It's slipped out of the public eye recently, but Rank, Inc.'s proposed trade and convention centre, on the site of the former Halifax Herald Building, and the planning process around it, has far too many parallels to the political wrangling that brought us the original World Trade and Convention Centre (WTCC) on Argyle. This feature article, by freelancer Hilary Beaumont, is the foundation of a series of pieces that will follow the new trade centre as the story develops.
John Buchanan stood atop one of the 110-storey trade towers in New York City. In these buildings, he had been told, 1,000 companies leased offices, 10,000 people worked, and 50,000 people did business each day. No direct flights from Halifax had been available for his trip, but the Nova Scotia premier hoped his announcement would change that.
Soon, Buchanan told reporters, Halifax would be home to a scaled-down version of the New York City WTCC. Negotiations were already underway with Guy Tozzoli, president of the World Trade Centre Corporation. Buchanan predicted Halifax’s complex would become the economic and business capital of the four Atlantic provinces. That was in November, 1981.
Today, as the HRM pushes forward with its plan to build a more physically impressive trade centre, parallels in the two story lines have appeared. Planning this time and last time started with a push from the government, not the public. Opinions that failed to cheer on the trade centre were chided by politicians and businesspeople. And last time, cheerleaders of the WTCC promised it would not operate at a deficit, but later changed their tune.
The envy of Dartmouth
The story begins in late August of 1981. Halifax City Council had, with much hesitation, approved the vague idea of a downtown convention centre with an attached hotel and parkade. It would cost an estimated $12 million, to be shared by three levels of government. The city would pay about $1.5 million, the federal government would pay $2.75 million, and the province would pick up the remainder. Council didn’t know where it would be built, what the public thought of the idea, or what it would look like.
Eight councillors voted in favour; four against.
“We’ve been waiting on this project for three or four years and now it’s being pushed on us in a matter of days,” councillor Graham Downey said after he voted against the proposal.
“Halifax will be flying a new flag, a world trade centre flag,” Mayor Ron Wallace said after the council meeting. “It is the only city in this part of the country that can make that claim and Saint John, St. John’s and Dartmouth will be envious.”
For the trade centre to be a financial success, it had to be successfully marketed. With council on board, it was time for interested parties to talk up the economic advantages, and win over the public.
Just three days after the elusive plans were announced, Bob Chisholm told the Mail Star that the convention centre would generate $8 million in spin-off revenue each year. That meant money in the pockets of hotels, stores and businesses in the downtown area. Prior to Council’s vote, the executive director of the Halifax Visitors and Conventions Bureau had played a large role in marketing the idea of a trade centre in Halifax.
“That is a very conservative projection, not knowing the specifics of the facilities,” he said.
Mail Star headlines in the days and months to come praised the centre as an “economic boost” that would “attract new businesses.” Before the complex opened in 1984, the public would hear more promises. The WTCC:
- would give airlines the impetus to schedule direct flights from Halifax to major cities;
- The WTCC would garner $35 million in spin-off revenue to the city and the province by the end of 1987 (an inflated value from Chisholm’s “conservative” projection);
- The WTCC was projected to break even, despite the fact that many other trade centres ran million-dollar deficits.
Speaking for the province, Government Services Minister Jerry Lawrence denied the possibility of a WTCC deficit until 1985 – the year after it was built.
Public shut out
On February 19, 1982, with four pages of pomp and circumstance, the Mail Star revealed the trade centre design: a three-storey convention centre with a five-storey trade tower. Trade Centre Limited, a nine-member board established the previous year by the city, had recommended the design to the province. It contained a modest 134,000 square feet of space that included a convention hall, restaurant and meeting and exhibition rooms.
The government had not yet asked Haligonians what they thought of the idea.
In the architect’s sketch, the building sat on the piece of land above Grand Parade, between George, Argyle, Duke and Brunswick. But that land had to be consolidated in order for the project to go forward. Council set a public hearing for April 7 to ask the public whether the smaller lots should be joined into one big lot, and whether the development contract should exceed the 40-foot height limit.
Haligonians were not asked if they wanted a trade centre; they were asked where they wanted it.
Meanwhile, it was full-steam ahead for the province and Trade Centre Limited. In March, five delegates from Halifax visited trade centres in Calgary, Houston and New Orleans.
“We’re convinced and reassured that what we’re doing is the right thing and we’re going about it in the right way,” TCL president D.C. “Dugger” McNeil said when he returned from the trip.
Representatives in Calgary, proud owners of a trade centre the same size as the one proposed for Halifax, had told McNeil his centre should be bigger. They also recommended he tax surrounding hotels to offset the trade centre’s deficit. The Calgary trade centre ran a $1 million deficit its first year.
McNeil brushed off both suggestions. They might be the right decisions for Calgary, he said, but the two cities were different sizes and had different economies.
A special council meeting was held April 7, 1982, at 7:30 p.m. to hear public feedback. Only 11 people showed up to make statements.
Seven of these people had a vested interest in the project since they worked for TCL, the architect's firm, the construction firm, and so on. In general, everyone who spoke was in favour of the proposal. A common complaint was the lack of downtown parking.
Two people voiced concerns with the building design: Dimitri Procos of the Community Planning Association of Canada, and Allan Ruffman, a representative of the Ecology Action Committee. Procos said he thought the facades of the building on Argyle and Duke streets should be “humanized.” Ruffman said the facades should be made “sympathetic to the surrounding area.” The view of the building from the street just didn’t fit, they said.
Ruffman also said he wanted an in-depth traffic study to be carried out before the plan could proceed.
He then asked the question others were avoiding: Would the deficit fall on the shoulders of city taxpayers? The city should figure out a way to cover a deficit, he said -- without raising taxes.
On April 15, 1982, council passed a motion to allow the development of a convention/world trade centre on the block above Grand Parade.
But deputy mayor Doris Maley insisted that councillors be given time to gauge public opinion during the 30-day appeal period. McNeil said the only thing that could stop the centre from being built would be a “rash of appeals.”
The day the appeal period ended on May 14, Halifax City Council made a financial commitment to the WTCC. The centre would cost a total of $24 million to construct (though it isn’t clear exactly when the amount doubled). The city agreed to pay one tenth of the building costs, plus $900,000 toward the operating budget of the Metro Centre, for a grand total of $3.3 million.
The federal government committed $2.8 million. The province would pick up the tab for the remainder – $18.8 million – despite a recession and cuts to provincial spending earlier in the year.
Nova Scotia Premier John Buchanan cuts the ribbon at the newly opened World Trade Centre on Argyle Street in this newspaper photo taken by Paul Darrow of the Daily News.
The World Trade Centre of the Atlantic opened on Feb. 24, 1985, to 1,200 invited guests. When they arrived, they received gifts of cloth-covered black boxes with golden trim containing decks of commemorative playing cards. Each deck cost $10, for a total of $12,000. The guests were treated to cocktails. Then dinner was served with wine. Then dessert with champagne. Wine, liqueurs, and dinner alone cost $36 per head, for a grand total of $43,000. Entertainment, security, staff time and invitations were extra.
The cost of the cards was “no big deal whatsoever,” Development Minister Roland Thornhill said following the event. The trade centre had the potential to help the province, he said, and Nova Scotians should promote it rather than “constantly harping on the negatives.”
As they wined and dined, John Buchanan addressed his guests: “Frankly, I’m getting a little tired of critics of this convention centre. This building will generate more revenue than the deficit on the balance sheet of the building itself.”
“There will be a day in the near future when the centre will break even and generate revenue itself,” he added.
Buchanan and Thornhill’s attitudes and TCL’s spending set the tone for the years to come.
On March 31, 1985, the World Trade and Convention Centre ended its first fiscal year with a deficit of $842,000. To balance the books, the city ponied up $153,000 and the province paid $689,000. They'd had a budget since 1982, when they started marketing the plan.
One month later, Thornhill confirmed that the WTCC was projected to end its second fiscal year with a $1.5 million deficit.
Taxpayers made up the $1.2 million shortfall on the province’s end. A $320,000 grant from the City of Halifax made up for the rest.
Between 1984 and 1994, Trade Centre Limited lost a total of $8.3 million (before depreciation).
In 1994, after yet another disastrous $1.08 million loss the previous year, President Ken Mounce was fired and replaced shortly after with Fred MacGillivray. Mounce had boasted of 59 major convention bookings in 1992 — the most since the trade centre opened. However, the recession the previous year meant fewer people per booking.
Mounce told the Daily News that each person attending a convention would spend about $225 per day. But a few years earlier Mounce had told the Chronicle Herald that the average delegate would spend $165 per day. TCL had used these estimates to calculate spinoff revenue for local businesses.
While Trade Centre Limited operated at a deficit, the argument for spinoff revenue was the only one that could benefit the public. After a decade, people were tired of paying for the failures of Trade Centre Limited.
MacGillivray said he had a five-year plan. The year after he was hired, TCL operated at a $405,000 deficit. In 1997, he made the company its first profit: $251,725. It was a tiny sum compared to the initial $24 million investment and promises of envy. Since then, they've announced positive and negative numbers, but it's never really clear what the numbers mean.
The province and the city now understand that the Crown corporation typically loses money every year. TCL’s current business plan aims to generate economic activity rather than profits.
“Attracting and hosting major events, meetings and conventions fuels our provincial economy,” minister of economic and rural development Percy Paris said in a recent press release.
As the new WTCC plan moves forward, the economic spinoff motives cited last time haven’t changed. The only major difference is that the city is behind the current push rather than the province. HRM has not yet asked Haligonians if they want a new trade centre.
What did we miss? Comment below, and keep the story going!
