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Expert: SXSW cancellation will have economic impact

According to Greyhill Advisors, it will mean loss of revenue to City of Austin

AUSTIN, Texas — We already know South by Southwest's economic impact to the City of Austin was nearly $356 million dollars in 2019.

That's according to Greyhill Advisors, the consulting firm that has conducted the economic analysis for the festival the past several years.

Ben Loftsgaarden, a partner with the firm, said it remains one of the single most profitable events in the City of Austin.

What we don't know yet is how much the festival's cancellation will affect the local economy.

"We really rely on hard data, we rely on understanding who the official registrants are and understanding their information and being able to track the spending that takes place by those individuals and also the corporate spending that takes place by third-party corporate sponsors," he said.  

Even with reports of unofficial events happening and visitors still coming into town, revenue won't be the same this year.

According to Greyhill, in 2019, SXSW directly booked nearly 12,800 hotel rooms in Austin. That generated nearly $1.9 million in hotel occupancy tax revenues.

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While Loftsgaarden can't predict exact dollars lost, he said the ripple effect is vast.

"The bars, the restaurants, all of the waitstaff and bar staff and drivers and parking attendants and event organizers and freelancers that do, you know, photography or other creative things around South by Southwest," Loftsgaarden said.

That's not including the out-of-towners.

"They come here to network, to make new relationships, to, you know, maybe get a deal for their new film or maybe to sign a deal, because they're an up-and-coming band. Those opportunities, you know, would be missed for this year," he said.

Loftsgaarden said they will keep track of what they can and take a look at numbers after March.

As far as the festival, Loftsgaarden believes the brand is strong enough to make a comeback. 

WATCH: City of Austin & County officials announce SXSW is canceled

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