Faced with intensifying competition from cities that are building or modernizing meeting facilities, managers at the Buffalo Convention Center are eyeing radical strategies for drumming up business, including the possibility of offering rent-free space to some out-of-town groups.
But to offset tens -- perhaps even hundreds -- of thousands of dollars in rent revenues, facility managers said they would likely need financial help from major hotel operators and local governments.
While officials stressed that the idea is only in the discussion stage, they underscored the importance of forging a "creative" strategy for weathering what could prove to be a challenging era. There are indications that plans to build a new $124.5 million convention center could be delayed for more than a year, meaning that the existing convention center will likely remain in use for at least four or five years.
Phil Kadet, the convention center's accountant, suggested Thursday that offering rent-free space to large out-of-town groups might be a shrewd investment.
"We would be better off if we rented the space for free and made our money on food service than if we have no conventions here," Kadet said at a meeting of the center's board of directors.
Richard Geiger, president and CEO of the Greater Buffalo Convention & Visitors Bureau, confirmed that offering drastically reduced rates or even free rent to certain out-of-town entities has been one of several ideas that has been "kicked around" in recent weeks.
"We have to come to grips with the fact that we're dealing in a marketplace where we're at a competitive disadvantage," Geiger said. "We're competing against cities that have newer, larger and more modern facilities. We realize that we're going to have to be creative."
But the general manager of one of the region's largest hotels said the discussions underscore the "desperate" state that Buffalo finds itself in as it struggles to compete with comparable cities that have launched ambitious plans for new or expanded meeting facilities. Thomas R. Pagels, who runs the Hyatt Regency Buffalo, urged local officials to put the new convention center project on a fast track.
"We won't go anywhere in the industry if we try to sell a product that is old and dilapidated," said Pagels. "Without a new facility, we simply can't compete. And the situation is becoming desperate."
Earlier this week, County Executive Joel A. Giambra said he believes the county is legally required to complete an environmental impact statement before proceeding with preliminary design work on a new convention facility. Giambra argued that the public should be be given more time to comment on the project and on a recommendation that it be built on Mohawk Street, a site that has become the focus of noisy debate in recent months.
Project advocates have raised concerns that Giambra's stand will likely delay the project for 12 to 18 months. They said it will be increasingly difficult to market Buffalo as a convention destination.
The existing convention center is 22 years old and managers said the facility's size and outdated features prevent it from competing for about half of the conventions that are held in the United States. They said the new facility would allow the area to be a contender for about 90 percent of that market.
Ironically, the existing center just finished its third-best year in terms of overall sales volume and ended 1999 nearly $195,000 in the black. Food and beverage sales were up more than 45 percent over 1998's levels.
But Dan D. Kohane, chairman of the convention center board, warned it could be difficult to fill the aging building with events over the next several years.
"People are going to want to go to larger, more modern facilities," Kohane said. "As every expert has predicted, there is going to be a downturn in business."