but could be better — at the Lynnwood Convention Center, which just finished its second full year of operations. Nearly 82,000 people attended...

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Business is good — but could be better — at the Lynnwood Convention Center, which just finished its second full year of operations.

Nearly 82,000 people attended 489 events last year at the facility, which opened in May 2005. The center’s budget had predicted 450 events, so on paper that looks like a great success.

But without an adjacent hotel, the convention center is losing some lucrative bookings — events drawing out-of-towners who would spend a couple of nights while dropping cash at local restaurants and shops.

Economic-development forecasts for the convention center predicted it would generate about 15,700 hotel-room nights by 2007, said Michael Echelbarger, board chairman of the Lynnwood Public Facilities District (PFD).

“We’re so far off — we’re probably at a third of what we’re supposed to be,” he said. “When people come in to town, they ask, ‘How many hotel rooms can we get? We need this many.’ And they can’t come unless we’ve got them.”

The PFD has been in negotiations since the fall of 2006 with a Spokane development company for a 200-room Hilton Garden Inn next to the convention center. The hotel is to replace Guaymas Mexican Restaurant and a former veterinary clinic on the southwest corner of the PFD’s 12.5-acre property off 196th Street Southwest.

“It’s been dragging on and on,” said Echelbarger, who has informed PFD staff that he wants “something substantial” — a signed contract or a letter of intent — by his board’s next meeting Tuesday.

“It’s not an ultimatum, but it’s an expectation. We’ve danced long enough; it’s time to make a decision. Is this our partner, or not?”

The Spokane group, kVc Development, initially had planned to build its Hilton across the street from the convention center on land owned by the Edmonds School District. The Inland Group of Spokane was in the final stages of a $6.4 million deal to buy the school site, for the kVc hotel and apartments, when the PFD opened its own hotel-bidding process in July 2006.

The Inland deal fell apart when kVc pulled out to instead pursue the PFD option. The school district, in conjunction with the city of Lynnwood, is about to seek new bids for its site.

Echelbarger said he’s a bit rueful about that now. The convention center still faces a vacant lot, where a Hilton otherwise might stand.

The PFD’s contract delays partially relate to its refusal to sell land to kVc. Long-term leases are unusual in the hotel industry, he said.

“If we rolled over and said, ‘Yeah, we’ll sell,’ the process would have gone a lot more quickly,” he said. “This is a long-term investment for the convention center and the city. What we think is appropriate in the year 2008, 50 years from now might not be appropriate. We want to continue to own this property so future boards can do what they think is best.”

Echelbarger stressed he can’t speak for his board’s other four members. But his own feelings are clear.

“It’s my opinion it will come to a head real quickly,” he said. “We’ll either be announcing we have this wonderful joint venture with kVc, or we’ll be looking for another operator.”

Grant Dull, the PFD’s executive director, is upbeat about the convention center’s early successes. While the convention facility isn’t turning a profit by itself, the PFD’s overall property — Convention Plaza includes a strip mall and Chuck E. Cheese — finished the year “slightly in the black,” he said.

Convention centers typically don’t fare well in their second year of operation, he said. They usually open with a bang because everyone wants to see the newest facility. The Lynnwood center, however, remained stable last year.

“I’m just really pleased that we’re getting the vast range of events that we thought we would,” he said.

Some bookings fill local hotels, he said, such as the recent three-day Seattle Open gymnastics event that attracted 800 people. “You couldn’t find a place to stay locally,” he said.

Local businesses — Premera Blue Cross, Panasonic Avionics, Big 5 Sporting Goods, Verizon Wireless, Moss Adams and Reid Middleton — book conferences and holiday parties, while city and community groups fill the center for events such as the latest Martin Luther King Jr. Day celebration.

Wedding expos were among its biggest events, drawing nearly 2,000 people several times last year.

“We serve a community function, and more importantly we provide an economic stimulus and an economic engine,” Dull said.

Diane Brooks: 425-745-7802 or dbrooks@seattletimes.com