|
The long-stalled plan to expand the San Diego Convention Center lurched back to life on the eve of June 2, the day 62 percent of the city's voters said yes to the $216 million project. Convention center officials were on hand and, as the returns rolled in, they began to fax victory announcements to organizations wanting to book their conventions at San Diego’s soon-to-be-enlarged facility.
The response was swift. By the next day, the American Society of Hematology and the Healthcare Information and Management Systems Society had sealed dates. These two groups alone are expected to generate $38.2 million in direct delegate spending. Other large groups, reassured by the election result, followed suit, including the American Library Association and the Golf Course Superintendents, the latter attracting about 25,000 delegates per convention.
"We have been booking business like crazy," says Carol Wallace, the convention center's president and chief operating officer. But out-of-town groups and convention center officials were hardly the only ones celebrating voter approval for the project, which has helped boost the Downtown ambience and economy since the original center opened nine years ago. Contractors relished the chance to bid on the huge project. Uncertainty was lifted for developers proposing hotels to serve the enlarged center, with its greater numbers of delegates. And restaurants and stores near the center, especially the Gaslamp Quarter and Horton Plaza, anticipated a major boost in business.
For years, city leaders and tourism groups had argued that when it comes to the convention center, more is better. The larger center will draw bigger groups and enable two or three conventions to operate simultaneously, they said. But the center's opponents contended the project was a boondoggle and litigated the expansion to a standstill for more than two years. By the time Prop. A, the expansion measure, went to the voters, center officials said that about 75 groups had to cancel their convention plans in San Diego at a cost of nearly $700 million in direct delegate spending.
With the win on Prop. A, the city found itself on a roll. In August the California Supreme Court issued a 24-page opinion in favor of the city of San Diego, deciding that the lease-revenue bond financing originally planned for the center expansion is legal. The ruling represented another defeat for convention center opponents. It also removed a cloud from lease-revenue bonds, a favored form of public financing that will save the city millions over a 30-year period compared with an alternative method — certificates of participation that are usually issued at higher interest rates. After the court decision, the city wasted no time in raising money to pay for the expansion project, issuing $205 million in bonds last month. Nor did the city wait long to start construction. A ceremonial groundbreaking took place June 19, less than three weeks after San Diego voters endorsed Prop. A. Featuring fireworks and VIPs, the ritual marked the transition from planning to reality — a reality that will extend the huge bayfront structure onto the adjacent 11-acre parking lot, doubling the center's exhibit space.
Here Come The Jobs
The most immediate benefit comes from the building process itself, which will generate 700 construction jobs and between 110 and 130 contracts during the 30-month building period.
The general contractor is Turner Construction Co., a giant that has built 34 convention centers around the country as well as stadiums and other big projects. But while Turner boasts an impressive track record, company executives say it is not enough to be a competent builder. The company also is taking steps to enable local firms to bid successfully. Turner is headquartered in New York, with regional offices in Irvine and an office in San Diego County, where Turner's local projects include the $30 million Viejas Outlet Center and a new veterans' home in Chula Vista.
Ron Rudolph, Turner's project manager for the convention center, says the goal of 30 percent local participation in the construction phase of the expansion is all the more important since Turner's San Diego partner in the original bidding, Centex Golden Construction Co., (formerly M.H. Golden) closed the San Diego office participating in the project two years ago. At the time, Centex Construction Group, Centex Golden's parent company, announced that Centex Golden would be folded into Nashville-based Centex-Rodgers Construction. Meanwhile, Rudolph, a native San Diegan, moved from Centex Golden to Turner in order to continue his key role in overseeing the expansion.
One strategy for providing more subcontracts to San Diego businesses — particularly for small and minority-owned businesses historically left in the cold — is to divide the work into smaller pieces. For instance, Rudolph says, the dry wall and stud package, with work totaling between $9 million and $10 million, was split in two, with separate packages for the first floor and the upper floor. "A company may be able to be bonded for $5 million worth of work but not $10 million," notes Rudolph.
Feeding The Subs
Although the big convention center expansion project generates a number of multimillion-dollar subcontracts, Rudolph says about 5 percent are expected to come in at less than $100,000. Another 10 percent to 15 percent of the contracts will be in the $100,000 to $500,000 range.
|
|
Some of the earliest contracts were among the smallest. The Cement Cutting Corp. was awarded $45,000 to demolish the USO building on the expansion site. Another $3,000 went to Construction Fence Rental to fence off the work area. Arrietta, a minority company, submitted a low bid of $447,000 for storm drain work. At the other end of the scale, the convention center project estimates its contract for steel will range from $32 million to $34 million, a size likely to preclude small competitors.
Beyond the traditional ways of advertising bids, the city has gone electronic to broaden its outreach. A list of available contracts for the convention center project, a brief description of each and deadlines for submitting bids are posted on the Internet —
www.sannet.gov — under business opportunities. "We’ll be doing another Web page to reach out to the community and keep them informed about the project's progress," says Jon Dunchack, the city's project manager for the convention center expansion.
|
For the first few months, officials expect the work will cause only minor disruptions of traffic between Fifth Avenue and Eighth Avenue on Harbor Drive, the area closest to the construction. But in one year, the section of Harbor in front of the center will be closed to traffic for 11 months, as workers lower the road to create a new entrance into the center's parking garage.
Turner hired Perry Dealy as development manager. He will work with the port and the convention center to deal with the noise and disruption of construction work. Among other things, his duties will include coordinating with events like the annual Street Scene, ensuring that the project complies with California Coastal Commission rules, coordinating signs, working with port tenants affected by the construction and dealing with transportation issues in and around the work site.
Still, Dealy anticipates that despite the inconvenience, the center's neighbors — the hotels, the restaurants, the businesses and residents of the Gaslamp Quarter and Centre City East — aren’t likely to complain too loudly, believing that the expanded center will be good for the Downtown community. "We have a compatible and supportive constituency," says Dealy.
If all goes as planned, the expanded center will open in August 2001, increasing exhibit space from 249,338 square feet to 525,791 square feet. Its economic impact would jump from $580 million a year to $900 million.
Beyond the direct benefits the larger convention center will generate, its supporters point to the effect it will have on the rest of Downtown, the hotels that will fill with higher numbers of delegates and the businesses and restaurants that will continue to flourish in its shadow. "So much redevelopment is planned around the expansion," notes the convention center's Wallace. "It’s going to bring more business Downtown."
|
