Downtown Commission wants proposals from private developers for convention center expansion


Monday, April 25, 2022 by Chad Swiatecki

The Downtown Commission wants the city to seek proposals from private developers to pay for part of the expansion and reconstruction of the Austin Convention Center.

At last week’s meeting, the commission approved a recommendation asking city council to direct staff to conduct a request for proposals; particularly the residential or office spaces on the upper floors of the site which are currently undergoing an ambitious overhaul costing over $1 billion from hotel occupancy tax revenue. The amended recommendation also calls for a report from city staff reviewing the state of affairs of convention centers across the country, with forecasts of how event attendance is expected to recover following the Covid-19 pandemic.

The commission has a task force that has been studying convention center expansion for months, taking particular interest in findings by convention business analyst Heywood Sanders showing that most projections of future industry activity congresses are too aggressive and inflated.

Commissioner Mike Lavigne said private developers may pick up a significant portion of expansion costs in exchange for the opportunity to create attractive residential or commercial real estate in the downtown core.

“I’m hooked on the idea of ​​a public-private partnership and I find it incredible that we haven’t explored this further. I’ve spoken to some major developers in the city about this in particular…and they’re all telling me unequivocally that it would be an incredible opportunity to build 40 floors of housing on top of the five floors of the convention center,” a- he declared. “Most cities put convention centers in places where they are trying to stimulate development or regeneration and we have the unique opportunity to put a convention center (expansion) in a place that is already a city in the making. boom. It is important that we go back and ask staff to consider a new approach.

In 2018, the Council gave the green light to staff and tourism industry players to move forward with the most aggressive reconstruction of the convention center, including plans to open up some of the east-west streets that are currently blocked by the installation. Opponents of the expansion have launched a petition to limit the amount of hotel tax that can be used for convention center capital expenditures – such as an expansion – and would have required a public vote to move forward with any such projects. This initiative was rejected, clearing the way for city and convention center leaders to move forward with expansion plans.

A proposal to expand the facility westward was recently shelved due to the high cost of acquiring the property, leaving vertical expansion the only option to add capacity to the convention center and include d other uses as a means of generating additional revenue beyond event bookings and hotel taxes. .

Commissioner Joel Sher tried to get the resolution tabled to allow the commission to hear from convention center advocates. Before his motion was not seconded, he reminded the committee of voter approval and clarified that the project’s bondholders instead of the city would be responsible for any financial shortfalls related to the convention center.

“It’s not a city bond and if there’s not enough money to get this (the expansion) done, then that’s the bondholders’ problem. Bondholders aren’t going to spend half a billion or a billion dollars on something unless they think they’re going to get paid back.

Commissioner David Gomez said the resolution should help clarify the contrasting data presented in recent years by those on both sides of the expansion issue.

“I see this resolution as an attempt to access truth and transparency… in all the businesses we undertake, a large part of what we base our decisions on is the data provided to us and we believe that tell us the truth, but we have two entities telling us different truths and they don’t mix, they don’t match.

Photo made available through a Creative Commons license. This story has been edited since publication to clarify the 2018 vote on the Convention Center expansion.

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