FSU Arena District, convention center could more than double to $53 million

https://www.tallahassee.com/story/news/2020/03/09/price-tag-fsu-arena-district-convention-center-could-more-than-double-53-million/5000740002/?fbclid=IwAR0K0NPMJpE8EOYzUuNbYwl_QbgbM78zDbSyqYW4DfrivXTHtnM8mEEv8qI

The cost to build out the proposed Arena District, stretching from Florida State’s campus to downtown, could more than double and come with a price tag as high as $53 million for Leon County taxpayers.

The Blueprint Intergovernmental Agency will weigh whether to approve a $40 million bond issuance for everything from design to construction in October to begin carrying out FSU’s vision for a hotel and convention center district, to include the Donald Tucker Center and Turnbull Center, along Madison Street.

Tallahassee is the only capital city in the south without a convention center, but a market feasibility study by FSU completed in December found a “high” demand for conferences, banquets and social events that could be accommodated by the project.

FSU is already in line for a taxpayer-funded access road near the university's southern border that would direct passengers to campus from Tallahassee International Airport. The Airport Gateway Project, proposed in 2017 and approved in 2018, improves seven miles of roadway and adds 12 miles of new sidewalks, trails and bike lanes that connects the airport to fringes of FSU and Florida A&M universities.

In Sept. 2018, the IA Board, authorized the bond financing process of $20 million to start funding the Arena District this year though associated surtaxes. But FSU officials said they are unable to provide any supplemental funding for design and construction. 

The idea for the “Area District,” also dubbed the Madison Mile, has been in the works since 2012 when FSU acquired the Tucker Center from Leon County.

In December, the Director of FSU’s Office of Real Estate Kevin Graham wrote to Office of Economic Vitality’s Director of PLACE Ben Pingree about the struggles the university had in 2019 in securing state funding.

“Funding for university capital projects has been significantly limited over the past several years,” Graham wrote. “Of the $54M in PECO (Public Education Capital Outlay) funds FSU is requesting from the State of Florida, $0 was funded in the last legislative session. This places a much greater burden on all other funding sources.”

The feasibility study recommends a brand-new convention center with 39,000 square-foot of rentable space – a third of which would make up ballrooms and the rest designated meeting areas – to spur economic growth. The costs to build the facility are estimated at more than $35 million with an additional $4.55 million for furniture, fixtures and equipment. To finance the bond, $13 million in debt services would be attached to the final price.

In a text to the Democrat, Graham said the facility that was proposed in the feasibility study closely resembles what Blueprint requested in 2018 as the minimum standard.

"We believe that this convention center needs to be understood as a community asset. FSU is offering to own it, maintain it, and operate it, each of which comes with substantial financial responsibility," he wrote.

If approved, the money would account for 42% of the economic development portion of sales tax dollars, reducing the IA’s power to fund future projects by more than $25 million, according to staff analysis.

Along with the Turnbull Center and Tucker Center, which would all be operated independently, the proposed district could mean more than 120,000 square feet in event space in the capital city.

FSU indicated it would build within the $20 million price range for a smaller convention center, which would be about the size of the Turnbull Center, but no economic impact analysis was run for a smaller project and a floor plan was not developed.

IA staff are not recommending building a smaller convention center.

Of note is the five hotels currently under construction within a mile of the proposed Arena District including the stalled Washington Square project behind the Leon County Courthouse that is expected to have 18,000 square feet in meeting space, similar to the smaller proposal. The total amount of meeting space that would come from the hotels is not yet known. 

Even without factoring in the number of estimated visitors who would visit Tallahassee annually because of the convention center, the feasibility study determined it would have an economic benefit of $30.7 million and create 230 jobs with an income of $8.5 million.

In the agenda item, Blueprint staff wrote what a boon approving the funding could be to attracting people to Tallahassee.

“A center of this size would allow the community to compete for state association and regional corporate events, as well as allow for growth among existing and prospective events that would consider Tallahassee-Leon County.”