New convention center by the numbers

Wednesday, December 15, 2004 at 1:00am

Whether to build a new convention center, expand the Commerce Street facility downtown or do nothing is a multi-million-dollar question facing Nashville.

A new report from consulting firms KPMG and HOK Venue said starting from scratch and building a 385,000-square-foot center south of Broadway would accommodate the city's wish list for space and amenities.

But the consultants suggested first trying to expand the current facility at 601 Commerce St., which would cost about $100 million less than the estimated $299 million cost of a new building.

There are tradeoffs. None of the expansion options would achieve the full amount of the recommended 250,000 square feet to 300,000 square feet of exhibit space. And they also come with a heavy political price tag, as some long-standing churches would have to be displaced.

Of four expansion options HOK Venue examined, the alternatives that emerged most viable would involve tunneling either south under Broadway or north across Commerce Street. These options would provide more exhibit space underground and new aboveground buildings with parking spaces, meeting rooms and a ballroom.

The north option would increase the center's footprint to 375,195 square feet from 149,400 square feet and include 240,475 square feet of exhibit hall space. It would cost an estimated $181 million and would require relocation of the McKendree Christian Life Center on Commerce and the Church of Christ building on 5th Avenue.

The south alternative, which would increase the center to 376,395 square feet, with 237,675 square feet of exhibit hall space, would cost an estimated $202 million. Expanding the facility on the west side of the Gaylord Entertainment Center would require the relocation of the First Baptist Church, although the historic steeple would be retained. This option would potentially conflict with an existing utility tunnel under Broadway.

Mayor Bill Purcell has made it clear that the city would not condemn land for expansion. So far, the city hasn't begun official discussions with church leaders. But any attempts to relocate the Baptist Church will run into stiff opposition.

The church, which has been downtown for 185 years, two years ago turned down a sizeable monetary offer from the federal government to relocate for an expanded federal courthouse, said Frank R. Lewis, senior pastor of the First Baptist Church.

"Our congregation certainly wants what's best for the city, but we believe a church in this location is more important than a convention center in this location," he said.

Though officials at McKendree and Church of Christ said relocation would be tough for their memberships, they say they have not closed the door to discussions.

McKendree's trustees voted recently to appraise the center property across from the center, said Jordan Callaway, business administrator for McKendree United Methodist Church.

The HOK consultants said the north expansion appears to "best meet the needs of the market among the expansion options presented" because it provides the best expansion of exhibit hall space.

Purcell last month appointed a new task force of business and community leaders to make a recommendation of how to proceed on the options available.

But no matter what the decision, the city does not have the money to pay for the expanded or new facility.

The estimated annual funding needs over a 20-year period range from $18 million-$19 million a year for the north option, $19 million-$21 million for the south option and $28 million-$29 million for a new building.

The consultants recommend the course that most other cities are taking - taxing users of visitors services to pay for convention centers.

The consultants suggest a combination of funding sources, including earmarking another 1 percent of the hotel/motel tax for the center project, which would bring in $3.5 million to $4.9 million annually.

In addition, a 1 percent car rental tax would bring in up to $800,000 annually and a new .5 percent restaurant tax would generate up to $5.8 million annually. An additional $2 million could be raised by establishing a tourism development zone to capture the incremental growth in sales tax revenue.

Even with all existing and hypothetical funding sources factored in, the annual shortfall for the north option, the consultants said, would be $1.2 million for a year; for the south, $152,000 to $2.9 million for the first nine years; and for the new option, $5.9 million to $11.1 million for 20 years.

However, consultants note that while a majority of stand-alone convention centers typically realize an operating deficit, they generate other economic benefits to the community. The incremental benefits of adding space to the Nashville Convention Center are estimated to range from $99 million to $223.4 million for Davidson County during the first five years of operations.

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