Attracting more conventions would be a key to success of downtown L.A. football stadium project
For Los Angeles’ proposed downtown football stadium to succeed as envisioned, its promoters need to attract more than an NFL franchise like the San Diego Chargers. They need to win over teams like David Glanzer’s.
Glanzer is part of a crew that scouted — and passed on — Los Angeles as a new venue for Comic-Con International, the comic book, film and pop culture convention that draws more than 100,000 people and $60 million to San Diego each year.
Football is the public focus of a bid by Anschutz Entertainment Group to add a downtown stadium to its portfolio of arena, hotel and theater venues adjoining the Los Angeles Convention Center. But the massive project, using public land, also rests heavily on a hope that a simultaneous overhaul and expansion of the center itself will lift the city into the top ranks of the nation’s conference destinations.
“What’s driving this vision is the Convention Center.... It doesn’t work right,” said Timothy J. Leiweke, the AEG chief pushing the stadium deal.
Some convention experts and Los Angeles tourism officials are optimistic that AEG’s plan to move a wing of the Convention Center to create room for the stadium would make Los Angeles more attractive to event planners. But others said the project would have to overcome a number of substantial hurdles.
It remains unclear whether the stadium proposal would be profitable without a big increase in convention business. Citing pending City Hall negotiations, AEG personnel declined to discuss it with The Times.
As city officials begin weighing the fine points of the $1.35-billion proposal, attention is focusing on three interlocking elements: AEG’s upbeat assumption about its ability to attract major new convention business; whether the project can trigger construction of thousands of close-by convention hotel rooms; and the financial backup to AEG’s pledge that taxpayers will not be on the hook if the whole plan goes bad.
Leiweke’s pitch is that reworking the Convention Center and integrating the new stadium into the operation could double the number of conventions lured to the city, adding an average of more than one new event per month.
However, AEG and convention officials set a less ambitious goal last week, telling a city panel they hope to add four to six new conventions a year. The key will be getting the right type of events, an AEG spokesman said, noting that about one-third of the Convention Center’s yearly revenue now comes from just two gatherings.
Project backers said they expect more conventions to stimulate construction of hundreds — perhaps thousands — of hotel rooms within walking distance of the Convention Center. “We are at a competitive disadvantage. We drastically need more hotel rooms downtown,” said Mark Liberman, president of LA Inc., the Los Angeles Convention and Visitors Bureau. He noted that Anaheim, San Diego and San Francisco have three to six times as many hotel rooms immediately around their convention centers.
New economic activity would generate taxes from the project area that would help pay off $350 million the city would borrow to move the Convention Center’s West Hall, replace parking and clear space for the privately financed stadium. AEG has promised to cover any shortfall in city repayments and says the public will benefit from tens of thousands of new jobs and hundreds of millions of dollars in new spending.
Such a multi-faceted concept could work, according to some experts, developers and convention industry officials. AEG’s recent opening of two hotels at nearby L.A. Live already has helped, drawing new conventions, one of which is this summer’s Microsoft Worldwide Partner Conference with 15,000 attendees.
But others warn that luring the most lucrative business gatherings away from other highly competitive cities could be a tall order.
Comic-Con’s reasons for staying in San Diego touch on many of the obstacles Los Angeles faces — too few hotels in downtown and a lack of contiguous exhibition space — as well as San Diego’s hard work in retaining the massive gathering.
Comic-Con is not the only group reluctant to move. “Our members have told us they like the campus feel of the Anaheim Convention Center,” said Scott Robertson, marketing director for NAMM, formerly the National Assn. of Music Merchants, whose convention is among the top 25 in the world and draws some 90,000 attendees.
The most coveted large conventions, such as medical groups, often rotate around the country and may return to a venue only every three to five years, said Steven Spickard, a sports and event center consultant for 30 years who has advised Los Angeles and other large cities. To get the 16 new conventions a year Leiweke has suggested, the center might need to land 45 to 60 major conventions on a recurring but not annual basis, he said.
Although that is possible, Los Angeles would need to win over “a whole bunch of them,” he said. “And all the other places that have had them in the past are still competing.”
Liberman, L.A.'s convention marketing chief, has said the city could draw more than six new conventions annually, but he cautioned that there is “absolutely no guarantee” even that goal will be reached.
Most experts and city officials interviewed by The Times agree that moving the West Hall of the Convention Center and connecting its exhibition space directly to the large South Hall would improve the marketability of the facility.
Together, the halls have 770,000 square feet of exhibition space, making Los Angeles about 15th in the nation. The proposed retractable-roof stadium would increase the useable convention space to about 1.2 million square feet. But AEG acknowledges that in terms of flat, open exhibition space — the kind many exhibitors prefer — it would add only about 165,000 square feet on the stadium floor. That means Los Angeles still would not be among the top 10 cities in the nation, based on industry rankings.
“In the great scheme of space, it’s not very much,” said Heywood Sanders, a professor at the University of Texas at San Antonio and author of several critical convention center studies. “And it doesn’t work out particularly well. It’s not … particularly functional space to be on the [stadium floor] with a vast roof and lots of empty seats.”
Two convention centers that use football stadiums for extra space — Indianapolis and Atlanta — illustrate the challenges AEG and Los Angeles could face.
Indianapolis’ Lucas Oil Stadium added 183,000 square feet of exhibition space to its convention center’s 566,000 square feet of floor space. But the stadium is off limits during about 47 training and game days during the Indianapolis Colts’ season, according to Chris Gahl, a spokesman for the Indianapolis Convention & Visitors Assn. AEG says it expects to limit such disruptions with a separate practice facility.
The Atlanta Falcons’ Georgia Dome added 102,000 square feet of exhibition space to its sprawling convention display areas, already the nation’s fourth largest. But it is rarely used for such gatherings, because convention planners prefer the contiguous space next door at the Georgia World Congress Center, said Jason Kirksey, a Georgia Dome spokesman.
Los Angeles officials say the stadium would open the door for the largest gatherings, including major religious groups, which bring tens of thousands of attendees together for opening and closing ceremonies. And without the stadium project, they say, the city would have no money to fund costly Convention Center improvements needed to retain even existing conventions.
Leiweke and key downtown business leaders say a redone convention campus would drive development of new hotels, a long-time city goal thwarted by market conditions and difficulties getting financing.
But hotels survive on a balance of conventions, business travelers and tourists, which poses challenges in downtown Los Angeles, said Carl Winston, director of the hospitality and tourism management school at San Diego State. “Most tourists, when they think of L.A., don’t think of staying downtown. They want to be by the beach, they want to be in West L.A., they want to be in Anaheim. It’s not, ‘Honey, let’s take the kids and go visit the Dorothy Chandler Pavilion.’”
A stadium would make downtown a more vibrant hotel market, said James Butler, chairman of the global hospitality group at Jeffer, Mangel, Butler & Marmaro, a Century City law firm. “But I’m not sure that the market either needs four or five more hotels or that there would be enough business to sustain it.”
The most difficult challenge, Leiweke says, will be getting another 1,000-room hotel to help anchor the largest conventions. That would probably require the city to add a financial incentive by reducing its customary bed-tax share, he said.
AEG’s recently completed downtown hotels received such a subsidy. But with city services being slashed and with the city’s budget shortfall estimated at $404 million, a push for more subsidies could prove controversial. Peter Zen, owner of the Westin Bonaventure, said he would probably fight efforts to give new hotels a tax break.
AEG said it supports a transparent review, but for now its officials declined to answer a number of questions, including whether the stadium would be profitable if increased convention business and construction of new hotels do not materialize as hoped.
The company also declined to describe the financial backup for its guarantee that no taxpayer money would ever be used for the project. It is not clear, for example, whether the assets of AEG or some form of letter of credit, bond or insurance policy would stand behind the pledge.
In a statement, AEG said it is confident that by the end of the approval process, the city and the public “will discover that there are no hidden secrets or agendas” and that the company stands behind its commitment to develop the stadium “at no cost and no risk to the tax payers.”
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