Advertisement
Advertisement

Convention business strong but homeless pose a sales challenge

Comic-Con, which is San Diego's biggest convention, signed a three-year contract in July, keeping the pop culture gathering here through 2021.
(Hayne Palmour IV / UT San Diego/Zuma Press)
Share

Over the last year, the San Diego Convention Center was able to secure enough future bookings to deliver to the city more than 1 million hotel room nights, even without a hoped-for expansion of the bayfront facility.

Those room nights, a barometer for measuring success in filling the center, far exceeded the sales force’s goal of 840,000 hotel nights and represent the third year in a row that the goal has been surpassed, according to a sales and marketing report released this week.

But don’t expect that booking level this year, warns Tourism Authority CEO Joe Terzi, who points out that 70 percent of the center’s capacity over the next 10 years and beyond already has been filled.

Advertisement

On top of that, San Diego’s growing homeless problem has not gone unnoticed by meeting planners, posing a hurdle for the sales team in persuading associations and companies to book a meeting here, Terzi acknowledged in an interview Friday.

He recounted an incident that occurred about a week ago when a meeting planner who was visiting San Diego to consider booking a meeting was attacked by a homeless individual in a hotel bar. He is still hopeful, he said, about securing that group’s business.

“Homelessness is becoming a more obvious challenge because it’s very visible and if you get accosted by a homeless person or have to step over stuff on the street, planners will say I’m not sure I want to have to deal with this,” Terzi said.

“We’re not the least expensive city, but we have a great product and have always been a safe and secure and clean environment but it we lose that, we could lose our competitive advantage. We feel this is the No. 1 issue we have to deal with now.”

Despite the concerns surrounding the growing presence of the homeless downtown, Terzi said he was encouraged that the hepatitis A outbreak has not been a large concern for meeting planners.

“I was just in Las Vegas at a big industry meeting where a lot of big buyers go, and we got a few questions but not a lot,” he said.

While the hotel room night commitments secured for future conventions was relatively high, the grand total was boosted by a windfall of about 190,000 room nights associated with a three-year deal Comic-Con International signed in July. The current contract with the pop culture convention is due to expire next year.

Among the highlights of the 2016-17 fiscal year report:

  • The center realized $41 million in revenues compared with $34.8 million in operating expenses.
  • Lost business amounted to a little more than $2 million in hotel room nights, with more than half that owing to insufficient space in the center or unavailable dates. Almost $400,000 in lost business was because a rival center got the bookings.
  • A total of 59 citywide meetings and events were booked for future dates — between 2017 and 2030 — accounting for 1,091,534 room nights.
  • Of the 59 bookings, 11, or 19 percent, were new to the city. Examples of new business include the National Grocers Association, Asian American Hotel Owners Association and the American Medical Group Association.
  • Conventions that came to San Diego last year drew nearly 900,000 attendees who spent an estimated $673.9 million on lodging, meals, transportation and other expenses.

Given San Diego’s consistent ranking among the top five convention destinations, city and tourism leaders believe that the center could draw even more business if it could be enlarged to accommodate larger associations that cannot fit in the existing center.

A group of city stakeholders, including hoteliers, business leaders and organized labor representatives, have been meeting in hopes of submitting to the voters next year an initiative that would hike the hotel tax to help pay for a more than $600 million expansion and also fund homeless services and road repairs.

So far no draft proposal has been released, although backers say they would like to put a citizens initiative on the November 2018 ballot.

Business

lori.weisberg@sduniontribune.com

(619) 293-2251

Twitter: @loriweisberg