In 2010 and 2011, convention and meeting events generated upwards of $1.1 billion combined in “economic impact” for Boston, according to a recent statement from the Massachusetts Convention Center Authority (MCCA).
The MCCA doesn’t precisely define how it calculates “economic impact,” so we can only assume it includes the cash spent on hotel rooms, meals, drinks, transportation and sightseeing, among other things, by all those conventioneers within our wonderful city.
That’s all incredibly valuable business. It’s business we’d love to see grow, if even incrementally.
But it isn’t business that has to grow in order for this city to thrive.
The MCCA has set an ambitious goal to make Boston into one of the top five convention and meeting destinations in North America – a list that currently includes Las Vegas, Chicago, New York, Toronto and Orlando, in descending order of popularity.
The thing is, places like Vegas and Orlando offer budget-conscious travelers a dazzling array of options on where to sleep, eat and drink – from five-star to dive bar.
Not so in Boston. In 2010, the average daily rate for hotels in Boston was $195.31, according to the Greater Boston Convention and Visitors Bureau. By comparison, Sin City’s average daily rates came in 45 percent lower in 2011, at $106.44, according to the Las Vegas Convention and Visitors Authority.
On t5boston.com, the MCCA’s website touting its top-five ambitions, it repeatedly mentions the need for more “mid-priced” hotels near its flagship Boston Convention and Exhibition Center facility in South Boston. More and cheaper hotels means more room stays, means more of that nebulous “economic impact” so widely sought.
But its statements ignore the simple reality that, in Boston especially, any new hotel construction is going to have to be for extremely high-priced rooms to win back any kind of return on investment for its developers. New, urban hotels aren’t built to be mediocre properties, and it can be assured that their older counterparts won’t be keen on lowering their own prices simply out of respect for the new kid on the block.
The MCCA rightly recognizes the need to increase overnight room stays – some of its most popular upcoming shows also boast some of the weakest anticipated hotel room nights. The group states that the 2012 Penny Arcade Expo (or Pax, as it’s known to its legions of nerdy, video-gaming attendees) is expected to generate some 70,000 visitors. But it only expects the show to generate 7,900 room stays – roughly one overnight room for every 10 attendees. And that’s over multiple days.
Pax attendees, it could be argued, aren’t among the most well-heeled, and may also be coming from nearby locales. But what’s the argument for the National Cable and Telecom Association show, expected to pull in 15,000 presumably far wealthier attendees, but only generate 13,840 hotel stays – again, less than one night per attendee?
One solution to this, of course, is to have the public fully or partly subsidize construction of a new, huge, and presumably “mid-priced” hotel to help convince conventioneers to stick around and open their wallets. This is on top of subsidies already charged for the MCCA’s existing facilities in the form of rental car surcharges, tour fees and certain cab fares paid by the very folks the MCCA is trying to attract more of: Tourists.
Setting aside the argument that Joe Taxpayer is rightly fed up and already overextended, would we really want to be subsidizing some middle-of-the-road property meant to attract the more budget conscious traveler? Of course not.
Look, there’s no easy way to say this, so we’ll just come out with it: The MCCA is being too ambitious.
Boston, right now, can’t afford what the organization says we need to jump to the next level. Nobody likes to say “good enough” is good enough, but in this case, it has to be. For now, anyway.
The “mid-priced” alternative is still just too expensive.
