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VOL. 118 | NO. 67 | Tuesday, April 20, 2004

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While concerned that Church of God In Christ might break

Hotels Reach Limit for Convention Perks

Concessions could strip events profitability, hoteliers say


The Daily News

While concerned that Church of God In Christ might break an annual tradition by moving its November convention to another host city in 2005, members of the Memphis Hotel and Lodging Association said there are limits to the financial concessions they can offer in exchange for the weeklong event.

The COGIC convocation can bring as many as 50,000 people to area hotels.

Concessions. MHLA president Wayne Tabor said that three years ago, hotel managers negotiated a contract with COGIC that set rates below $100 for participating hotels. In fact, he said, a study found that during last years COGIC convention, the average room rate was $74.68.

Efforts to lower rates even further would be difficult, he said.

We have done what we can do in the past 10 years to keep that convention here, Tabor said. I would hate for it to go away, but that decision is for COGIC to make.

We actually develop relationships with our patrons, and many of them return, so we certainly dont want to see them go to another city. But we still have business decisions to make and we are expected to make those decisions in the best interest of our facilities. Ultimately, thats what we will do.

Keeping them happy. Douglas Browne, general manager of The Peabody, said he is optimistic that a deal can still be made to keep the convention in Memphis for the long-term.

COGIC has been great for the city, Browne said. There has been a long relationship with them. I see this as a marriage, and we just need to work out the kinks and move on and make them happy.

Negotiations between COGIC, the MHLA and the Memphis Convention and Visitors Bureau continue.

Back for an encore. The 97-year-old organization, headquartered in Memphis, has publicly stated that if it were to move its annual convocation to another city, it would prefer to return to Memphis in three years when the church celebrates its 100th anniversary.

However, Tabor said if the COGIC convention or any other major convention were to leave Memphis, it might not return, depending on its experience in a new city.

And if it did ultimately return to Memphis, lodging might not be available.

If another event comes along that is as big or even half that size, we have an obligation to our owners the people who have invested in the brick and mortar of these hotels to fill these rooms, Tabor said.

Gains and losses. Last year, 24,000 rooms were booked in local hotels and motels due to the COGIC convention, generating about $1.8 million in revenue.

However, last year the CVB gave up $86,000 in hotel tax funds to reduce COGICs costs to reserve the convention center. Now, as a further incentive, the CVB is considering waiving the entire reservation cost of $126,000, Tabor said.

This time, we are offering to take away that convention center cost entirely, he said. So not only are we looking again at a reduction in room rates, but we are also looking at increasing our costs.

That would mean the convention would give the city and county a total of $25,000 in revenue.

We are getting closer and closer to the city and county losing money on this particular convention, Tabor said.

In addition to room rate concessions, there are also security expenses related to the event. Plus, hotel and motel management must handle a number of special issues during the large-scale event, Tabor said.

Logistics. One of the most common concerns is keeping convention-goers happy with service and overcoming communication lapses between hotel management and meeting planners who book the rooms.

There are some demanding people, not just with COGIC, he said. Some want more than what you have sold them. Its like air travel. They may have paid a coach fare, but they want first class.

Tourism impact. Local restaurants and retailers stand to lose a large amount of revenue if COGIC moves its convention.

Any time you lose something like that, its not a good thing, and it would definitely have a financial impact, said Christian Georgi, owner of East End Grill and president of the Memphis Restaurant Association.

Browne said local hotels and motels will aggressively work to recruit other conventions and other types of business to replace COGIC if it changes venues.

I dont know if we could replace it with a citywide convention, he said. But this happens on a day-to-day basis. There are some events we lose and some we gain.

COGIC replacement. Tabor said he has faith that the CVB staff would find a replacement for the COGIC event, though it might take a couple of years.

I think the first year we would miss COGIC attendees, he said. We will have withdrawal.

But we will rebound, we will survive and we will bring in other meetings to absorb that loss.


PROPERTY SALES 62 288 2,619
MORTGAGES 52 197 1,783