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With or without Outdoor Retailer, leaders press on with convention center hotel

Published February 17, 2017 6:44 pm

Development • Long-harbored plans were not tied to Outdoor Retailers, trade shows, leaving.
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Utah's largest trade show announced its exit just as key players were hashing out terms for a convention center hotel that it had long called for.

Emerald Expositions' decision to exclude Salt Lake City from consideration for future Outdoor Retailer shows led stakeholders on Friday to reassure potential investors in a proposed 750- to 900-room hotel near the county-owned Salt Palace Convention Center.

Their explanation: The hotel was important to Outdoor Retailer. But Outdoor Retailer wasn't especially important to the hotel, which will do just as well with a much smaller convention in place of Outdoor Retailer.



"The reason that we looked at the convention center hotel as a missing piece in our portfolio really has nothing to do with Outdoor Retailer," said Salt Lake County Mayor Ben McAdams. "You don't build a church for Easter Sunday."

Hours before Thursday's news broke, landowner Vasilios Priskos confirmed he was in "active negotiations" with county-selected developer DDRM to site what would become the capital city's tallest skyscraper on the southeast corner of 100 South and West Temple.

Priskos owns much of what's known as Arrow Press Square (even though he razed the namesake building in December 2015) and said he's "never felt so good about the prospect of a convention center hotel," even if "nothing's finalized."

Friday, he was "very disappointed" that the local economy would lose Outdoor Retailer and its 40,000 annual visitors. But its threatened departure hadn't diminished the prospects of a convention center hotel, Priskos said.

"This project's been in play for 20 years. The Outdoor Retailers of this world are going to come and go. This hotel is not being built for Outdoor Retailer."

His site's primary competition is county-owned land on the northeastern corner of the Salt Palace, east of Abravanel Hall. DDRM CEO Stan Castleton said Friday that his team hasn't given much thought to county land on the southeastern end of the Salt Palace, where construction would interfere with scheduled conventions.

Of Arrow Press Square, Castleton said: "We're not 100 percent of the way there yet. That's the bottom line. There're some issues, and we're not ready to commit to that site just yet."

Disadvantages include at least one landowner who is currently holding out and a Rocky Mountain Power substation that would need to be moved, Castleton said. And while the city would allow DDRM to build higher at Arrow Press Square — the county's sites are capped at 375 feet — that brings increased risk.

"I'd be lying to you if I said I'm not worried about rising construction costs for a building of that size in today's world," Castleton said. "That's actually quite scary as you look out over the next five years, with inflation and so forth."

The other site would be cheaper and smaller — nearer to 750 rooms than the 900 expected at Arrow Press Square — though nearby condo owners have complained that a hotel would deprive them of their western valley view.

McAdams said that so long as the hotel meets parameters laid out in the request for proposal — built within 1,000 feet of the Salt Palace and to include 85 square feet of convention, exhibit and meeting space for every room — he's "agnostic, beyond that, as far as where it goes."

DDRM — dealmaking with landowners, investors and the county, with whom it's currently working out a term sheet — follows in the footsteps of Dallas-based Omni Hotels, which declined post-performance tax breaks of up to $75 million and walked away from the table in August 2015.

Negotiations with DDRM have now far exceeded the four-month period anticipated in the county's RFP. Castleton said it's crucial that stakeholders reach an agreement soon, given the need to raise capital.

Priskos said he met Castleton when a late-1990s deal for a 700-room Marriott fizzled at the same spot. Should Castleton decide to build elsewhere, or not at all, he has a "Plan B" to erect a smaller hotel at the site.

McAdams said that of about 100 conventions each year that pass on Salt Lake City, surveys indicate that about 30 are dissuaded by a perceived lack of nearby hotel space.

If a convention center hotel lured as many as five of those 30, McAdams said, it would offset the loss of Outdoor Retailer.

Scott Beck, president of the county-supported tourism and convention bureau Visit Salt Lake, said Friday that "whether it's a convention of 3,000 or 30,000," a convention center hotel would flourish just the same — even if it's a different story in other municipalities stretching north to south from Weber to Utah counties.

Beck added that Utah's conservative stance on public lands doesn't provoke the widespread distaste that sparked a convention exodus in Charlotte, N.C., after the state's controversial "bathroom bill" prohibited transgender individuals from using restrooms that fit their gender identity.

The outdoors industry was responsible for just two of the Salt Palace's 52 shows in 2016, Beck said, albeit the largest.

mpiper@sltrib.com

Twitter: @matthew_piper

 

 

 

 

 

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