Las Vegas Convention and Visitors Authority executives and a consultant on Thursday laid out the financial game plan to pay for the $1.4 billion expansion and renovation of the Las Vegas Convention Center.
The three-hour briefing was a part of the second of three meetings of the seven-member Oversight Panel for Convention Facilities in Clark County, directed by the Nevada Legislature to oversee construction and financing of the six-year program that is expected to begin next year.
The LVCVA will build a 600,000-square-foot exhibit hall as well as renovate existing facilities by connecting existing halls and adding meeting rooms.
Next month, the panel will review the design and construction process in preparation for a May vote to endorse the project.
Chief financial officer Rana Lacer and building representative Terry Miller, the LVCVA’s project consultant, explained the hard construction costs, the contingency budget and soft costs for the project. Construction will account for between 60 percent and 80 percent of the overall cost and is estimated at $362 per square foot.
The project would be paid over 30 years through bonds secured by a 0.5 percentage point increase in Clark County’s hotel room tax. Debt service on bonds will be added to existing debt and the maximum annual payments of around $118 million will occur in 2026 and 2027, dipping down to about $50 million by 2049.
Panel members expressed some concerns about the economy sustaining itself to keep up with the debt, but Lacer explained that analysts projected conservatively to develop models indicating the payments could be sustained through expansions of the tax base and higher room rates over the years.
Earlier in the meeting, representatives of four major trade shows told the panel about some of the features the Las Vegas Convention Center will need to keep their shows in Southern Nevada.
Managers and executives with ConExpo-Con/Agg, the International Council of Shopping Centers, CES and the National Association of Broadcasters offered their suggestions for expanding and upgrading the convention center.
Among the suggestions from the show operators: more meeting rooms, better technology and easier transit between buildings.
The recommendations are complicated by different shows wanting different types of amenities and with managers trying to predict how trade shows will change 10 or 20 years in the future.
The challenge for the LVCVA and the Oversight Panel will be matching what’s wanted with the $1.4 billion budget to improve the building.
Contact Richard N. Velotta at firstname.lastname@example.org or 702-477-3893. Follow @RickVelotta on Twitter.