Convention losses during pandemic expected to reach $1 billion, Nashville Convention and Visitors Corp. says

Nashville businesses have lost an estimated $500 million in revenue due to convention cancellations during the pandemic, and the Nashville Convention and Visitors Corp. expects it to hit "close to a billion dollars," by the end of the pandemic, NCVC President and CEO Butch Spyridon said Tuesday.

Additionally, cancellations are expect to cost taxpayers roughly $43.11 million in local and $40.38 million in state taxes during that time period, according to the NCVC. Overall, the city saw $100 million in revenue lost in the first few months of the pandemic.

NCVC cited 1,225 meeting and convention cancellations totaling more than 1 million hotel room nights and 638,351 fewer visitors from Feb. through June 2021. This number does not include independently arranged meetings not reported to the NCVC; more cancellations are expected.

The estimated $500.14 million lost revenue accounts for money visitors might have spent on hotels, meals, shopping and entertainment while in Davidson County. But it's just a fraction of the projected loss to come.

"I fully expect we'll hit close to a billion dollars in lost convention business by the time all is said and done," Spyridon said.

A fraction of those cancellations continue into early 2021, with six in January, three in February and two in March. April, May and June so far have one cancellation each.

Spyridon anticipates that conventions will begin to resume in March, assuming the pandemic has been controlled by then. January and February are "at a high risk of disappearing," he added.

"We don't know when the end is, but I absolutely know there is an end to this, and it's probably six or eight months of struggle, and then we begin recovery," Spyridon said.

Despite the significant hit to one of Nashville's top industries, Spyridon said it's not cause for panic. As the public health crisis continues and the timeline for a return to "normal" remains unclear, the NCVC's staff is focusing on building relationships with potential convention clients to keep Nashville "top of mind" for the post-COVID-19 future.

"We're still pretty optimistic that if we get the spread under control and a vaccine by the end of the year that we can hang on to business," Spyridon said.

NCVC: Pandemic halted Nashville's booming convention business

Conventions make up 42% of Nashville's hotel market, itself one of the city's top-earning industries, according to Spyridon. Leisure accounts for 34% of hotel stays, and businesses travel and contracts with airlines and other companies make up the remaining 24%. 

Nashville was on track to set a record for visitors in February, Spyridon said. Before COVID-19 brought large gatherings to a halt in mid-March, Nashville was slated to host 16.1 million visitors in 2019, according to the NCVC. Spyridon said this year's visitor cou could now be slashed by around 30% for the fiscal year through September.

"The meter is still running," Spyridon said of the total amount of lost business revenue — convention and otherwise — since the start of the pandemic. "We're at about $2.5 billion today in (total) lost business. I think over the course of two years, it will be in the $5 billion range in lost business revenue, and it's money we'll never get back."

Convention cancellations have impacted every hotel with meeting space in the county.

The Gaylord Opryland Resort & Convention Center, Nashville's largest hotel, was likely hit the hardest "in terms of volume of group cancellations," NCVC said in a statement to The Tennessean, but the property has also "had some success in re-booking canceled groups for future dates."

Cancellations have ripple effects far beyond hotels. Convention attendees tend to spend considerable amounts in dining and entertainment while in town, and conventions often lead to return visits for pleasure or new business opportunities, according to Spyridon.

Barrett Hobbs, owner of Cumberland Hospitality, has three bars and restaurants in the Opryland area and three downtown. He said his business has been cut by about 98% due to drops in convention and tourist traffic and restrictions imposed by the city.

Business dropped significantly after the men's SEC Tournament was canceled, he said.

"...from an economic standpoint, when you take away tourists and ... conventions and you take away the ability for even the locals to come in, there's no business left."

Hobbs said the city needs to focus on letting its businesses open and operate safely to avoid an "economic disaster."

"Then we can address the conventions," Hobbs said. "Economically though, we have to move quickly."

Maintaining creative contacts

In the meantime, NCVC is pouring its efforts into creative, interactive virtual experiences and partnerships with local businesses to keep potential clients interested and the city ready.

On Tuesday, NCVC hosted a live virtual cooking demonstration with delivered ingredients for 41 clients and potential clients. Nashville chef and TV personality Maneet Chauhan taught participants how to make chicken tikka masala from her Chaatable restaurant. 

Chauhan said her participation is just an extension of her desire to share Nashville with others.

"Unfortunately, they are not in front of me, but they are in their kitchens, so it is the next best thing until the time they can come back and I can actually cook in front of them," she said.

NCVC has also hosted 10 virtual songwriter events for 85 clients throughout the U.S. and U.K. and delivered Nashville-themed gift baskets from Batch Nashville to groups who cancelled previous reservations.

The organization coordinated a virtual singer-songwriter experience and gift baskets for one company that decided to continue its conference virtually in July.

Spyridon said NCVC has cut back dramatically, but kept the operation running so Nashville is ahead of the competition when in-person conventions resume.

"We're going to put ourselves out there," he said. "We're going to get above the noise and put a positive spin (on the situation), or as positive a spin as possible, as opposed to, 'the sky is falling.'"

From Feb. 2020 through June 2021:

• 1,225 meetings or conventions were cancelled
• This amounts to an estimated 1,001,351 canceled room nights and 638,351 fewer visitors

Estimated losses from Feb. 2020 through June 2021:

• Estimated $500.14 million loss in direct spending on rooms, meals, shopping and entertainment in Davidson County
• Estimated $40.38 million loss in state tax revenue
• Estimated $43.11 million loss in local tax revenue

Source: Nashville Convention & Visitors Corp

Reach Cassandra Stephenson at ckstephenson@tennessean.com or at (731) 694-7261. Follow Cassandra on Twitter at @CStephenson731.