Convention Center Fades with Arena Approval
Updated: Aug 31, 2020
Clarksville, TN (CU) - One developmental topic slipping off the radar has been a Clarksville convention center. In 2019, a small hotel with meetings rooms was approved for construction. That property is an amenity for local business, but the extended impact to neighboring businesses will be minimal at best.
The decision for an arena was an interesting choice and will certainly be a needed addition to the city. It is still important to not make the mistake of believing the “multi-purpose event center” (MPEC) will service as a convention center. Have you ever had a coworker taking on too many jobs and then end up not being very effective at the basics? Uh-huh. How much of a consistent asset to the local business community can convention services be managed through an arena company and building? That’s up for a debate. What’s not up for debate is the arena cannot be a comparable substitute to a convention center.
A convention center has floor plans to service small meetings - to wedding receptions - to trade shows and/or large association conventions. The greater purpose of these convention centers is to create economic benefits for the larger community on a consistent basis. This is achieved by attendees staying at local hotels, dining at local restaurants, shopping locally and visiting local tourist sites. Understanding quantities of convention events are an important factor when compared to the quality of a single concert or arena event.
It's very real for convention services and arena events to be recognized as two very different professional skill sets. Can we expect a consistent convention services product from an arena management company? Powers Management, expected managing partner of the MPEC, is being incentivized by the number of tickets sold per event. Read that sentence again. It’s expected a business will focus on actions that impact revenue streams. In this instance, the MPEC incentives will clearly be event driven. That's a tabled debate for a different time.
The long lasting convention center debate should not be placed at Mayor Pitts’ feet. In all fairness to planning, the project has been one of the biggest challenges for Clarksville over the years with most obstacles concerning preferred locations.
In the meeting industry, today’s planners are looking for more than just a meeting location. The targeting of a best-fit destination which match potential interests of convention groups is key. And Clarksville’s asset? Location, location, location. Clarksville has a driver friendly population of approximately 19 million people within a 4-hour commute. One of the hottest American convention locations is an hour away in downtown Nashville. The opportunity? Nashville has the highest hotel rates in the country and their history shows no signs of the prices lessening.
Now toss out the treasure chest of favorable Clarksville stats and accommodations received during recent years. It won’t take much of an elevator speech to gain the ear of a meeting planner.
Then the elephant in the room emerges...
According to a survey of national meeting planners it was found that 79% of planners were more likely to book conventions if there was an "amenity-rich" hotel next door. I recently read an article featuring David Anderson, vice president of Spectra by Comcast. Spectacor is a management company responsible for hundreds of convention centers, arenas and sports facilities within their portfolio. Mr. Anderson’s views, specifically, a need for an amenity-rich hotel being within a walkable distance of the facility were consistent with those uncovered from the meeting planner’s survey.
So, what have been the two convention center locations under consideration in the past? How will the hotel industry needs relate?
The Riverview Inn has been an asset to Clarksville for decades. In our current climate, it serves a drastically different customer than would a hotel needed for a convention center. This topic is a much larger discussion, but the brand standard requirements of major hotel chains would be punitive to the Riverview’s bottom line value. It’s just not feasible to believe the project ROI would be beneficial on the remodel of Riverview Inn. The needed upgrades for brand standards of the Hilton, Hyatt, or Marriott flag’s would require too much investment. In the end, you’ll either have a bare-bone hotel or the current property will be razed for a new structure.
The Governor’s Square District
The area adjacent to Exit 4 has shown tremendous growth and sustainability. The access points to the area are strong, F&B options are plentiful and hotel development underlines investors confidence. The debate becomes the future plans for downtown Clarksville against the risk of convention groups settling for a generic experience in the GSD. Would convention group experiences at the GSD lead to unique stories and word of mouth to sell future events? Doubtful.
A few years ago, Bob Priest-Heck, President and COO of Freeman, highlighted the new convention group market as attendees looking at venues differently. Progressive convention center operators have become involved in more dynamic roles of assisting local CVBs with local governments, chambers, educational groups and small businesses to quicken economic development and push innovation.
“Millennials don’t see the convention center as the place where the event is happening,” Priest-Heck said. “They look at the whole city as the venue.”
According to Destination Marketing Association International, lodging and food/beverage typically account for 75% of a convention attendee’s direct spending. Trade shows also contribute additional expenditures to the community. Typically, at least 80% of conference attendees stay in a hotel. According to Roger Brooks, CEO of Destination Development Inc., overnight visitors spend three times what day visitors spend. We're now looking at the most impactful change and development resource of an area, downtown Clarksville for example, being found through a convention center business model.
Are city leaders quietly playing 4D chess with future plans to build a downtown convention center to complement the arena? It can only be hopeful speculation at this point.