The San Diego Convention Center is planning on putting up a nice expansion and is asking local hotels to contribute. Local hotels would need to contribute $30 million annually to help finance the new expansion under a proposal that was announced on May 12 by Mayor Jerry Sanders.This plan includes forming a convention center assessment district where downtown hotels near the center would be assessed 3% on each room per night. Hotels located immediately outside of downtown in areas like Mission Bay and Mission Valley would only be assessed 2%.
Any hotel located further out than that would receive a 1% assessment. A board of directors, which is set to include hospitality industry members, would oversee the assessment district. Officials have stated that the hospitality industry's annual contribution to the debt service for the expansion would be between $28 million and $30 million. The funding plan was developed by Mayor Sanders along with civic leader Stephen Cushman, the convention center's executive board and hospitality industry representatives.
According to Sanders, "As I have said from the very beginning, the expansion of our convention center should be paid for by those who will benefit from it. Given the hospitality industry stands to gain substantially, it's only logical that they should fund a significant portion of this."
The San Diego City Council will receive an update on the project as well as the funding plan at its meeting on May 17th. The plan will also eventually be voted on by area hotel owners and is not expected to require a public vote.
Financing for the expansion has yet to be finalized, however, city and convention center officials are estimating that the work will cost around $550 million, which is down from a previous estimate of $711 million. Officials have stated that the project has been redesigned in order to achieve a greater efficiency and to improve public spaces.
Source: San Diego Business Journal - Hotels Asked to Kick in for Convention Center Work
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