Lucas Oil boom likely a fantasy

The Indianapolis Colts‘ new Lucas Oil Stadium is about to open for business – fans have already been allowed in to kick the tires – and along with opening day come promises of an economic windfall to come:

INDIANAPOLIS (WISH) – Taxpayers are footing most of the bill for the new stadium, but city and state leaders promise financial blessings will rain down on expectant Hoosiers.

“Folks are saying Lucas Oil Stadium is going to be a special place. So I think the cache of Lucas Oil Stadium is going to attract a lot of events that otherwise perhaps would not have looked at Indianapolis,” said Gerry Dick of Inside Indiana Business.

The Indiana Convention and Visitor’s Association expects the stadium and the expanded convention center to bring an additional 18 to 23 major conventions and trade shows and 4 to 5 large consumer shows.

So, are those expectations reasonable, or does the TV station reporting this have exceptionally appropriate call letters? I asked Heywood Sanders of the University of Texas, one of the foremost experts on the convention center industry; he replied that the PriceWaterhouseCoopers report that the convention association’s numbers are based on projects a 50% increase in convention business. “But PWC has a history of ‘over-predicting’ convention center performance,” he continued. “For the new Boston Convention and Exhibition Center, the firm forecast an annual total 612,000 to 697,000 annual hotel room nights. The actual total for 2007 came to 364,577 – just a bit short. And there’s no reason to think that somehow, in a market overbuilt with convention center space, that Indianapolis is going to somehow be the great exception.”

But hey, at least there’ll be pork poppers.

3 comments on “Lucas Oil boom likely a fantasy

  1. Lucas Oil Stadium is fantastic. As for the convention center expansion, Indianapolis is different. You can stay and walk everywhere. Hotels and restaurants are within 5 blocks all around. I doubt any city can match the facilities and surrondings. Even San Antonio with it’s Riverwalk, you still need to get accross the highway too get to the dome.

    Lack of space has already cost the city 2 large annual conventions because the center was too small. They both promised to consider coming back, but after moving to much larger centers both conventions can no longer fit in even the expanded center.

  2. What a waste of taxpayer money. Convention industry is oversupplied with space already, and worsening. I can’t see how this is a good return on investment- are there no other problems in the area that could have been addressed with these tax dollars?

  3. Although the new stadium may be a great building it is just the latest example of corporate welfare for team owners. Orignally proposed in December of 2004 at 500 million dollars the new revised cost is over 720 million in taxpayer dollars.

    The Irsay family gets all the ticket revenue, suite revenue, 40% of concessions, naming rights, parking et. al. We the taxpayers pay for the stadium cost as well as it’s annual maintenance.

    Over the thiry year term of the lease the tax hit for Indianapolis will be approximately 2 billion dollars (stadium and convention center) while the ownership of the Colts will earn an estimated 1.4 billion dollars and pay nothing to support the facility. The Colts share in the stadium’s cost is about 10% of the 720 million dollars or around 70 million dollars.

    That’s Irsay 1 and taxpayers 0.