Convention planners squint to see an industry rebound

Everything about McCormick Place is designed for crowds. When the people will be back is the question that preoccupies those in the meetings business, which has been at a standstill since March.

An early and sudden victim of attempts to control the spread of COVID-19, the convention shutdown took with it jobs in hotels, restaurants, the construction trades and contractors that make up the economic gears. The effect has been profound in cities around the U.S., but nowhere is it more noticeable than in Chicago, where McCormick Place has the title of largest convention complex in the U.S.

The distinction seems more like a burden now. Under state orders responding to the pandemic, McCormick Place and smaller halls aren’t like a shop that can reopen at limited capacity. They can come back only when the state reaches a full reopening that requires, according to its guidelines, “a vaccine or highly effective treatment widely available or the elimination of any new cases over a sustained period.”

“I think people will be up for going to events again once we get past this, whatever ‘this’ is,” said Peter Eelman, vice president of the Association for Manufacturing Technology, which has pulled the plug on McCormick Place’s biggest event of the year, the International Manufacturing Technology Show. It became the 97th event to withdraw from McCormick Place so far this year.

Scheduled for Sept. 14-19, it was to have filled every corner of McCormick Place’s 2.6 million square feet, even the little-used Lakeside Center. It’s a biennial affair and when another one comes around in 2022, “I’m sure the world will look quite a bit different,” Eelman said.

How it looks will depend on progress with COVID-19. “That will determine really how people will feel,” said one person close to McCormick Place operations. “They want to come back to events and see others in their industry, but there’s also a lot of apprehension about infections.”

Sun-Times file

Look for deep cleaning, temperature checks and masks to be part of the convention experience, experts said. Social distancing, however, could be a tougher sell over time, said Sherrif Karamat, CEO of the trade group for convention organizers, PCMA. “You and I, when we meet, we’re going to want to shake hands,” he said. “We say in this business that when you meet face to face, you see eye to eye.”

Some show sponsors may be asked to take more space at a hall so attendees can spread out. When that comes up, the sponsors might drive a hard bargain about rental rates.

Larita Clark, CEO of McCormick Place’s owner, the Metropolitan Pier and Exposition Authority, said she’s prepared for those conversations, knowing that when business resumes, so will the competition with convention cities such as Las Vegas or Orlando that undercut Chicago’s costs. “They are out for our customers. Our competition might give the exhibit hall for free or offer lower hotel rates,” she said.

Working with other tourism interests, Clark said her agency doesn’t have to match other cities dollar for dollar but can put together attractive packages that account for people’s inherent desire to gather in Chicago.

Provided

She said attendees may be asked to use smaller meeting rooms, or go into rooms where three-quarters of the chairs have been removed. If shows are asked to take more space for social distancing, “we will make every attempt to hold rents steady,” Clark said.

Karamat said with working remotely now common among businesses, there may be more long-term demand for conventions and trade shows as an opportunity to get together. But for those who don’t want the in-person experience, some shows and convention halls will need to explore digital options for streaming their programs, earning extra revenue from the service, he said.

Karamat said economic projections done for PCMA show an industry rebound could start in 2021, but perhaps not until 2023 if bleaker scenarios for the virus come to pass. Some parts of the country already are reporting more cases after gatherings during the Memorial Day weekend.

The uncertainty weighs on Clark’s mind as well. Her publicly subsidized agency, commonly called McPier, a year ago brought to the Legislature a package for higher taxes on restaurant meals and more bonding authority to fund a new building and carry out at least a partial demolition of the Lakeside Center. Caught by surprise, freshly elected Mayor Lori Lightfoot objected and the plan died.

Clark said the proposal, made before she was named CEO, and any expansion talk is “off the table.”

“We believe events are going to return, but I want to see what that looks like and give events the opportunity to ramp it back up,” she said.

Ideas for the Lakeside Center, the complex’s oldest building, have included replacing it with parking and green space or making it a casino. Clark said she’ll defer to the mayor and the governor on the casino option, saying many convention planners still see gambling as a distraction for ordinary networking and selling.

In the meantime, McPier has adopted a bare-bones budget. Clark said 2,300 out of more than 2,800 employees are not working or have been laid off or furloughed. Employees still working have been asked to take 15-day furloughs, she said. Its Wintrust Arena and Marriott Marquis hotel are shut for now.

“McCormick Place isn’t going anywhere,” Clark said. With the convention industry accounting for an estimated 15,000 Illinois jobs, many will join her in rooting for it to return in fighting shape.