The Civic Space Race...
From Bloomberg comes what their analyst, Joe Mysak, calls "The Report Wall Street Doesn't Want You to Read," and some New Orleans business and political leaders may not like the message either. Mysak's conclusion from the report under discussion is that U.S. cities should stop the convention center "space race."
Mysak characterizes convention centers as expensive, money-losing propositions, even before you count the costs and debt. The reason he says that Wall Street doesn�t want you to read the report is that they make millions of dollars underwriting bonds for convention centers and convention center hotels, and don't want states and localities to stop betting on the future success of the convention business.
The basis for the discussion is a 35-page research brief prepared for the Brookings Institution, released this week, called "Space Available: The Realities of Convention Centers as Economic Development Strategy." The research was conducted by Heywood Sanders, a professor in the Department of Public Administration at the University of Texas at San Antonio, who has spent almost a quarter century studying convention centers and their economic impact.
Public spending for convention centers has doubled over the past decade, to almost $2.5 billion a year. Exhibit space has increased 50 percent since 1990, to 61 million square feet in 2003. And 44 cities have plans for expansion or new centers in the hopes of increasing jobs, tourism and tax revenue.
This is occurring while the convention business is shrinking, and was doing so well before September 11, 2001. The business is contracting as a result of industry consolidation, reductions in business travel, and alternative ways of conveying information, says Sanders.
Mysak concludes that it may be time to change the way we think about cities and why they work, or don't. Has "public sector entrepreneurship" with its emphasis on taxing, spending and building really delivered? Maybe cities should halt their convention center space race and invest in things like infrastructure and basic services.
Let me know your thoughts on this issue.
Mysak characterizes convention centers as expensive, money-losing propositions, even before you count the costs and debt. The reason he says that Wall Street doesn�t want you to read the report is that they make millions of dollars underwriting bonds for convention centers and convention center hotels, and don't want states and localities to stop betting on the future success of the convention business.
The basis for the discussion is a 35-page research brief prepared for the Brookings Institution, released this week, called "Space Available: The Realities of Convention Centers as Economic Development Strategy." The research was conducted by Heywood Sanders, a professor in the Department of Public Administration at the University of Texas at San Antonio, who has spent almost a quarter century studying convention centers and their economic impact.
Public spending for convention centers has doubled over the past decade, to almost $2.5 billion a year. Exhibit space has increased 50 percent since 1990, to 61 million square feet in 2003. And 44 cities have plans for expansion or new centers in the hopes of increasing jobs, tourism and tax revenue.
This is occurring while the convention business is shrinking, and was doing so well before September 11, 2001. The business is contracting as a result of industry consolidation, reductions in business travel, and alternative ways of conveying information, says Sanders.
Mysak concludes that it may be time to change the way we think about cities and why they work, or don't. Has "public sector entrepreneurship" with its emphasis on taxing, spending and building really delivered? Maybe cities should halt their convention center space race and invest in things like infrastructure and basic services.
Let me know your thoughts on this issue.
posted by John V at 9:00 AM
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