Moscone Center, ‘Crown Jewel’ of SF’s Tourism Industry, at Risk of Decline
Moscone Center, which draws more than a million visitors in a typical year, accounts for 21% of San Francisco's overall tourism industry
Tourism is the CIty's largest industry, but is poised to drop 63% in the current fiscal year due to COVID-19
In a new report, a Civil Grand Jury found that high costs and visitors' safety concerns pose a long-term risk to Moscone Center, recommending that the City allocate $2.5 million in subsidies, alongside enhanced security, to shore up SF's convention business
San Francisco’s Moscone Center, a convention mecca and major contributor of tourism revenue, is at risk of long-term decline post-COVID according to a new analysis.
The City’s Civil Grand Jury, a civilian oversight panel that audits government operations, found that high costs and “street blight” surrounding Moscone Center are steering convention planners towards other locations like Las Vegas and San Diego, putting jobs and revenue in jeopardy.
“Moscone Center is the crown jewel of the City’s tourism industry,” said Peter Mills, committee chair of the Grand Jury. “I think it’s clear that the tourism industry, and the convention business in particular, is hugely important for San Francisco: It generates jobs, income, and tax income for the city.”
In a typical year, Moscone Center draws more than one million visitors and accounts for a whopping 21% of the City’s overall travel and tourism industry, inclusive of hotel bookings, restaurant activity, transportation and other spending associated with conventions.
The venue itself, which usually hosts Salesforce’s annual Dreamforce conference and a plethora of other conventions and gatherings, consistently earns top marks from convention planners, according to surveys. The Civil Grand Jury studied Moscone Center for a one-year period, conducting extensive interviews with City agencies and other stakeholders, such as convention planners, trade groups and hotel associations, and analyzing its economic outlook.
Tourism is San Francisco’s largest industry, with hotels and visitors generating 107,000 jobs and $5.9 billion in wages and benefits annually, according to Beacon Economics. In 2018, tourism contributed $771 million to the City’s coffers through hotel taxes and property taxes.
Then came the COVID-19 pandemic, which led to a swift cancellation of in-person conferences, along with countless vacations to San Francisco.
The SF Controller’s Office cited a lack of tourism as the primary driver of the City’s expected budget shortfall of $1.5 billion, estimating that hotel tax revenue will drop 63% in fiscal 2020-2021.
“It’s going to be a long time before we can get some of these conventions, but what we said in the report is that it’s going to be a more competitive business coming out of COVID,” Mills added. “Like SF, other cities across the world have invested in their convention industries and will want a piece of the business when it comes back.”
Moscone Center lost a handful of high-profile convention clients in recent years, with some citing “street conditions” and/or high costs in choosing another city. Those factors were corroborated by the Civil Grand Jury, which found that high costs dissuaded event sponsors, and that safety and cleanliness concerns discouraged conventioneers from returning.
The report issued several recommendations intended to support the long-term success of Moscone Center, which include event subsidies to offset costs and a more visible security presence in the immediate area around the facility, which is situated on Mission St. between 3rd and 5th Sts. in SOMA.
The addition of three or more uniformed officers to the area during peak convention times would “enhance the perception of security” so that visiting conventioneers feel more secure and more likely to return, Mills added.
The report also recommended that the City allocate at $2.5 million towards Moscone rental discounts, with the goal of attracting multi-year deals with organizations seeking to host conventions.
Several City departments, including the Mayor’s Office, the Board of Supervisors, the City Administrator and the Chief of Police, are required to respond to the Civil Grand Jury’s findings. A follow-up meeting will be scheduled by the end of this year.