Renaissance Center in direct competition with Convention Center


Is the upgrade to the downtown convention center about making Tulsa competitive with other cities, or is it about making downtown Tulsa competitive with southeast Tulsa?

The existence of John Q. Hammons' Renaissance Hotel and Convention Center, at the heart of Tulsa's main commercial corridor at 71st Street & US 169, is an inconvenient fact for promoters of Proposition 3, the proposed new sales tax that includes money for a new downtown sports arena and renovations to the downtown convention center. The Renaissance's very existence contradicts several assertions made by the yea-sayers. Perhaps that's why it wasn't taken into consideration in CSL's study of the feasibility of expanding the downtown convention center.

The proponents say that Tulsa needs a facility with a ballroom at least 25,000 sq ft in size. The Renaissance Tulsa has a 28,800 sq ft ballroom.

When confronted with the $1.7 million operating deficit projected for a renovated and expanded downtown convention center, the yea-sayers say that convention centers are "loss-leaders", expected to lose money so that visitors will come and spend money around the city. But John Q. Hammons built his Convention Center with the expectation of making a profit. Motivated by profit, and guided by years of experience developing hotels, Hammons chose a location and a design and amenities that would make the Renaissance ulsa attractive to convention and meeting planners. That's the free market at work.

When plans for the hotel were first announced, Hammons was pressured by city leaders to call his facilty a "conference center", so as not to give the voters of Tulsa the impression that expansion of the downtown convention center was unnecessary, in the lead up to the "It's Tulsa's Time" vote in November 2000.

A Tulsa Whirled business article dated April 4, 2002, drew this comparison:

Conversely, about 15 miles to the southeast of downtown, a multistory atrium-style hotel with 300 guest rooms and suites plus an 80,000-square-foot convention center is scheduled for completion early next year, said Mike Craddock, vice president of Hotel Broker One.

"We're going to see the biggest hotel in Tulsa history," Craddock said of the building on 71st Street just east of U.S. 169, the Mingo Valley Expressway.

It is owned and being developed by John Q. Hammons Hotels Inc. of Springfield, Mo.

"It will compete directly with the convention center downtown," Craddock said. "New properties always do better."

The possible rivalry could reduce crowds and subsequently the amount of money spent in the downtown area, which already is suffering from layoffs at companies that have downtown operations, Brandt said.

Mike Craddock's statement about direct competition fits the results of the CSL feasibility study, which shows that the overwhelming majority of national association and business conventions and tradeshows would still be uninterested in Tulsa, even if we expand and renovate the downtown convention center. Only SMERF groups had even a plurality expressing an interest, and that appears to be the target market of the Renaissance Tulsa as well. If private companies can cater to this market and bring these groups and their money to town, does it matter if they're going downtown or to the southeast? It matters to those with an interest in downtown real estate, but it doesn't affect the bottom line for the community's economy -- jobs, spending, and tax revenues.

Stephen Goldsmith, former Mayor of Indianapolis used a "Yellow Pages" rule when considering whether government ought to perform a certain function, or leave it to the private sector. "Look at the city’s Yellow Pages. If the phone book lists three companies that provide a certain service, the city probably should not be in that business, at least not exclusively."

Even if the downtown center were fully revamped, it would still be at a disadvantage to the Renaissance Tulsa. The Renaissance is walking distance to restaurants, movie theatres, a large discount and grocery store, and clothing, electronics, and office supply stores. The downtown convention center is in the middle of a big government complex, with little private enterprise for blocks. To get from the convention center to our nightclub and restaurant districts, you've got to walk at least half a mile past the jail, the homeless shelter, and the bail-bond offices (to the Brady District) or past empty parking lots and empty office buildings (to the Blue Dome District).

Perhaps the best thing to do with the convention center is privatize it -- sell it off to private investors who will make it competitive with the Renaissance. Or perhaps downtown property and hotel owners could purchase it and run it as a loss-leader to draw people downtown. But government has no business losing money (reducing the money available for basic city services) in an effort to draw business away from a private company.

About this Entry

This page contains a single entry by Michael Bates published on September 2, 2003 12:45 AM.

Why vote no? was the previous entry in this blog.

BREAKING NEWS: KTUL preempts sales tax debate is the next entry in this blog.

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