SD Convention Center Poised For Healthy Upturn in 2014

By Gene Cubbison
|  Wednesday, Jan 1, 2014  |  Updated 5:33 PM PDT
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After the recession grounded a lot of major trade group meetings, San Diego’s Convention Center is now poised for its best financial showing in five years. NBC 7’s Gene Cubbison explains the reasons behind the upsurge and what’s in store for 2014.

After the recession grounded a lot of major trade group meetings, San Diego’s Convention Center is now poised for its best financial showing in five years. NBC 7’s Gene Cubbison explains the reasons behind the upsurge and what’s in store for 2014.

Photos and Videos

SD Fact Check: New Convention Center, More Visitors?

If you build it, they will come. At least that’s the hope for a new San Diego Convention Center. But will the big expansion really drive more visitors? The Voice of San Diego’s Scott Lewis and Lisa Halverstadt explore that idea in this week’s San Diego Fact Check by looking at another big city’s new convention center, and claim that it hasn’t brought more business.

SD Fact Check: Convention Center Expansion Opposition

Is lawyer Cory Briggs really the only one opposed to the San Diego Convention Center expansion plans? Voice of San Diego's Scott Lewis and Lisa Halverstadt take a closer look.
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San Diego's convention center is on track to make its 25th year in operation its best year in the last five.

Why? Economic forces that have hurt business since late 2008 are shifting upwards.Plus. the facility is due for a structural growth spurt.

"We're back to the heydays of 2008, before the collapse of the economy, and the attendance numbers are really strong since 2008,” says Steven Johnson, the Convention Center Corporation’s Vice President of Public Affairs. It shows a real return to a thriving economy."

But center executives were seeing doom and gloom as year-to-year numbers were way off in the first quarter of 2013.

They blamed frozen tourism marketing funds; skeptics said the dynamic was cyclical. Either way, the financial picture for 2014 has flipped to the sunny side.

The convention center rings in the new year with the International Auto Show -- one of the highest-profile events that book the San Diego Convention Center.

In 2014, 70 major gatherings and dozens of smaller events are expected to help drive the region's economy on the fuel of spending by upwards of 850,000 out-of-towners who’ll leave $605 million in local tills, and have a total regional economic impact of $1.4 billion.

"It's what meeting planners call a 'perfect package', with an airport two miles away,” Johnson said in a New Year’s Eve interview. “So their attendees like to come here. They come for the convention -- and they tend to stay for the vacation. They go to the Zoo and Sea World. They bring their family."

Officials say the center gets a high level of return business, and comfortably weathers discount-rate competition from rival venues in Las Vegas, Los Angeles and Anaheim.

"Economic attractiveness of the packages for these large conventions are a little bit less expensive than San Diego,” says San Diego Tourism Authority CEO Joe Terzi. “But yet, more often than not, we win out because it's such a great destination -- and people recognize San Diego's worth a little bit more."

Over the years, the Convention Center has generated a remarkably dynamic 'return business,' satisfied customers who want more of the same high level of hospitality.

"A good example, obviously, is Comic Con, who's here every year,” Terzi told NBC 7 in an interview Tuesday. “So we are very fortunate that we get people to San Diego -- they don't want to leave -- and get them to come back on a regular basis."

To seal even bigger deals, a $520 million expansion project is set to break ground next year, to enlarge the facility by one-third – a bold bid to keep the ever-growing Comic Con extravaganza here in San Diego, and attract other events that can't fit into the current space.

The undertaking is being hailed by regional commercial interests as well as the center’s neighboring businesses and hospitality industry.

"If you look throughout the Gaslamp (Quarter),” Johnson says, “what the Convention Center has helped provide in terms of an economic revitalization of downtown drives tax revenues to city coffers … and helps us maximize the returns of the Convention Center as an investment for the benefit of the region."

But while the expansion project has been given the green light by the California Coastal Commission, it’s still subject to a legal case that's now on appeal.

Back in May, a trial court judge upheld its main funding source – a hotel room-tax surcharge ranging from 1 to 3 cents on the dollar, aimed at raising $35 million annually over 30 years.

Critics say the assessment, approved via a weighted vote in a private election among the city’s hoteliers, was an illegal use of municipal taxing power.

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