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August 23, 2002GT Resort courts potential suitors- Owners originally just wanted partner for water park, but now they are considering optionsBy BILL ECHLINRecord-Eagle staff writer ACME - The Grand Traverse Band of Ottawa and Chippewa Indians is not alone in its interest in buying the Grand Traverse Resort and Spa. Originally looking for investors to build an indoor water park, the resort now has up to five potential suitors to buy the multimillion-dollar facility, its general manager says. Paul McCormick said Thursday that resort owners KSL Recreation Inc. were looking for an investor to build an indoor water park when up to five potential partners, including the Grand Traverse Band and a company based in Omaha, Neb., said they would be interested in buying the entire resort. McCormick did not identify the other potential buyers. A spokesman for the Grand Traverse Band said earlier this week it is exploring the idea. Since KSL Recreation Inc. bought the 900-acre, 660-room resort in 1997 for $45 million, it has added a spa, a golf course and clubhouse, doubled its profits and from last year doubled its group business, McCormick said. But to "get to the next level" it has to overcome its reliance on seasonal business. The La Quinta, Calif.-based company owns nine major properties nationwide, with all but the Grand Traverse Resort and Spa being in warmer year-round regions. To increase annual average occupancy beyond 50 percent, the resort must draw more family business year-round, he said. An indoor water park looked like a winner. The Great Wolf Lodge in Wisconsin Dells, a sister to a new resort of the same name going up south of Traverse City, has an annual average occupancy rate of more than 70 percent even though it has a climate similar to Traverse City, a representative of the lodge said. An indoor water park at the Grand Traverse Resort and Spa would cost between $20 million and $22 million, an amount more than KSL Recreation wanted to pay alone, McCormick said. It hired the Chicago property management and realty brokerage Jones Lang LaSalle to search out potential investors, he said. "We'll be looking at all our options," McCormick said. Options for KSL Recreation include finding an investor for the water park, selling the resort but remaining as manager, or selling the resort to another operator, he said. The catalyst for KSL Recreation's actions is increasing competition in the area, McCormick said, particularly from the Great Wolf Lodge under construction and the Grand Traverse Band's plans to build its own hotel. The family-oriented Great Wolf project will add 281 rooms while the proposed Turtle Creek hotel would have up to 350 plus a sizable convention center and entertainment complex. "We feel we have a natural advantage with our location at the main entrance to the whole area from the east, so we just wanted to look for ways to go forward and maintain our competitive base," McCormick said. Bill Echlin is the reporter for business and tourism. He can be reached at (231) 933-1493, or at bechlin@record-eagle.com |
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