Financial and infrastructure troubles plague Hawaii Convention Center
by Jonathan Helton, Grassroot Institute
The Hawaii Convention Center has cost state taxpayers $140 million in operating losses alone since 2012, turning a profit in just one of the past 13 years. Considering the center’s other financial woes and worsening physical condition, this should prompt state policymakers to raise major questions about the facility’s future.
The Hawaii Convention Center has been hosting business, nonprofit and government conferences since it opened in 1998, winning numerous awards and accolades among the convention industry and boasting an impressive economic impact.
Unfortunately, it has also been a constant drag on taxpayer resources. According to a 2018 report from a Chicago-based consulting firm, the Hawaii Convention Center had a larger percent difference in its income and expenses than the mainland average between 2011 and 2017. In other words, although convention centers across the country often lose money, Hawaii’s convention center lost more relative to its income.
As the table below shows, 2024 was the only fiscal year since 2012 that the center brought in more money than it spent — and by only $3.1 million.
Source: Hawaii Tourism Authority annual reports and Accuity audit of the Hawaii Convention Center’s special-purpose financial statements. Note that these calculations include only the center’s own-source expenses and revenues, not any outside revenue transfers to the center.
A few years ago, the center’s financial picture looked even worse as it was struggling to repay the bond that the state issued to foot the bill for its $348 million construction. When taking interest payments into account, the full amount owed was $450 million.
Under a 2001 agreement, the center was supposed to be on the hook for $26.4 million a year to pay down that general obligation bond. The debt was first set to be repaid by 2025; however, a later agreement extended that deadline to 2027.
But the 2018 Legislature decided to cancel those payments after the center failed for two years to cover the full $26.4 million due. As a result, taxpayers — not the center — wound up paying off the remaining $192 million.
Either way, the state would have been responsible for making the payments if the center continued to fall behind, because general obligation bonds are backed by the state’s general fund.
When the Hawaii Convention Center first opened, it was expected to bring in tax revenues, not lose them — at least enough to cover its own construction costs.
So what went wrong?
Simply put, the center did not attract as many guests as it originally projected. In 2017, University of Hawaiʻi economist James Mak pointed out that the center originally proclaimed it would host 60 events a year with an average attendance of 6,200 to 7,500 by 2006 at the latest.
Mak wrote that “Instead, in 2004, the convention center booked 39 events with an average delegate count of 3,300. In 2005, HCC booked 46 events with an average delegate count of 3,829; the corresponding numbers for 2006 were 37 events and 2,626 delegates.”
Twenty years later, the goal still has not been met. The Hawaii Tourism Authority’s 2025 report shared that the center hosted 55 tradeshows with 65,040 total participants, resulting in an average event attendance of just 1,183.
These below-expected numbers extend to tax revenues. The HTA’s 2025 report estimated that the center generated $45.4 million in tax revenue from “citywide events.” This is a far cry from the $335 million in annual tax revenue the Legislature initially claimed the center would create.
To make matters worse, the center itself is now physically deteriorating, casting even more doubt on its financial future.
It began operating a modified event schedule at the beginning of this year that is set to last through 2027 while extensive repairs take place — although not as many as its leadership had requested. Earlier this year, state lawmakers declined to fund a $55 million budget request for maintenance and improvements to the center.
With an unprofitable, expensive-to-maintain facility on their hands, lawmakers must answer the question: What to do now?
Possible answers — and other reasons for the center’s financial and structural issues — will be explored in part two of this article series.