Local News

Raleigh Convention Center in red after first year

Posted September 2, 2009
Updated September 3, 2009

— The $220 million Raleigh Convention Center lost about $1 million during its first year of operation, officials said Wednesday.

The convention center opened last Sept. 6 to great fanfare – and rainy, blustery weather brought in by Tropical Storm Hanna – with city leaders predicting it would become a key component in the ongoing effort to revive Raleigh's downtown.

Raleigh Convention Center Convention center brings thousands to Raleigh

Financial figures through the end of Raleigh's fiscal year in June show the convention center had expenses of $5.17 million while bringing it only $4.21 million in revenue during its first 10 months of operation.

Sales and marketing director Laurie Okun said the convention center has maintained that financial track during July and August and will close out its inaugural year with a $1 million loss.

"We did a lot of pre-selling and a lot of that pre-selling had to do with discounts. Sometimes you have to give and take," Okun said.

Still, city officials maintain that the convention center has proved to be a success.

The facility hosted 273 events in its first year, with a combined attendance of 353,041. The number of events was 6 percent above projections made last year by a New York-based consultant hired by the city, while the attendance figure was 56 percent above projections.

"The facility was not designed to make a profit. The facility was built to put heads in beds," Okun said. "We delivered on the hype."

Seventeen conventions that were held at the convention center during the year have already decided to return to Raleigh in future years, she said.

"We work very, very hard to back-fill what will make us money," she said.

Mayor Charles Meeker agreed that the convention center was an unqualified success at bringing people to Raleigh for conventions and trade shows last year. He added that area taxpayers aren't subsidizing the losses because the facility is funded through hotel and restaurant taxes.

"What it's designed to do is bring people here, in part to have meetings, but also to bring their money here to Wake County, where it's spent," Meeker said. "The county gets the return of that money by (having) people employed as well as (having the money) bouncing around the community."


This story is closed for comments.

Oldest First
View all
  • rdcress Sep 3, 2009

    Does no one realize that regardless of how many the center draws to Raleigh the ones who paid for the center never see one red cent. That's wonderful that a few people get jobs and there may be a little benefit to the general economy but the reality of the situation is that the tax payer never gets one bit of relief after having paid for this. If tax money was used then there should be a payback to the tax payers not just a few businesses - mostly hotel chains that take the profit out of state and country. I for one am sick of hearing about such ventures that aren't intended to make a profit. Oh, once again, someone else is paying. Get real, we all continue to pay and will for this and the next and the next. The collectivist mentality of the City or community benefiting is a crock.

  • Fun Sep 3, 2009

    Looks arent going to anything for taxpayers. They should put the civic center and Exploris on the national stage along with Meeker as the poster child for government mismanagement!

  • Frank Downtown Sep 3, 2009

    Now if they could just finish the space next to them with the music ampitheatre and finsih the "L" bulding around the parking deck it would look alot better in that area.

  • dbcooper41 Sep 3, 2009

    i'm glad i'm not subsidizing this boondoggle because it's paid for with meal taxes. oh wait a minute, i guess i am paying for it with every bite i take. suddenly my breakfaast doesn't taste quite as good.
    this project was welfare for construction firms from the beginning.

  • jgilchr Sep 3, 2009

    I think it takes time for projects such as these to turn a profit. Overall I do think the city had to make some money being these people needed hotels, food etc. while they were in Raleigh.

  • jet2rdu Sep 3, 2009

    Did anyone not expect to see this headline about the Raleigh Convention Center being in the red?

    Other coming "Being In The Red Headlines" you will see:

    North Carolina 2010-2011 Budget In The Red

    I-540 Northern Loop Toll Road In The Red

    Wake County School (fill in the year) Budget In The Red

    And one, if we finally elect officials with fiscal responsibility to the taxpayers, we hope NOT to see:

    Triangle Light Rail System Again In The Red

  • cartman Sep 3, 2009

    Since everyone is basing the convention center I'll explain a little about the economics. The convention center will most likely never make a profit, at best it will be break-even. What is does is draw people to Raleigh. Over 300K people attended events, many due to conventions. These people travel from other places to Raleigh. Let's say only half of the people rent a hotel room, or 150,000 people and they each stay one night (this is a conservative estimate), average hotel cost in Raleigh is $100 per night. 150,000 people x $100 = $15,000,000 ($15 million). I believe the room tax rate is 7%, so Raleigh collected $15,000,000 x 7% = $1,050,000. These taxes actually cover the loss from the convention center. There is also all the employees of these hotels who earn wages and pay taxes, and property taxes from the hotel. The convention center provides a financial benefit to Raleigh, you have to look past the sensationalism of the article.

  • kellyaustin96 Sep 3, 2009

    This just another tax and spend liberal project that was voted down by the taxpayers numerous times. Is anyone surprised about the outcome? When did it become the responsibility of taxpayer's to create occupancy for hotels?

    The supporters will say the tax revenue on hotel room occupancy wil help our local tax base. Just how much money do we need to teach someone 2 + 2 = 4? How much of the education budget is wasted on adminstrative staff? These are rhetorical questions because the aware know these answers. The Tea party climax will conclude with the November 2010 elections. Be there or be taxed to death!

  • Bob3425 Sep 3, 2009

    "city officials maintain that the convention center has proved to be a success" Anyone have any questions why were in the situation were in, with this kind of thinking

  • aspenstreet1717 Sep 3, 2009

    The true loss is much larger. This type of accounting would get you arrested in the private sector.