Questions surround future of World Market Center

The future of the semiannual furniture shows at the World Market Center, one of the biggest events on the Las Vegas meeting calendar, has been covered with a question mark by the $1 billion merger last week with several competitors in High Point, N.C.

The shows have generally drawn about 50,000 buyers and exhibitors, making them among the biggest events on the Las Vegas convention calendar. However, High Point also puts on two shows a year, with approximate attendance of 75,000 each, usually less then three months after Las Vegas.

Four shows a year thrived when the housing and furniture industries boomed . But as recession tightened its grip three years ago, officials in both places agree, many manufacturers and retailers disappeared while those that remained often sent fewer people.

With 13 buildings, including three in Las Vegas, now under the control of the newly created International Market Centers, CEO Robert Maricich said the long-term plan is still up in the air.

"Is four times enough or is it too much?" he said. "We'll have to see how that plays out. As long as people see value in it, four shows can work."

At least this year, the next Las Vegas show in August and High Point show in October will continue as planned.

Many other details of how International Market Centers will operate still have not been sorted out. Maricich said that the International Market Centers name and logo will likely go on the huge downtown buildings at some point.

"We have buildings A, B and C," he said. "I don't think there is any emotional attachment to those names."

He will try to persuade manufacturers to set up showrooms in both cities to fill vacancies . In Building B, for example, the occupancy rate slumped from 98 percent when it opened in 2007 to 75 percent two years later, according to the financial reporting service Trepp. Maricich declined to disclose more recent numbers and Trepp did not have them.

Kevin O'Connor, chairman of the High Point Market Authority, which operates markets in cooperations with numerous separately owned showrooms, said little will change for the industry.

"I don't think the marketplace will support two national markets, and High Point has emerged as the national market," he said. "Largely speaking, a lot of people made the determination that they had to have a stake in the ground and High Point was the place to have that stake."

He described Las Vegas as "a good regional market for the Western half of the United States." However, Maricich said Las Vegas has pushed for national and international clients, but has also focused on building niches such as mattresses, gifts and home decor.

One factor that has favored High Point, said Jerry Epperson of the investment banking firm Mann, Armistead & Epperson in Richmond, Va., is its proximity to the big metropolitan areas along the East Coast . He also said High Point has signed a broad range of furniture companies particularly in the high end, while Las Vegas has been more narrowly concentrated on the middle market.

However, the International Market Centers deal will almost certainly halt the transcontinental battle for tenants.

Mayor Oscar Goodman set the tone in 2004, while the first Las Vegas building was under construction, by proclaiming, "If I lived in High Point, North Carolina, I'd either be committing suicide ... or looking for a ticket to come out to Las Vegas. ... I'd be worrying about the new furniture capital of the world: Las Vegas."

His remark, industry officials agree, galvanized North Carolina to fight back, backed by tens of millions of dollars in financial help from the state government.

"That was a totally unnecessary thing to say," Epperson said.

Even Maricich cringes at the recollection of Goodman's outburst.

What ensued, Epperson said, was "immature bickering back and forth" and bitter competition to land clients. When economic recession hit, both sides took a financial beating, as several High Point buildings went into foreclosure or receivership and the World Market Center defaulted on its loans.

At this point, Maricich said, the markets will sell themselves jointly instead of being at odds with each other.

Contact reporter Tim O'Reiley at
toreiley@reviewjournal.com or 702-387-5290.