Wednesday, May 19, 1999
City hopes to break new ground by selling convention center name
BY LUCY MAY and DAN KLEPAL
The Cincinnati Enquirer
If Delta Air Lines agrees to pay $30 million for 20-year naming rights to an expanded downtown convention center, it could mark one of the biggest such deals in the country.
While naming rights for sports facilities have become commonplace cities are just beginning to use the technique to help pay for new or expanding convention centers.
The first such deal was struck when Midwest Express Airlines bought naming rights to a new center in Milwaukee in 1997, agreeing to pay $8.5 million over 15 years.
“Hopefully, we'll be breaking some new ground here,” said Michael Wilson, president of the Greater Cincinnati Convention and Visitors Bureau.
The proposed expansion of the Dr. Albert B. Sabin Cincin nati Convention Center would more than double the size of the facility at a cost of $325 million to $350 million.
One industry expert estimates the naming-rights deal could give Delta a 2-to-1 or 3-to-1 return on its investment, even if the airline keeps
Dr. Sabin's name on the facility. (The idea of dropping the name of the late Dr. Sabin, who developed the oral polio vaccine, has been blasted locally.)
That's because the Delta name would naturally appear on every brochure, pamphlet or map produced by the convention and visitors bureau, said Cindy Shevrovich, a senior executive vice president with Joyce Julius & Associates in Ann Arbor, Mich.
Buying such advertising directly — instead of buying naming rights — would cost the airline two or three times the $30 million being discussed, she said.
But Delta's decision about the naming rights for the expanded center won't be driven by advertising value, said David Anderson, district director of civic and promotional affairs for the airline's local operations.
Instead, Mr. Anderson said the $30 million investment would be a good one for two reasons. First, it would allow the company to provide “corporate leadership” for a project Mr. Anderson views as vital to the health and development of downtown.
Second, an expanded center would mean more visitors to Cincinnati. More visitors means more potential passengers for Delta, he said. That gives the airline a much more concrete business benefit for the investment, he said.
“It's an all together different animal than naming rights of a stadium,” Mr. Anderson said. “This is about corporate leadership and quantifiable dividends.”
With sports facilities, corporations with naming rights count on national television exposure during games and playoffs, said David Milenthal, whose Columbus-based consulting firm has worked to develop Cincinnati's convention center expansion funding strategy.
But this project offers much easier-to-measure dividends for Delta, he said.
The sale of naming rights for convention centers is being discussed nationwide, and it's only a matter of time before more cities make such deals, said Kevin Bartram, chief operating officer for The Wilkinson Group, a San Francisco firm that specializes in sponsorship programs.
Community leaders in St. Paul, Minn., for example, will announce the new name of that city's convention center later this week. A local energy consortium will pay $250,000 a year over 10 years to name the center Touchstone Energy Place at RiverCentre, said Jim O'Leary, executive director at RiverCentre.
Cincinnati leaders hope to get a decision from Delta later this summer. A group of local politicians and business leaders traveled to Atlanta last week to pitch the naming-rights proposal to Delta's top corporate executives.
Mr. Anderson, the self-described architect of the pitch, termed the meeting “cordial, constructive and positive.”
He stressed the naming rights are not a done deal and said any such deal would require an endorsement from Delta's board of directors, which could discuss the issue before the board's next scheduled meeting in July.
While the details of how the center would be named under a naming-rights deal with Delta have not yet been worked out, Mr. Anderson stressed that Delta isn't looking to dump Dr. Sabin's name.
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