San Antonio’s $850M Convention Center Plan Rides on Hotel Taxes

By Nathan Snyder, Editor, The Hotelier Times

San Antonio city staff briefed Council on Oct. 28, 2026 on an $850 million, two-phase expansion of the Henry B. González Convention Center — $700 million then $150 million — plus $125 million of Alamodome work, funded by hotel occupancy tax and a Project Finance Zone. The planned convention center hotel was dropped. Visit San Antonio’s Mario Bass says booking pace “plummets in 2031.”

KSAT (Garrett Brnger) published the story Oct. 28, 2026 at 10:24 p.m., after a Wednesday council meeting and reporter briefing. This was a staff briefing, not a binding appropriation vote — the date of any final council vote is unconfirmed. The San Antonio Business Journal also covered the proposal. Figures in this piece follow KSAT’s Oct. 28 reporting.

The $850 Million Plan in Two Phases

Staff proposed a two-phase expansion totaling $850 million — about $100 million above the prior staff estimate of $750 million, after earlier ranges of $700 million to $900 million, KSAT reported. Construction-material costs drove the increase, per local coverage.

• Phase 1 — $700 million: all new exhibit and ballroom space.
• Phase 2 — $150 million: the lion’s share of meeting space, which KSAT reported “could be held until the economy improves.”

The expansion would add more than 209,000 square feet of exhibit, ballroom and meeting space and connect the building to Civic Park, though it is not fully designed, per KSAT. Michael Lockwood of Populous, the architectural firm hired by the city, said the extra exhibit space would put the convention center in the top 10 nationwide.

Ben Gorzell, chief of financial and administrative services, said the city would like a design solicitation out in spring 2027 and does not expect construction until late 2028 or early 2029, KSAT reported.

Hotel Taxes Pay for the Big Room

Financing for the convention center expansion and the Alamodome work relies on a Project Finance Zone that diverts a portion of hotel-related state taxes, plus the city’s local tax on hotel stays — the hotel occupancy tax (HOT), per KSAT. That is the Texas policy bet in one sentence: hotel guests fund the meeting space that is supposed to fill hotel rooms.

For owners, every HOT debate and every PFZ allocation fight between the arena, the convention center and the Alamodome is a fight over your guests’ folio line items. The same pattern shows up when cities build or back headquarters hotels — we covered Indianapolis’s city-owned 800-room Signia by Hilton as the opposite structure. San Antonio just chose not to add a new convention hotel.

Convention Hotel Dropped; Compression Stays Local

KSAT reported the city dropped pursuit of a new convention center hotel after the San Antonio Water System found it would be too expensive to move a chilled-water plant in its way. A land bridge over Interstate 37 to Hemisfair was indefinitely shelved after federal funding “is no longer there,” though staff say the idea is still studied.

No new headquarters hotel means any incremental group room nights from a larger center land on the existing downtown inventory. That is compression opportunity for hotels already near the Henry B. González Convention Center — and a competitive issue for properties outside the walk shed. It is the inverse of the Signia model, where the city itself owns the tower next to the halls.

Mario Bass: Pace ‘Plummets in 2031’

Mario Bass, President and CEO of Visit San Antonio, told KSAT the extra space would let the destination go after another 74 groups. Bass said San Antonio is “currently holding our own” versus Austin, Fort Worth and Dallas on booking pace, but that pace plummets in 2031. “That has everything to do with the convention centers that are opening up and the investments that are being made,” Bass said, per KSAT.

Bass tied that 2031 cliff to convention-center openings and investments in peer Texas markets — Austin, Fort Worth, and Dallas — per KSAT. That is the business case for San Antonio building now: hold share while rivals expand, then avoid a cliff when those new halls come online. For Texas pipeline context, see our Dallas pipeline Q3 2026 and Texas hotel pipeline coverage.

Alamodome $125M and the $1.3B Spurs Arena

Alongside the convention center, staff proposed $125 million of Alamodome work over about 10 years — “really making sure the building’s got the operational capital that it needs to function and operate as it does today,” Gorzell said, per KSAT. A major Alamodome overhaul (every scenario over $1 billion) is pushed to 2035 or later.

The $1.3 billion Spurs arena remains part of Project Marvel, with the Spurs hoping to open for the 2030–2031 season. Final arena deal timing and the UTSA site purchase were still in negotiation as of the Oct. 28 briefing, KSAT reported. Owners should read the district as one demand map: arena, convention center and dome all drawing on the same hotel-tax stack.

What This Means for Your Hotel