The Dallas City Council on Wednesday approved a six-year, $65 million deal with a firm led by developer Jack Matthews to oversee a nearly $3 billion rebuild of the downtown convention center.
Inspire Dallas LLC, which state records show was established in April, is now tasked with turning concept drawings of a new Kay Bailey Hutchinson Convention Center, as well as aspirations of revitalizing parts of the downtown area and boosting city tourism dollars, into a reality.
“It takes a vision and a long-term commitment to do what the city is doing right now. I applaud you on that,” Matthews said to the City Council before the vote Wednesday. He noted that his team is made up of mostly Dallas-area based subcontractors and some are currently involved in the building of convention centers in Florida, Abu Dhabi, and Qatar.
Matthews through his real estate development company Matthews Southwest has been behind the construction and renovation of several downtown-area projects like The Omni Dallas Hotel attached to the convention center, Gilley’s Dallas, the South Side on Lamar apartment complex, and the old Dallas High School building.
City records show Matthews’ firm was selected over the bids from six other groups, including one from engineering and design firm WSP Inc., which developed the master plan for the convention center redevelopment.
The City Council voted 12-1 to approve the contract. Council member Cara Mendelsohn was the lone vote against the deal citing ongoing concerns with the new convention center project’s price tag and other issues.
Mayor Eric Johnson was absent during the vote. Mayor Pro Tem Tennell Atkins abstained from the vote, which typically occurs if an elected official has a conflict of interest. He didn’t immediately respond Wednesday to a question on why he abstained from the vote.
The project management deal could grow to as much as $71 million due to clauses such as an extra $2 million that could be added to account for any increases in the scope of the project, and a $4 million renewal option that could extend the contract to a seventh year.
Construction for the new convention center is planned to start in 2024 and be complete by 2028. A proposed new deck park attached to the convention center built over Interstate 30 is scheduled to be open by 2030.
About 30 people urged council members to approve the deal, including Matthews, Dallas County Commissioner John Wiley Price, Downtown Dallas Inc. President Jennifer Scripps. At least a dozen of them said they were representing subcontractor businesses owned by women and people of color.
Residents and city officials called for the new convention center’s construction to have significant diversity in the firms that are hired.
Joyce Williams, director of Dallas’ small business center, told the City Council before the vote that around 51% of the subcontracting firms are owned by women and people of color, and that tally is made up of 18 firms made up of owners who are African American, Hispanic, Asian and Native American.
The city’s minority/woman business enterprise goals on projects is 38%
“In the last five years, we have not even come close to 50.75 (percent) participation,” Williams said. She said the average high may be around 42%.
The City Council in February 2022 voted to tear down the Kay Bailey Hutchinson Convention Center and build a new one. Several officials believe it’s the best change for Dallas to compete with other cities for major events, provide better amenities for residents and visitors and increase tourism revenue.
The building has around $700 million in deferred maintenance costs, including needs for a new roof.
The planned footprint of the new convention center would essentially rotate 90 degrees from the current building so the entrance runs parallel with the west side of Lamar Street/Botham Jean Boulevard.
A new convention center is a centerpiece of the city’s redevelopment plans for a huge swath of downtown stretching from the Eddie Bernice Johnson Union Station at the southwest end of the central Business District to the Dallas Farmers Market a little more than a mile southeast.
The new building is planned to be 2.5 million square feet, about 500,000 square feet larger than the current facility, with 10% more exhibit hall space, more than double the amount of meeting room space and nearly triple the amount of ballroom space. The amount of parking space would remain around 2,000 with a split of underground and above ground options. Plans also call for adding a food hall and rooftop terrace. The existing heliport would migrate over to the new convention center.
The demolition of the current building would open up access to around 30 acres in the area, which city officials believe could be turned into a mixed-use entertainment district connecting downtown to the Cedars neighborhood. It could lead to more hotels, restaurants, office space, housing and other amenities.
Dallas is planning to use two funding methods to pay for the convention center and related projects, expected to bring in almost $4 billion over 30 years.
The state in 2021 approved the city’s request to keep a portion of the state’s percentage of hotel sales taxes, hotel mixed beverage taxes and hotel occupancy taxes collected from businesses within a 3-mile radius of the convention center. It will last for 30 years — until 2051 — and is expected to bring in $2.2 billion.
Separately, Dallas voters in November 2022 approved the city to raise the amount of hotel occupancy taxes collected from customers of hotels, motels and short-term rentals from 13% to 15%. The increase is expected to bring in $1.5 billion over 30 years, with $1.2 billion slated for the convention center replacement and up to $300 million to renovate Fair Park’s Cotton Bowl, Coliseum, Automobile Building, Band Shell, Centennial Building and Music Hall.