WHOA: As San Diego Convention Center decays, expansion plan is shot dead

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201408270359 WHOA: As San Diego Convention Center decays, expansion plan is shot dead

I can’t say this was unexpected, but here we go again: after the threat of endless legal battles, environmental group opposition, the lack of any real financing plan and perpetual local conflict, after spending $10 million in six years, the planned expansion of the San Diego Convention Center has been killed. KILLED.

One of the biggest ironies of the Convention Center expansion’s demise is that this path — the one that has taken six years, cost $10 million and ended in nothing — was considered the least risky. And yet, with one 7-0 vote Tuesday, the San Diego City Council abandoned the effort. The $520 million plan to expand the facility — the biggest construction project on the city’s docket — is now dead. It won’t have to fight off the last environmental litigation from attorney Cory Briggs, who engineered this collapse. It will not pass go.


Whoa.

The Convention Center expansion was a key in San Diego Comic-Con agreeing to stay in San Diego, and signing a multi-year contract to stay. The planned $520 million project was to have been funded by a hotel tax, but his aced many legal challenges, and opposition to the plan won out. Those in favor of the expansion said it would draw other big shows that the current Convention Center can’t handle, but I’m not sure huge trade shows themselves were a big enough growth area to justify the expense:

Now what? :

Councilman David Alvarez, who voted against the financing plan two years ago, said he was pleased that his colleagues decided against pursuing an appeal.

“We have a new opportunity to move forward with a better project, including a potential stadium site, and engage San Diegans in a citywide dialogue about how to build the best facility possible,” Alvarez said. “The people of San Diego should get a say on whether to fund a convention center expansion, and discuss the size, scope and location of the project that best serves the needs of our city.”


Stadium site? Yep, the other problem in downtown is getting a new stadium for the Chargers, and now the idea of a dual use stadium/convention center seems to be dancing in the heads of some—possibly in that big area on the other side of Petco Park. But that would also have to be paid for by someone. And probably not cosplayers.

Adding to all the confusion? The Convention Center itself is said to be badly in need of repair:

The move to pursue a naming rights deal is fueled by the center’s growing tab for repairs, most notably the need to replace the fabric structure of the upper level Sails Pavilion.

“The Sails Pavilion is 25 years old, and its useful life is 20 years, so it’s rotting and likely to fail anytime soon,” said center spokesman Steve Johnson.

In addition, the center no longer has the funds to maintain an operating reserve, a concern raised repeatedly by the city’s independent budget analyst. The center is largely self-supporting through the revenues it gets from leasing the bayfront facility, although it does receive an annual city subsidy of $3.4 million, $1.9 million of which goes to the Tourism Authority staffing for booking large conventions.


Double whoa.

So now what?

As I’ve covered the convention center story for the last few years the Chargers dilemma has always been bubbling under the surface—Qualcomm Stadium (formerly Jack Murphy Stadium) was built in 1967 and it’s about what you would expect from that era, without any nostalgic value to keep it around. While I’m not an expert in the local politics surrounding this, I’d suspect getting a new stadium will become the new #1 dream project.

As for Comic-Con International, it’s current deal is to stay in San Diego throughout 2016. When the extension was originally signed in 2010, it was based on the planned expansion. IN the intervening four years, the big show seems to have taken many steps to deal with its constrained facilities. For a long time, the biggest problem facing the con was finding a way to increase revenue with ticket sales at a finite level. They seem to have found ways to grow with more sponsorships and spreading out to the nearby hotels.

I never got around to writing my SDCC 2014 final report, but it was obvious to me that things had been scaled back this year, some things internally, some things externally. I don’t think the expansion plan failing was unforeseen by anyone involved with Comic-Con. And like Mark Evanier, I can’t see San Diego not being in San Diego. 130,000 people it will be. Only so many people can go to the Super Bowl or the Oscars of the Westminster Dog Show. There can be endless crowds milling around the Gaslamp district, but even that seemed to lose a bit of luster what with the Zombie Walk hit and run. It’s likely that we’ve just reached the size that things are going to be for the foreseeable future.

In some ways, I’m glad to hear the expansion won’t go through. The outdoorsy area behind whe center added a nice natural seaside feeling, and as shown by this years Simpsons display and Gotham zipline, it can still be put to very good use.

In the meantime, perhaps that decaying roof is our new ticking time bomb.

Comments

  1. Charles Rozanski says:

    I began advocating for a longer duration (7-10 days) for the convention several years ago. I have no idea if San Diego has any consecutive weekends available any time soon, but if they do that would be a far less expensive way of allowing more fans to experience the show. Over the years, I have spoken with dozens of my fellow exhibitors about this idea, and have yet to find a single one who objects. All agree that spreading our costs of travel and setting up at the show over more revenue days, would actually be quite beneficial.

  2. San Diego needs to address the Stadium issue with the Chargers or there is a very real possibility the league will help move the team to LA or Orange County (who are already part of that NFL TV Market). LA was planning on building a multi use stadium/convention space as well but without a team it stalled. The NFL is all about having great, new stadiums especially for a Superbowl hosting cities and San Diego needs to be in that business. The NFL brings a LOT more $$ to the city and local businesses than conventions do.

  3. Joe – there is very little evidence to support building stadiums for professional sports teams. The money returned just isn’t actually there.

  4. I had a much longer response get wiped out by a bad connection, but I would just agree with Heidi and chris. I really can’t see SDCC moving from San Diego, especially as they are doing some interesting things to expand beyond the convention center.

    I moved from San Diego in 2012, so I’m not up on the details, but I sincerely hope the Chargers don’t get taxpayers to pay for their new stadium. It never ends up paying off for the community, and that franchise simply doesn’t deserve it, imo.

  5. David says:

    San Diego needs both. It would probably go bankrupt faster if the chargers left more so than Comic-Con but the financial effects of either one leaving would be dire.

    Extending the con for 7 days isn’t an option for many exhibitors. When you look at the short term cost, most already lose money with the exceptions being a Hasbro or Mattel. Asking them to fund more for publicity’s sake would drive too many companies, CCI relies on, away.

    The 4 day pass is going away and single day prices going up. That’s the world we’re going to live in for the foreseeable future and it’s a bit sad that it will still thrive under those conditions.

    CCI had offers for much cheaper expenses from cities like LA, Vegas, and Anaheim but they chose to stay in San Diego. They’re committed to riding through this storm and hopefully the city will get its books in order to keep the show there because there’s only so much anyone can take before they hit their breaking point.

  6. Chuck R: You do realize that expanding the shoe by days would add so much in hotel and other expenses that any gains would be wiped out, right? I never NEVER spoken to ANYONE in favor of this! I guess we run in different circles.

    That said, pretty much anyone who has a major entertainment booth is there from Saturday/Sunday to the following Monday/tuesday anyway. I think SDCC will remain a unique amazing experience and other venues will add their own niche experiences like Movie Con and SXSWi.

  7. Hmm.. so what are they doing with that hotel tax they’ve been charging me (and everybody else that’s been in a hotel) for the last few years? They aren’t using it to expand the convention centre and if it was an ‘illegal’ tax are they going to refund us? Maybe a class action suit is needed?
    My understanding was that San Diego signed the last agreement under the understanding the city was going to expand the convention centre. I don’t know if that’s actually in the contract, but if so I hope they sue the city for all the lost revenue that a non-expanded convention centre will cost them.
    In short, I wish it were really, really, really more expensive to the city to cancel the convention centre expansion than it would be to go through with it.
    IMO multimillion dollar making NFL football teams should not be getting public money.

  8. Wayne Beamer says:

    Heidi: About the non-funding of SD Convention Center improvements: Told you so…

  9. Cameron says:

    I’m not sure how I feel about this news. Pros and cons either way.
    Im not sure leaving San Diego all together is a viable option since no matter where it goes it will just be considered that city’s Comic Con. Most cities these days have a comic con of sorts already.
    I think SDCC will end up raising the price significantly per ticket to cover the loss of growth that is had the potential of gaining.
    SDCC brings in $163,000,000 to San Diego every year (at least) hope they realize what that could mean if they lose SDCC

  10. Chris Thorne says:

    Mr. Rozanski – All of this talk about whether or not to have 4-7 day cons is a moot point for you and your business cause you are pulling out of SDCC anyway right? You can’t make any money there. How is spending even more time and lodging costs for you and your team make the show more affordable?
    The city council is listening to the people that elected them and those people love sports. SDCC is not about sports and they don’t want to spend money on things at they can’t watch on TV.
    SDCC should stay in SD, the Gaslamp is a very unique area that cannot be replicated in Anaheim, LA or Las Vegas. I have been to all three places for shows and SDCC is the best, because of the Gaslamp. I hope it stays, but if there is more money to be made for SDCC I am sure they will leave and if they do, Comic-Con will deteriorate…In my very humble opinion.

  11. I’d suggest the one big difference between San Diego and events like the Westminster or the Oscars is that they also have extensive television rights with much to make money off of people who can’t physically attend, something Comic Con has never been able to fully capitalize on, nor am I sure they’re able to as groups like The Nerdist have fully staked out that ground.

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