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The Madison Record

Grocery building eyed for conference center

By Staff
Mitch Freeman Madison County Record
A state of the art conference center in Madison could be the finest facility within a 100-mile radius, if Madison Mayor Jan Wells wins approval from the city council to move forward with her plan.
Wells is leading the charge to purchase Spencer Square shopping center on Madison Blvd., including the vacated Food World building, which would be converted into a high-tech conference center. Hotel operators are concerned about competition for conference business.
Local hotel representatives, Madison Chamber of Commerce representatives and city council members have met in a series of focus group discussions to identify and work out issues related to the proposed conference center and purchase of the shopping center.
A presentation document released by the mayor's office indicates that the purchase of Spencer Square would produce immediate revenue for the city and enhance business recruitment, as well as provide large-scale conference/meeting space.
Mayor's Aid Michele Miller said the conference center could be designed to support high tech events by providing video teleconferencing, data links, broadband connections, electronic collaboration, dynamic tabulation responses, large screen displays and sound proofing. The facility would also be equipped with movable walls, kitchen facilities and a sound system.
"These things will set us apart from other conference centers," Miller said.
The vacated Food World structure would provide 45,444 square feet for the conference center and the adjacent building would provide 11,282 square feet of currently vacant commercial space for retail business.
The conference center is expected to attract spill over events that the Von Braun Center in Huntsville cannot accommodate, in particular the high-tech events. Miller noted that access to meeting space at Redstone Arsenal has been limited as a result of enhanced security measures and that the proposed conference center offers close proximity to NASA, Redstone Arsenal, Research Park and the Huntsville International Airport.
There would be ample parking, three hotels and 15 restaurants within a half-mile of the proposed conference center.
However, there are issues of concern among those who have been involved in the focus group meetings.
Local hotel operators question a $1 room tax they have been asked to impose on their guests in support of the proposed conference center. The resulting revenue would help to get the conference center project off the ground, according to Miller.
The mayor is proposing that the project be a combination public and private business venture, with the intention of minimizing financial risk to the city. The proposed conference center design includes the ability to configure the building into conference areas that could accommodate groups as small as 50 to groups larger than 1,500 people, on an as need basis. The ability to accommodate small groups raised the questions about competition from some local hotels.
Representatives from the Radisson Inn, Holiday Inn and the Ramada all voiced concerns about the proposed private side of the plan creating competition with them for business. All three hotels offer some level of conference facilities.
They all voiced objections to the $1 room tax for various reasons.
Radisson Inn general manager Randy Brown has a problem with the room tax, because it would benefit a private investor, whereas if the project were strictly a city business venture, the room tax would be supported. He said that he welcomes the idea of a conference center and that it would benefit the area, as well as his hotel business.
Debbie Newman, who manages the Holiday Inn, would not commit to invoking the room tax until more financial details about the entire project are made clear.
She also has issues with imposing the room tax, if a private investor is part of the plan. Newman said that she is for the convention center if it is profitable for the hotels and it doesn't take the smaller conference business away from them. The Holiday Inn can accommodate conferences and meetings of up to 100 people.
Cindy Bradley and Jeff Hamby, representing the Ramada Inn, said that they can accommodate conferences of up to 300 people and had concerns that the proposed conference center might take away their business for conferences of 300 or less.
They are in favor of the conference center if it doesn't jeopardize their conference business.
According to Miller, the revenue from the room tax would help to offset the costs of hiring a consulting firm to investigate the proposed public/private business arrangement and to make improvements to the outside of the Food World building, for advance marketing, prior to renovation completion.
Miller said the consulting firm would work out details of the public/private partnership. She explained that the city would finance the purchase the property, and that the private investor would be responsible for renovation costs and conference center management. Revenue estimated at between $1.5 and $2 million would be split as determined between the city and the investor.
According to a worst-case scenario, if the Food World building remains vacant and is not converted into a conference center, and no additional commercial space is leased, the city would still come out ahead on the deal, Miller said.
The building adjacent to the Food World building would generate a projected $21,169 in monthly revenue, according to Miller. After related, projected expenses of $19,753 including mortgage, maintenance, management fees, etc., the city could pull in a profit of $1,416, she said.
"You could turn around and sell the property at no financial risk," Miller said.
It will be up to the city council to decide the fate of the proposal.

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