The Salt Lake County Council will consider selling a large chunk of the Salt Palace Convention Center and the land beneath it to the Smith Entertainment Group this week.
The 12 land parcels and portions of the convention center contemplated for sale, located at 55 S. 300 West, are on the city block directly east of the Delta Center. That portion of the Salt Palace houses its largest exhibit hall, along with a smaller exhibit hall and a connected parking garage.
The exhibit halls to included in the land sale make up nearly 195,000 square feet — about 20% — of the convention center’’s total capacity, while the land beneath those structures spans about 6.5 acres.
The potential sale is the latest move to emerge as government officials and SEG executives work toward creating a new sports, entertainment, culture and convention district, now spanning five blocks downtown beneath and around the Delta Center.
The county and SEG, owners of the Utah Jazz and the Utah Hockey Club, have negotiated a purchase agreement for the Salt Palace property, pricing it at “market value,” according to a resolution on the sale up for council consideration Tuesday.
But that potential price tag has not been included in the portion of the pending resolution made publicly available on the county’s website ahead of Tuesday’s meeting.
A public hearing on the potential sale is scheduled for 3 p.m. Tuesday, ahead of the council’s consideration and potential vote on the resolution, which is scheduled for 3:05 p.m.
The council has determined that the sale is a “necessary condition” for the Delta Center’s improvement, according to the resolution, because additional events at the overhauled center are projected to increase the value of its taxable sales to “more than $400 million annually” by 2034.
Once sold, the resolution says, the property will provide for a “redevelopment that will connect premier downtown spaces,” such as the Delta Center, the Salt Palace, Abravanel Hall, Temple Square, City Creek Center, the Eccles Theater, the Utah Museum of Contemporary Art and “future 2034 Olympic Games venues.”
“The sale will revitalize downtown Salt Lake City, preserve current property values and sales tax collections, and increase property values and sales tax collection,” the resolution states. “The sale will ensure future sales tax and property tax revenue from the continued operations of the Utah Jazz and the Utah Hockey Club at the Delta Center.”
In addition, the sale will change that 6.5 acres from a county-owned and tax exempt set of parcels to nonexempt property, which will bring in an additional $4.9 million a year in property tax revenue once the area is redeveloped, according to the resolution.
Proceeds from the sale will go toward the county’s remodel of the Salt Palace as well, which, according to the resolution, is estimated to cost about $1.5 billion.
About 80% of the funding for the renovation will come from additional future sales and property taxes generated by the redevelopment, the resolution states.
“The remodel, reconstruction and modernization of the Convention Center will add a second ballroom and upgrade meeting and exhibit space, which will allow the Convention Center to host multiple major events simultaneously,” the resolution states. “This additional capacity will generate additional annual tax revenue of $6.3 million in state sales tax, $4.2 million in county sales tax and $1 million in Salt Lake City sales tax.”
The sale of the property comes on the heels of a last-minute effort to expand a new taxing district designed to funnel public funds into portions of Jazz owner Ryan Smith’s downtown sports, entertainment, culture and convention district.
On April 4, a panel within the Governor’s Office of Economic Opportunity approved the inclusion of “Block 67” into that special taxing district. Located at about 100 South and 300 West, the block includes two hotels and luxury apartments just south of the property that the County Council will consider selling Tuesday.
