The sales team that books trade shows and meetings into the San Diego Convention Center did very well in the fiscal year ended June 30, but needs the facility to be expanded to remain successful, tourism officials told the City Council on Thursday.
The San Diego Tourism Authority has an annual goal of contracting for 860,000 hotel room nights that will be used in the future by conference attendees. In the 2014-15 fiscal year, the Authority booked more than 1 million, according to a presentation to the council’s Economic Development Committee.
Most of those 1 million room nights will be spent in the next 10 years, but some were booked into the 2030s.
However, SDTA officials said they’ve become victims of their success, because they now have less space and fewer dates to sell.
SDTA President and CEO Joe Terzi said beating that figure will be “very difficult” in the future without expansion.
“As you stack every year, more and more and more business into that building, and you have less and less availability, the only opportunities we have to continue to stack that amount of room nights into the building are off- peak dates or much further out,” Terzi said.
He said most major associations won’t book certain dates, such as over or near holidays, and aren’t willing to sign a contract more than 10 years out.
City and tourism officials are laying the groundwork for a plan to expand the center, which they contend is losing out on the biggest trade shows because competing cities offer more room. Even Comic-Con has outgrown the center and uses facilities at nearby hotels.
An expansion plan adopted under former Mayor Jerry Sanders fell by the wayside when the financing mechanism was rejected in court. A new funding plan could go before voters next year.
If the voters approve funding, the project will still have to overcome a lawsuit challenging the California Coastal Commission’s approval of the project needs to be resolved before construction can begin.
Terzi said several big shows have gone elsewhere, rather than book in San Diego. He said he’s also had to turn some other business away.
While all that is in the future, Terzi and center President and CEO Carole Wallace said the most recent fiscal year was a success. Wallace said the facility’s occupancy was 68 percent, above the national average of 44 percent. The fiscal year was the third in a row with an occupancy increase.
Wallace said the occupancy rate will never be 100 percent because of holidays and maintenance requirements. The industry standard for full occupancy for one year is 60 percent, she said.
According to the report, the 172 events at the convention center during the fiscal year had a regional economic impact of more than $1 billion, generated almost $21 million in hotel room taxes and nearly 691,000 hotel room nights. More than 808,000 attendees spent $624.7 million during the year, the report said.
The five events with the biggest economic bangs, according to the report, were:
- Comic-Con International, almost $136 million;
- Cisco Live, $70.3 million;
- ESRI, over $50 million;
- the National Safety Council, $44.4 million; and
- the American College of Cardiology, just over $42 million.
— City News Service