Study: Old Sac Waterfront Plan Could Generate $58M In New Spending Per Year
Source: Sacramento Business Journal, Emily Hamann
Photo: An overview of the proposed Destination Sacramento project. On Dec. 10, Sacramento City Council approved moving ahead into the design phase. As these are just concepts, the actual structures in these renderings could change.
The concept to revitalize the Old Sacramento waterfront is ready to move into design stages, after City Council gave the go-ahead.
Riverfront Project Manager Richard R. Rich presented the design concepts to City Council on Tuesday. The Council unanimously voted in favor of the ideas presented, and authorized the team to begin architectural and engineering design.
“I think it represents an absolute breakthrough,” Mayor Darrell Steinberg said at the meeting.
In April, the city allocated up to $47 million for what it calls Destination Sacramento, a series of new amenities to revitalize Old Sacramento and the waterfront. It’s one part of a four-part plan to turn Old Sacramento into a regional destination attracting millions of people per year and a civic asset that will increase convention sales.
Reenactment-style historical sites are no longer the tourism draw they once were, and in recent years Old Sacramento has lagged behind the rest of the city in terms of commercial real estate revenue and occupancy rates.
The Destination Sacramento project is the first part of the effort to revitalize the historic district. Other parts of the plan include forming a partnership between the city, Downtown Sacramento Partnership, state and private businesses for funding and operations of the district; developing vacant parcels; and improving district lighting, entrances and parking.
The Destination Sacramento design team, led by Stantec Inc. (NYSE: STN), came up with a plan to build a new event deck on top of the Sacramento History Museum, and replace two buildings between Front Street and the railroad tracks with a new civic park, event and amenity space.
At the council meeting, Visit Sacramento CEO Mike Testa also expressed support for the project.
“This project presents the opportunity to redefine Old Sacramento’s waterfront,” he said. “A city’s waterfront is almost always a draw for tourists and locals, but Sacramento has never quite reached its potential. This project will help to change that narrative.”
In an interview with the Business Journal, Testa said new developments like the waterfront help him sell Sacramento to event and convention planners. When he’s trying to get a new convention to come to town, the first two questions are about the size of the convention center and nearby hotels.
“The third question I typically get is what is there to do after hours, after the convention is done,” Testa said. The waterfront project would add more scenic outdoor space to hold after-parties and other ancillary convention events. It could also help generate buzz about the city.
“Things like this help us to create that really positive narrative that there’s a lot to do in Sacramento besides what happens at the convention center,” Testa said. “It helps us to market the city.”
The city recently commissioned AECOM’s (NYSE: ACM) economics division to study the economic impact of the Destination Sacramento project.
The study estimates five or six new conventions per year could come to Sacramento because of the project, creating an additional 26,000 hotel room-nights and up to $9 million in additional economic output.
In total, the study estimates the waterfront could generate between $30 million and $58 million in new visitor spending per year, and could create between 600 and 1,200 new jobs. That spending would also bring in $602,000 to $1.2 million in new transient occupancy tax per year, and up to $1.6 million in total tax revenue.
The study also lists a number of impacts that can’t be quantified, including attracting skilled workers to the area and raising property values.
“Public spaces and cultural amenities have been notable catalysts in community and neighborhood revitalization,” the study states. “As an anchor experience, visitor destinations make neighborhoods more attractive and induce private investment.”