Major groups — though few in number — book MCC conventions

Sunday, December 5, 2010 at 9:05pm
MCCOmniSite.jpg
Jude Ferrara/SouthComm

On April 5, 2015, thousands of Second Amendment rights advocates are expected to converge on Nashville, congregate at a sleek new Omni Hotel and cross Fifth Avenue South to a $585 million convention center for the annual National Rifle Association convention.

For the next 10 days, the horde of gun enthusiasts will presumably pack the center for meetings and festivities, and — if Music City Center’s promised $134.9 million annual economic impact holds true — flood downtown honky-tonks, restaurants, sporting events and concerts during their down time, spending their disposable income with vigor. 

It’s the type of event and scenario Nashville leaders say wouldn’t happen if the city were to rely on the undersized and dated Nashville Convention Center, completed in 1987 and to be departed when the new center south of Demonbreun Street opens in February 2013. Landing the NRA, they contend, is the direct result of all parts of Mayor Karl Dean’s signature project finally coming together in just the past couple of months. 

In January, Metro decided to play catch-up in the ultra-competitive convention arms race, with the Metro Council voting 29-9 to use tourist-targeted tax dollars to bankroll the new 1.2 million-square-foot convention center. But tourism leaders say their pursuit of high-profile convention groups stalled in May and June, as the city cleaned up after Nashville’s flood during an already stagnant economy. There was also the lingering uncertainty of an anchor hotel. 

“We didn’t lose anything, but we went into a bit of delay in terms of closing business,” Butch Spyridon, president of the Nashville Convention & Visitors Bureau, said. “There were still knocks on the door, there was still business, but people weren’t ready to commit until they knew what the hotel product was.” 

That answer came in October, when the council signed off on a public-private deal to finance a new $287 million Omni hotel at the convention center site. It was the final piece of Nashville’s massive investment. The NRA, which had turned down the opportunity to hold its annual convention in Nashville just one year earlier, finally jumped on board. 

“Their final decision didn’t come until after the Omni deal was announced,” Spyridon said. “That was enough — enough information, enough confidence.”

With the project finally coming full circle, the belief now — 27 months before Music City Center opens –– is that other convention groups of a similar caliber will follow suit. It seems they will need to in order to reach hotel booking projections Dean and others used to sell Music City Center to Nashvillians a year ago. 

“No excuses,” Spyridon said in light of all the project’s components finally aligning.  

So far, 36 convention bookings are secured for Music City Center. Thirteen of those have come in the 11 months since the council approved the hotel’s financing. Of those 13, two groups — the Southeastern Conference Men’s Basketball Tournament and the American Animal Hospital Association — account for two bookings each. 

The 36 bookings total a combined 381,620 room nights. Spyridon has said his goal is to have 1 million confirmed room nights when Music City Center opens. 

The CVB must make gains in the coming years to reach hotel-room projections forecast by Chicago-based HVS Consulting, which performed a feasibility study for the new convention center last year and updated figures this fall after the Omni announcement. The updated study projects Music City Center will generate 143,575 room nights during the 2012-2013 fiscal year. Currently, 37,784 room nights are booked for that period. (The center will operate for only four months during the 2012-2013 fiscal year.)

Moving forward, the CVB must net more than 375,000 additional room nights for each of the next four fiscal years beginning in 2013-2014 to reach projections. At its peak, Music City Center is projected to start generating 503,975 room nights beginning in the 2015-2016 fiscal year. For now, 46,665 room nights are booked for those 12 months. 

There’s a reasonable amount of time to get there, though. Spyridon said convention groups typically book events three to five years in advance. He said smaller banquets and consumer shows, which he’s also eyeing, book events 12 to 18 months in advance. 

“If we get 12 months out, then I might have a different answer for you, but right now, no,” Spyridon said when asked if he’s worried about meeting the center’s first-year projections. 

Spyridon anticipates that business will rapidly pick up, expecting to double the number of bookings from 36 to 72 one year from now. He said he already has convention group “leads” that would create 238,000 room nights. He said 35 percent of such leads typically pan out. 

Spyridon hinted that a large “education-related group” is poised to announce one of its future conventions is headed to Nashville. He also mentioned the Tennessee Titans-Washington Redskins football game in November, when Nashville city leaders welcomed 12 D.C.-based groups. 

Leading up to the council’s vote to finance Music City Center, HVS Consulting’s projections were the source of doubt for the council’s nine voices of dissent. Skepticism hasn’t gone away. 

“You’re never going to reach those HVS projections,” Councilman Eric Crafton told The City Paper last week. “For one thing, everybody’s broke. Companies don’t know what tax liabilities they have coming up, they don’t know what their health care liabilities are coming up, so they’re not hiring people, and I wouldn’t think they’d be just chomping at the bit to take trips to conventions in this kind of economic climate. For Nashville’s sake, I hope they will.” 

Councilwoman Emily Evans, the council’s fiercest critic of the Music City Center financing plan, said that although the opening is still more than two years away, the bookings so far look “weak” because of the city’s indecisiveness on the hotel, which led to a prolonged negotiation. 

“The concern for the project isn’t 2016, ’17 and ’18,” she said. “I think we’ll have figured out what our business is and have kind of hit our stride. The concern — and it always has been — is going to be those early years.” 

Evans said total room nights tell only part of the story. “What we’re selling those room nights for, how many tax dollars they’re producing, is also important,” she said. “We’re going to have to look at all of it really.” 

But Music City Center’s biggest boosters remain confident they’ll meet the consultant firm’s projections. 

“[Convention groups] didn’t doubt that there would be a new convention center, but they were waiting to see what we were going to do on a convention center hotel,” said Marty Dickens, who chairs the Convention Center Authority. “Fortunately, things have worked, and thank the good Lord that Omni was very interested.”   

6 Comments on this post:

By: MCC Skeptic on 12/6/10 at 12:40

At least the City Paper and Joey Garrison have the fortitude to question the Mayor, thank you. While I think it is a little too early to judge the success of Dean's monument to himself (this being a monument is not too early to judge), I think this article raises some good points and leaves some others unanswered.

First, how many NRA members are coming to town?

How does the NRA feel about Dean getting out of the Expo business? How many regular "Joe Gun Owners" will be kicked out? So Dean is for NRA execs, but against the common gun owner?

The room night shortages are just staggering, it was well laid out in the print edition.

Joey, is Butch taking credit for the Washington Redskins coming to town? Do those 12 groups count in his totals? What happens when the 'skins don't play here next year?

Did you ask, or did Emily get an answer to, what is the hotel rate we are giving these rooms away?

By: AmyLiorate on 12/6/10 at 12:57

Ah yes, Nashville's future prosperity is based on jobs for waitresses and bartenders with revenue generated by more out of town drunks.

Aren't you blessed to have such splendid employment opportunities for the high school graduates! A brighter outlook based on vice and airline tickets.

Isn't it funny how conventions just can't seem to book events unless a hotel is tied directly to the convention halls?

Heaven forbid that the Hyatt and other hotels have the same opportunity to negotiate as the preferred hotel for any events. It's fine to use government money to benefit one hotel and let the others enjoy the scraps left over.

I could go on, but I have a Webex meeting to attend at 12:00. See ya. ;)

By: CitizensWin on 12/6/10 at 4:02

The NRA already has as convention center in Nashville, it's called the Tennessee State Legislature.

By: haney7 on 12/7/10 at 8:57

Posted by AmyLiorate:
"Isn't it funny how conventions just can't seem to book events unless a hotel is tied directly to the convention halls?"

Amy, since most convention cities have hotels tied directly to the convention halls, it makes sense when "shopping" to compare similiar facilities...and offer as nice accomodations to their clientel as possible. Those that wish to drive/walk in to the convention are able to stay at the Insect Inn near the stadium and commute, I suppose.

By: karlwithak on 12/7/10 at 5:40

NRA as a loyal Sponsor of NASCAR events has already had several NRA members coming from out of town contact local NRA members in Nashville. First question asked, What races are going on at the Fairgrounds that weekend.

They got a bit of an earful related to the mayors current plan to demolish the FIRST place they asked about visiting when they got to Nashville.

Really.

They sure as hell aint asking about the schemerhorn !

By: yucchhii on 12/11/10 at 4:02

"ALL" politicians are full of it! It's been demonstarted and proven many many times over! why do you people keep falling for them pulling the wool over your eyes? This country is continuing to do a nose dive and all they can do is find ways to make themselves MORE money! These politicians know what P T Barnum said to be true..."There's a sucker born every minute!" in this case they are all gathered here in nashvill going along with Karl Dink!