UPDATE: Sept. 1, 2020: Orange County, Florida, is halting all work on a $600 million convention center expansion project due to a drop in hotel taxes depleting the project's budget. In order to conserve money, Orange County Mayor Jerry Demings said all contracts related to the project will be terminated, including the contract with project construction manager PCL Construction.
Demings announced in July, following the plummet of the project’s revenue source due to COVID-19, that the project would be delayed. Development has officially stopped, after $12 million was spent on the design and preparation. Construction was supposed to begin later this year.
Dive Brief:
- Officials for two major renovation projects — the Broward County Convention Center in Fort Lauderdale, Florida, and the Dallas-Fort Worth International Airport (DFW) — announced this week they would be put on hold due to the coronavirus.
- The $3 billion airport and $900 million convention center have both felt the pandemic’s historic impact on the travel and hospitality industry, and parts of the work will be delayed indefinitely by their owners because of it.
- Nationwide, construction starts for major hospitality projects have dropped drastically when compared to the same period from 2019, according to data Dodge Data & Analytics shared with Construction Dive. Since the beginning of the year, construction starts across the U.S. on exhibition halls and hotels or motels have dropped by 67% and 47%, respectively, when compared to 2019.
Dive Insight:
The two pullbacks on works in progress are notable. Since the breakout of the pandemic in March, work at most construction projects that had already broken ground has continued. These two high-profile jobs show that even if projects have already begun, the economic uncertainty surrounding coronavirus also has the power to stop them in their tracks.
In the Dallas metro area, hotel and motel construction dropped 40%, according to Dodge, and Fort Lauderdale has seen an even larger drop, with exhibition hall starts plummeting 99% and hotel starts 79%. This is at least in part due to the heavy decrease in travel caused by the coronavirus.
After DFW posted record numbers in 2019 that included more than 200,000 daily travelers, just 12,500 people moved through the airport in April. Although this summer’s travel numbers are up, DFW Airport CEO Sean Donohue told a local TV station that he expects business travel will remain at a virtual standstill for perhaps years to come.
As a result, the $3 billion Terminal F project has been halted, with no announcement on when it will resume. The airport had announced a deal with American Airlines to build the new terminal last year, but in April Donohue warned DFW board members that it might have to be postponed or scaled back because of the coronavirus.
He confirmed that decision this week, saying "to be spending a lot of money right now not knowing the pace of the recovery of all of America's plans, we thought the right thing to do was to suspend [the project].”
In Fort Lauderdale, the eastern expansion of the Broward County Convention Center, including a headquarters for the hotel portion of the project, has been halted indefinitely, partially due to bonds needed to complete the project.
Work on the western expansion of the project, which began last year, will continue through its expected completion in October of 2021. Balfour Beatty is the general contractor on the expansion.
The original plan included construction of 350,000 square feet of exhibition space, 132,000 square feet of ballroom space and an 800-room headquarters hotel.
