Are Convention Centers Worth It? 

Cities spend billions to build and renovate large convention centers – is it worth it? That’s the question raised by a recent New York Times article.

According to Skift Meetings research, 22 new convention centers are under construction and 60 new projects are in the pipeline across all tiers. Dallas, Austin, and Los Angeles each have big expansions underway. 

The premise of the Times story is that companies are spending less on conferences and attendance is down. 

According to the U.S. Travel Association, travelers spent $119 billion on meetings and events travel in 2023.

That’s down from $139.3 billion in 2019. But it’s been coming back and U.S. Travel projects growth of 9% in 2024.

In addition, data from STR shows that group room demand matched 2019 levels in September. The pace of future bookings has been well ahead of 2019 for most of this year.

Booking Seven to Eight Years Out

The Institute of Electrical and Electronics Engineers (IEEE) is booking its large events seven to eight years out to secure desirable convention center space, said Marie Hunter, IEEE’s managing director of conferences, events, and experiences. “And even then, we are sometimes finding convention centers are already booked,” she said.

Hunter reports that 2024 is going to be a record year for IEEE technical conferences with over 550,000 estimated participants worldwide. IEEE sponsors more than 2,200 conferences each year. 

“For technical exhibitions, we find that our participants want to see the products in person and that the exhibitors may even sell to each other, becoming a community marketplace,” said Hunter. 

IEEE isn’t the only group finding it challenging to book the space they need. “Supply is not meeting demand,” said Janet Dell, CEO of Freeman, an event agency. “There are shorter move-in times, they can’t get dates.” 

Much thought goes into the decision to renovate a convention center.  “There is collaboration between cities, states, and consultants. Billion-dollar projects are not arbitrary decisions,” said Don Welsh, the CEO and president of Destinations International. “Plus, planners are saying you have to up your game and provide the environment our attendees want, and convention centers are listening.”

Not surprisingly, the industry supports more conferences and promotes the potential economic benefits to a city. 

Are Convention Centers Money Sucks?

“The notion that a convention center is a money suck is counter to how they are operated and balance out an entire ecosystem,” said Trevor Mitchell, president and CEO of The International Association of Venue Managers (IAVM). “Hotels, retail outlets, and restaurants are impacted when a convention is in town. Not to mention the people who are employed by these centers.”

Kevin Hinton, U.S. Travel Association’s managing director, group travel, concurs. “The ROI of a convention goes well beyond the performance of the convention center. There is vast spending that happens well beyond the buildings where the meeting is being held,” he said.

Another important factor to consider is the collaboration that happens when in-person at a convention. “Convention centers are incubators for industry,” said Sherrif Karamat, CEO of PCMA. For instance, he points to five new AI conferences that have been created post-pandemic.

“Forced tourism” is ignited by conventions. “Conventions are a great way to attract people to a city,” said Craig Davis, the president and CEO of Visit Dallas.

The Kay Bailey Hutchison Convention Center in his city is undergoing a significant $3.5 billion. redevelopment. When completed, the new center will have 170,000 square feet of ballroom space, 260,000 square feet of meeting rooms, and 800,000 square feet of exhibit space.

Construction began in June and is scheduled to be completed in 2029. Forty-one events have been booked for 2029 and later and 96 others are on the table, said Davis.

Convention Centers Help in Crisis

Convention centers can help communities in other ways. During the pandemic, they became hospitals, testing centers, and eventually vaccination centers. The Jacob K. Javits Convention Center, the first in the country to convert into a hospital with 1,000 beds, along with a nurses’ station and pharmacy, also transformed into a vaccine distribution center.

The San Diego Convention Center was used for three months to house unaccompanied immigrant minors. This was in March of 2021, during the Covid pandemic, and as a result, no scheduled events were impacted. Another, the El Paso Convention Center was also transformed into a migrant shelter in December of 2022.

Industry associations have the data to prove the importance of convention centers and thus the entire event ecosystem. The Events Industry Council (EIC) states that the $1.5 trillion of total GDP supported by global business events would rank the sector as the 13th largest economy globally. 

“The data is there. We haven’t been able to capture the essence of why it matters,” said Amy Calvert, EIC’s president and CEO. “Anecdotally, the deeper, more purposeful impact and reason of events need to be part of the story we tell.”