Audited financials from the Washington State Convention Center Public Facilities District. The numbers behind the word "fragile."
Adjust the sliders to see how hotel market conditions and convention activity affect lodging tax revenue, bond coverage, and the operating trajectory. All figures estimated from public disclosures.
Model assumptions: operating expenses fixed at ~$185M/year; convention activity index 100 = 2024 baseline (~$96M convention-dependent revenue); Bellevue diversion reduces both lodging tax and per-attendee on-site spend (food, AV, parking); bond debt service ~$110M/year ($75M interest + ~$35M principal on $1.9B); reserves $25M (CEO, Feb 2026). Seattle lodging tax 7% modeled only — KC-wide 2.8% adds ~15% more. All figures from 2024 audited statements. 2025 figures expected May 2026 — update DATA_YEAR constants in script when available.
The annual report shows a $16 million operating loss for 2024. The audited financial statements — which include $53 million in annual depreciation that the annual report omits — show a $69 million loss. Both numbers are real. The audited figure is the one that matters for the balance sheet.
| Line item | Amount | % of revenue |
|---|---|---|
| Revenue | ||
| Food & beverage (Aramark) | $38.0M | 33% |
| Building / facility rental | ~$28M | 24% |
| Parking | ~$22M | 19% |
| AV / tech services (Encore) | ~$15M | 13% |
| Other | ~$13M | 11% |
| Total revenue | ~$116M | 100% |
| Expenses | ||
| Operations & maintenance | ~$80M | |
| Depreciation | $53M | |
| Other | ~$52M | |
| Total expenses | ~$185M | |
| Operating loss (audited) | −$69.4M | |
| Operating loss (annual report) | −$16M | excl. depreciation |
* Revenue line items estimated from available disclosures. Depreciation figure from audited statements. Full breakdown pending document review.
Reserves peaked above $200 million before the Summit opened. Since 2022, net position has declined by $35–38 million per year. At the current rate, reserves reach zero before 2030 — one year after the state backstop expires.
2023–2025 figures estimated at $35–38M/year decline rate. Actual figures pending annual report.
CEO Jennifer LeMaster, February 2026: "From their high of more than $200 million, the reserves today sit at about $25 million." The same interview: "I'm not going around saying the sky is falling, but I want people to be aware that we're in a fragile position."
The Summit construction came in $300 million over its original budget. The bonds are not secured by the buildings — they are secured by the lodging tax stream: 7% on hotel rooms in Seattle, 2.8% in the rest of King County. This distinction matters: the Arch can change hands or operators without triggering bondholder claims.
The backstop: Washington State law includes a provision treating any shortfall in debt service as a loan from the state. That backstop expires in 2029. After that, if reserves are gone and lodging tax doesn't cover the bonds, there is no automatic state rescue.
What the bondholders need: A stabilized credit. The current trajectory — $38M annual reserve drawdown, declining net position — is a deteriorating bond. Restructuring the Arch off the PFD's operating books improves the credit without impairing the collateral. The tax stream is unchanged.
| Item | Figure |
|---|---|
| Total bonds outstanding | $1.9B |
| Estimated annual interest | ~$75M |
| Lodging tax rate (Seattle) | 7.0% |
| Lodging tax rate (rest of KC) | 2.8% |
| State backstop expiration | 2029 |
| Original Summit budget | $1.6B |
| Final Summit cost | $1.9B (+$300M) |
The $38 million in food service revenue is the SCC's biggest income source — bigger than building rent, bigger than parking. The convention center makes more money selling boxed lunches to captive attendees than it does renting the halls they're standing in.
This creates a structural conflict. The SCC has no financial incentive to make it easy for attendees to eat off-campus. The exclusive contractor model is the business model. When the Aramark contract expires January 2, 2027, the board faces a direct choice: renew and stay in the captive-catering business, or restructure and open the building to a food hall model that serves the neighborhood instead of extracting from it.
That contract expiration is the hinge on which the Commons proposal turns. See The Operational Plan for the full contract analysis.
In 2019 — the last full year before COVID, operating as a single building — the Arch generated $37 million in revenue against $37 million in expenses: $74,000 in operating income. Breakeven. The building was self-sustaining.
The Summit opened in 2023. Revenue across both buildings increased 58 percent. Expenses increased 103 percent. The organization was built to run one building and suddenly had two — twice the staff, twice the maintenance, twice the debt service — without twice the conventions to justify it.
The two-building model is losing $38 million a year. The one-building model broke even. The math points to the same conclusion the proposal reaches: one convention center, one public commons, operated separately.
| Year | Revenue | Expenses | Result |
|---|---|---|---|
| 2019 (Arch only) | $37M | $37M | +$74K |
| 2024 (both buildings) | ~$116M | ~$185M | −$69.4M |
| Change | +58% | +103% |