Dallas forecasts $2.2B in HOT revenues to contribute to convention center redo
Dallas councilmembers approved a financing strategy on October 13 that could generate $2.2 billion in estimated revenues for a new or extensively renovated Kay Bailey Hutchison Convention Center.
Kay Bailey Hutchison Convention Center
The city will focus on leveraging revenue bond capacity assured by local Hotel Occupancy Tax (HOT) generation, enacting an ordinance that results in the development of a Project Financing Zone (PFZ) limited to a 3-mile radius around the center. The zone would collect the anticipated revenues over 30 years in an area that currently contains 71 existing or under-construction hotels.
Dallas’ projections assume rooms revenue will return to pre-pandemic levels by 2024, then increase by a historical 4.1 percent annual inflation-adjusted growth rate.
Center officials will prepare the PFZ ordinance and correspondence to send to the Texas Comptroller’s Office by November 13.
After that, they are preparing to present a final alternative to the City Council in January or February 2022 for the renovation or replacement of the center.
Preliminary cost estimates range from $500 million options to alternatives reaching $3 billion that would involve total replacement.
The city’s Economic Development Committee was briefed on October 4 regarding the PFZ and the center’s master plan, which is in the sixth month of an estimated nine-month development process.