Few songs fire up a crowd in the Capital Region like Garth Brooks’ classic rendition of “Callin’ Baton Rouge.” Yet, on the country music star’s 2017 world tour, he bypassed the city for which his chart-topping single was named, playing, instead, for five consecutive nights in Lafayette.
Officials with the Raising Cane’s River Center and local tourism leaders offered a couple of explanations for the snub: The 10,000-seat arena in the River Center—the only local venue potentially large enough to have accommodated Brooks with enough available dates—is too small to compete for a major concert with Lafayette’s 13,000-seat Cajundome or New Orleans’ 17,000-seat Smoothie King Center.
Besides, they said, Baton Rouge’s proximity to New Orleans all but ensures it will be overlooked when top performers come to the region.
While no doubt true, a growing number of city and civic leaders are increasingly weary of the excuses—because it’s not just on the arena side that the River Center continues to underwhelm.
Over the past five years, the facility as a whole—which includes the arena, an exhibition hall, a performing arts theater and two garages—has seen a slide in the number of events it hosts. In 2019, there were 14% fewer than in 2018 and 37% fewer than in 2017.
Some of the decline can be attributed to the renovation of the theater, which is not only closed for construction but has required management to relocate some events planned for the theater into the arena or exhibition hall, thereby displacing events planned for those spaces. But the decline had begun even before the theater work was underway.
The facility also continues to lose money—a little less than $1 million a year on average over the past five years. While 2019 and early 2020 have showed a significant improvement in stemming the tide of red ink, that’s primarily because of cost cutting and increased food and beverage revenue—not more business coming to town.
Frustrating to some officials is that back in the early 2000s, a study suggested Baton Rouge could grow its convention business if downtown had 1,000 hotel rooms in walking distance to the River Center. The hotels got built, with public-dollar help through tax incremental financing (or TIF), but—as downtown hotel owners privately grumble—the convention groups haven’t materialized to the extent that was anticipated.
Is the problem the facility and its limitations, or is it an attitude that has sought excuses over opportunities?
Currently, the Broome administration is preparing to issue a request for proposals for a study that will try to answer those questions. The study, estimated to cost $125,000, will look at how to maximize the facility and make it more competitive. The administration has also formed an advisory group to keep closer tabs on the River Center and follow up on whatever the study recommends.
Is it too little too late?
Not necessarily, say experts. But they suggest that if Baton Rouge truly wants to have a first-class facility it must look beyond the number of meeting rooms or seating configurations.
It will, instead, require thinking about how to position downtown Baton Rouge as a convention, entertainment and visitors destination while simultaneously figuring out how to get ahead of the eight ball rather than continuing to play catch up in an industry that is rapidly changing and increasingly competitive.
“I absolutely think there is potential to do better,” says Butch Spyridon, who headed Baton Rouge’s convention and visitors bureau in the 1980s and has been president and CEO of the Nashville Convention and Visitors Corp. since 1991. “You have to find your way around the objections. You have to build your mousetrap. Based on your limitations, that dictates what kind of mousetrap you build.”
Missed the mark?
To an extent, the limitations facing the center are rooted in external market realities. New Orleans will always outshine Baton Rouge as a convention destination. As for concerts, the Smoothie King Center will always attract more top performers. Lafayette and Shreveport, meanwhile, have both invested in their respective arenas in recent years, which makes them even more of a competitive threat.
Another strike against the River Center, at least as a convention destination, is the limited direct air service between Baton Rouge and most markets. Because it’s hard to get here by commercial jet, most national meeting planners won’t even give the city a look.
There’s also the fact that the convention market has changed over the past decade, and it’s no longer good enough to have 1,000 hotel rooms in walking distance to an exhibition hall. Convention groups increasingly want facilities that offer more amenities under a single roof, including a dedicated, convention center hotel.
“There are more markets today where hotels are either connected to or adjacent to convention centers and that gives meeting planners more options,” says Dan Fenton, an executive vice president with national consulting firm JLL. “Our research shows if attendees have to walk more than one or one-and-a-half blocks to their hotel, meeting planners will consider that a less-competitive market than they would have just five years ago.”
There are internal limitations with the 43-year-old River Center as well. Though the theater is currently getting a complete overhaul, older parts of the facility haven’t been renovated in years, and the last major expansion was nearly a decade ago.
Its arena, as the Brooks snub shows, is too small for big acts, yet too big for small, intimate performances.
Its parking garages, though under a new management that promises improvements, have historically been poorly run and maintained, besides being difficult for elderly and handicapped patrons to access.
Some also point to another problem: a lack of strong leadership and guidance. The River Center is privately run by ASM Global, a company formed in the fall of 2019, when SMG—which managed the River Center for two decades—merged with AEG. ASM assumed the contract after the merger.
Though ASM answers to City Hall, so do a lot of agencies and departments. There’s no single commission, however, specifically dedicated to leading and watching over the River Center.
“I’m not a fan of privately run convention centers because they’re at odds with the mission of either publicly funded buildings or CVBs,” Spyridon says. “Their job is to make a profit.”
Nashville, by comparison, created a Convention Center Authority when it built its new convention center in the early 2000s. Though the authority doesn’t manage every aspect of the facility, it is a public agency and its sole mission is to ensure that the publicly funded convention center is sustainable and successful, both financially and as an economic development driver.
Similarly, the Louisiana Stadium and Exposition District in New Orleans is, in theory at least, accountable for the performance of the Mercedes-Benz Superdome and Smoothie King Center. It farms out day-to-day management to ASM, but ASM answers to the commission and works closely with it.
The River Center has no such comparable agency—only, the mayor’s recently formed advisory committee, which has no legal authority.
The financial picture
While Brooks and other big-name acts may snub the River Center, taxpayers have not. The facility, in fact, receives nearly $10 million annually from the city, state, taxpayers, naming rights and event-related income.
However, half of that money—an estimated $5 million this year—is dedicated to capital needs or paring down construction debt. Of that, only $1.3 million can be spent on new construction projects, which helps explain why it may seem like the River Center is getting a lot of public money but has limited improvement and upgrade options at the moment.
The River Center also gets about $5.3 million a year in revenues, including naming rights royalties from Raising Cane’s and public subsidies that come from the city-parish general fund. Most of the money is generated by events and event-related income. But the city-parish subsidy is not insignificant, accounting for nearly $1.8 million in 2020.
It’s not uncommon for a public facility like a convention center or arena to lose money and many of the River Center’s peers around the country also lose money every year. In fact, ASM’s contract with the parish, which includes a flat fee of some $260,000, also agrees to pay the company an incentive for losing less money than is budgeted.
But just because many public facilities lose money, doesn’t mean the River Center, which has always operated in the red, should get comfortable with losing money and not explore ways to at least break even, says Baton Rouge Area Chamber President and CEO Adam Knapp.
“We need to look at the financial and business plan strategy around the complex so it isn’t something the city is losing money on every year,” he says.
What will it take?
Both city-parish leaders and ASM management say things at the River Center are not as bad as some measures might suggest. They note the decrease in the facility’s operating loss in 2019 and posit that if the theater had not been closed, event-related revenues would have been up last year.
Ice skating last December was a huge win, generating a $255,000 profit, thanks to the addition of skating lessons, early morning sessions, new games and better marketing.
Convention business for 2020 is looking strong, with 18 major groups currently booked.
The theater is set to be finished by late this year or early 2021.
The new management company running the garages promises not only to improve operations but is contractually required to spruce up the buildings.
What’s more, the facility itself has a new management team in place. ASM recently named a new general manager, Shane Chalmers, to succeed Les Crooks, who served in an interim capacity for more than a year.
For their part, city officials say they’re focused on the facility and ways to make it better, and even their efforts of the past few months appear to be paying off.
So what should they be thinking about as they evaluate proposals for the new study?
It’s not an easy question to answer. First, the city must decide what it wants its downtown convention and visitors industry to look like and then figure out how the River Center can fit into that vision. There’s no right answer, says Fenton at JLL, but a plan can serve as a road map that will help guide other decisions.
“One thing we always ask is, what is the right mix for your market?” he says. “It’s not the same for every community but whatever the answer will tie back to your strategy.”
Spyridon agrees that a master planning process is necessary. He says he would “put everybody around the table and do a deep dive strategic plan and get everybody on the same page” to determine where Baton Rouge—and, by extension, the River Center—can be strong.
That might mean developing a specific niche, like business from state associations. It also means figuring out how to marshal existing assets and package them in such a way that makes the market more attractive to visitors.
“What is your sweet spot and what are the resources you can bring to bear to overcome the objections and make yourselves more attractive? he says. “It’s about getting in front of the trends, not behind them. It’s about getting everyone working together. You can play politics or you can grow.”