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Could a bigger convention center mean millions more for Fort Worth?

February 23,2018

Star-Telegram article by Sandra Baker 

On the heels of a 500-page consultant report that says Fort Worth has a good deal of work to do in raising its profile if it wants to compete for new businesses, the head of the city's tourism bureau said that accelerating the planned expansion of the Fort Worth Convention Center can go a long way in helping with that.

Fort Worth has already lost out on at least $200 million worth of convention business because the city doesn't have the space available when groups want to come here, and that number will only keep growing, said Bob Jameson, president and chief executive officer of the Fort Worth Convention and Visitors Bureau.

"The awareness of Fort Worth is not where it should be," Jameson told the City Council recently in his pitch that they approve speeding up the project's time line. "We are losing out on larger and prestigious conferences that complement the city's economic development roles. We cannot afford to lose time."

The expansion has been on the books for a long time, but city staff has said that work likely couldn't happen until around 2025. Project costs have not been made public.

City officials have talked about tearing down the 50-year-old domed arena at the north end of the convention center and replacing it with more ballroom and meeting space since the late 1990s. That work was left out of the $75 million expansion and renovation of the south portion of the convention center completed in 2004.

To meet customer demand from that expansion, in 2009, the Omni Fort Worth opened across Houston Street from the convention center with the help of $31 million in city and county tax incentives. It serves as the headquarters hotel for the facility.

Since then, the number of visitors to Fort Worth has risen 75 percent and the hotel tax collection has doubled, Jameson said.

“It’s time to do it again," Jameson said. "The market is asking us to act. Our hotel demand is above the national average, and yet we lose hundreds of millions of dollars in economic impact each year because we do not have space for the meetings that want to be here."

The Convention and Visitors Bureau, created by the city to bring visitors and tourism to Fort Worth, said tourism has a $2.4 billion annual economic impact on the city.

Dickies Arena mixed in

The convention center expansion was planned as part of a larger project that includes construction of the $540 million Dickies Arena at the Will Rogers Memorial Center in the Cultural District. The city is capped at spending $225 million on the project. It has already paid $100.7 million of that commitment.

The remaining arena costs are being paid by Event Facility Fort Worth, a nonprofit group that is handling the arena's construction in partnership with the city. The 14,000-seat arena, which will also serve as a sports venue and is already booked for some NCAA events, is one-third completed. It is scheduled to open in time for the Fort Worth Stock Show in 2020.

It was always anticipated that events now held in the convention center arena will be moved to the Dickies Arena while construction is ongoing.

Financial projections from a few years ago showed the city wouldn't be able to take on more debt to cover the convention center expansion until about 2025.

But that may no longer be the case.

The city is paying for the arena project, in part, with the state's portion of the hotel tax revenue within a three-mile radius of both the arena and convention center. City staff conservatively estimated revenues at nearly $1.6 million in 2017, but revenue came in $236,299 ahead of those projections.

That funding is also planned to support the convention center project.

Susan Alanis, an assistant city manager, said now that the city has clarity on the Dickies Arena financing, city leaders can start looking at the convention center project. It's possible that money will be available by the end of the year to start designing the project, she said.

"We can map out what's possible," Alanis said. "We know how much the debt costs on the arena. That's one less variable."

It's still undecided, though, whether to first build a second convention center hotel or do the convention center expansion, she said.

Nearly two years ago, the city had lukewarm response from two possible hotel developers and as a result put that project on the back burner until after 2025. The developers wanted more information than the city was able to provide, including what incentives would be available. 

In the meantime, downtown has added several new hotels and others are expected in the next couple of years.

The city was hoping the hotel project would have included the cost to straighten the curve on Commerce Street on the east side of the convention center, which is mostly a loading docks area. Straightening the street will open a good deal of developable land and is where the hotel is planned to be built.

The city, though, may be changing how to wants to pay for the street work and now says completing that project should probably be done before anything, Alanis said.

"We could incorporate it in a capital project. It makes more sense to do that preparation in advance as part of the whole game plan," Alanis said.

Jameson said he'd like to have design discussions for the expansion and updating funding models by the end of the year. 

"We need to have a time line that is as defined as possible. The sooner we can get that buttoned down the more effective we can be in selling it leading up to its renovation, selling it during its renovation, and selling it after its renovations," Jameson said.

It's not unusual for convention and meeting planners to book events 10 years in advance, he said.

Consultants have said the north end of the convention center could include a 50,000-square-foot ballroom installed with retractable seating to host events in an arena-style setting, as well as more exhibit and meeting space.

The city bought the convention center from Tarrant County in 1997.

Sandra Baker: 817-390-7727

Location Mentioned: Fort Worth Convention Center