Cleveland's Proposed Convention Center: A Possible New Approach

Cleveland leadership has been wrestling with the issue of whether and how to finance and build a new downtown convention center over the past couple years.

The business community has been for it, some important elected officials have been reluctant to commit to the deal, and the general public says it does not want its taxes raised to pay for the development. Cleveland Mayor Jane Campbell has recently announced the project is "dead" -- at least for now.

To say the least, the process has been frustrating for all concerned, especially to fail at an issue of this magnitude and one with such great public attention. Now, the fingerpointing begins. Why did the initiative fail? Is it REALLY dead? Can a new strategy revive the project in the future? These are important questions to examine at this point in time.

The business community now says the lack of sufficient political will and support is one of the culprits. City and County officials are blaming each other, and some political leaders say the business community has pushed too hard on the conevntion center project. The Plain Dealer Newspaper says the deal did not have enough citizen input. The voting public appears to be relieved that another bite on its wallet will not occur for now. Was a bad economy to blame? The past recession and related economic problems are factors affecting most major investment decisions in the past three years. Probably all of these factors contributed to the current inability to get the project off the ground. I think completely new funding and market growth strategies are needed at this point, if the convention center stands any chance of making it.

For those who want to see a new convention center happen, here are some suggestions:

1. Rethink how the project would be paid for. I said this before. Cleveland should team up with 3-4 other cities trying to build major facilities and create a real estate investment trust (REIT) to raise the financing for all of the facilities as a packaged deal. Yes, this is a new approach, but so what? Yes, work a deal that is worthy of private sector investment. Is that possible? It could be if a realistic plan guided the development in terms of faciity size and market focus.

2. Revisit this project 6-9 months from now. Allow emotions to settle down and then bring it back to the table with a new concept and funding strategy. Public sector support and assistance will still be needed in terms of site assembly, permits and approvals and infrastructure improvements.

3. Come to the table with a "real" strategy to grow Cleveland's travel and tourism sector over the next decade. Identify some new ways that the private marketplace can be strengthened around this sector. Most cities continue to see it as a subsidized industry. We need to think differently about it. A part of that new strategy must be a way to expand marketing efforts to attract new conventions, meetings and tourism events. This plan should look at the sector on a regional basis and it should define in conservative terms how much of a role the new convention center will play.

4. Go to the State of Ohio and ask it to put some funding into a modest guarantee for the new Cleveland convention facility portion of the REIT. Other cities in the pact should ask their states to do the same.

My guess is that this approach just might work, if the rght plan is followed. Don't be surprised if even some international investors step to the table in support of the REIT financing scheme. The international investment environment is changing. Be willing to take out-of-town money.

Yes, this is a new approach, but what's the alternative if we want a new convention center and a stronger travel and tourism industry?