Mar. 13, 2010--As Comic-Con nears decision time as to whether to stay or go, San Diego's hospitality industry is scrambling to address concerns that high room rates at some hotels could thwart the city's chances of holding on to the mammoth four-day convention.

Facing competition from Los Angeles and Anaheim, San Diego Convention Center officials are working with local hoteliers to persuade them to offer more competitive convention rates in the hope of convincing Comic-Con International to remain in its 40-year-long home.

Although the pop-culture extravaganza is contracted to stay in San Diego through 2012, Comic-Con is exploring options for 2013 and beyond because it has largely outgrown San Diego's bayfront convention center. The show regularly sells out weeks in advance, and there is a long waiting list of vendors interested in exhibiting at the convention.

Eager to address Comic-Con's concerns, the San Diego Convention Center Corp. last month offered a three-year proposal that would double the number of discounted hotel rooms set aside for the convention and provide free meeting space within the waterfront hotels.

The city, however, apparently has more work to do if it wants to retain the event.

"We're hearing very clearly from Comic-Con that hotel room rates are an issue in our ability to stay competitive for the business for 2013 on, so we've redoubled our efforts to ensure that the hotel community understands how important this piece is to our successful bid," said convention center spokesman Steven Johnson. "We don't want to lose such a lucrative, annual piece of business in this economic environment, so we're using every piece of information we hear back (from Comic-Con) to refine the bid and address their concern."

The city was anxious enough about the prospect of Comic-Con heading north that San Diego Mayor Jerry Sanders this week convened a meeting of tourism industry representatives to make sure hoteliers were willing to do everything they could to beat competitors who can offer more convention space and lower hotel rates.

Local tourism officials stress that Comic-Con is like no other convention, attracting 126,000 attendees yearly, along with worldwide media attention driven by its close ties with Hollywood studios and movie directors who depend on the gathering to gauge fan interest in their projects. Some liken it to hosting a Super Bowl every year, because of its high profile and economic impact worth tens of millions of dollars.

"Given the decision by Comic-Con will be made in a few weeks, the mayor wanted to bring all the players in one room so he could know if there was anything additional that could be done to increase our chances of keeping the convention," said Darren Pudgil, a spokesman for Sanders.

In the area of room rates, Comic-Con officials were concerned that some of the hotels that had committed to offer discounted rates exclusive to attendees had exceeded a $300 nightly threshold, Johnson said. In other cases, some downtown properties that normally offer more moderate prices were proposing convention rates comparable to what a four- or five-star hotel would charge.

Nearly a dozen hotels out of 64 in the Comic-Con room block were identified as having excessive rates, Johnson said. Some of those hotels already have agreed to renegotiate lower rates, he added.

"We recognize that folks up in Anaheim and Los Angeles are more affordable and are coming in and quoting very low rates, so we want to make sure we're competitive and our bid is attractive and that we accentuate all the positives," said Jim Durbin, general manager of the San Diego Marriott in the Gaslamp Quarter, noting that his convention rates are less than $300 a night. "We've got a buyer out there who's being wooed by other competitors, so they're going to take advantage of that circumstance by pushing the best deal they can get wherever they can get it. We're treating this like a Super Bowl, and hopefully, no one price-gouges."

Anaheim, with a convention center that has roughly a half-million more square feet than San Diego's and nearby hotel rooms that are on average $35 a night cheaper than in the downtown core, is viewed as the city's principal competitor. Hoteliers acknowledge that they will never be able to beat Anaheim's room rates but say they can reduce their prices to mollify Comic-Con officials.

Comic-Con spokesman David Glanzer noted that while hotel pricing is a key issue, the decision on where the convention settles will ultimately come down to how San Diego addresses all the issues the convention organizers have raised in recent years. Although the organization had hoped to reach a decision by the end of this month, it may take longer, he said.

"What's happened in the last couple of years was people were complaining about the convention rate, which they said was so high," said Glanzer, who confirmed that Comic-Con has received formal proposals from Anaheim and Los Angeles. "I don't know that (the rate issue) is a comparison between cities, but rather the difference between San Diego's rates during Comic-Con weeks and non-Comic-Con weeks.

"One of the concerns we have is we've had to cap attendance for attendees and those exhibiting, and that means our income will be flat in a couple of years as costs increase, so we need to accept the proposal that best ensures we remain solvent."

Local hotel operators have heard the message clearly and are ready to consider altering their pricing, said Namara Mercer, executive director of the San Diego County Hotel-Motel Association.

"Not all the hotels were aware they weren't in line with what was expected for the bid package, so they're renegotiating their rates to make sure they're falling within those guidelines," Mercer said. "They want to make it right now, so I think you'll see tremendous progress."

While Anaheim is confident that it has the resources Comic-Con needs to stage a successful convention, as well as proximity to Hollywood, it's also pragmatic about its chances of stealing the show away from San Diego.

"We would love to have it, but we're realists. To unseat something that's been there for 40 years is difficult," said Charles Ahlers, president of the Anaheim/Orange County Visitor & Convention Bureau. "They have real grass-roots ties to San Diego, which is a competitive advantage, but if size matters, think of Anaheim."

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