An aerial view of the proposed expansion, including the rooftop park. (Photo by San Diego Convention Center)
The California Coastal Commission reached a unanimous decision Oct. 10 to approve the San Diego Convention Center and Hilton San Diego Bayfront Hotel Expansion.
Alhough a unanimous vote makes it sound like an easy decision, the approval from the California Coastal Commission wasn’t a sure thing.
“The [California Coastal Commission] staff actually issued a denial report against the proposal,” said Steven Johnson, SDCC VP Public Affairs. “I think the commissioners themselves were convinced that the project was valuable to the region and would improve the waterfront experience by improving pedestrian access, views of the bay and the addition of a five-acre park overlooking the water.”
An expansion could be very valuable for the region, indeed. In a recent survey of 64 clients or key prospects of SDCC by Red 7 Media Research and Consulting, 98 percent stated that it was “extremely important/critical” or “very important” to have enough contiguous exhibit hall space within a single venue complex.
“We have contiguous space, we just don’t have enough of it,” said Johnson.
The $520-million project designed by Fentress Architects, John Portman & Associates, and Civitas will increase the amount of contiguous event space by more than 200,000 sq. ft., for a total of 750,000 sq. ft. It will also double space with the addition of an 80,000-sq.-ft. ballroom. Financing for the project is still under appeal. The proposed financing plan will pull $3.5 million annually from the city of San Diego, $60 million from the San Diego Unified Port District, and additional funds from hotel taxes.
A look at the proposed expansion from the bay. (Photo by San Diego Convention Center)
One major client feeling the space crunch is Comic-Con International: San Diego, the annual comic convention that has been at the facility since 1970. According to Johnson, the convention, which generates a $175-million annual economic impact with nearly $3 million in tax revenues for the city, outgrew the facility several years ago.
David Glanzer, director of Marketing and Public Relations for Comic-Con, said that although Comic-Con began with a 300-person event, attendance has ballooned. The convention has had to cap its attendance at 130,000 for the last six-seven years because of the limited space at the facility.
“The last few years the show has had more of a campus atmosphere as we’ve had to move and expand outside of the convention center to surrounding venues and hotels,” said Glanzer.
Comic-Con is contracted with SDCC until 2016. Should the financing appeals be resolved in the coming months, construction for the 30-month expansion project will break ground in 2015 to be completed in 2018.
“Believe it or not, when we negotiate we really won’t take the expansion into consideration — we haven’t in our last two turns negotiating because we haven’t known where the project stands, and even with this month’s decision there are still a few hurdles to cross,” said Glanzer. He added that Comic-Con International is based in San Diego and would ideally like to continue at the facility if logistical concerns like space and financial concerns of too-high hotel rates can be mitigated.
The company also operates WonderCon at Anaheim Convention Center and Alternative Press Expo at Concourse Exhibition Center in San Francisco, so they know “it’s possible to do shows outside of San Diego.”
One Group not so thrilled with the Coastal Commission’s decision is the National Football League’s San Diego Chargers. The approval of the SDCC expansion effectively dismissed the Chargers’ latest proposal for a combined convention center and stadium, which would have relocated the Chargers away from Qualcomm Stadium where the team has played since 1967.
“The Spanos family [which owns the Chargers] has been at work for more than a decade trying to find a publicly acceptable stadium solution in San Diego,” said Mark Fabiani, Chargers' special counsel to the president. “The downtown combined convention facility-stadium is only the most recent of our many proposals to have been shot down by the city’s elected officials and bureaucrats.”
In light of the decision, the Chargers are revisiting a former plan to redevelop the existing Qualcomm Stadium site and use revenues from the development to help pay for construction. In the plan, the city would provide the land to a private developer who would agree to finance the cost of the stadium along with the Chargers and the NFL. The developer could continue to develop the acreage to recoup their investment with a reasonable rate of return.
“Whether the economy and real estate market are strong enough to support this idea at this time is still unknown, as is the level of interest, if any, of the city in this idea,” said Fabiani. Each year between Feb. 1- April 30, the team’s lease allows them to relocate upon payment of a relocation fee to the city of San Diego.
“In 2014 that fee is specified in the lease as approximately $21 million,” detailed Fabiani, though no concrete decision as to whether relocation will be necessary has been made.
Interviewed for this story: Mark Fabiani, (858) 874-4500; David Glanzer, (619) 414-1020; Steven Johnson, (619) 525-5000
