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Palm Beach County's Convention Center Continues
 to Lose about $1 million a Year
.
Four Year Old $84 million Convention Center Lacks Adjacent Hotel

By Mark Hollis, South Florida Sun-SentinelMcClatchy-Tribune Regional News

Sep. 20, 2007 --WEST PALM BEACH -- Four years after opening and without an adjacent hotel to draw big conventions, Palm Beach County's convention center will continue to bleed about $1 million a year until at least 2011, county tourism officials projected Thursday.

The losses in running the 100,000-square-foot, $84-million downtown West Palm Beach center tops a list of reasons why a stockpile of hotel bed tax dollars is expected to shrink in half.

A now $12.8-million reserve fund of hotel bed taxes will shrivel to $5.6 million within the next five years, being used primarily to pay for such things as paying the debt that was assumed in building the convention center.

Members of the Tourist Development Council, who oversee how bed taxes are spent and tourism-programs are run, were upbeat despite the grim financial news.

"We knew all along it would cost this much," said Charles Lehmann, executive director of the TDC.

Lehmann and other tourism officials insisted that the convention center was never projected to operate at a profit within its first several years of operation. They also said they are hopeful the convention center can at least slow its financial bleeding once an adjacent hotel opens.

This week, a City of West Palm Beach planning group gave tentative approval to build a 20-story Westin hotel and a nearby 1,800-space, seven-story parking lot near the convention center. Final approval is expected to come within the month from the city commission.

David Burke, a TDC member and vice president of sales and marketing for The Breakers hotel, said he wasn't troubled by the center's financial forecast, calling it an "ultimate dream" for the center to break even.

"It's something to keep an eye on, but not an alarming situation whatsoever," Burke said. He also said very few convention centers across the country are able to quickly operate in a profit. And though it's running at a financial loss, Burke said the center helps draw some tourists to the county. He and others cited boat shows and art shows that have been featured at the center in recent months.

"It's a tourism generator and will become even more of one with more hotel beds nearby," Burke said. "It's an asset to the community...No one has been under the illusion that this thing would turn a $5-million a year profit. They (convention centers) just don't do that."

The county collects roughly $26 million a year in hotel bed tax funds, which amount to 5 cents on every dollar a tourist spends on their overnight accommodations.

Mark Hollis can be reached at mhollis@sun-sentinel.com or 561-228-5512.

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To see more of The South Florida Sun-Sentinel or to subscribe to the newspaper, go to http://www.sun-sentinel.com/.

Copyright (c) 2007, South Florida Sun-Sentinel

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