take hotel occupancy: despite projections of a large increase, the occupancy rate was actually higher during the reconstruction of the center, while it was shut down, than after it reopened.

In a city like Boston, the demand for hotel rooms generated by conventions is just not significant. It’s such a small fraction of the total demand—about 5%—that any impact it might have is overwhelmed by other factors.

Yes, we’re coming to that. After hearing from more reporters, and increasingly from public officials also looking for assistance, by now I’ve read about forty different feasibility studies. And you know, not a single one says don’t do it, don’t build a new center. Not one even says this might not be a good idea, or maybe you should be cautious. Every single one says "build it, you’ll do great."

I now have a study done for Niagara Falls, Ontario. It says there’s tremendous unrealized potential for convention business there, because of proximity to the U.S. It says "you’re accessible from everywhere in the eastern and northern U.S., and you’re close to Buffalo, where good things are starting to happen." It provides a whole list of large shows and meetings just waiting to come to Niagara Falls, if an adequate facility is built. But you hear the same thing in Buffalo. And in Cleveland, and Pittsburgh. Everyone gets a study saying "build it, and good things will happen." But with everyone adding capacity at the same time, some will win and some will lose.

In any other area of economic activity, people know you have to build on your strengths rather than playing into your competitor’s. If you were opening a small shop, a Mom-and-Pop store, where would you put it? Would it be at the intersection of your main street and the interstate, directly across from Home Depot? No, you’d find a niche where you can operate and they can’t. You wouldn’t go head-to-head with Home Depot; you can’t compete on their turf and on their terms. The same applies here. Suppose you do double the size of your convention center, to 125,000 square feet. Well, the McCormick Place Convention Center in Chicago has 2.2 million square feet, and they’re desperate to fill it. They’re even trying to lure small and medium-sized meetings, because there aren’t enough big ones to fill the space. Buffalo can’t compete with that.

You have to ask how they arrived at these numbers, and what relationship the numbers have to reality. And when all the reports reach the same conclusion, you have to take a closer look.

Johnson Consulting has done similar studies for Boston, Milwaukee, Charlotte, and Austin that I’ve reviewed. In each case, the conclusion was that the city should build or expand convention center space. Even in the cities that have long been held up as models of convention center success—places like Washington and particularly Atlanta—there have continued to be declines in downtown retail and economic activity, constant demands for new public projects and investments, and calls for ever more convention center space to remain competitive. Indeed, Atlanta saw its most crucial downtown development initiative of the 1980s, the renewal of Underground Atlanta as a festival marketplace, effectively go bust in the last two years—even as the city hosted more and more conventions. The payoff is simply not there.

You ask how he’s done in the past. How accurate have his previous predictions been? The more reports he’s produced, the more of a record there is to judge by—ask how successful his estimates have been up until now.

The immediate proponents often are hotel owners and Convention and Visitors Bureaus. But it’s usually the big boys, the major players in local business, who are really behind it. These are people who have a tremendous amount of money invested in the entire downtown area, and when the city’s economy is doing poorly they’re desperately concerned that they could lose a good part of what they’ve put into downtown. They may grab at anything that looks as though it might preserve that investment, without thinking it through carefully—especially if it’ll be built with someone else’s money. In those circumstances, it can be very difficult to stop the project, because of the incredible amount of money and resources—and passion—behind it.

Off-hand, I actually can’t think of any examples where they have been stopped. But you do sometimes see a shift in strategy after a convention center is built and doesn’t work out as hoped, in an effort to attract the convention business that didn’t materialize. Often there’s additional public investment to try to save the convention center that was supposed to save downtown. The quest to redeem a non-functioning convention center often ends up putting the public sector into the hotel business. In Charlotte, after no one in the private sector built a headquarters hotel, Johnson Consulting recommended that the city build or subsidize one. Chicago built a hotel at the McCormick Center—it’s a Hyatt, but it’s publicly owned. Birmingham also built a hotel, and in St. Paul, the city owns two-thirds of all hotel rooms downtown! In Los Angeles, because the convention center didn’t attract enough business they built an arena next door.

Well, again, you need not to go head-to-head against the strengths of folks who will out-compete you. If you want to commission feasibility studies, do one to identify your own market niche. To find out what will attract people downtown, figure out what’s already there that you can build on, what attracts people now. Many successful developments of this sort involve specialty retail, office, or exhibit space. These are entrepreneurial efforts, possibly with some support from the city, but no massive, all-at-once public investment.

Read Cities Back from the Edge, by Roberta Brandes Gratz and Norman Mintz. They show that revitalization works where you have multiple small-scale undertakings, not blockbuster public investments. Compare SoHo to the West Side projects around the Javits Center—one wasn’t centrally planned at all, it just happened as people discovered inexpensive space available in attractive buildings, and it’s thriving. The other has received all kinds of public attention and isn’t going anywhere.

I saw the same thing in Cincinnati: one area had quietly become a hub for diverse small enterprises—restaurants, offices, entertainment—attracting them with nice buildings and low expenses, and it was full of people; across town was the area the city had been trying to revitalize via a plan involving large direct public investment, and it was dead, no one around. Big-box development just doesn’t work.

It’s not about the design, it’s about the scale of the project and its monolithic nature. Look at Buffalo’s downtown ballpark.

Right, there’s nothing wrong with the design. But what has it done for the area around it, despite the people it draws?

Draw your own conclusions.