Detroit Regional Convention Authority in Negotiations with SMG to Manage Cobo Center

The Detroit Regional Convention Facility Authority announced Thursday that it has selected a proposal from convention and arena management company SMG to take over operations of the Cobo Center. Negotiations will take place through September and day-to-day management could be turned over to SMG by October 1.

The RFP process was approved by the Authority on July first. Requests were sent out on July 13, with responses due August 3.

SMG’s proposal was selected out of four received. Other proposals were sent from Global Spectrum, Hines and Jones Lang LaSalle, interim Authority CEO Walt Watkins tells EXPO. "The Authority felt that desired improvements to the ongoing operations and improvements at Cobo could best be implemented by a company with extensive experience managing conference and convention centers, particularly those with similar characteristics and challenges as Cobo," he says.

In announcing the selection of SMG’s proposal, Watkins said that the firm already has "significant" relationships with associations that can bring in convention business. SMG’s experience, he added, extends to "renovating older buildings."

The renovation experience will come in handy. The Authority, which took control of Cobo under legislation passed by Michigan Legislature on September 15, 2009, also announced that it has received an $80 million loan from Wells Fargo to begin work on "phase one" improvements and repairs to Cobo Center. The city of Detroit will be paid $20 million from those funds to transfer the Cobo Arena and its parking garages to the Authority.

According to Watkins, key points of negotiations with SMG will focus on the division of responsibilities and goals. Plans will also include expanding the sales and marketing team. "There are many facets and areas of a contract of this type, but generally we must focus on clear delineation of responsibilities; anticipated results and our respective liabilities. We will also focus on the human resource transition issues and the creation of a robust sales and marketing process," he says.