Non-Environmental Cost-Benefit News

More than a year after the Custom Electronic Design & Installation Association decided to move its annual trade show out of tight quarters in Indianapolis, it's planning a comeback.

The massive CEDIA Expo will return to roomier digs in 2010 if city leaders succeed in adding 275,000 square feet to the convention center, razing the RCA dome to nearly double exhibit space. Association leaders were set to sign a multiyear commitment to Indianapolis midmonth, pledging to stay put through 2013.

The Indianapolis-based organization is moving its expo to Denver for three years beginning in 2006 and will spend a year in Atlanta before coming home. But officials can reconsider if the project isn't on track in 2008.

The CEDIA show is one of the city's largest annual events, attracting 24,000 attendees who spend $22 million. It was the first major event to announce plans to leave because of the space crunch, and the second to say it will return.

Last month, Laguna Beach, Calif.-based Performance Racing Industry agreed to return for four years beginning in December 2010 as long as the convention center is expanded. Luring PRI back means recapturing the $26 million its 40,000 attendees spend in the Circle City each year.

Together, the two trade shows could generate nearly $200 million in visitor spending during their four-year commitments. And the new business that is expected to flock to a larger center could spur another $165 million each year, according to estimates included in a 2004 feasibility study.

That's all ammunition CIB can use to rally support for the project, which includes a replacement for the RCA Dome.

With costs expected to exceed $700 million, some of the funding likely will come from higher hospitality taxes. That would require legislative approval, and CIB may seek other public support, too.

Before rate increases, a larger convention center would produce $8.6 million in newstate tax revenue each year, the feasibility study said. Glass told CIB members Nov. 8 that any request would be less than that.

As the need became more obvious, so did the site of the expansion.

After months of study, CIB settled on two possibilities: the RCA Dome parcel and property to the northwest now occupied by a state parking garage and, across West Street, a T.G.I. Friday's restaurant.

Glass said the northwest option has lost appeal. Among the biggest hurdles: the price. Expanding on the site of the dome is expected to cost $250 million; Plan B was more than twice that.

"With that kind of difference, I'm not sure the numbers work," Glass said.

Tearing down the dome would mean finding another home for the events held there now, but a new venue may have been in the cards anyway given the city's talks with the Indianapolis Colts and the NCAA's dissatisfaction with the 21-year-old facility as a site for its Final Four.

Still, the case for support of a $450 million retractable-roof stadium--officially a "multi-use venue"--is still coming together.

Consulting firm PricewaterhouseCoopers is studying the Colts' impact on the city and state, comparing the status quo to a scenario that includes a new venue. Results are expected later this month.

Glass expects to see numbers "well north" of the $72 million different consultants estimated in 1996, due in part to the team's success.

A new venue can't hurt, he said, and may help the Colts--and the city.

Under terms of a 1998 contract, the Colts could leave Indianapolis after the 2006 season if the team's revenue has not matched the league median for two of the past three years. Unless the city makes up the eight-figure difference.

City and team leaders have been working on an agreement behind closed doors, but Glass told CIB members a new venue would boost revenue.

Twenty-three of the 31 NFL cities have built or substantially remodeled their stadiums since the dome was erected in 1983, Glass said, which is raising the bar.

"That median revenue just keeps going up," he said.

Then there's the potential--if not likelihood--of an Indianapolis Super Bowl that would follow a stadium project, a one-time boost of $150 million or more.

And let's not let football overshadow basketball. This is Indiana, after all.

Indianapolis-based NCAA has agreed to stay put for the long haul and keep its hometown in a regular rotation for college basketball tournaments, as long as the dome is replaced or improved. Having the NCAA here has an economic impact of $65 million a year, Glass said, not counting the $30 million fans attending the Final Four spend.

By Andrea Muirragui Davis Volume 26, Number 36, November 15-21, 2004
Indianapolis Business Journal