Chicago stands to lose $747M
That’s hit to economy just on 33 canceled conventions alone
Chicago could take a $747 million economic hit because dozens of conventions scheduled to take place in the city have canceled due to the fast-spreading new coronavirus, according to an estimate from a McCormick Place spokeswoman.
The impact includes lost spending from event attendees at hotels, restaurants, transportation and entertainment venues.
COVID-19, the disease caused by the new coronavirus, has prompted governors across the country to issue shelter-at-home orders to reduce the spread of the virus. On Thursday, there were more than 82,000 confirmed cases in the U.S., the most of any country.
Conference organizers are canceling events well into the summer, and hotels in the city are temporarily closing as the virus continues to hinder the hospitality industry.
The Sweets & Snacks Expo, the National Restaurant Association, the American Library Association and the American Society of Clinical Oncology nixed their summer shows, bringing the total number of event cancellations at McCormick Place and Wintrust Arena to 33 as of Thursday, McCormick Place spokeswoman Cynthia McCafferty said in an emailed statement.
Altogether, the 33 shows would have brought about 484,000 people to Chicago, McCafferty said. The conferences also accounted for about 533,000 hotel room nights.
McCafferty said about 60% of the shows would return later in the year or next year.
By not having those events, the city will see a decline in the tax revenue it generates from hotels. In its budget overview, city leaders had projected hotel tax revenue of $128.5 million in fiscal 2020.
“The convention industry typically generates about 5 million room nights annually out of 12 million total rooms sold in the central business district. We will probably lose
over 20% of those (convention industry) room nights, and that’s assuming few more cancellations and some rescheduling of meetings and shows that have been canceled in the short-term,” said Chicagobased hotel consultant Ted Mandigo.
Mandigo said April through June is the prime season for conventions, and the city doesn’t see another spike until the fall.
Hotels, restaurants and transportation vendors are among the companies that depend on convention business.
Chicago-based Continental Air Transport operates a fleet of 45 vans and SUVs under the Go Airport Express brand, which transports passengers between McCormick Place, hotels and O’Hare International Airport.
John McCarthy, president and CEO of the firm, said he is looking at federal assistance programs like small business loans that he could use to help pay employees and fund health care plans.
The firm laid off 30 workers earlier this month, most of whom are drivers, McCarthy said.
“This would be a busy time of the year for the business. We carry tens of thousands of passengers, but now we’re only carrying a handful,” he said.
But federal aid won’t be enough to shore up business, McCarthy said. The shuttle service provider relies on tourists and conventiongoers, and with more event cancellations well into the summer, Go
Airport Express could continue to suffer, he said.
“The convention center is an important part of our business. … Right now we’ve limited services to private rides, which typically has little demand. We also continue to operate a parking lot shuttle service at O’Hare paid by the city’s Aviation Department,” McCarthy said.
McCarthy declined to say how much money his firm lost for the month. However, he hopes events scheduled to take place at McCormick Place later this year will make up for some of that lost business.
“I hope this is over soon,” he said.