While its cost to the State is a sticky issue, the centre attracts big spenders to Dublin for several days at a time, writes SUZANNE LYNCH

SITUATED ON the north bank of the river Liffey, the distinctive glass facade of the Convention Centre Dublin stands out against the city’s skyline.

It may be one of the most spectacular additions to the iconography of the Dublin dockland area, but the convention centre has also proved to be one of the most controversial.

Earlier this year, it made the headlines following confirmation that the State had paid €43 million to the Treasury Holdings consortium behind the centre as part of a public-private partnership agreement. This equated to a State subsidy of €500 per visitor.

While Nick Waight, chief executive of the convention centre, is hesitant about playing any blame game, he does take umbrage at the reports. “The figure of €500 per visitor doesn’t take into account the fact that the number of people coming through the door stay for a number of days and nights in the city,” he says. “86,000 visitors last year equates to about 170,000 visitor days.”

He also notes that the State is effectively retrospectively paying for the €380 million building that was built by Treasury Holdings but which will be handed back to the State in 25 years.

Nonetheless, the fact that the exchequer is footing part of the bill at a time when the public finances are under pressure is inevitably a noose around the neck of the centre, which celebrates its first anniversary this month.

The idea for a purpose-built convention centre had been part of Government policy since the 1980s, but was finally given the green light by former minister for tourism John O’Donoghue in 2005. Two years later, Spencer Dock Convention Centre Dublin Ltd, a consortium owned by Richard Barrett and Johnny Ronan, won the contract to build, operate and run the centre.

Under the public-private partnership agreement, the State pays the company an annual charge of about €47 million a year for the first five years, and just under €24 million for the subsequent 20 years. The building will then revert to the full ownership of the State.

A report by the Comptroller and Auditor General published last September found that O’Donoghue decided to proceed with a national conference centre in 2005 after being told the costs would outweigh the benefits by up to €217 million.

The report also found that the winning consortium’s bid was “the most expensive proposal”, and its selection was based on higher marks for design, construction, operation and maintenance.

Nonetheless, Waight asserts that the convention centre is a major addition to the Dublin economy.

He points out that most convention centres around the world are built and financed solely by the State and don’t benefit from the risk-sharing model implicit in the public-private partnership agreements. More significantly, most are loss-making.

“Ninety-nine per cent of convention centres around the world lose money. They’re there not to make money. They’re there to generate revenue within the economy,” Waight says.

He believes that the convention centre here has done just that.

It hosted 300 separate events in its first year of operation, with 86,000 attendees, many of whom spent up to four nights in the city.

“The impact on the local economy has been huge. We’ve had very positive feedback from hotels who have benefited from the bed nights. It also has a knock-on effect on everything from linen-cleaning to the restaurant trade.”

The core of the centre’s business is international conferences. About 40 per cent of the business derives from the international conference market, with the centre hosting a number of events this year including the annual conferences for various international medical associations and the Google Europe, Middle East and Africa sales conference. Supporters of the convention centre argue that this is effectively a new tourism market for Ireland. It’s a category of business tourism that would not be coming to Ireland were it not for the convention centre.

Waight argues that the international conference market is relatively recession-proof. “Many of the major international associations have commitments in their constitution to hold annual conferences. The lead time can vary anything between three and 10 years.”

But he admits that, like almost every other sector in the economy, the general conference market “crashed” when the recession hit.

“While industries still had to have events, there was a general rebasing of the market. Costs came down.”

Revenues at the convention centre are about 18 per cent below the projected revenue line, according to Waight, although he argues that this is a good result in light of the more general 35 per cent drop in the market.

While the company has been hit on revenue, it is on line with profit due to management of costs, and still hopes to be profitable within four years.

Waight also defends the centre’s record in attracting visitors, following criticism that the average attendance has been just over 300 people, despite the fact that the centre can accommodate up to 8,000.

“The average number for a conference anywhere is 1,500, but most are much smaller. While the centre can accommodate up to 8,000 people, that figure is based on simultaneous sessions and duplication of space. The maximum capacity of the centre is more like 5,000.”

Waight himself is something of a veteran in the conference and events industry in Britain, with more than 20 years’ experience. He was appointed chief executive of the convention centre here after Treasury appointed the National Exhibition Centre Group in Birmingham to run the facility. Waight still remains chief executive of the Birmingham exhibition centre, dividing his time between Dublin and the UK. Is there a conflict of interest in trying to represent two competing venues?

“No, they are very different venues. Dublin is unique compared to most convention centres because it is in the middle of city, and is located in close proximity to the airport. The link with Birmingham means that we have managed to pass on business to Dublin. International conferences go to different places every year.”

As well as international conferences, the centre also hosts smaller local events, from black-tie dinners to the Christmas Toy Show Experience. Among the highlights this year was the royal visit.

Asked whether the convention centre is priced too high for smaller-scale, locally generated events, Waight says the company does negotiate on price. He also disputes that the centre eats into the conference business of other hotels in the city, arguing that the bed nights generated by the convention centre far outweigh any hit on the market.

Waight is upbeat about the future for the convention centre, which hopes to be the best such facility in Europe by 2014. This year the centre was named second-best overseas convention centre in the Meetings and Incentive Travel Industry Awards, after only four months in operation. The convention centre has bookings up until 2015, and already has more bookings for 2012 than it did for 2011.

According to Waight, Dublin is one of the best venues for conferences in the world.

“The combination of the people, Ireland’s reputation for hospitality and the city centre location of the convention centre means that Dublin can be the leading conference centre in Europe. We were named the second-best conference destination in Europe this year – our aim is to become the best.”