Expanding A Foundation For Prosperity
San Diegans know the Convention Center works
By Bob Nelson
San Diego’s Convention Center has proven itself a reliable cornerstone for a much larger industry. Last year, the Convention Center generated more than $1.3 billion in regional economic impact, supported more than 12,000 jobs in hospitality, transportation, manufacturing, agriculture, telecommunications and professional services. That’s about 8.1 percent of the entire visitor industry’s $15.9 billion economic impact in 2009, making hospitality San Diego’s third largest industry.
Although it experienced a moderate downturn with the economy during 2009, attendance at the San Diego Convention Center was the only good news in an otherwise dreadful period for the local hospitality industry. A typical convention attendee spent $1,462 a day in San Diego during 2009 — about three times that of an average leisure visitor.
When the Convention Center opened 20 years ago, city leaders envisioned a thriving convention and meeting hub, an economic powerhouse supporting San Diego’s future. They were right: the Convention Center has surpassed all expectations, providing $18 billion in economic impact since opening. Local businesses and residents directly benefit from that spending — in hotels across the region; special event venues like Petco Park, Midway Museum, Balboa Park, San Diego Zoo and SeaWorld; restaurants and retail stores in Horton Plaza, the Gaslamp Quarter, Little Italy; well-paying contractors who build and break down the exhibits; and a wide variety of local entrepreneurs like taxis, pedicab drivers, land and bay tour operators, and more.
San Diego taxpayers directly benefit too. The hotel and sales taxes paid by Convention Center guests average more than $24 million a year to the region. That’s money that stays long after the visitors have gone, and it pays for street repairs, police, fire protection, libraries, beaches and parks used by San Diegans from every neighborhood.
The Convention Center is a community amenity on its own — an architecturally stunning facility attracting 230,000 local residents who attended numerous community events last year. However, the real economic lift comes from the Convention Center’s 519,418 out-of-town visitors who last year filled 750,382 hotel room nights. Among our favorites are medical and pharmaceutical conventions because their doctors, scientists and executives spend even more than the Center’s average attendee. While Comic-Con gets most of the publicity — and at 126,000 guests is our largest convention in terms of attendance — other events with fewer guests will generate more impact. The upcoming Society of Neuroscience will bring in 36,000 surgeons and scientists and will generate a hefty $163.7 million in economic impact. Those five days of neuroscience alone will generate $2.3 million in tax revenue to the city of San Diego; that’s a lot of asphalt repair for local streets paid for by this single convention.
With construction prices now softer and the global economy showing signs of a gradual but solid recovery, we now enjoy a unique window in time to expand this important economic engine. With a 20-year record of success, the expansion endorsed last year by the Mayor’s Citizen Task Force is projected to pump an additional $698 million every year into our current $1.3 billion annual economic impact. Expansion will generate 6,885 permanent new jobs and add $17 million annually in new tax revenue to city coffers. This opportunity comes at the same time as Mayor Jerry Sanders has presented a grim five-year financial outlook for the city unless we can ramp up revenues to help maintain neighborhood streets, public safety and other vital city services.
Failing to expand the Convention Center is not revenue neutral. As we have seen recently as Comic-Con carefully weighs its future options, failure to expand the Convention Center would mean our region would lose business, jobs and critical tax revenues. The current facility is mostly sold out in practical terms. Already more than 400 conventions and trade shows have been turned away due to a lack of space or available dates, losing more than $1 billion of activity that could be providing more jobs and more hotel-room nights just when we need them the most.
Visitors and conventioneers love San Diego. Expanding the San Diego Convention Center will build on a solid record of success, benefiting the hospitality industry and the entire regional economy. That’s why so many San Diegans know it will work.
For more information on the Mayor’s Citizen Task Force on the Convention Center Project, visit conventioncentertaskforce.org. All the economic studies and conceptual plans for the proposed expansion are online there. I urge you to review these reports and draw your own conclusions about why expansion is such a hot topic in an otherwise chilly economy.
Bob Nelson is chairman of the board of the San Diego Convention Center Corp.