Cleveland Businesses’ Hopes for Convention Bonanza Fall Short, Reports Reuters

By Scott Malone and Daniel Trotta

CLEVELAND – Along a cobblestoned row of restaurants near the Cleveland arena hosting the Republican National Convention this week, the crowds on the sidewalk were packed. However, just a few blocks away from the television cameras and T-shirt vendors selling merchandise, traffic was notably light. Business owners reported that the four-day convention, which concluded on Thursday, actually had a negative impact on their sales.

"It scared away a lot of our regulars," said Frank Como, general manager of Bar Louie, a large bar and grill located in the popular business district off 4th Street. "I hired a bunch of people and had to send them home. We ordered heavily on food and alcohol, and we’re still sitting on it."

This narrative of diminished business echoed across Cleveland, a city now home to 388,000 residents, less than half the population during its peak in 1950. City promoters marketed the convention as an opportunity to revamp Cleveland’s Rust Belt image, especially after the local Cavaliers won a professional basketball championship.

The Cleveland 2016 Host Committee had anticipated a $200 million economic impact from the event. A $35 million city investment was directed towards Public Square, which became a focal point for convention activities, including protests. In preparation for the influx of visitors, hotel operators either renovated existing properties or constructed new ones, including a 600-room Hilton near the convention center.

However, several sponsors withdrew their support, with some citing the divisive rhetoric of presidential candidate Donald Trump as a reason. This led organizers to seek assistance from billionaire Sheldon Adelson to cover a $6 million fundraising deficit. Many prominent party leaders opted not to attend. Security measures also hindered access, causing downtown businesses to close, and even the anticipated number of protesters was less than expected.

City officials have refrained from estimating the convention’s actual economic impact, and the host committee did not disclose whether Adelson provided financial support. A financial report is expected later this year.

Officials stated their primary objective was to promote long-term investment and draw tourism to Cleveland’s attractions, such as the Rock and Roll Hall of Fame.

"We did this to show that Cleveland is changing," said Joe Roman, president of the Greater Cleveland Partnership and a vice president of the host committee.

During the convention week, a handful of caterers and upscale restaurants benefitted from the estimated 50,000 attendees. Joan Rosenthal, founder and president of Marigold Catering, noted that she had to bring in temporary workers to maintain a workforce of 300 each night, significantly more than the usual staff size.

Due to reductions in corporate donations, many clients scaled back their catering budgets, with some opting for steam table service instead of hiring chefs for live cooking demonstrations. "You lost a lot of the showmanship," Rosenthal remarked.

Victor Matheson, an economics professor at the College of the Holy Cross in Worcester, Massachusetts, observed that conventions frequently fall short of economic projections. Many studies underestimate the expenses associated with large events, most of which are funded by political organizations and local advocates.

"There are heavily militarized zones where only reporters or delegates are allowed, which discourages regular visitors from attending," he explained.

John Johnson, a real estate salesman from Cleveland, took a moment to sell hats featuring local and Trump-themed designs. By Thursday, he had slashed the price to $10. "I’ll probably lose money," Johnson admitted.