Georgia World Congress Center reports $1.3 million loss

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By Leon Stafford

The Atlanta Journal-Constitution

Dan Graveline knew fiscal 2009 was going to be a tough year at the Georgia World Congress Center when he projected a loss of about $800,000.

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W.A. BRIDGES JR., AJC Dan Graveline runs the GWCC.

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But when the final numbers were released Tuesday at the monthly board meeting for the nation’s fourth largest convention center, that loss ending up being $1.3 million.

It’s the first loss the center has seen since fiscal 2005, a year after opening its third building. It also is expected to be followed by a bigger loss in fiscal 2010, which began July 1.

“I will submit to you that the glass is still half full,” said Graveline, executive director of the behemoth downtown facility. “All in all, it’s been a tough year, but we’re pretty proud where we ended up.”

Why so positive? Because Graveline said it could have been worse had officials not cut expenses — freezing salaries, leaving open positions vacant and putting big projects on hold.

The convention industry, like all businesses this year, hit a hard recession wall. Companies sent fewer employees to big meetings, trade shows set up smaller booths that used less of the floor space the GWCC sells, and visitors passed on breakfast, lunch, dinner and even cocktails, cutting the money the GWCC expected to earn by 42 percent.

Heywood Sanders, a professor at the University of Texas at San Antonio who studies the industry, said convention facility operators may have to get used to losing money. The industry is overbuilt and he suspects that even when the economy recovers, attendance at conventions won’t.

“The scary possibility is that attendance will be consistently lower as more and more cities build centers,” he said.

In addition, he said hotels, which have hundreds of vacant rooms, are finding ways to lure small meetings away from convention centers by offering packages with rooms and meeting space.

That could hurt the GWCC, which projects a loss of $5.7 million for fiscal 2010.

Graveline said most of fiscal 2010’s loss — $4.6 million — will come in the first six months, a direct result of the recession.

Several big conventions from this past May demonstrate the challenges the facility faces.

Attendance at the BIO International Convention, a meeting for the bio-tech community, was down 10 to 12 percent, Graveline said. And organizers of the 2009 Kitchen/Bath Industry Show and Conference originally had planned to use the entire convention facility, but nixed using Hall A — about 350,000-square-feet of gross exhibit space — because it was not needed when the meeting opened.

The GWCC is not alone in its woes, Graveline said. Competing cities Orlando, Chicago and Las Vegas also have suffered a downturn. Las Vegas, in particular, lost business after a backlash against lavish spending by companies seeking bailouts.

“We’re surviving better than most in the industry,” Graveline said.