(The following story by Steve Jordon appeared on the Omaha World-Herald website on April 26, 2010. Dan Kusek is a member of BLET Division 622 in Alliance, Neb.)
OMAHA, Neb. — Dan Kusek drove a coal train owned by Warren Buffett one day last week from Ravenna to his hometown of Alliance on its way to the mines of Wyoming.
This week, the 40-year Burlington Northern Santa Fe engineer plans to drive his own car the 400 miles to Omaha for his first “Woodstock for Capitalists” — Saturday’s annual shareholder meeting of Buffett’s Berkshire Hathaway Inc. Kusek might bring his wife, Jane, and sons Jeff and Greg, too.
Berkshire Hathaway bought the railroad in February, converting the stock owned by Kusek and about 65,000 others into Berkshire shares just in time to trigger an invitation to this year’s meeting.
“I’ve read about the meeting for years,” said Kusek, an Alliance City Council member. “Just the atmosphere of a Warren Buffett-Berkshire Hathaway annual meeting — it’s almost like being in Lincoln on game day.”
New shareholders like Kusek are a big reason that some executives of the Omaha-based investment company expect 40,000 people — probably three-fourths of them from out of town — at this year’s meeting.
That would be the ninth consecutive record crowd, and Omaha’s hospitality industry and retailers say they’re ready, no problem, come on down and bring the kids.
In fact, the city is prepared for even bigger crowds, with more hotel rooms and a we’ll-fit-ya-in attitude honed by two decades of people-handling experience.
The expected gusher of humanity is no surprise. Last year, with the economy in the dumps, Berkshire’s stock price down by half and people avoiding crowds because of the H1N1 flu virus, a record 35,000 people showed up at the Qwest Center Omaha.
This year, the economy is recovering, Berkshire’s stock price is up 40 percent, and the virus is nearly forgotten. And besides Buffett’s new railroaders and his 500,000 longer-time shareholders, thousands more bought his newly split “bargain” stock over the past 2½ months.
“It’s always mayhem, but it’s a really fun opportunity to meet fascinating people who come from all around the world and who are thrilled and delighted to be here,” said Susan Jacques, president of Berkshire’s Omaha jewelry giant, Borsheims. “Anytime we can have new folks come to take a look at the activities in the city of Omaha, we love it.”
Buffett biographer Alice Schroeder wrote recently that the intense interest in Buffett and Berkshire makes it obvious that the Berkshire meeting should be webcast, if not shown on cable TV, but that is unlikely to happen.
“Warren wants people to come to Omaha,” she wrote. “Not just to shop, but because it matters to him personally that people care enough to spend money on plane tickets and hotel rooms to come hear him talk.”
Buffett has said that there still is value in face-to-face contact, and he sees many of his shareholders in person at events during the long weekend surrounding the meeting. Many more shareholders meet one another as well, often forming lasting friendships that are renewed each year at informal gatherings in Omaha.
The company initially talked about limiting shareholders to two credentials each. But in the end, shareholders were able to order their usual maximum of four each. The credentials give them free access to company events.
The weekend’s signature event is the five-hour question-and-answer session with Buffett and Berkshire Vice Chairman Charlie Munger on Saturday. But the first person that visitors might meet is the “starter,” a curbside coordinator that Omaha’s taxi companies will have on duty for the first time to connect riders and cabs at Eppley Airfield.
“He’ll be sort of an unofficial ambassador to Omaha,” said John Davis, operations director for the Omaha company that operates the Happy, Yellow, Checker, Cornhusker and Safeway taxicabs.
“We want to put our best foot forward for Omaha. We know taxi service is one of the things a city is judged on.”
Buffett has said that if the crowd gets too big for the Qwest Center, Berkshire could also rent the Civic Auditorium complex, which could accommodate nearly 15,000 people, and provide a video link for people to watch the meeting from eight blocks away. But everyone wants to be in the Qwest Center, and Berkshire hasn’t booked the Civic, said Roger Dixon, president of the Metropolitan Entertainment and Convention Authority that manages both facilities.
“There’s room for people,” Dixon said. “It just depends on how much they want to grow this.”
The Qwest Center arena seats 18,300 people, and an additional 10,000 can watch video screens in the adjacent ballroom and convention hall, plus in the ballroom of the Hilton Omaha across the street. Others mill about the exhibition hall during the meeting or head elsewhere, never actually stopping to hear Buffett and Munger.
“Omaha rocks for this week,” said Robert Batt, executive vice president of the Nebraska Furniture Mart, another Berkshire subsidiary. “It’s not just about us. It’s about everybody. It’s putting the best face on Omaha.”
About one-third of the store’s shareholder sales are to out-of-towners, Batt said.
The Mart’s shareholder discounts run Tuesday through May 3, and Borsheims’ lower prices are from Monday through May 8.
“We do a month’s worth of business in one week,” Batt said. “We can handle huge amounts of people.”
Although hotels bump up room prices for special events such as the Berkshire meeting, the area no longer sells out its hotel space. Calls late last week to three motels outside the downtown area found that they had rooms available for Friday night, when shareholder demand peaks.
Counting the three new hotels just across the parking lot from the Qwest Center, plus new and expanded hotels in Council Bluffs, Sarpy County and elsewhere, the number of hotel rooms in the metro area has grown from 10,121 in 2006 to 13,226 today, said Dana Markel, executive director of the Omaha Convention and Visitors Bureau. Assuming that most rooms are occupied by more than one person, the hotels could easily accommodate about 25,000 guests.
For some weekend events, people will just have to deal with bigger crowds as best they can.
Borsheims rents the biggest tent it can fit into its parking lot — 12,000 square feet. Still, the store itself, expanded in 2006, will be elbow-to-elbow customers. Jewelry and watch vendors send a total of about 100 of their own salespeople to help with the volume.
The Furniture Mart studied Disney World’s techniques to avoid long lines of customers, Batt said.
Car rental companies bring in vehicles from surrounding states for the weekend.
Kusek, the Alliance locomotive engineer, isn’t worried about the crowds, and he hopes to hear Buffett talk about the railroad.
Rail workers were impressed by Buffett’s comment that the $26 billion purchase of Burlington Northern Santa Fe was “an all-in wager on the economic future of the United States,” Kusek said.
“That Warren Buffett was making that kind of investment, I think he made a good bet,” Kusak said. “It’s up to the employees of Burlington Northern to deliver.”