Project “way over” $104M
Rooftop expansion far from starting; new price tag remains unclear.
A rooftop expansion of the Colorado Convention Center that downtown boosters portray as vital for its competitiveness still is far from launching — 16 months after voters approved tourist tax extensions to raise $104 million for the project.
Denver city officials now acknowledge that the tax money, to be raised from car rentals and hotel stays and used for borrowing, may not be enough to cover the complex project.
“It’s way over $104 million,” said City Council president Albus Brooks, who is part of the project’s leadership team and has kept tabs as multiple departments hammer out details. “But I think it’s too early to say how much.”
A more concrete price tag won’t be available until later this year, after officials and outside consultants finalize the scope of the project, the Department of Public Works said. A department spokeswoman said behind-thescenes preparations for the project were well underway.
The evolving wish list’s chief components include a large new ballroom, an expansive outdoor terrace with mountain and downtown views atop an existing parking garage, and technology upgrades throughout the center to accommodate emerging event needs.
But in response to questions from The Denver Post, DPW communications director Nancy Kuhn cited several factors that together could drive the final cost beyond the estimate given to the public in 2015. They start with the difficulty of undertaking an upward expansion on top of the northwest portion of the building. The addition also will push the
structure, including the existing building, into high-rise status in the building code — triggering new safety, fire and smokecontrol system requirements, along with a re-evaluation of emergency evacuation plans.
And then there are the expected logistical difficulties from undertaking a major renovation while the convention center stays open for business, adjacent downtown streets handle daily traffic and a light rail line runs through the building.
The amount of costly steel needed also could affect the price. And a labor shortage in the Denver area’s booming construction industry — a challenge for all big projects — may push costs higher.
Brooks cited another factor: the potential need for more fortification of the existing roof structure to support the load of heavy equipment for a kitchen and other services, seen as necessary to serve the new meeting space. The last large expansion, finished in late 2004, included significant structural support in the columns and foundation for an anticipated rooftop addition — but the building may need other support, Brooks said.
Together, all of those issues raise the possibility that city officials will need to find new sources of money to cover any cost escalation.
Or they could decide to leave some components out of the project.
“We have exceeded what we thought we were going to spend on this project, so we’re trying to scale back what we want to do,” Brooks said.
He later added: “I think the project is getting done — it’s just a question of premium, midgrade or economy. Obviously, everybody wants premium. However, we’ve got to balance out other needs in the city.”
“Every day we wait is costing more money”
But the potential for a higher cost and the pace of the initial stages have stoked frustration among some hotel managers and others attuned to the convention industry.
“I think Denver’s very well positioned. We just need all of these pieces to come together,” said Amie Mayhew, the president and CEO of the Colorado Hotel and Lodging Association, who also cited the need for a new large convention hotel next to the center. “Every day we wait is costing more money, and it’s another day that Visit Denver can’t be selling a renovated convention center.”
Tom Clark, the retiring leader of the Metro Denver Economic Development Corporation, helped lead the charge for the expansion. Individual convention shows are growing larger while the number of prospective shows decreases, he said, and that dynamic only heightens the competition among centers.
He shares city officials’ view that the rooftop project brings added complexity compared with the last horizontal expansion. Still, Clark said: “Like everyone else, I’m kind of going, ‘Can we get this thing done?’ ”
So far, the city hasn’t set a timeline for final design or construction.
But Kuhn says the project is moving forward, hitting milestones that include hiring a project manager last summer. City officials also selected contractor Trammel Crow Co. in February for a program management contract that will include helping to coordinate the design and construction phases.
Officially, project manager Adam Phipps said through the DPW spokeswoman that it was too early to speculate on how the 2-year-old “rough estimate” of cost — based on conceptual ideas in earlier studies — would compare to more detailed project plans.
“From the city’s point of view, we do not feel the cost of the project has gone up, as we never thought $104 million was going to be the actual cost of the expansion,” Kuhn said. “The $104 million number was based on a very preliminary vision — there was not a detailed project scope or budget in November 2015,” when city voters approved the tax extensions.
The ballot question, called Measure 2C, had support from Mayor Michael Hancock and civic and business leaders before it passed with nearly 66 percent support from voters. The measure wrapped up tax support for both the convention center expansion and the larger National Western Center project.
Both will benefit from permanent extensions of 1.75 percent portions of the city’s car rental and lodger’s taxes that had been due to expire in 2023.
More competition on the horizon
The Colorado Convention Center’s 2004 expansion cost $340 million, nearly doubling the giant structure and adding the 5,000seat Bellco Theatre. The center now has 584,000 square feet of exhibition space, ranking it 23rd nationally in a 2015 list compiled by Trade Show Executive — alongside convention centers in Phoenix, San Diego, Boston and Salt Lake City.
But its standing has slipped as other cities have undertaken large-scale expansions or made plans to grow.
And downtown hotel managers, city officials and Visit Denver — the convention and visitors bureau that promotes the center to meeting planners — are keenly aware that the Gaylord Rockies Resort & Convention Center is already booking events past its planned opening in late 2018.
The Gaylord center, which is under construction on 85 acres in Aurora near Denver International Airport, will have 1,507 hotel rooms and 400,000 square feet of meeting space. That compares with 769,000 square feet of total meeting space in Denver’s convention center.
“They could do a good percentage of what’s in our building,” said Richard Scharf, Visit Denver’s president and CEO.
Denver also is in the hunt for the huge Outdoor Retailer trade show, which is so big that even after the center’s expansion it would require temporary or offsite venues as a supplement.
More flexible meeting space is needed
The new convention center expansion is smaller than the 2004 project, but a 2014 market analysis by a consultant portrayed it as vital to Denver’s competitiveness. The analysis found a market need for more flexible meeting space rather than new exhibition halls, because the center currently can host 95 percent of the country’s trade shows and conventions, according to Scharf.
Recent discussions have focused on building out a large ballroom or other space covering as much as 80,000 square feet, with the possibility for subdividing it.
That and other amenities, including the terrace, would better accommodate small, medium and large meetings and events, Scharf said. The added space also would allow for large events to happen concurrently, reducing downtime while crews set up and tear down in event spaces — and encouraging more use of the convention center.
Visit Denver’s economic impact analysis estimates that convention center activity in 2016 resulted in $543 million in economic activity, including hotel stays and visitor spending.
If an expansion resulted in more bookings, as expected, that figure would grow by $47 million a year, the 2014 market analysis projected.
A master plan commissioned by the city set some priorities for the expansion, with the most emphasis on the rooftop expansion, renovations to some adjacent spaces in the center and the technology upgrades.
After that, the plan also recommends connections from the terrace to the Sculpture Park and the Denver Performing Arts Complex. It also eyes improvements to the center’s 14th Street frontage, to its drab light rail station and to the southeast Welton Street side as part of a bid to revitalize that dead street.
But those could wait, both for development around the center to make them timely — the city is working on plans for an overhaul of the DPAC — and for the money to pay for them. The master plan also cites the potential of private partnerships to shoulder some costs.
Scharf said Visit Denver, industry leaders and city officials are working together to make the expansion a reality.
“The good news is that everybody’s on the same page,” he said. “I know that it always appears that it takes a little longer, because there are so many details that need to be addressed,” given the complexity. “The ones that you build from the ground up in a field are (easier).”