Never about that plan of salvation.
The Washington State Convention Center expansion project, which saw its funding for the devastating epidemic and subsequent devastation of the travel and tourism industry, secured funding to complete the project, developers announced this week.
The developers of the Months project have been warning for months that their money is running out to complete the $ 1.9 billion project, and that if the government loan is not secured, construction will stop this year, leaving a useless steel-concrete structure in the city center. Seattle
King County has promised to find a way to provide a $ 100 million loan for the project. Seattle և Washington’s both said they were looking to raise or somehow find an additional $ 200 million to make up for the lack of funding for the project.
But now that more than 100 million Americans are at least partially vaccinated against COVID-19, millions more are being vaccinated every day – an economy that seems ready to jump back – the convention center provided private funding to complete the project. which was always a plan, a pre-epidemic.
“Given the fact that private financial institutions were ready to invest in the Convention Center’s debt this week, investors believe that our regional economy is improving rapidly, that tourism and conventions will quickly return to pre-epidemic levels,” said Dow Costandin, CEO of King County. : prepared in the announcement. “When the situation seemed difficult for the Convention Center, we were ready to intervene, help save 1,000 construction jobs, maintain momentum for this economic development project.”
On Wednesday, the Convention Center sold $ 342 million worth of bonds that developers say should be enough to complete the project, with ribbon cutting scheduled for the summer of 2022.
This և previous financing of the expansion plan is provided by the presentation of future King County tax revenues. In fact, it is a bet that a larger convention center will bring in more hotel guests, who in turn will pay more hotel taxes, which will then be used to cover the cost of building a larger convention center.
But when the epidemic happened, people stopped traveling. Revenues of downtown Seattle hotels fell more than 90 percent from a year earlier, according to the Downtown Seattle Association. Suddenly, betting on future hotel tax revenues did not seem so certain to investors, և salvation was saved.
About a year ago, project managers began to warn that their money was running out.
“Here’s what has changed,” said Matt Griffin, chief executive officer of Pine Street Group. “Six months ago we did not have a vaccine, we did not have these big stimulus packages, what really happened in the bond market, people realized that the recovery phase was coming.”
“People will have to travel again. “We can take some risks,” he said.
Griffin said their bankers contacted JP Morgan about six weeks ago, who said they were looking for private financing again, as if that might be an option.
“They said the world is changing, we can go back, maybe we can go back to the old plan,” Griffin said.
Griffin said the convention center still plans to raise about $ 55 million in federal funding from Washington state to cover the increased construction costs associated with the epidemic.
There was an order for more than $ 3 billion for the $ 342 million bonds, which were sold at a 2.8% interest rate, according to the convention center. “Evidence from Seattle’s long-term bond market strength.”
The Atlanta Convention Center project went worse last month, selling $ 440 million worth of bonds with a 4.2% interest rate.
Treasurer Mike Pelichciotti had to approve the bond offer.
According to Pelichciotti, the sale shows that “the private market has confidence in the future
“The growth of tourism in our state, while freeing up state money so that states and local governments can now spend it on Washington’s other potential recovery and investment needs.”
It is unknown at this time what he will do after leaving the post, as business trips have virtually ceased and conferences have been canceled. Houston says more contracts have been signed for the second half of this year than for the same months of 2019.
Predictions are different in Seattle. The president of the Downtown Seattle Association sees that congresses and business trips will return in early 2022, while the CEO of Visit Seattle said earlier this year that he does not see a complete recovery of the city’s tourism by 2024.
The bond offer package, compiled by the convention center, predicts events for the 22 convention centers in the second half of 2021. In 2019, 212 events took place.
In all, 71 groups canceled the conference center due to the epidemic. 14 of them have been postponed for years to come, 26 are considering reshuffling, and the rest will not be moved, according to the convention center.
The Conference Center has so far booked 30 events for 2022 and 27 for 2023.
When the extension is opened, it will double the capabilities of the center կտ allow multiple events at the same time.
“Although future bookings are not at a normal rate, as the COVID-19 epidemic has caused disruptions for 18 months,” the convention center wrote in its bond offerings, “they are associated with associations, corporate planners and consumer show executives who demand future dates.” “Expressing readiness to have meetings in 2022, to seek information for planned purposes.”