From cancelled quilting gatherings to car shows, the COVID-19 pandemic has wiped out hundreds of millions of dollars in lost revenue from canceled events, conferences and conventions across the state.
Not including tourism dollars, the Detroit Metro Convention and Visitors Bureau estimates that Metro Detroit alone has lost more than $200 million from convention and business meeting cancellations.
And that’s not including revenue generated by the state’s largest convention center, TCF Center in downtown Detroit. The annual Detroit auto show held there alone typically generates an estimated economic impact of $430 million to the region.
“Recognizing that our governor and the administration are doing what they can to save lives, as a result of putting restrictions in place, it has demoralized our industry and devastated it, just devastated our industry,” said the group’s CEO Larry Alexander.
The auto show was cancelled, in part, because the TCF Center was converted into a temporary field hospital early on in the outbreak, when it appeared hospitals could be overwhelmed. It treated a total of 39 patients before closing.
Related: Field hospital at TCF Center treated 39 coronavirus patients over nearly 4 weeks
Industry experts say the revenue losses may have a reverberating effect on hospitality businesses, including shuttered restaurants and hotels and a scaling back of marketing efforts to bring in business and visitors.
For nearly three months, large- and medium-scale gatherings have been forbidden in Michigan by order of Gov. Gretchen Whitmer to limit the spread of COVID-19.
In areas less affected by the pandemic, like northern Michigan, Whitmer only this week allowed gatherings of up to 50 people indoors and up to 250 people outdoors. Outdoor performance and sports venues in those regions can have up to 500 people inside.
Related: Outdoor performance and sports venues in those regions can have up to 500 people inside.
Elsewhere in the state, including nearly all of the major population centers, gatherings of up to only 10 people are allowed indoors and 100 outdoors.
A workgroup composed of state labor department officials and travel industry leaders have sent Whitmer proposed safety guidelines that call for a reopening of conference and convention spaces to 50 percent capacity.
Whitmer’s office is vetting those guidelines.
While the impact of association conferences coming to town may not always be obvious to residents, the reality is that conventions can be financial boons, said Dave Lorenz, vice president of Travel Michigan, which is part of the Michigan Economic Development Corporation.
The economic impact isn’t just in dollars spent around the town or on hotel and conference space bookings, but on return leisure trips and even business investments sparked by that initial visit, he said.
“The meetings, conventions and conference world is critically important to the future of Michigan's economy and its communities, specifically our biggest cities,” he said.
Lorenz didn’t have an estimate on the total year-over-year direct economic impact of the meetings, conferences and conventions portion of the state’s travel industry.
Some industry leaders are hopeful 2020 won’t be a total loss, with some bookings still on the table for later this summer and fall.
Trevor Tkach, president and CEO of Traverse City Tourism, said with the spring and early summer seasons wiped out, they’re hoping to make up business in the fall and winter by shifting some of the nearly 500 cancellations onto those seasons. He said the region has lost 10s of millions of dollars due to the cancellations so far.
“We definitely depend on group business in the spring and fall, on those shoulder seasons for us, because they help to sustain business and employment for a lot of those who work in the lodging space,” he said.
Tkach concedes that the recent allowance of gatherings of up to 50 people indoors and 250 people outdoors in his region still preclude many of the previously-booked conferences and meetings.
Some say an industry bounce back isn’t likely until 2021.
“We’ve lost over 100 groups for 2020, and that’s a big blow,” said Doug Small, CEO of Experience Grand Rapids. “With that said, the vast majority of them have rebooked for a future year.
“While they’ve walked away in 2020 for the obvious reasons, we have worked with them to find dates for future years, so we are bullish on 2021, 2022 and 2023 at this point.”
Hotel room revenue in Kent County was $226 million last year. Latest forecasts place that number at about $125 million this year -- about the amount it was in 2010, following the Great Recession, according to Small.
The revenue isn’t just important for the hotels themselves, but also Experience Grand Rapids, which captures a portion of that in taxes.
“That’s how we function. We get a portion of that revenue and if it’s not there, then that gives us very little to promote and market the destination going forward,” he said, noting that hotel room occupancy has been slowly building back up since April.
Another looming threat against the comeback of meeting, conference and convention travel is the possibility of a second wave of COVID-19 later this year.
Even with more bookings in 2021, it may not be until a vaccine becomes available that business returns to normal, according to Alexander.
“I really believe it’s probably going to be next year before we actually begin to experience anything close to what we’re accustomed to,” he said. “I think it’s going to be 2021 before we start to enjoy some of the large concerts that we’ve had, sporting events and getting large crowds of people together again, and that’s really hoping we get a vaccine.”
Lorenz said he’s confident that convention and meeting spaces will be able to open safely, but that the amount of business will depend on the perception of safety.
“Businesses, managers and owners aren’t going to feel comfortable sending their people out to conferences for a little while, maybe the first of the year,” Lorenz said.
PREVENTION TIPS
In addition to washing hands regularly and not touching your face, officials recommend practicing social distancing, assuming anyone may be carrying the virus.
Health officials say you should be staying at least 6 feet away from others and working from home, if possible.
Use disinfecting wipes or disinfecting spray cleaners on frequently-touched surfaces in your home (door handles, faucets, countertops) and carry hand sanitizer with you when you go into places like stores.
Michigan Gov. Gretchen Whitmer has also issued an executive order requiring people to wear face coverings over their mouth and nose while inside enclosed, public spaces.
Additional information is available at Michigan.gov/Coronavirus and CDC.gov/Coronavirus.
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Kent County to allocate $94.2M for coronavirus relief
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