City Okays Convention Center Expansion

The Wisconsin Center District secured the necessary city approval Tuesday to advance its plan to expand the city’s convention center.

Using bonding to finance the expansion, the district hopes to start construction in 2021 with a grand opening in 2023.

The Common Council’s Public Works Committee vetted the proposal two weeks ago and the full council approved the plan Tuesday. The city, under state law, is required to certify the plans.

The plan, which is now undergoing final design and construction estimating work, would cost between $300 and $375 million. “We are not committing to anything at this point,” said district CEO Marty Brooks during the committee meeting. The expansion would add 215,000 square feet of exhibit and meeting space to the convention center, bringing the facility to 481,000 square feet and nearly doubling the total.

“My understanding is you were already so leveraged you had to borrow double to get the bucks you needed,” said Alderman Nik Kovac. The state-controlled entity owns the Wisconsin Center, Miller High Life Theatre, UW-Milwaukee Panther Arena and Fiserv Forum.

Brooks and John Mehan of Robert W. Baird & Co. said that wasn’t the case. The district now has approximately $3 million in unrestricted revenue annually from a $1 million lease payment from the Milwaukee Bucks and $2 per ticket fee at Fiserv Forum.

It could also raise the 2.5 percent county-wide hotel room tax to 3 percent. In addition, it collects a 7 percent City of Milwaukee hotel tax, 0.5 percent food and beverage tax and 3 percent rental car tax. But “the only flexibility to raise any of those taxes is the county room tax,” said Brooks.

The district announced tvsdesign and Eppstein Uhen Architects as the project architecture team in December. A partnership of Gilbane Building Co. and CD Smith was hired in January to lead the construction. A final cost estimate is expected in April.

In 2019 the state approved a moral obligation to pay the remaining project debt should the district default.

Ald. Michael Murphy expressed skepticism about the proposal when it came before the Public Works Committee. “The concern that I have is that every one of the expansions centers for the most part has never lived up to what they were promised in terms of hotel rooms per night,” said Murphy. “I’ve been through a number of times, there is usually the same cast of characters that want the expansion.”

Murphy said he expects more subsidies or taxes to be required. “We’re going to need a signature hotel, usually they come back later and ask for a public subsidy on that.”

The committee approved the proposal on a four-to-one vote with Murphy in objection.

Brooks and others gathered in the back of the council chambers Tuesday morning, but there wasn’t any drama to watch. The meeting did start more than 20 minutes late, but the council passed the authorization without discussion. Only Murphy voted against the proposal.

The state Secretary of Revenue and Secretary of Administration still need to sign off on the plan, said Mehan.

Conceptual Renderings

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Related Legislation: File 191565