KEVIN LEININGER: Demise of downtown arena shows Fort Wayne’s momentum comes in many forms

Fort Wayne's "momentum" isn't threatened by the demise of the planned downtown "event center." (Courtesy image)

One of Mayor Tom Henry’s favorite words is “momentum.” Whether the topic is neighborhood improvement, jobs or downtown development, it’s a prominent part of his vocabulary — even when circumstances seem to suggest otherwise.

“It’s my job to lead and ensure that we continue the positive momentum and investments we’re experiencing in our community. This means exploring bold ideas that can be transformational,” he said in the Nov. 16 statement announcing an indefinite delay on a proposed $105 million downtown arena and “event center.” To some, use of the word in that context might have seemed ironic or even cynical. But it was, in fact, perfectly appropriate.

Avoiding a bad decision represents a sort of momentum, too. And make no mistake: That’s precisely what plowing ahead with the glitzy project despite public opinion and a cautionary $49,000 study by Utah-based Victus Advisors would have been.

When the report was finally released a couple of months behind schedule, it essentially contradicted a $39,000 study done in 2015 by Hunden Strategic Partners by concluding that, unless it was managed in a way that did not compete with the Memorial Coliseum, the new 6,000-seat facility would generate just 10 new events per year with an annual operating loss of $469,000 if operated as a stand-alone facility.

“Due to the nature of the Fort Wayne event market, in particular the expected transfer of existing event activity between existing venues and a new downtown event center, Victus Advisors’ direct estimates of economic/fiscal impacts ($89.5 million in direct spending and $1.3 million in taxes over 30 years) are relatively low compared to the $105 million estimated project costs,” the study stated. Even so, it added, eight of 10 “stakeholder” groups surveyed supported the project because of its perceived long-term support of downtown improvement plans. It’s not easy for politicians to resist that sort of pressure.

On one level, of course, Henry had little choice. As his November statement acknowledged, the project would have required help from the Indiana General Assembly and, “I don’t feel as though it would be fair to ask for their support during the 2018 legislative session when our community hasn’t yet embraced the project.” Presumably at least part of that support would come in the form of increased Professional Sports and Convention Development Area revenues generated by sales taxes at the coliseum and other venues. Expanding that area would have been crucial to a new arena because the coliseum currently receives about $2.6 of the $3 million generated annually, which has funded $45 million in capital improvements at the coliseum since 2007.

That begins to illustrate the fatal flaw in the downtown arena plan as it was presented. The coliseum regularly ranks among the top-performing arenas of its size in the world, but after interviewing several promoters Victus concluded Fort Wayne remains a “secondary entertainment market” and that it “may be too saturated with concert venues if a downtown venue is built.”

What’s more, Victus noted, the coliseum is able to keep rental rates relatively low in part because of the “significant on-site parking revenue . . . (that) could make it very difficult for a new downtown event center to compete.”

Replacing that sort of competition with cooperation is why Victus and others supported the creation of a management umbrella that would include the new arena, coliseum and Grand Wayne Convention Center. But that would have required an agreement between the Democrat Henry and the Republican-dominated Allen County government, which owns the coliseum. Despite discussions, it never happened.

Instead of viewing Henry’s decision as a setback, however, local officials should view it as what it really was: An opportunity to step back and view the community’s long-term arena needs in a more comprehensive way. As coliseum General Manager Randy Brown told me shortly after Henry’s decision was announced last month, the community now has the opportunity to plan for a next-generation larger arena. Despite all of its upgrades, most of the coliseum’s arena dates back to 1952, and sooner or later a replacement, not a competitor, will be necessary.

Where should it be built? How should it be funded and managed? The need for such decisions is years away, and Henry has now provided the time to make them wisely. In the meantime, Fort Wayne can best continue its momentum by concentrating its attention and resources on things it doesn’t have. Who knows? That $49,000 paid to Victus may prove to be a bargain.

This column is the commentary of the writer and does not necessarily reflect the views or opinions of The News-Sentinel. Email Kevin Leininger at kleininger@news-sentinel.com or call him at 461-8355.

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