The newest CoCo Key Water Resort in Orlando, Fla., is scheduled to open this month. With more than 385 rooms and a waterpark ope year ’round, it will be one of the newest lodging options in the vacation mecca.
But it’s not the only new waterpark venture now being planned.
Though the other parks are not yet under construction, experts say the new projects are a sign the economy is starting to recover. As it does, these projects also are examples of how aquatics will have to go beyond traditional sources of financing to bring new developments to fruition.
“Lenders are definitely starting to look at things,” said David Sangree, president of Hotel & Leisure Advisors, LLC, in Cleveland. “But the flood gates have not opened yet.”
So what’s on the drawing boards? In January, Great Wolf Resorts Inc., headquartered in Madison, Wis., announced that it has entering into a licensing agreement with Zamias Services Inc., which will open a Great Wolf Resort near Pittsburgh.
“The hope is to break ground this year, and the goal is to have this newest Great Wolf Lodge open by 2011 or early 2012,” said Steve Shattuck, corporate director of communications.
A few weeks after the Great Wolf Lodge announcement, Schlitterbahn Waterparks came out with news of its own: a $360 million waterpark and convention center development in Cedar Park, Texas. The project is planned on 95 acres and is set to be completed by 2012. According to reports, it may also include lodging.
Additionally, Kalahari Resorts, based in Lake Delton, Wis., is moving forward on its plans to build a new resort in Fredericksburg, Va. Started approximately two years ago, it is the third in the Kalahari brand. The project includes a proposed $250 million, 832-room hotel and 200,000-square-foot waterpark resort.
If the company can break ground by June 30, Virginia will allocate $25 million in tax-exempt “recovery zone facility bonds” to fund the project. The bonds were established by the American Recovery and Reinvestment Act of 2009. Whether that happens depends on whether Kalahari Resorts can secure the rest of the funding needed.
Beginning construction by June has been the intent all along, according to Josef Haas, Kalahari’s COO. But financing isn’t easy for anyone to obtain, given the current economy.
“Four years ago, banks would’ve said, ‘How much you need? Don’t you need more?’” Haas said. That’s not the case today, but he said signs have become much more promising recently.
Agreements such as the one between Kalahari and the state of Virginia likely will allow the other projects to move forward as well.
According to reports, the Schlitterbahn project is to be a partnership between Schlitterbahn Waterparks of New Braunfels, Texas; Rick Redmond, co-owner of Volente Beach Waterpark on Lake Travis; and the city of Cedar Park, which may provide as much as $6 million in funding for infrastructure.
Shattuck said the agreement between Great Wolf Resorts and Zamias Services Inc. is the first example of the company’s new development strategy, to expand by pursuing licensing agreements and move away from being an owner-operator.