Convention Center Expansion in Washington State: Is It The Rule, Or The Exception?

Successful Meetings OCTOBER 2006

If, according to industry watchdog Heywood Sanders, the convention center market is in danger of oversaturation, then someone forgot to tell Washington State.

Practically on the eve of the January 2005 publication of Sanders' Brookings Institution white paper, Space Available: The Realities of Convention Centers as Economic Development Strategy, Tacoma, WA, was opening its 277,000-square-foot Greater Tacoma Convention and Trade Center.

It was only the first of several such debuts. From the diminutive, 34,000-square-foot Lynnwood Convention Center, which debuted just outside of Seattle in 2005, to the recent addition of the 122,000-square-foot ShowPlex Exhibition Center at Pierce County's Puyallup Fair & Events Center, the space just keeps rolling out in the beautiful Evergreen State.

Why? Because new space creates excitement-and business. According to Ruthie Reinert, executive director of the Tacoma Regional CVB, the economic impact has been tremendous: "Visitor spending increased 7.4 percent and room-nights booked increased seven percent in Tacoma-Pierce County in 2005, compared to 2004. This is partly because we have the two major new facilities to market."

In July, the Spokane Convention Center debuted Phase I of an expansion that, when complete in summer 2007, will bring its total square footage to 314,565-more than double the center's original footprint.

Harry Sladich, Spokane CVB's president and CEO, fully expects the expansion to be a financial boon. "Our ranking from Tradeshow Week jumped almost 100 places on the list," he says. "We were the 260th largest convention center in the U.S.; now, we are the 169th." Sladich declares that the center's new size places it in a new "dating pool," explaining, "We were a regional rotation. Now we can go out in national competitions. We've beaten out Baltimore, Orlando, and Phoenix for pieces of business last year."

Furthermore, when its expansion is complete, Spokane will overtake the Greater Tacoma Convention and Trade Center to become the second largest in the state, behind Seattle's 1.39-million-square-foot Washington State Convention and Trade Center-which itself expanded by 102,000 square feet in 2001.

All this new build represents nearly 750,000 square feet of purpose-built meeting and exhibit space-a 46-percent increase over total inventory since 2003. Or, to look at it another way, there is now approximately one square foot of meeting and exhibit space per three inhabitants-compared to New York State, where the ratio is more like one to 13.

Even so, John E. Christison, general manager of the Washington State Convention and Trade Center (WSCTC) and president of the WSCTC Corporation, is unruffled by the new builds: "Our total income is long-term meetings," says Christison, citing that, out of approximately 1,800 events annually, about 83 percent of WSCTC's revenues derive from 42 to 43 national meetings. "Citywides continue to be [Seattle's] bread and butter," he notes. Instead, Cristison regards Tacoma and Spokane as incubators for future business: "From our perspective, small groups that are meeting in Spokane may grow, and would ultimately come to us."
Sladich does not even consider competing with Seattle: "It's such a large city and its energies are focused on the big, big fish. And those fish can't swim here. So we're not butting into each other."

Instead, he is looking south of the border-to Oregon. With the Spokane Convention Center having attained 28 points toward LEED certification by the U.S. Green Building Council-and only 12 more to go-Sladich seeks to capture the "green business" that has been a mainstay of Portland's Oregon Convention Center.

Michael Smith, VP of sales for the Portland Oregon Visitors Association, admits all of the center expansions in Washington State "are making the marketplace more competitive-as if it wasn't competitive enough already!" As Washington's cities improve their convention centers by adding new space, he adds, "It makes the list of destinations with which we compete even longer."

Smith points to the heart of the issue: Regardless of what Sanders' spreadsheet says, the destinations with the newest space always have the opportunity to swing new business in their direction. But will that business remain with those centers when they are no longer the "new kids on the block"? Only time will prove Sanders wrong-or right. -Terri Hardin