Convention center hotel: Opposing views on the taxpayer-subsizided monstrosity

I suppose this won't be a big surprise, but Jim Schutze and the Dallas Observer and the Morning News offer decidedly different views of the convention center hotel project this week. In Schutze's piece, he takes a look at some of the specific numbers in the analysis that led to council approval for the hotel and concludes that we'll be lucky if the thing works; he also points out that perhaps the council should spend some time and money solving basic issues like pot-holed streets and deteriorating sidewalks instead. The DMN, on the other hand, takes a more circumspect view of the situation, using interviews with city operators elsewhere to indicate that just about everyone everywhere else believes that their cities' investment in their own convention center hotel was a smart move. No solutions today, just more facts and more questions...

Comments

[dallas may]

I don't mind the hotel. I think it will be a good addition to the city. If a hotel is what we need to push Dallas higher in world standing, lets do it. I still would like to buy to Rangers too.

[Jason]

Not sure if you are being serious Dallas May, but I think the issue isn't so much about a new hotel as it is about a tax payer funded hotel. There are several hotels in Dallas, new ones are popping up in uptown all the time. Why should tax payers fund a convention center hotel. Do you think that a city funded hotel is going to push Dallas into a "Higher world standing"? Seriously? What parts of the world have you visited?

[Dallas May]

@Jason,

I understand your concern, and yes, this is about the hotel being tax-payer funded. Why should I, a home owner in Dallas, spend tax money to build a Hotel? Well, I believe government's job to do things that will increase prosperity of the city as a whole. For example, imagine if we never built the North Central Express way. Can imagine the traffic going down Greenville every day! That was a very expensive job that only the government could possibly do. This is kind of the same. This is a good thing for the city, and will bring with it lots of opportunities and jobs.

For me, the real questions are more on a smaller scale? Why not build it, then lease out the management? Why does the city have to control everything.

[Rick Wamre]

Dallas May, I believe the city's current plan is to build the property and hire a hotel management firm to manage it. The ultimate question, though, is if the hotel has a chance to be as successful and profitable as our city councilmen seem to think it will be, why won't a private developer build and operate the property — they're in the business and know the risks/returns better than anyone. The answer is that no private developer apparently believes that an investment of $500 million will generate a suitable rate of return, given this project's risk. In other words, professional real estate people won't take the risk, but our combination of city employees and part-time city councilmen are grabbing at that dangling rope like it's the last route out of purgatory.

[Jason]

I totally agree with you Rick. My gut is that the market is nearly to the point of saturation right now. The Victory area is pretty much the hot spot right now, and even this area seems over built. Where are the developers?

Dallas May, there is a huge difference in building infrastructure like roads and bridges- vs. building a hotel. Infrastructure is used by anyone in the city, and promotes commerce and economic growth. You getting to work in 20 minutes vs. an hour everyday, or the FedEx truck get to his destination faster help the business bottom line.

As for a hotel that I won't see the inside of and driving by does nothing for me, won't help land the next Fortune 500 company choosing to relocate it's headquarters or make anyone's workday or business more efficient.

[dallas]

@Jason

Yes, of course I would agree there is a difference between Infrastructure and a Hotel. I was only using it to make a point that there are somethings that government should do, that no private organisation could ever accomplish, or even attempt. I see the Hotel as being one of these things. It is very similar to the Trinitiy River Project. Why hasn't a private company bought up the Trinity and made a big park and a toll road out of it? Well, it is because doing so would require an astronomical investment, and the return on investment would not be seen for decades. This is why we have taxes. so that government can pay for the things that no private organisation would pay for. Other examples may include a police force. Imagine if you had to buy insurance to pay for a private vigilanty company to protect you. An example of something that was almost shot down like a duck in south Texas, was the Dart Train System. Many, MANY people opposed building it, siting that it was too expensive, and General Motors had just finished demolishing the old trolly car system. Why did we need to make the multi-billion dollar investment in a train system? Well, today I'm glad Dallas did, as are the other people in the jam-packed Redline that I ride each day.

I'm not saying that this hotel is as nessessary as a police force, or a major highway, or a public transportation system, but never the less I see it as a good investment for the city.

[Jason]

"there are somethings that government should do, that no private organisation could ever accomplish, or even attempt." "That we have taxes so that government can pay for things that no private organisation would pay for," yet there are private hotels all over the city.... I'm not trying to pick and choose from your argument, I just don't see any link to spending $500 million and an equal return on that investment.
All of the examples you cite are of safety, and transportation infrastructure, and yet I am not convinced that a Hotel can be categorized as such. It's apples and oranges to me. Its so far off base that I have know idea where to begin. We are obviously of different opionions. Would you accept city services to be cut back to build this hotel?

[Dallas May]

It is clear that we disagree, and thats ok, I understand your position. But there are many examples where Government and private industry overlap. Why should the city support libraries when there are dozens of book stores? Why should the city support public parks when there are a number of private amusement parks in the area? Why should a city support a community theatre when there are many private theatres? Why should the city support an orchestra when there are many private musical groups? Museums? I could go on. In fact you could have this conversation about any governmental sector.

I guess the point of our disagreement is that whether or not this is a commercial venture. If it is a commercial venture and the city truly expects to be profitable, then this is a bad move and I would be against it. Rather, I think this is a "Branding/Advertising" issue for the city. This is something for us to put on our brochures to bring your conventions to Dallas and get to know us. I think that is what this is about. Yes, it may not benefit you directly, but I think it will benefit the city in the long run. And yes, $500 Million is expensive advertising, but if that is what our competitors are paying, we need to match it.

[Dallas]

Oh, and what city services were you asking about? Water? No. Utilities? No. Zoning? Maybe... (Just kidding, I have family that work in zoning.)

[Finn]

I truly believe the opponents of this hotel are missing the forest for the trees. The fact of the matter is that if this city wants the convention center to be used on a regular basis by the large conventions which bring tens of thousands of people to Dallas, then there must be a convention center hotel. Most large groups will not consider a city without an attached hotel, and the fact is that we have lost multiple conventions already because of this shortcoming. I fail to see the problem with building such a hotel and having another company manage it. Whether you like it or not, if Dallas wants to reap the benefits of convention business, then we've got to have such a hotel. My guess is that the folks who complain about this hotel (and the ones on the Advocate staff who are so anti-business, it's a joke), are the same ones who marched lockstep with Laura Miller and her band of crazies against Victory Park. How did that turn out again, fellas?