Getting it together again

Though not yet as robust as they would like, insiders say the meetings and conventions industry in Dallas is picking up

Lisa Tanner
Senior writer

Look into the minds of leaders of downtown hotels and other businesses that serve the convention trade and you might well see visions of tens of thousands of Mary Kay Inc. associates.

That's because the beauty-products company's associates are bound for Dallas in larger numbers than ever, with five different waves expected in late July and August.

More than 57,000 people are expected, making it one of the largest of the group's conventions ever, said Greg Elam, senior vice president of communications for the Dallas Convention & Visitors Bureau. The economic impact is estimated at more than $115 million.

The expansion of the Dallas Convention Center is beginning to pay off in long-term bookings, with new sales of future business "nicely ahead" of those at this time last year, Elam said. The $130 million expansion allows two conventions to run in the facility simultaneously, a capability not in place before. The center also boasts a new 203,000-square-foot, column-free exhibit hall and a wireless communications system recently well-used by attendees at a Microsoft Corp. convention.

"There are very few dates available at the convention center from mid-January (2005) through September 2005," Elam said. "That gives us a sense of the future."

More than 1 million future hotel room-nights have been sold, put under contract in the fiscal year that ends in September, he said, adding that, while short of the original goal, that pace is ahead of last year and was accomplished during a time of economic uncertainty.

That said, 2004, as long anticipated, will not be a "robust" year in the convention cycle, Elam said.

That's because larger groups often book two, three or four years in advance, and at the time they were examining their options the new convention center space was not available for them to consider.

"If they didn't book during that window, it just won't happen," said Steve Vissotzky, general manager of the 1,122-room Hyatt Regency Dallas. In fact, "2004 will be a difficult year for the majority of the big hotels," he said.

To date, 2003 hasn't been good for downtown hotels, although some are buoyed by signs that business travelers are cautiously testing the water again.

Small-meeting business is also increasing, but those meetings are being booked much closer to the date of the event than in the past.

"We're seeing groups that are very tentative about making commitments," said Vissotzky, who is also chairman of the Hotel/Motel Association of Greater Dallas.

Groups that plan meetings aren't really sure if they should stage the event and, if they do, often anticipate a reduced attendance, he said.

But the corporate market, which also often books smaller meetings, makes decisions more quickly, he said. And in much the same way as those who travel at the last minute have to pay more for their airline tickets, companies that book meetings at the last minute can be a lucrative market for hotels.

"In the corporate world, if they see some profits and an opportunity for new sales, they'll pull together a meeting very quickly," Vissotzky said.

Those types of meetings won't solve the issue of 2004 being a difficult year for conventions citywide, but they will help cushion the effects of the reduced business downtown hotels have seen in the past two years.

The industry was well into a downturn before the events of 9/11. Faced with the steep decline in business travel, Dallas area hotels found creative ways to fill their rooms, offering special packages, targeting leisure travelers and cutting their rates to entice customers.

Now, "there's a sense that the economy is slowly working itself out," Vissotzky said.

At the same time, downtown businesses and city government seem to "be on the same slate" about improvements to downtown, making strides through use of bond money and other sources to improve the infrastructure.

The downtown area for years has needed "pizzazz and spirit," but now the groups not only are aware that something needs to be done, but are doing it, he said, citing the improvements on Main Street, including the new restaurants there that are used by area residents and visitors alike.

"We need all the assistance we can get," Saward said. "Everyone is hungry for business."

That business will build back at a slow but steady rate, he said.

For the first six months of this year, business at Le Meridien was up 7% compared with the same period last year, Saward said.

But the hotel has had to be "extraordinarily flexible" on the rates it charges to secure that gain, he added.

"We only have one chance in front of the customer, so we have to get the best pricing out there, since we won't get another chance to rebid," Saward said.

Still, the last several months have yielded "positive signs" from top local, corporate accounts, he said. That includes more hotel stays by people traveling to Dallas to visit companies located downtown. At the same time, those companies are also hosting more small meetings.

The hotel has added more sales managers, believing that much of its success will come through direct selling, meeting face to face with those who make the decisions about small meetings and business travel.

"We're more self-reliant on booking our own business," Saward said.

Contact DBJ writer Lisa Tanner at ltanner@bizjournals.com or (214) 706-7117.