The 25-year-old convention center is in need of new revenues to pay for repairs to the aging facility.
The 25-year-old convention center is in need of new revenues to pay for repairs to the aging facility. — K.C. Alfred

The San Diego Convention Center, facing more than $40 million in deferred maintenance and operational expenses, is looking into a naming rights deal to raise revenues.

The Cleveland, Ohio-based Superlative Group has been hired by the Convention Center Corp. to explore not only corporate naming rights but also sponsorships and the naming of different parts of the center.

The company, which has experience selling such rights to ballparks, stadiums and arenas and other municipally-owned assets, will spend the next 90 days exploring what potential value the center has for sponsorship and naming partnerships.

Possible opportunities beyond naming the entire center are partnerships with automotive, banking and insurance companies, for example, who could advertise their businesses on signage within the center, explained Kyle Canter, Superlative's chief operating officer.

"The goal is to maximize and leverage these highly valued opportunities while being tasteful," he said. "In our business, we say that you don't want to 'NASCAR' it up (like a NASCAR vehicle) with a bunch of stickers. There's a fine line between leveraging highly valued opportunities and going overboard because then you devalue everything."

The move to pursue a naming rights deal is fueled by the center's growing tab for repairs, most notably the need to replace the fabric structure of the upper level Sails Pavilion.

"The Sails Pavilion is 25 years old, and its useful life is 20 years, so it's rotting and likely to fail anytime soon," said center spokesman Steve Johnson.

In addition, the center no longer has the funds to maintain an operating reserve, a concern raised repeatedly by the city's independent budget analyst. The center is largely self-supporting through the revenues it gets from leasing the bayfront facility, although it does receive an annual city subsidy of $3.4 million, $1.9 million of which goes to the Tourism Authority staffing for booking large conventions.

Meanwhile, the city's plans to substantially expand the center remain in limbo in light of a Friday ruling by an appellate court panel that the financing mechanism for the $520 million project is unconstitutional. The city is seeking to use a special hotel room tax to pay for the bulk of the expansion. No decision has been made yet on how to proceed.

Once Superlative completes its research phase, the next step will be for the Convention Center Corp. to decide on how it wants to proceed and then pursue actual sponsorship and naming rights deals. Under the corporation's contract with Superlative, the firm would receive a commission of 12.5 percent of annual naming rights and sponsorship revenues, up to $1 million, and 10 percent over $1 million, Johnson said.

The entire process could take from 18 months to two years, he said.

Although there are few major cities with centers that have been branded with corporate names, the demand for such naming rights revenue is growing, said Canter. Among those who currently have partnered with corporations are centers in Milwaukee, Cincinnati, Bakersfield and Madison, Wisconsin.