King County Offers $100 Million To Sustain Convention Center Work

SEATTLE — King County is finalizing a $100 million financing package to keep hundreds of construction workers on the job at the Washington State Convention Center expansion project in downtown Seattle.

In May, developers warned the partially-completed project faced a $300 million budget shortfall and could run out of money by the end of the year due to the steep financial ramifications of the COVID-19 pandemic.

On Thursday, King County Executive Dow Constantine announced his office was working with the county councilmembers to offer a $100 million loan from the county's $3.4 billion investment pool, to be paid back later with 1 percent interest.

"This action is designed to preserve many hundreds of family-wage construction jobs at a difficult time for workers and for our economy, as well as to prepare our region to take advantage of economic growth with the pandemic is behind us," Constantine said. "One of the consequences of the coronavirus is the temporary devastation of the travel and tourism business."

The nearly $1.9 billion undertaking is among the largest in the city's history and provides work for roughly 1,000 construction workers in the region, according to the county. In normal times, Constantine said, the project would have issued more bonds, backed by lodging tax revenues, but with virtually no tourism or events taking place in 2020, that funding source was essentially cut off.

Without money secured soon, developers expected to lay off the project's entire construction force by the spring.

"Last May, we said that if we didn't have a financing plan for the last $300 million by the end of the year, we'd need to start steps to close down the project," said Matt Griffin, one of the project's developers. "Now we're there. This project has the potential to be a crucial community asset for our recovery. Delaying it would be a huge loss for the region."

All of the speakers at Thursday's briefing framed the revitalized convention center as a cornerstone of the post-pandemic economic recovery, providing a new home for events that draw visitors from all over the world and boosting revenue at nearby local businesses.

"As we have painfully learned over the past 10 months — recovery for the travel, tourism and hospitality industry in King County will take years," said Tom Norwalk, CEO of Visit Seattle. "It is critical for our region's recovery that construction continues. Attendees to these national meetings spend broadly throughout the region — impacting restaurants, retail and cultural organizations in addition to our growing lodging sector."

An immediate benefit, the speakers reiterated, is ensuring continued employment for hundreds of workers.

"Perhaps at no other time in our region's history has it been more critical to fight tooth and nail to save every existing family-wage job," said Jeanne Kohl-Welles, the King County Council's budget chair. "I believe we have a fiscal duty to do everything it takes to keep this highly significant project for our economic recovery moving forward."

Critics of the project, including former Seattle Mayor Mike McGinn, have criticized the massive project as a "black hole," a "money pit" and an oversized investment in a "stagnant and dying industry" that leaves taxpayers on the hook.

In March, McGinn co-authored an opinion piece published in City Observatory, which reads in part:

"If Seattle—or any city—wants to capitalize on the tourism business, it's not going to succeed by throwing money at the ever larger non-descript barns that are convention centers ... The city's real asset is its unique urban quality, its public spaces, art, culture, nightlife and its distinctive small businesses, like the restaurants, boutiques and vendors that dor downtown Seattle and Pike Place Market."

If the project remains on-track, the expanded convention center is expected to open in 2022. According to Visit Seattle, nearly three dozen conventions are booked to take place between 2022 and 2026.