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Inn's Out

Portland Shelves Convention Center Hotel

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PORTLAND'S PROSPECTS for a convention center hotel are dead for the time being. Mayor Sam Adams, Multnomah County Chair Ted Wheeler, and Metro Council President David Bragdon agreed on Friday afternoon, September 18, to let the project's development agreement lapse.

The trio of local leaders had to decide by September 28 whether to continue researching and designing the hotel idea at a likely cost of $5 million to $12 million for the next phase. Adams had already asked for an extension on that deadline in December 2008. The mayor assembled a committee to look at the numbers in January, and in April the committee recommended continuing to pursue the project at a total expected cost of $247.5 million for the entire project.

Last week though, the county drastically revised its projected lodging and car rental tax revenues, a portion of which would have funded the $5 million to $12 million cost for the hotel's next phase. The county projected those taxes to bring in $2.1 million less in 2010 than they did in 2008, from about $11.7 million to $9.6 million—leaving insufficient money in the coffers to pay for the next phase, say the three elected leaders.

"Given the projections going forward, there just aren't funds available," says Wheeler. "This is a financial decision."

Others say Portland can't afford not to build such a hotel. The city lost 69 conventions in 2008 because of convention hotel issues—either because there's no big hotel opposite the Oregon Convention Center on NE Martin Luther King Jr., or because guests would have to divide themselves between too many smaller hotels—says Jeff Miller, president of Travel Portland, a public/private partnership agency that tries to lure tourists and business travelers to the region. Travel Portland booked a total of 426 meetings last year, which brought a combined $134 million to the region, including 50 conventions, Miller says.

"I'm disappointed because of the lost economic impact to the city," says Miller, who says Dallas just broke ground on a similar, 1,200-room, publicly funded project after having gone through a fight like Portland's, which has been contentious over recent years. "It's a lot about political will," says Miller.

"Obviously it's a more marketable facility if there's a hotel across the street," Bragdon says of the Oregon Convention Center. "But there are all kinds of factors in the convention business, some of which are beyond our control."

Adams says he wants to debrief the process and begin working with stakeholders on an alternative strategy to bring more tourist and convention dollars to Portland. Miller says he believes the mayor understands the importance of this process, but he also guesses that the convention center hotel idea may resurface again when the recession is over.

"The voters expect me to make business-like judgments when it comes to business-like decisions," says Mayor Adams, justifying the change in direction. "And the revenues weren't sufficient. There have been plenty of proponents and plenty of critics—it has been a polarizing issue. But my concern was to make a fair and impartial judgment."

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