Longform

Conventional Wisdom

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Pena pushed the Union Station site, and at one point it seemed all but certain the convention center would be built there. But questions over financing and the wisdom of locating the convention center away from the downtown core continued to dog the project, and opponents launched a successful petition drive to require a public vote on the proposal. The result was one of the biggest setbacks of Pena's career, as voters rejected the Union Station site 65 percent to 35 percent in 1985.

That's when the Colorado Legislature entered the fray. The state agreed to contribute $36 million to the project, with the proviso that final determination of an appropriate site would be given over to the Urban Land Institute, an independent Washington, D.C.-based research group. (With its contribution, the legislature also ensured that the new center would be named for the state, rather than the city in which it was built.) After studying the competing sites, the Urban Land Institute recommended the location on 14th Street next to Currigan Hall; Pena and other civic boosters endorsed the selection with a sense of relief that the whole controversy had come to a close. In those pre-Amendment 1 days, all it took was a vote by Denver City Council to approve the bond sale, and the deal was done. The job of designing the center fell to Curt Fentress, the Denver architect who would later be brought in on Denver International Airport.

"The impact of this will be very substantial, not just in terms of hotel beds it fills, restaurant business and shopping sales, but the spinoff of ancillary tourism as well," predicted Governor Roy Romer in 1990. The new center came in on time and within budget that spring, and civic leaders gleefully waited for torrents of new business to course through the streets of downtown Denver.

They were soon disappointed. The new center failed to meet projections almost from the moment it opened, and downtown hotels continued to suffer the same low occupancy rates they had hoped would be a thing of the past. In 1991 the center's gleaming environs were occupied less than half the time.

The responsibility for booking national conventions into the center falls with the convention and visitor's bureau, an independent agency whose annual budget is largely funded by a 1.75 percent chunk of the lodger's tax assessed on Denver hotel rooms. And the anger of downtown hoteliers over the convention center's weak performance soon found a target: Roger Smith, the president of the bureau.

Members of the bureau's board of directors, which includes the general managers of most of the major downtown hotels, were convinced Smith was doing a poor job of marketing Denver. They began plotting to remove him. When Smith refused to go quietly, a nasty internal dispute soon found its way onto the front pages of Denver newspapers.

After a public bloodletting that dragged on for months, Smith stepped down in 1993. Meanwhile, Colorado was earning reams of bad publicity after the passage of Amendment 2, and a national boycott of the "hate state" cut further into convention business.

Dilbeck took over as head of the bureau in 1994 and quickly placated the hotel managers on the board. He replaced much of the bureau's sales staff and is credited with helping to reverse the fortunes of the center. National convention bookings have increased from 30 in 1994 to 41 this year, and the number of convention delegates has gone from 154,350 in 1994 to an estimated 189,074 this year. The center's operating loss has also dropped, from $3 million in 1993 to $1.6 million last year. (Convention centers almost never make money, and Denver's annual subsidy, covered by a payment from the general fund, is small compared to those of other cities.)

The hotel industry is also sitting pretty compared with the grim situation of just a few years ago. Downtown hotels enjoyed an occupancy rate of more than 70 percent last year, and finding a room downtown during the summer can be next to impossible. Room rates are over $100 a night at many Denver hotels. When the expanded Adam's Mark Hotel opens late next year, Denver will also have its first 1,000-room-plus convention headquarters hotel, a longtime goal of city boosters.

Not all that expansion is market-driven, though. The Adam's Mark project, for instance, is being funded with $23 million in subsidies from the Denver Urban Renewal Authority. An earlier proposal to build a 1,000-room hotel near the convention center with $20 million in public funds was shot down in 1990 when downtown hotel managers complained bitterly about subsidies going to a competitor. However, the convention and visitor's bureau succeeded in getting most of the downtown hotels to support funding for the expansion of Adam's Mark, arguing that having a headquarters hotel would help all the downtown hotels by bringing more convention business to Denver and noting that the Adam's Mark project would add only about 375 new rooms to the market.

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Stuart Steers
Contact: Stuart Steers