NASCAR hall is leisure business letdown

NOT LIVING UP TO EXPECTATIONS: The Hilton Garden Inn sits across the street from the NASCAR Hall of Fame in uptown Charlotte. Erik Kohlenstein, general manager of the hotel, said that while he has seen a boost in business with the hall’s opening, he expected more. "Of course, with 800,000 (projected attendees), we thought we were just going to go haywire and just not have any rooms available any day of the week," he said. Photo by Caitlin Coakely

When the NASCAR Hall of Fame opened in May, David Montgomery, sales manager at the Westin Charlotte Hotel, thought the museum would generate travelers taking weekend trips to see the new attraction.

But so far, NASCAR-driven hotel guests are more frequently checking in wearing business suits than Dale Earnhardt Jr. hats.

“We expected it to be more leisure travelers, with convention traffic sort of as an afterthought,” Montgomery said. “But it’s seemed to be the other way around.”

Sid Smith, executive director of the Charlotte Area Hotel Association, is less surprised by the outcome. Though he acknowledges that the hall generates some hospitality business from leisure travelers, the additional space to host conventions and corporate events is the museum’s real value.

That’s why Smith is not concerned about the low attendance numbers for the hall of fame. When the hall was built, financed in part by a 2 percentage-point increase in hotel occupancy taxes, attendance projections were set at 800,000 for the first fiscal year. In the six months since it opened, however, the hall has only brought in a little more than 170,000 visitors, and first-year projections were revised to 350,000.

But, Smith pointed out, many conventions are planned two to five years in advance, so attendance rates might pick up in the coming years.

Erik Kohlenstein, general manager of the Hilton Garden Inn in uptown Charlotte, shares Smith’s optimism. He said he has seen a boost in business with the hall’s opening but acknowledged that it hasn’t lived up to expectations.

“Of course, with 800,000 (projected attendees), we thought we were just going to go haywire and just not have any rooms available any day of the week,” Kohlenstein said.

On the books

Tim Newman, chief executive for the Charlotte Regional Visitors Authority, which operates the facility, encourages Kohlenstein’s and Smith’s predictions.

Over the next five years, the CRVA has confirmed $125 million in bookings, and more are being negotiated, he said. According to surveys of attendees, 60 percent of the hall’s out-of-town visitors came to Charlotte specifically because of the venue, for a convention or other meeting or as a personal trip, he said.

That’s a good sign, said Craig Depken, a University of North Carolina at Charlotte economist who studies sports and entertainment spending. Of the three categories of visitors that the hall might attract — those from out of town who come to the city exclusively for the museum; those who are already in Charlotte for another purpose and decided to stop by and visit while they’re here; and locals — the first category is the one that drives the most economic impact.

The catch is, it’s also the category most difficult to reach by marketing, he said.

“You can advertise all you want in Dearborn, Mich., and it won’t make much of a difference,” Depken said. “It’s when the locals really get involved, that’s what we can leverage.”

While it’s less likely that a family, even a couple of die-hard race fans, in Michigan will travel to Charlotte solely to visit the NASCAR Hall of Fame, it’s more common that a Charlotte resident will bring visiting family to the museum and then maybe dine or shop in uptown Charlotte, he said.

But often, Depken said, that demographic is overlooked because it doesn’t seem to yield as much of an economic impact.

“If you think about lunch for three people, that’s what, $30? That’s not much,” he said. “But let’s do that 1,000 times. While that may not be as grandiose as they may want to portray, it’s nickel and dime. It’s adding up.”

Right now, the hall of fame does not have any posters displayed at local businesses or the airport, said spokeswoman Natividad Lewis, though there are some billboards up around town.

‘It’s not been dramatic’

But so far, those lunch-eaters haven’t been coming out in droves — at least not as much as expected.

“We have seen some more business. We do get some referrals, but it’s not been dramatic,” said Brandon Caudle, owner of Lola’s restaurant across the street from the hall. “But I thought there would be more (business), that it’d be busier.”

Giving an update on the hall at a Charlotte City Council meeting Nov. 22, CRVA officials said reaching racing fans across the country has been difficult, especially with a small marketing budget.

Going forward, Newman said the CRVA will be doing more marketing to locals, particularly when it comes to holiday events, such as UnDeck the Hall on the day after Christmas, when visitors can take a decoration from the Christmas trees decorating the hall.

While marketing efforts have reached race fans nationally, the number of locals coming to the hall and bringing guests has not been as high as it could, Newman said. But with the holiday promotions, he thinks there will be an increase.

“You’ve got all these people coming to town, and what are we going to do with them?” Newman said. “The Hall of Fame is really a unique thing they can show their out-of-town friends and residents.”

Convention gold

But over at the hotel association, Smith said big events are key to the hotel industry.

“The race fans who already come to races and stay one night, they may stay two nights to see the Hall of Fame. That is a help by any measurement,” he said. “But the actual conversion of that into hotel room nights, while positive and good, is not where the big return for the hotels is located. That is located with the second targeted audience: conventions, trade shows and large meetings.”

Depken said the low attendance at the hall this year should not be taken as a sign that the attraction is a flop. It’s common that projected attendance numbers turn out to miss the mark, and the economic downturn has made the projections even less relevant, he said.

“The numbers being generated for the hall of fame were for a world that never existed,” he said. “They were being made based on an economy that’s different than what we have today. I put zero weight on the predictions.”

Caitlin Coakley can be reached at [email protected].