Rising steel and aluminum costs may negatively impact construction and renovation plans
The construction and renovation of hotels and convention centers — already an expensive, complex endeavor — are now facing an even more precarious landscape thanks to the rollercoaster of U.S. tariff policy. The sudden imposition and just-as-sudden suspension of new steel and aluminum tariffs have introduced a level of uncertainty that’s rattling developers, planners, and contractors alike.
Steel and aluminum are foundational materials in hotel and convention center construction, used in everything from structural framing to HVAC systems and elevators. Even modest shifts in their price can significantly affect project budgets. With tariffs currently sitting at 10% for most countries and soaring to 125% for imports from China, the ripple effects are beginning to hit the sector hard.
“Higher costs may lead developers to pause, redesign, or phase projects,” says one industry observer, citing a growing trend of project delays and budget overruns. Renovation work, particularly infrastructure or exterior updates, is also becoming more expensive, stretching already tight capital plans. In many cases, these pressures may render projects financially unviable.
The confusion deepened earlier this month when President Donald Trump abruptly rolled back a series of new tariffs after only half a day in effect, announcing a 90-day pause. While the decision initially buoyed the stock market, investor optimism quickly gave way to skepticism. For the construction industry, the message was clear: brace for a bumpy ride.
“A 90-day pause on tariffs is probably not enough to restore owners’ confidence that they can go ahead with projects or help contractors that order materials with a long lead time,” says Ken Simonson, chief economist at the Associated General Contractors of America. “Further, the constant changes in announced tariff rates adds to uncertainty, which is a negative for investing.”
Sarah Martin, associate director of forecasting at Dodge Construction Network, echoed the concern. “If some of these tariffs remain on pause for ninety days, it could mute or delay some downside impacts but it won’t detract from the uncertainty and confusion across the market right now,” Martin explains. “If businesses can’t plan for where prices are going to be over the next year, or where they’ll source those materials from, the risk that construction activity slows in the short term remains.”
The situation is especially dire for materials with complex supply chains. While developers might be able to shift steel purchases to other countries or rely more heavily on U.S. sources, China’s 125% tariff on American imports — coupled with its own retaliatory 84% tariff — threatens the availability and pricing of components that require extensive labor or intricate part integration.
“For more generic items, like steel, contractors may be able to shift purchases to other countries or the U.S.,” Simonson notes. “But for items that incorporate a lot of parts and/or labor, setting up replacement supply chains will be time-consuming.”
Several U.S. cities are currently undertaking significant convention center renovation and expansion projects to enhance their facilities and attract more events.
FURTHER READING: WALKING THE TARIFF TIGHTROPE
Here’s a look at some of the notable projects underway:
Expansion Projects
Los Angeles Convention Center: The City Council has approved moving forward with a long-planned expansion project with an estimated cost exceeding $2.2 billion. The project aims to add 190,000 square feet of new exhibit hall space, 55,000 square feet of meeting room space, and 95,000 square feet of multi-purpose space. The Gilbert Lindsay Plaza will also be renovated. Construction is anticipated to begin in September 2025, with a pause from the end of May 2028 to September 2028 for the Olympic Games. The project is expected to be completed by March 2029. The expansion aims to allow the center to compete with larger facilities and potentially double its revenue.
Orange County Convention Center (Orlando, FL): A $560 million expansion project of the North-South Building, named the Grand Concourse Expansion, is set to begin in 2026 and finish in 2029. This will add 44,000 square feet of meeting space and a 100,000-square-foot ballroom. There are also plans for a second phase (Phase 5B) which would add another 200,000 square feet of contiguous multipurpose/exhibit space and better connectivity between the North and South concourses. Upon completion of both phases, the North-South Building will have 1.15 million square feet of exhibit space.
Austin Convention Center (Austin, TX): A $1.6 billion project called “Unconventional ATX” is underway to nearly double the rentable square footage from 365,000 to 620,000 square feet. The existing facility is scheduled to close in April 2025, with the new center expected to reopen for the spring festival season in 2029. The design focuses on accessibility, flexibility, and sustainability, aiming to be the world’s first zero-carbon-certified convention center. It will include significant outdoor spaces and public art installations.
Kay Bailey Hutchison Convention Center (Dallas, TX): A $3.7 billion expansion project has commenced, aiming to add 500,000 square feet, bringing the total to 2.5 million square feet. The individual meeting and ballroom space will almost triple to 430,000 square feet. The project will consolidate the current five separate buildings into one cohesive center and reorient it to enhance connectivity with the surrounding downtown area. Construction is expected to be completed between 2028 and 2029.
Renovation and Upgrade Projects
Phoenix Convention Center (Phoenix, AZ): While not a physical expansion, the center has recently implemented a facility-wide program for reusable food and drink packaging in collaboration with Bold Reuse and PepsiCo to support its environmental goals. They are phasing in reusable dishes and cups to reduce waste. Additionally, their exclusive catering provider began a pilot program for reusable serveware in July 2024.
Henry B. González Convention Center (San Antonio, TX): The convention center has partnered with Smart City Networks to complete a technology upgrade to a Wi-Fi 7 network, providing enhanced speed, efficiency, and reliability for events.
Tampa Convention Center (Tampa, FL): Following a major renovation completed in 2023, which included 18 new waterfront meeting rooms, the center is currently focused on beautification and technological upgrades. They recently unveiled the first of three dynamic art displays and are installing modern LED walls for digital signage and upgrading exhibit hall lighting for better intensity and energy efficiency.
America’s Center (St. Louis, MO): Phase one of renovations and expansion is complete, featuring a new 72,000-square-foot exhibit space (Hall 4X) and 23 new loading docks. A new entrance providing access to several halls is expected to open by May 2025. Additionally, an outdoor culinary garden has been created to grow fresh produce for the in-house caterer and can also host small outdoor events.
Las Vegas Convention Center (Las Vegas, NV): A $600 million renovation of the Legacy Campus is underway, extending the technology, customer experience, and design of the newer West Hall to the existing North and South Halls. Work on the South Hall, including a new arrival area, lobby, pre-function space, and boardroom, is complete. North Hall renovations are in progress.
These projects represent significant investments in the convention and meetings industry, aiming to provide modern, sustainable, and versatile spaces to attract a wide range of events and contribute to the economic growth of their respective cities. For now, uncertainty reigns. As developers and investors hold their breath, hotel and convention center projects risk grinding to a halt, not because of a lack of ambition, but because the rules of engagement keep changing by the day. Until clarity returns to trade policy, the scaffolding of America’s hospitality and convention infrastructure may remain frozen in place.
Any thoughts, opinions, or news? Please share them with me at vince@meetingsevents.com.
Photo by Ubaid E. Alyafizi For Unsplash+
