Convention Center Hotel Subsidy Urged : Redevelopment: Task force recommends that city allocate $100 million to attract a facility to the area.

A task force of dozens of architects, community leaders and tourism officials is recommending that city government provide a $100-million subsidy to attract a new downtown hotel that officials believe is critical to the success of the expanded Los Angeles Convention Center.

The recommendation is part of a detailed report to be released today that will outline strategies to market the center and revitalize the surrounding neighborhood.

Because the city and the Community Redevelopment Agency have spent more than $500 million on the center--which will open in August, 1993--the stakes are extremely high, and local officials are counting on revenue from the lucrative convention business. But without a nearby hotel, the center will be at a tremendous disadvantage.

“The recession has made things very difficult, but we simply have to find a way to develop a hotel,” said Ed Avila, CRA administrator. “We’re coming down to the wire.”

In addition to delineating a strategy for attracting a hotel, the task force report addresses other Convention Center issues, such as improving the neighborhood, enhancing the image of downtown, marketing downtown and improving transportation so the area is better connected to the rest of the central city.

But it is the need for a hotel that is the most immediate issue, task force members say. Los Angeles tourism officials have hoped since the construction of the Convention Center in 1971 that a hotel would be constructed nearby.

But because the center--bounded by Pico Boulevard, Figueroa Street, Venice Boulevard and the Santa Monica and Harbor freeways--is away from the heart of downtown, developers have been reluctant to finance such a project, CRA officials say.

In the late 1980s, when the Convention Center expansion began, CRA officials realized they had to offer incentives to attract a major hotel within a block of the center. They actively sought prospective projects and offered some financial incentives. Three developers expressed interest in building hotels, but the CRA could not come up with enough financial incentives and the plans fell through, Avila said.

As a result of the impasse, Mayor Tom Bradley set up the Convention Center Area Task Force 15 months ago, Avila was named the chairman and the CRA provided the staff. The task force determined that about “$100 million of public assistance is needed to attract a hotel and make it financially feasible,” said David Riccitiello, CRA project manager for the neighborhood surrounding the center.

This assistance could be provided in several ways, including offering city land to developers, waiving various city fees and increasing the CRA’s spending limit so it can provide financial assistance for the project. Much of the CRA’s budget comes from taxes generated by new development that it fosters. The task force hopes to have a hotel built by 1997.

“Without a convention headquarters hotel, the Convention Center will be unable to effectively compete against the four other major West Coast convention centers,” according to the task force report. “This will result in significant economic losses to the local economy.”

The city has lost more than 25 major conventions bookings to other cities in the past two years because there is no nearby hotel, said Michael Collins, senior vice president of the Los Angeles Convention and Visitors Bureau. Los Angeles simply can’t compete with other cities for large national conventions, he said, because it has only 195 hotel rooms within two blocks of the center. In San Francisco and Anaheim, for example, there are more than 2,000 rooms within a few blocks of their convention centers.

Still, the expanded center is attracting interest. In an average year, about 150,000 rooms are rented in area hotels as a result of conventions at the center. But now, as a result of the increase in convention booking for the expanded center, more than 600,000 rooms will be rented during the expanded center’s first year of operation, said Collins of the Convention and Visitors Bureau.

The task force also addressed the need to improve downtown’s image and that of the neighborhood. Suggestions include establishing an events coordinating committee for downtown, a media campaign to target downtown workers and residents for 24-hour activities, additional police, improved landscaping, and an organization of property owners and tenants to promote improvements.

The task force also recommended providing support for the Downtown Strategic Plan, a document currently being drafted by a 60-member committee that will influence planning, development, design and historic preservation in downtown Los Angeles for the next two decades.

When the Convention Center expansion is completed, it will be the largest on the West Coast and the ninth largest in the country. It is expected to generate more than $191 million annually for the local economy and could bring thousands of jobs to downtown Los Angeles.

The expanded center, designed by I.M. Pei & Partners of New York and Gruen Associates of Los Angeles, will include a five-acre open plaza, two ultramodern 150-foot glass pavilions covered with reflective prisms and a two-story conference center spanning a block along Pico Boulevard.

The expansion of the center was financed by the sale of $390 million in tax-exempt revenue bonds, approved by the City Council in 1985. The CRA contributed $126 million, which was generated through bond sales and property taxes on new downtown developments. The agency bought the 35 acres, relocating 1,500 people and 68 businesses at the site.