CHARLOTTE -- The NASCAR Hall of Fame awakened a sleepy corner of this arriviste banking town. It added another steel and glass bauble to the Queen City’s bejeweled downtown, or “uptown” as civic boosters insist it be called. And it firmly notched Charlotte as the buckle of the car-racing belt, the headquarters for an industry that raced from its rural roots nearby to a corporate office tower adjacent to the hall of fame.
But the museum, which celebrates its first birthday next month, didn’t welcome anywhere near the 800,000 visitors projected for its first year of operation. It didn’t break even either, losing instead an estimated $1.3 million. And it didn’t dispel notions that Atlanta, a hard-charging competitor for the car-racing cathedral, would’ve been a better spot for NASCAR to park.
“I’m not going to say I told you so, but my guess is that the number of visitors would’ve been higher in Atlanta than in Charlotte,” said A.J. Robinson, president of Central Atlanta Progress, which lost the hall to North Carolina. “And in Atlanta they would’ve been exposing their brand to a wider, more diverse audience.”
Atlanta, set to begin construction this fall on two museums near Centennial Olympic Park, can glean important lessons from Charlotte’s struggles, officials in both cities say. The National Center for Human and Civil Rights, for example, has delayed construction, pared costs and reduced its size. Neither the center, nor the College Football Hall of Fame, will rely as heavily on taxpayer money as NASCAR did to build and operate its venue.
Still, the recession and its tepid recovery have tempered expectations in both cities. Atlanta, though, can expect a more robust economy when its museums open in 2013. In addition, Charlotte’s woes were exacerbated by NASCAR's waning popularity at the track and on TV. So city-versus-city comparisons, and criticism, are unfair, said Winston Kelley, the NASCAR hall’s executive director.
“I don’t want to get into a he said, she said, but Charlotte can support three NASCAR races a year and Atlanta can’t support two; Charlotte is a more NASCAR-friendly town,” Kelley said. “I would be worried if we had a bad product. But the fact is we have an exceptional product. And we will continue to learn, grow and be successful.”
It’s hard to argue with the National Association for Stock Car Auto Racing’s 2006 selection of Charlotte for the hall of fame. Lowe’s Motor Speedway, up the road in Concord, is a fan favorite with three major races each year. (One of Atlanta Motor Speedway’s two annual races was moved last year to Kentucky.) Racing teams owned by Richard Petty, Joe Gibbs, Michael Waltrip and others operate nearby and offer tours.
Charlotte’s $135 million bid for the hall of fame bested Atlanta’s ($102 million) and Daytona's ($105 million) offerings. Charlotte, keen to stamp an identity on its uptown tourist district, opened the city-owned hall last May 11.
“It should’ve been here,” said Tim Peck, a Greensboro, N.C., attorney recently visiting the hall. “Certainly Georgia had local racing, but really this seems to be where everybody in the sport gravitated around. If the hall can’t make it here, it can’t make it anywhere.”
The 150,000-square-foot venue appeals to casual and die-hard NASCAR fans alike with theaters and interactive displays, stock cars through the ages, computer-simulated racing and a Heritage Speedway museum.
“It’s real, let’s put it that way,” said Robbie Watts, a welder from Georgetown, S.C., in front of the I.M. Pei-designed building. “It shows where it got started and where it’s at today. It’s well worth coming to see.”
If only more people would see it. Charlotte, for its bid, predicted the hall would attract 800,000 visitors the first year of business. Kelley, the hall director, now estimates attendance at 250,000. Hall of fame backers also expected a $700,000 surplus for the first fiscal year. Losses, though, will reach $1.3 million.
The $15.3 million budget was slashed by nearly a fourth. Part-time workers have been dismissed. Exhibits won’t be “refreshed” as quickly. NASCAR, which licensed the hall, won’t take its expected 10-percent cut of revenues. And the hall will require a $1 million infusion from the Charlotte visitors agency, which operates the building, to cover this year’s losses.
If losses continue next year, the hall may again ask Charlotte City Council members to tap the so-called hospitality tax charged on hotel rooms and prepared food and beverages. The fund was used significantly to build the hall -- which ultimately cost $195 million -- and helps the visitors’ authority maintain other venues in town.
Kelley anticipates that another 250,000 visitors next year, as well as conferences, soirees and other events, will put the hall in the black. City councilman Michael Barnes isn’t convinced.
“I have concerns with both the financial side and the attendance side of the venue,” he said. “Can we generate enough revenue to cover the cost of the facility and the people who work there?”
The recession bears part of the blame for the hall’s troubles.
“We would have loved to have opened in 2007 rather than 2010 and probably had a much greater financial cushion to be able to weather the storm,” said Tim Newman, CEO of Charlotte’s visitors’ bureau.
Newman laments the overly rosy attendance projections and cautions Atlantans readying the football and civil rights venues to estimate conservatively. NASCAR, for example, expected fans, locals and conventioneers to comprise equal portions of the attendance pie. Newman said not enough fans visit the hall and the number of locals is “much less than expected.”
The hall, too, has struggled with a larger, more existential question: What is it?
“Nobody knew at the time it opened what it was going to be. A museum? An entertainment attraction? What is its identity?” mused Blake Davidson, a NASCAR vice president. “Atlanta must have a very clear marketing message of what you want to be and who you target. And it must continue to let people know what you’ve got, especially with the economic challenges everybody is facing.”
Atlanta museum backers say they’ve learned from Charlotte’s mistakes. The city’s larger market -- the metropolitan area is three times the size of Charlotte -- should support attendance predictions. (The football hall estimates 500,000 visitors its first year; the civil rights center expects 650,000.) The new attractions will also benefit from their locations in the Centennial Park district, home to the aquarium, CNN and the World of Coca-Cola.
“People want to come here because of the diversity of these attractions,” said Robinson of Central Atlanta Progress. “In today’s world, you have to be known for more than one thing. Charlotte is a wonderful town, but it does have this one identity now and it will sink or swim with that identity.”
Planning new attractions in a recession, instead of opening in the midst of one, may work to Atlanta’s benefit. The civil rights center, for example, initially sought $125 million for its museum, conference rooms and endowment. It now targets $100 million. The size has been sliced by almost a third, though overall exhibition space remains the same.
And, unlike the NASCAR hall, the center will raise 60 percent of its money privately. The rest comes largely from bonds backed by a special downtown tax district.
“The number one lesson for the whole industry is to not use long-term debt because interest payments make it incredibly tough to be sustainable,” said Doug Shipman, the center’s CEO.
The NASCAR hall’s price tag may be steep, Charlotte boosters say, but the city’s tourism industry needed a marquis attraction -- and an identity. Already, the hall pays dividends. City officials insist NASCAR, particularly its TV and radio studios, helped lure the 2012 Democratic National Convention. The Newman of the visitors' bureau said 75 conventions, many keen to use the hall for meetings, have been booked through 2016.
“Anybody who comes here and sees the facility will say, ‘Wow, that’s the crown jewel of the city,'" NASCAR's Davidson said. “But we have to get people to see it first.”
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