RFP Proposed for Convention Center

[vicupstate]

I seem to remember that the Hyatt's first right of refusal isn't a new thing - like its been a thing for a while as the Courthouse/City Hall's days were numbered when the Hyatt (then Adam's Mark) broke ground, but I could be wrong.

I mean, there are certain advantages that the Hyatt naturally has (which also benefit the city) being next door, because one large facility could be developed.

I am 99.8% certain that when the Adam's Mark (now Hyatt) was built they were given the first right of refusal as part of their development deal. The key will be what does that mean exactly, as Charles Hunter mentions. Can they simply buy the land and sit on it or do they have to do something within a certain period of time, and what constitutes 'something'.

I can't imagine anyone submitting a bid for this without the proposal including a very substantial investment by the city. Free land, and serious cash on the order for $50-100 mm would be my guess.  They probably would expect to pay no property tax or have the taxes put back into the property in some way.

[Steve]

I seem to remember that the Hyatt's first right of refusal isn't a new thing - like its been a thing for a while as the Courthouse/City Hall's days were numbered when the Hyatt (then Adam's Mark) broke ground, but I could be wrong.

I mean, there are certain advantages that the Hyatt naturally has (which also benefit the city) being next door, because one large facility could be developed.

I am 99.8% certain that when the Adam's Mark (now Hyatt) was built they were given the first right of refusal as part of their development deal. The key will be what does that mean exactly, as Charles Hunter mentions. Can they simply buy the land and sit on it or do they have to do something within a certain period of time, and what constitutes 'something'.

I can't imagine anyone submitting a bid for this without the proposal including a very substantial investment by the city. Free land, and serious cash on the order for $50-100 mm would be my guess.  They probably would expect to pay no property tax or have the taxes put back into the property in some way.

I don't think someone would ask for THAT much....maybe if Rummell and Munz bid I suppose:)

My feeling is that some sort of Public-Private partnership will be proposed, which makes sense for a development like this. Personally, I think the owners of the Hyatt (Westmont Hospitality) would be great candidates to bid themselves. I read they own something like 500 Hotels, so for them including another smaller hotel wouldn't be a stretch, unless they think they couldn't fill them. In theory, a good convention center handles both.

I'm posting about this in a week where I'm going to Columbus, Ohio for a convention (low Wednesday night is 29 Degrees - yes it's April). The main building is a 375k SqFt facility. I can tell you the convention I'm going to likely takes up 1/3 of that.

[vicupstate]

Actually I think $50-100 mm would be the floor not the ceiling. These centers simply do not make money and the hotel and other revenue streams would not cover the deficit. A 1,700 car garage is a huge money loser as well. Plus JAX is trying to establish a new convention market in an industry that is overbuilt to begin with. 

If you are visiting Columbus for the first time, be sure to visit the Short North Market that is just a couple of blocks from the CC. Columbus is a great city to visit. Be sure to walk/drive around as much as you can.  Just blow off the seminars and be a tourist ; )     

[Steve]

As much as I complain about Columbus, I've been quite a few times. Outside of the weather it's a great city.

I do agree about the Garage - that's massive. In terms of the Convention Center in general, I sort of look at it as a "loss leader". The Convention Center might not make money, but the idea is everything around it should, and hopefully it doesn't become a money pit.

How much money does the Prime Osborne Lose? How does that compare to projections on a new one?

As an example, Oklahoma City is working on theirs (Article from 2016 below). They're planning for 500k SqFt for $287M. Now, apparently they don't need structured parking to get to 1,200 spaces (700 Center, 500 Hotel-based), but would to get to the 2,000 number they want. Interesting discussion.

http://newsok.com/article/5480802

[Steve]

BTW, I'm still not sure where you're going to get 1,700 spaces, unless it's a tiny footprint garage that's a mile high. I can't see how you get the convention center, hotel, and garage on these two blocks.

It would have to be one VERY vertical center. Perhaps if you can move the JEA water treatment plant a half-block away, then do a garage there?? I'm not in favor of an earlier plan that demo'ed the two story buildings at the corner of Newnan and Bay.

[KenFSU]

Actually I think $50-100 mm would be the floor not the ceiling. These centers simply do not make money and the hotel and other revenue streams would not cover the deficit.

"We have a great opportunity for a high-end hotel/convention center, which this town really needs. It's something we are going to try and work with the city on." - Shad Khan, November 2016

To me, Shad Khan/Iguana is the only potential private partner that makes sense.

1) Shad Khan has stated for years that Jacksonville needs a new convention center; he's expressed interest in partnering with the city on it; it was part of his first two Shipyards plans. As we've seen with Daily's Place and the entertainment complex for Lot J, he's not married to any specific location as much as he is married to the idea of getting it off the ground.

2) The Jaguars are going to announce a 250,000 sf entertainment complex later this month for Lot J that can't be sustained only by game-day activity. A convention center at the Old Courthouse site, linked to the entertainment complex via Bay Street improvements that the Jags already consider critical to the Shipyards project, would potentially drive tens of thousands of additional visits to the entertainment complex, annually.

3) Further, Iguana has already been selected to develop the Shipyards. A thriving convention center adjacent to the Shipyards could only benefit Iguana.

4) Iguana has already started to dip their toe into the convention/events market via Bold Events, including the upcoming One Spark revival. Khan, Lamping and co. consider it a vital revenue stream for the organization. Partnering on a convention center would be a natural evolution for Bold Events.

5) Khan clearly has his heart set on a five-star hotel in Jacksonville, possibly a Four Seasons. Again, you can't sustain that off the back of 8 football games a year. A convention center directly benefits his hotel project, wherever said hotel ends up being built.

The city covers Bay Street improvements, splits the cost of the convention center with the Jags, Jags serve as project manager, Bold Events manages the venue.

Jacksonville gets a badly needed new convention center at 50 cents on the dollar and all the positive tourism and business externalities that come with having a modern facility, the Jaguars get an additional revenue stream for Bold Events and all the positive externalaties for the Shipyards/Lot J/Daily's Place/Khan's hotel that come with having a new convention center in Jacksonville.

[Steve]

Maybe, but don't count the Hyatt ownership out.

Booking a concern isn't the same a booking a large corporate convention. The Hyatt Ownership (plus Hyatt in general) have a LOT of experience in the convention and hotel business.

[vicupstate]

The city covers Bay Street improvements, splits the cost of the convention center with the Jags, Jags serve as project manager, Bold Events manages the venue.

If so, that would easily cover the $100 million in my prior post.

It is pretty much a given that Khan is going to bid and will have an inside track, but Hyatt could be in a position to be a spoiler. Of course, it is probably more likely that they might welcome Khan doing it.

BTW, isn't LOT J a no- go based on contamination? If it is contaminated, why not just go back to the first idea of Shipyards or Met Park?   

[KenFSU]

To answer your question, Vic, Lot J is contaminated, but the Jaguars are confident that it can be cleaned and developed much more quickly than the Shipyards and/or Met Park, particularly when you factor in the ramps. They're going to reveal the project plan at the State of the Franchise event later this month.

[BenderRodriguez]

I know I may be looking waaaaaay into the future on this. But, what the over/under on the current convention center being retro-fitted for once again being a train station when a new convention center takes off?

[marcuscnelson]

I know I may be looking waaaaaay into the future on this. But, what the over/under on the current convention center being retro-fitted for once again being a train station when a new convention center takes off?

I remember there being rumors/murmurs about the possibility of Brightline being a quiet mover & shaker in recent events, with the potential goal of making Union Terminal a station for them.

I'm just hoping they'll take the convention center part and make it a Park-Line TOD.

[vicupstate]

I know I may be looking waaaaaay into the future on this. But, what the over/under on the current convention center being retro-fitted for once again being a train station when a new convention center takes off?

Assuming the Convention Center does actually get built, I would say it is virtually certain. What else would you do with it?

[FlaBoy]

I know I may be looking waaaaaay into the future on this. But, what the over/under on the current convention center being retro-fitted for once again being a train station when a new convention center takes off?

Assuming the Convention Center does actually get built, I would say it is virtually certain. What else would you do with it?

With its meeting space and stately architecture, it would be a great location for an educational institution of some sort, a museum as well, or both. Eventually, it should have some purpose as a train station as well, especially Amtrack. But if we are counting on Brightline, that may be well into the future. 

[Steve]

I know I may be looking waaaaaay into the future on this. But, what the over/under on the current convention center being retro-fitted for once again being a train station when a new convention center takes off?

Assuming the Convention Center does actually get built, I would say it is virtually certain. What else would you do with it?

With its meeting space and stately architecture, it would be a great location for an educational institution of some sort, a museum as well, or both. Eventually, it should have some purpose as a train station as well, especially Amtrack. But if we are counting on Brightline, that may be well into the future. 

Amtrak is the key to move from the awful Northside Location. There may be some track work needed as the track to the side of the train station is the FEC Line (next to US1). Amtrak uses the CSX Line (next to US17).

[thelakelander]

Without millions from an outside source, I don't see Amtrak coming back downtown any time soon. I also don't see anything rail related seriously happening with JTA either. For Jax, it's Brightline or bust for this generation.