Chargers Suggest Piggybacking On Convention Center Expansion
CAVANAUGH: I'm Maureen Cavanaugh. It's Thursday, September 22nd. If you think paying for a new football stadium and a Convention Center expansion in downtown San Diego is just too much to consider in this depressed economy, then how about combining the two? That's the idea being floated before members of the San Diego City Council. But Convention Center officials and hotels in the area don't seem to like the idea much. Joining me to talk about the stadium-convention merger proposal are my guests. Mark Fabiani is general counsel and spokesman for the San Diego Chargers. Hello. FABIANI: How you doing? CAVANAUGH: Great, thank you. And Steven Johnson is with us, he's vice president of public affairs for the San Diego Convention Center. Steven, thank you for joining us. JOHNSON: It's a pleasure. CAVANAUGH: Now, we invite our listeners to join the conversation, either by phone, 1-888-895-5727, or on twitter at KPBS midday to tell us what you think about this new idea. That's 1-888-895-5727. Mark, let me start with you because it's basically the Chargers' idea. The Chargers have asked their architects to draw up some stadium designs that would include convention space. It doesn't seem hike a natural combination. So how do you think it would work? FABIANI: Well, it is a natural combination all around the country. Only here in San Diego do we seem to find it revolutionary. Up the road, the entertainment group, one of the premiere companies in the world in this business is betting $2 billion of its own money that a convention facility and a stadium can work together. JOHNSON: Indianapolis has done it successfully, other cities have done it, and it works because it vaults you into a whole different world of events. For example, San Diego, even if it expands its existing Convention Center by a couple hundred thousand square feet will never be able to host the NCAA final four. It will never be able to host major boxing or MAA matches. It will never be able to host conventions that require a lot of flat, floor space such as would be available in a covered football stadium. So instead of expanding by a couple hundred thousand square feet, this proposal would basically vault the city into a different realm, able to attract major, major national events that we have no chance at now, and never will have a chance at. CAVANAUGH: Mark, I know that your architects are going to be rendering their ideas on what a design might look like. Can you give us any kind of a visual? How that might work, how a convention center could meet in a stadium? FABIANI: Well, national political conventions are a great example where you need large spaces in order to have the major speeches and the major events. And you also need then meeting rooms. And there is no reason why a football stadium built in a state of the art way can't do both things, can't prove the huge, large venue that is necessary for, say, a democratic or Republican National Convention, can utilize the suites and the other areas inside the stadium for meeting rooms. And then if you tack additional convention space onto that, say in the end zones, you answer a lot of opportunities for events that again San Diego will never have access to. We could never host a national political convention here. We could never host an NCAA final four here. Even if the existing Convention Center is expanded by a couple hundred square feet. CAVANAUGH: The proposed stadium alone has an estimated price tag of $800 million. How much more would it cost to add these convention capabilities that you're suggesting? FABIANI: Well, the best example is the one I mentioned earlier. The an choose entertainment group is proposing to use its own money to privately finance a similar project in Los Angeles, at a cost of $1.2 billion. They're showing if their mates are accurate that you can billed both of those facilities together far more inexpensively than you can build them separately. Of course we don't have a design for the San Diego facility yet. So I can't give you hard numbers. But it only stands to reason. You're not building separate food service facility, you're not building separate meeting rooms if you have the suites and other public areas available inside the stadium. You're making dual use of all of these things, this far you're going to save considerably to the construction cost. CAVANAUGH: I am speaking with Mark Fabiani, he is general counsel for the San Diego Chargers. And my other guest is Steven Johnson, vice president of public affairs for the San Diego Convention Center. We're talking about this idea that's being proposed by the Chargers to have a dual-use stadium, downtown football stadium, that would include expanded convention space as part of the stadium design. We're taking your calls at 1-888-895-5727. Steven Johnson, let me go to you. The initial reaction to this plan is highly doubtful is that fair to say? JOHNSON: It's very fair. CAVANAUGH: What are your concerns about this idea of merging these spaces? JOHNSON: At first, I have to say that it's great to keep the Padres here, it's great to keep the Chargers here. It helps us sell San Diego. So it's not an anti-Chargers position. It's really about what's going to work and what we can sell. The mayor's task force went through and vetted that very question three years ago. And they looked at the very site mark has been talking about for the stadium. And in that research we talked to the top meeting planners that have come to San Diego who have outgrown us, who want to come back, or who would use the facilities, two separate facilities. And they were very clear with us that they viewed it as two separate facilities. That they would not book those facility it is together. That their exhibitors would feel like they were the kids shuffled off at a Thanksgiving dinner at the kids' table because they weren't part of the big party and they couldn't sell it. And they have to sell to the exhibitors. So they also voiced serious concerns about the distance from the hotels in the current facility to a site more than six blocks away from the current facility. That said, two things I'd like to respond to what was just said. Number one, what LA is doing is building a stadium right next to the Convention Center. It is right next door. So it is not a six-block walk from one to the other. Number two, the idea that San Diego hasn't done similar, when you think about it, is really not true. We built Petco Park across the street from the San Diego Convention Center. We use Petco Park, our clients use Petco Park, so we already have the ability to put large groups of people in the seats of Petco Park or use it as a smaller venue as well. We partner closely with the Padres in the use of Petco Park. We did that a long time ago before LA even thought about it. San Diego has been very innovative and up front. And I think the approach that the mayor has taken on this has been right on the money, which is to continue with the expansion of the current Convention Center as it's been planned and to continue to work with the Chargers. CAVANAUGH: Don't you actually have some concerns too about booking conventions with the NFL as well? JOHNSON: Oh, yeah, the stadium would be blocked out. I'm not exactly sure when the NFL puts out their schedule, I think it's within a year. But we book 5 to 10 years out for these big events. So the very goal that mark speaks to of trying to have these super groups etc, they won't book. It's I huge operation to bring in 40,000 people and give them hotel rooms. So they book 5 to 10 years out so they have this space so they can do the things they need to do to execute a huge event. CAVANAUGH: I want to get mark's reaction, but one more question before I do that. How are members of the hotel industry reacting to this idea? You're saying that the downtown hotels don't necessarily like it because the stadium convention expansion merger would be too far away? JOHNSON: Well, are it's not only too far away, but they view it as not the best option for their investment. They would be the primary funders of the Convention Center expansion. They have to assess themselves. Of and they do not want to trade an expansion of the current facility, which would be able to bring super groups into the building and groups we have lost Mike health information, management solutions, with first thousand people into San Diego for a facility six blocks away that would mean that we would never get that type of business back. So they know the market very well, they understand what the meeting planners want. They have been a part of the mayor's task force. And the lodging industry association on Monday voted unanimously to support an expansion of the Convention Center as a contiguous exhibit hall space which will make us the largest exhibit space on the west coast. CAVANAUGH: What about this six-Brock walk that everybody's having a major problem with? FABIANI: I have to laugh at that in that cities all around the country have made this kind of project work. And that's why we weren't particularly surprised since we've seen it before in San Diego, people are determined here for some reason to squash ideas the moment they're revealed rather than having an open robust debate. It's as if you're asking people to fly to the moon. You're asking people to walk a few blocks in an area that has a great climate. I think those of you who have been to ComiCon year after year understand that ComiCon now happens all over downtown San Diego, not just in the Convention Center. There are events all over San Diego downtown. Blocks and blocks from the Convention Center. So the idea that people can't walk a few blocks or don't want to walk a few block, and must be kept in a hermetically sealed environment, if that's the case, the hotel people who are being asked to pay for this project who have hotels in mission valley or La Jolla or elsewhere, they ought to be really worried because they're not going to get any additional business if the Convention Center's position is that people won't walk a few blocks downtown. CAVANAUGH: But will your architects be addressing any of these issues in proposing any sort of transportation or tram system or -- FABIANI: Oh, sure, these are issues, again, other cities have managed them. They've managed them well. And there's no reason why we can't with an excellent climate here in San Diego manage the issues just as well as the other cities have. We have a no-can-do attitude here. Any time something that's way out of the ordinary is suggested, you have people who say oh, we could never do. JOHNSON: I guess I just would counter that by saying I don't think people are just saying no can do. I think what we're doing is pointing out that the research that was done as part of looking at the site that mark's talking about, three years ago, with the mayor's task force. And there's a lot of stakeholders that were involved in that process. And we went out to the clients themselves and had multiple interviews and talked to the actual people who will buy the building. They're the ones we listen to because that's who we have to sell it. You can characterize it that way if you want, but I wouldn't suggest that is an accurate characterization. I think it's just us sharing what we've learned through this process. We've been in this process to expand the facility for four years. Of the hotels are the primary funders, and if they have a strong negative reaction to it because they don't feel they're going to get their return on the investment that they're going to pay, I think that's valid to raise. CAVANAUGH: Now, yesterday at the City Council budget committee hearing, the Convention Center was asked to supply some information about the people who did not book at the Convention Center because it was overbooked as opposed to the conventions that did not use San Diego's Convention Center because it was too small. JOHNSON: Correct. CAVANAUGH: The idea being, if the major problem is that it's overbooked, that the idea of a stadium/Convention Center expansion might make sense. Doesn't that argument -- JOHNSON: That was a conversation that was happening in the mayor's citizens task force as well. And there's a whole component of the report that speaks to that. There's really four reasons we want to expand the current facility. One, attract business that was always too big to fit in the current facility, number two, get business that we've lost because they outgrew us back into San Diego. They want to come back but the building is too small. Three, keep the ones that are currently ready to outgrow us like Comicon and number four, be able to stack multiple group the. And the reason we want that, it pushes occupancy out of downtown into mission valley, fashion valley, etc. Two smaller buildings are not going to push the kind of occupancy into mission valley, fashion valley, etc, that we need. So as a result the city is not going to collect as much TOT revenue on the investment of the expansion of the Convention Center. I don't think it's a way to maximize the return on the facility by splitting it. CAVANAUGH: Let's take a call. Jessica is calling us from San Diego. Hi Jessica. NEW SPEAKER: Hi. I had a comment. I've been attending ComiCon fair long time. And I completely agree. I'm totally with expanding the Convention Center. Even though we are using a lot of downtown, it's frustrating when you find out about something that was going on downtown that could have been going on in the Convention Center but you didn't know about it. Or when you're trying to get into a particular panel at ComiCon and you have to make a choice because you either have to stay in the Convention Center or you have to go to a hotel. CAVANAUGH: Right. NEW SPEAKER: So if you look at -- another thing too, is unfortunately I love the Chargers, but look at how many games they're getting blocked out. How are you going to replace the revenue if you do build this new stadium for the Chargers? Because it's supposed to be for them, namely. CAVANAUGH: Thank you for the call. Lots of questions there, mark. I don't know that we have time to actually address them. We're just about out of time. Let me ask you in closing, mark, when do you think that we might actually see something, some sort of visual proposal for what this combined use stadium might look like? FABIANI: I talked to our architects this morning. They have been working on this for a couple weeks now. They've still got some work to do. We're still talking to people around town to facility their ideas. I'm hoping in the next month or so, you'll have something to look at. Unless the idea is just so vigorously shouted down that we're not even allowed to have a debate about it in San Diego, which I think would be unfortunate. Of course it's happened benefit. And it might happen here again. But our view is this is not an issue that should be decided by people who run hotels or people who run the Convention Center or by the Chargers. This should be an issue that's decided by the voters. And if the voters think that one plan is better than another plan, it should be up to them, not the people necessarily who have hotels right next to the existing Convention Center. So we're fair vigorous public debate, and hopefully a vote on this. CAVANAUGH: Well, both of you can always debate that right here on KPBS midday. JOHNSON: A pleasure. CAVANAUGH: I want to thank Steven Johnson, vice president of public affairs for the Convention Center. Mark Fabiani with the San Diego Chargers, thank you both thank you very much. JOHNSON: Absolutely. FABIANI: Take care now.
Mark Fabiani, General Counsel, spokesman, San Diego Chargers
Steven Johnson, VP Public Affairs San Diego Convention Center