Dem convention boosts Denver merchants

“We were probably wildly conservative with our numbers,” Grant said. “The $160 million did factor in lost business, which we don’t have. There’s no one who’s going to say this is a bad deal for the city. Look around: Every café is filled, the streets at midnight are filled.”

So how high will the convention boost be?

True, almost all downtown Denver hotels are sold out this week — and priced to the ceiling. The Democratic Party alone reserved 17,000 of the Denver area’s 42,000 hotel rooms. According to Expedia.com, a room at the Brown Palace is fetching $450 a night (a $225 increase over normal rates) while a room at the Magnolia Hotel is running $667 a night (a $480 bump from the normal rate).

This is where economists like Alan Sanderson, a professor at the University of Chicago, and Victor Matheson, a professor at the College of the Holy Cross in Worcester, Mass., inject their doubts. Sanderson believes the DNC’s direct economic impact on Denver will be closer to $16 million. Matheson, who this year co-authored a study on the financial bang from political conventions, agreed that Denver officials inflated their projection by a factor of 10.

“Sure, it’s a huge economic event, but it’s a fraction of what boosters are saying,” said Matheson, who has analyzed the monetary aftermath of every convention since 1972.

His study crunched local employment numbers during conventions and dissected effects on the host cities’ overall income — the civic version of gross domestic product — as well as personal income per capita. Matheson found no significant change in any of those indicators. On top of that, there are the costs a host city incurs, although $50 million in federal money is being spent on security at the 2008 DNC.

“There are, without question, thousands of people in town for this event. There may be conventioneers at the bars and retail stores and hotels,” Matheson said. “But I bet the locals are not going into their regular Cheers downtown where they say ‘Norm’ when you walk in the door. The regulars are being crowded out.”

But to Denver merchants like Trina Lynch, customers are customers. She and her husband Lamont own Boney’s Smokehouse in downtown Denver, not far from Players clothing. Before the DNC, the Lynchs ordered extra meat and decided to stay open 12 hours a day, stretching their typical lunchtime fare. This week, revenue at Boney’s Smokehouse has increased by 100 percent, Trina Lynch said.

Mountain guide Stefan Van der Steen hopes to double his usual number of clients at Denver Adventures, located in the foothills of Golden, just west of Denver. So far, he’s not sure if the delegates will be able to break away for any high-country hikes, but a number of journalists have booked jaunts this weekend.

“The professor at Holy Cross says you have to subtract all the lost business, well, we don’t agree with that,” Grant said. “If ‘The Dark Knight’ is sold out and turns away 100 people, do you subtract those 100 people from the gate? Of course not. You can’t do better than sold out.”

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