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Hotel Waterpark Resort Industry Report 2007

48 Hotel Waterparks Opening, 97 Under Construction

By Jeff Coy and Bill Haralson
.

July 2, 2007 --- During 2007, forty-eight (48) new hotel indoor waterparks are expected to open, including new additions and expansion projects that are scheduled to open in the second half of 2007. Ninety-seven (97) hotel waterpark projects are under construction now or will break ground later in 2007.

An indoor waterpark is like an outdoor waterpark, except all the fun is packed into a cube which is attached to a hotel that is open 365 days a year, rain or shine. The first hotel indoor waterpark in the USA was accidentally created in 1994 by Stan Anderson, owner of the Polynesian Resort in Wisconsin Dells WI, a businessman who was trying to fill his hotel rooms on weekends. He installed some water gizmo in his indoor pool, and weekend occupancy skyrocketed. From this, Wisconsin Dells has spawned 21 waterpark resorts and has become the waterpark capital of the world.

Hotel waterparks are a small but fast-growing sector of the resort industry which is expected to total one hundred and eighty-four (184) by year end. Hotel waterparks merge lodging, recreation and entertainment into one package. They are a big hit with families and hotel owners nationwide because they fill empty rooms at higher room rates.

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Stan Anderson, owner of the Polynesian Resort in Wisconsin Dells and pioneer of the hotel indoor waterpark industry in the USA.
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The following chart illustrates the growth over the last six years.
 
 
2007F
 
2006
 
2005
 
2004
 
2003
 
2002
 
Amount
 
Amount
 
Amount
 
Amount
 
Amount
 
Amount
Hotel Indoor Waterparks
184
 
136
 
104
 
81
 
65
 
50
Rooms
31,414
 
23,899
 
18,998
 
13,877
 
11,464
 
8,510
Indoor Waterpark Sq Ft
4,461,469
 
3,225,669
 
2,344,469
 
1,721,269
 
1,385,969
 
1,019,104
Meeting Rooms
614
 
479
 
422
 
373
 
352
 
322
Meeting Space Sq Ft
1,699,634
 
1,326,435
 
978,935
 
806,085
 
679,435
 
626,955
Affiliated with a Brand
85
 
67
 
52
 
37
 
27
 
20
Independent
99
 
70
 
52
 
44
 
38
 
30

Nationally, these 184 properties have a total of 28,729 rooms, nearly 4.0 million square feet of indoor waterpark space and 614 meeting rooms covering nearly 1.7 million square feet of meeting space. In 2007, about 46% of hotel waterparks are affiliated with a national franchise brand, up from 40% in 2002.

Hotels and resorts have ups and downs. They are seasonal properties with high periods and low periods from month to month and from weekday to weekends. The indoor waterpark has an amazing ability to fill empty rooms with families and young children on weekends all year long and whenever kids are out of school. Yet a hotel waterpark resort is still just a hotel with a very expensive ($400 psf) attraction, similar to having a golf course or conference center. The indoor waterpark is a perfect component for the hotel owner that wants a balanced mix of customers --- individual business travelers, groups and individual leisure guests.

USA Hotel Industry Performance

The USA hotel industry occupancy is expected to reach 63.1% for 2007, just slightly under the 63.4% recorded for 2006 --- up from a low of 59.0% in 2002 and almost even with benchmark Year 2000.
 

USA HOTEL INDUSTRY TRENDS
 
2007F
2006
2005
2004
2003
2002
2001
2000
Occupancy
63.1%
63.4%
63.1%
61.3%
59.1%
59.0%
60.1%
63.7%
Average Room Rate
$102.97
$97.31
$90.95
$86.24
$83.19
$83.19
$84.85
$86.04
Source: Smith Travel Research. 2007 Forecast by JLC Hospitality Consulting

Nationwide, hotel room rates will reach an average of $102.97 in 2007, up from $97.31 in 2006, a low of $83.19 in 2002/2003 and up from $86.04 in benchmark Year 2000.

In 2006, airport, urban and resort hotels ran the highest occupancies. Interstate hotels showed the biggest improvement in occupancy over the previous year. Of course, resort hotel locations showed the highest average room rates at $135.42, which reflects all of the amenities of a resort, compared to other types of lodging.
 

TOP PRODUCING HOTELS BY LOCATION
 
 
Occupancy
Average Room Rate
 
Percent
% Chg
Amount
% Chg
Urban
68.4
0.5
$125.18
9.2
Suburban
64.0
0.2
$84.99
7.5
Airport
69.3
0.7
$93.54
9.2
Interstate
57.8
1.6
$63.23
5.1
Resort
66.6
0.0
$135.42
6.8
Small Town
57.0
0.8
$74.37
4.4
Source: Smith Travel Research, Year 2006.

Forecast for 2007

For the first five months of 2007, hotel industry occupancy reached 61.6%, only 3/10th of one percent behind the same period last year. Hotel room rates averaged $102.86 compared to $97.21, up $5 over the same period last year.

Through May, upscale, upper scale and luxury chain hotels achieved higher occupancies than midpriced and economy properties. The Mountain Region produced the highest occupancy, probably due to the great winter ski season in the Rockies. Nationally, the highest priced hotels achieved the highest occupancies. Regarding location, airport hotels ran the highest occupancy at 70% followed by urban hotels at 67.3% and resort locations at 66.7%.

Hotel room supply, demand, room rates and revpar (revenues per available room) all showed positive growth for the last 12 months and through May 2007. Hotel occupancy showed a slight downward shift for the last 12 months but showed positive for May 2007 as we head into summer.

USA HOTEL INDUSTRY TRENDS
 
 
May

2007

 
Last 3

Months

Last 12

Months

Year to

Date

Supply
Up 1.4%
 
Up 1.3%
Up 0.8%
Up 1.2%
Demand
Up 2.1%
 
Up 1.2%
Up 0.1%
Up 0.6%
Occupancy
Up 0.7%
 
Down 0.1%
Down 0.7%
Down 0.6%
Average Room Rate
Up 5.5%
 
Up 5.5%
Up 6.7%
Up 5.8%
Rev Per Available Room
Up 6.3%
 
Up 5.4%
Up 5.9%
Up 5.2%
Source: Smith Travel Research, May 2007.

In the summer of 2007, the USA hotel industry will achieve a new record number of occupied rooms per night of 3.14 million, according to a report by PriceWaterhouseCoopers in June. The summer occupancy in 2007 is forecast to be slightly lower than 2006, 69.6%, the second-highest since the peak of 72.1% in 2001 and about one percentage point below the 70.2% occupancy in 2006.

Occupancy for the five-day weekend of the Fourth of July, which falls on a Wednesday this year, is expected to be spread among the before and after weekends at 69.2%. Labor Day weekend is expected to reach 70.1%.

Looks Good for Summer 2007 Leisure Travel

The USA travel industry is expected to have a good summer travel season in 2007, with leisure travel increasing 1.4% over last summer, according to the Travel Industry Association. Americans will take 330 million person-trips in June, July and August, a record high number. Americans are expecting higher gas prices this summer but seem to be taking it in stride. Gas prices of around $3.00 will cause 11% of Americans to modify their summer travel plans, according to a TIA-AAA survey. The real tipping point seems to be $3.50 a gallon gas, with nearly one-third of travelers saying they would cancel their trip.

According to PWC, higher gas prices will result in 8,000 fewer occupied rooms per night between Memorial Day and Labor Day.

There is also emerging price resistance to increases in hotel average room rates. USA hotel average room rate (ADR) increases will decelerate through the remainder of 2007, as new construction accelerates and demand lessens. Nevertheless, analysts predict that hotel room rates will increase in 2007 by the second-highest percent in 10 years.

Most families in the USA will bite the bullet on higher gasoline prices and refuse to abandon their vacation plans.

Many will vacation closer to home, eat fewer meals in restaurants and escape for weekends at nearby regional resorts --- a growing number of which now offer indoor waterparks and family entertainment centers.

Most Lucrative States for Hotel Investment

Currently, the most lucrative states for hotel investment are Hawaii, New York and Massachusetts where hotel revenues are the highest in the nation.

Alaska, Illinois, Arizona and Massachusetts had the biggest gains in revenues per available room.

Hotel revenue per available room (RevPAR) is the key indicator that takes into account supply, demand, occupancy, scarcity and pricing.
 

HIGHEST REVENUE-PRODUCING HOTELS BY STATE
 
 
2006
2005
 
 
RevPAR
RevPAR
 
 
Amount $
Amount $
% Chg
Hawaii
147.41
134.69
9.4
New York
122.28
111.40
9.8
Massachusetts
80.98
73.65
10.0
California
77.31
70.75
9.3
Florida
72.13
69.49
3.8
Alaska
71.45
61.57
16.0
Nevada
75.11
72.86
3.1
Rhode Island
75.52
74.75
1.0
Maryland
69.95
67.01
4.4
New Jersey
68.20
64.13
6.4
Arizona
65.74
59.47
10.6
Illinois
67.70
58.81
15.1
USA Average
61.69
57.39
7.5
Source: Smith Travel Research, Year 2006.

RevPAR is a measure of asset productivity that often points developers to the most attractive locations for new construction, although many of these desirable locations also have high barriers to entry.

Most Desirable Hotel Markets

In 2006, the most desirable hotel markets, in terms of their ability to generate the highest revenues per available room are New York City, Oahu, Miami and San Francisco.

The biggest gains were made by Chicago, San Francisco, Boston and Los Angeles, which recorded double-digit hotel revenue growth.
 

HIGHEST REVENUE-PRODUCING HOTELS BY MARKET
 
 
2006
2005
 
 
Revpar
Revpar
 
 
Amount $
Amount $
% Chg
New York City
198.85
176.21
12.8
Oahu
129.42
118.66
9.1
Miami
100.71
93.14
8.1
San Francisco
100.57
89.91
11.9
Washington DC
96.42
93.79
2.8
San Diego
95.88
88.14
8.8
Boston
94.81
84.73
11.9
Los Angeles
85.50
77.51
10.3
Chicago
82.46
70.15
17.6
Top 25 Market Average
81.82
74.76
9.4
Anaheim-Santa Ana
81.50
76.09
7.1
USA Average
61.69
57.39
7.5

USA Resort Performance

Hawaii is the leading resort destination with 79.8% occupancy (down 1.6% from last year) and $184 average room rate (up 11.2% over last year). This compares to occupancy of 66.6% and average room rate of $135 for all resorts in the USA.
 

HOT & COLD RESORT DESTINATIONS
 
2006
Occupancy
%
Change
2006
ADR
%
Change
Hawaii
79.8
-1.6
184.81
11.2
Nevada
71.9
1.2
104.42
1.9
Florida
65.8
-4.6
109.59
8.8
California
69.5
0.8
111.21
8.4
Arizona
67.0
1.9
98.11
8.5
USA Resorts
66.6
0.0
135.42
6.8
Colorado
61.0
3.7
97.19
6.0
Minnesota
60.3
-0.2
84.19
6.2
Wisconsin
54.9
1.6
76.07
5.0
Source: Smith Travel Research. Year 2006

Nevada, Florida, California and Arizona trail closely behind with occupancies of 71.9%, 65.8%, 69.5% and 67.0%, respectively. Colorado recorded the biggest gain in occupancy at 3.7% while Hawaii recorded the biggest decline in occupancy versus last year.

The highest resort room prices were found in Hawaii at $184, California at $111, Florida at $109 and Nevada at $104. Hawaii recorded a price jump of more than 11% in 2006 compared to last year.

Colorado, Minnesota and Wisconsin achieved statewide occupancy under the national average for all USA Resorts in both occupancy and average room rates. However, trends are shifting. Wisconsin and Minnesota have the highest number of hotel indoor waterpark resorts in the country, and a growing number of ski resorts are considering indoor waterpark projects to achieve year round revenues. Many of the top hotel waterpark resort properties record occupancies and room rates far above the national averages and equal to many of the Sunbelt resort destination states.

USA Hotel Waterpark Resort Performance

On January 1, 2007, there were 136 hotels in the USA with indoor waterparks --- from the smallest water features to the largest waterpark resorts.

During 2007, forty-eight (48) new additions and expansion projects are expected to open by year end, bringing the total to 184 hotel waterpark resorts open and operating in the USA.

Another forty-nine (49) projects are under construction now or will break ground during 2007 which are scheduled to open in 2008 and beyond.
 

      Construction Project Growth
  Hotel Waterpark Resorts USA
  2008 F 2007F 2006 2005 2004 2003 2002 2001 2000
Open at beginning of year 184 136 104 81 65 50 41 32 18
Openings during year 49 48 32 23 16 15 9 9 14
Total Open at end of year 233 184 136 104 81 65 50 41 32
Percent Change 26.6% 35.3% 30.8% 28.4% 24.6% 30.0% 22.0% 28.1%  
   
Under Construction 97 73 52 32 9 10 9 8
In Development   166 108 121 69 46 19    
Source: Jeff Coy & Bill Haralson, Hotel Waterpark Resort Research & Consulting.

Clearly, hotel waterpark resorts are not a fad but here to stay. About 166 projects are in the development pipeline compared to 108 in 2006, 121 in 2005, 69 in 2004, 46 in 2003 and 19 in 2002. The waterpark sector of the resort industry has experienced annual growth of more than 30% over the last several years.

But it is difficult to know how well hotel waterpark resorts perform financially as a group. Many of the larger independent properties do not report statistics to Smith Travel Research. Even the Wisconsin Dells Convention & Visitors Bureau collects little in the way of way of hotel waterpark resort performance data. The hotel owners keep their operating data fairly close to the vest. Great Wolf Resorts Inc is a public company and their operating data is available for all to see online in various SEC filings. Yet, two years ago, Great Wolf Resorts stopped reporting individual property data in favor of reporting same store comparisons, which effectively makes it more difficult for shareholders and other observers to determine how well individual hotels are performing. Regardless, Great Wolf Resorts performance is not necessarily the industry benchmark because they are being out-performed in several markets --- although they lead the industry in terms of multiple locations.

As a result, the best operating performance data is in proprietary databases of a few consultants, appraisers and emerging management companies with multiple locations. In 2001 Hotel Waterpark Resort Research & Consulting was formed for the purpose of collecting, analyzing and publishing data regarding this growing segment of the resort industry. HWRRC is a collaborative effort of Jeff Coy of JLC Hospitality Consulting of Cave Creek AZ and Bill Haralson of William L. Haralson & Associates of Alto NM. Together the two consultants produce an Annual Industry Report, a Construction Report and several developer workshops, where they present their latest research and a variety of expert speakers.

Wisconsin Dells Hotel Performance

In 1990, before indoor waterparks, Wisconsin Dells ran a 40% annually hotel occupancy and had a 100-day peak season. Today, it has 18 hotels with indoor waterparks and has a 365-day peak season. The largest hotel waterpark resorts are running occupancies in the high 70s and low 80s --- 15 to 20 points above the national hotel average.

In 2002, hotels WITH indoor waterparks achieved 26 points higher occupancy and $69 higher average room rates than hotels WITHOUT indoor waterparks in Wisconsin Dells.

In 2004, we updated that research survey to determine the impact of 9/11, the economic recovery and what happened to the haves and have-nots in Wisconsin Dells over the last three years.

Eighteen (18) hotels WITH indoor waterparks captured 85% of the total market hotel revenue in Wisconsin Dells while forty-four (44) hotels WITHOUT indoor waterparks were left with only 15% of the total market hotel revenue. As a result, we referred to Wisconsin Dells as "the land of haves and have-nots."

In 2007, the top two hotel waterpark resorts achieved average room rates above $200. Hotels WITH indoor waterparks recorded average room rates that are 2X that of hotels WITHOUT indoor waterparks. And the average room rate trend over the last three years is getting higher for the haves and lower for the have-nots! The biggest properties are gaining market share while the smaller properties continue to lose market share.

USA Competitive Supply of Hotel Waterparks

One hundred and eighty-four (184) hotel indoor waterparks are open and operating in the USA, including projects scheduled to open in the final months of 2007. Here is a list of hotel waterpark resorts that opened in the following states since 2001:
.

HOTEL WATERPARK RESORTS OPEN
2007F 2006 2005 2004 2003 2002 State
60
49
35
32
28
25
Wisconsin
22
21
20
15
14
10
Minnesota
10
8
7
5
3
2
Michigan
15
8
4
2
1
1
Ohio
8
7
4
4
3
3
South Dakota
7
3
0
0
0
0
Texas
7
4
3
2
1
1
Iowa
7
4
2
1
0
0
Washington
6
5
4
3
2
2
North Dakota
4
3
3
2
2
0
Pennsylvania
4
3
1
0
0
0
Illinois
4
2
1
1
1
1
Nebraska
3
2
2
1
0
0
Indiana
3
3
2
0
0
0
Virginia
3
2
2
2
2
1
Massachusetts
3
2
2
2
1
0
Kansas
2
2
2
2
2
1
Montana
2
2
2
2
2
1
Missouri
2
1
0
0
0
0
New York
12
5
8
5
3
2
Others
184
136
104
81
65
50
Total
Source: Jeff Coy & Bill Haralson, Hotel Waterpark Resort Research & Consulting

Here is a list of the hotel waterpark resorts added to the supply in 2006:
 

HOTEL WATERPARK RESORTS OPENED IN 2006
Name Location Rooms Indoor
Waterpark
Sq Ft
Opened
Best Western Edgewater IWP Addition Duluth MN 282 30,000  200601
Holiday Inn Kearney NE 163 6,000  200601
Great Escapes Hotel & Waterpark Lake George NY 200 38,000  200602
AmericInn Appleton WI 62 200602
Lake Lawn Resort Condo Expansion P1 Delavan WI 222 200603
Great Wolf Lodge Add Condos & IWP Wisconsin Dells WI 128 38,000  200604
Holiday Inn Holidome Convert to IWP Elmhurst IL 214 25,000  200604
Ramada Condo Hotel & Big Splash Auburn WA 150 7,000  200604
Grand Lodge & Waterpark of America Bloomington MN 403 70,000  200605
Holiday Inn East Add Rooms & IWP Columbus OH 338 60,000  200605
Mt Olympus I-OWP Add Rooms Wisconsin Dells WI 56 200605
Schlitterbahn Resort & Waterpark Galveston TX 0 70,000  200606
Wilderness Convert O-Wave Pool to IWP Wisconsin Dells WI 0 68,000  200606
Ramada Casino Resort & IWP Anacortes WA 135 14,000  200606
Wilderness Glacier Canyon Condo Lodge Wisconsin Dells WI 224 200606
Kalahari Resort Add Convention Center Sandusky OH 0 200606
Comfort Suites Thumper Pond Add IWP Ottertail MN 78 12,000  200607
Chula Vista P1 Addition to IWP Wisconsin Dells WI 0 80,000  200608
LaQuinta/Fairfield WaTiki Indoor WP Rapid City SD 255 30,000  200608
Deer Valley Lodge & IWP Barneveld WI 62 12,000  200608
Chula Vista P1 Addition to Condos Wisconsin Dells WI 166 200608
Chula Vista P1 Addition to Conference Ctr Wisconsin Dells WI 0 200608
Ramada DFW North Big Splash Renovation Irving TX 150 200609
Great Wolf Lodge Add Rooms & IWP SqFt Williamsburg VA 100 200610
Jellystone Expand OWP, Add 3Bears HIWP Warrens-Tomah WI 120 48,000  200611
Great Wolf Lodge at Kings Island Cincinnati-Mason OH 401 78,000  200612
Sheraton Chicago Northwest Add IWP Arlington Heights IL 426 65,000  200612
Double JJ Ranch & Gold Rush IWP Rothbury MI 235 60,000  200612
Cherry Valley Lodge Add IWP Newark OH 200 45,000  200612
Arrowwood Condo Resort & IWP Lake Okoboji IA 100 18,000  200612
Lakeview Resort Add Rooms CC & IOWP Canyon Lake TX 31 7,200  200612
Kalahari Resort Golf Course Addition Wisconsin Dells WI 0 200612
Source: Jeff Coy & Bill Haralson, Hotel Waterpark Resort Research & Consulting, December 2006. 

 

Top 25 Largest Hotel Waterpark Resorts in the USA

Hotels with the largest indoor waterparks are concentrated in Wisconsin Dells WI but the trend is moving nationwide.
 

TOP 25 LARGEST HOTEL WATERPARK RESORTS IN USA
Name Location
Rooms
Indoor
Waterpark
Sq Ft
Opened
Wilderness Hotel & Golf Resort* Wisconsin Dells
WI
817
229,000 
199501
Kalahari Resort Wisconsin Dells
WI
738
125,000 
200001
Chula Vista With Phase 1 Additions Wisconsin Dells
WI
466
110,000 
200608
Scotts Hotels & Splash Lagoon IWP Erie
PA
270
102,000 
200304
Kalahari Resort Sandusky Sandusky
OH
596
80,000 
200505
Great Wolf Lodge at Kings Island Cincinnati-Mason
OH
401
78,000 
200612
Great Wolf Lodge Pocono Mountains
PA
401
78,000 
200510
Grand Lodge & Waterpark of America Bloomington
MN
403
70,000 
200605
Schlitterbahn Resort & Waterpark Galveston
TX
0**
70,000 
200606
Wilderness Covered Wave Pool Wisconsin Dells
WI
0
68,000 
200606
Sheraton Chicago NW & CoCo Key Arlington Heights
IL
426
65,000 
200612
Mt Olympus Treasure Island Wisconsin, Dells
WI
302
65,000 
199901
Great Wolf Lodge Williamsburg
VA
301
64,000 
200503
Double JJ Ranch & Gold Rush Rothbury
MI
235
60,000 
200612
Holiday Inn East & Fort Rapids Columbus
OH
338
60,000 
200605
Mountain Grand & Avalanche Bay Boyne Falls
MI
200
58,000 
200505
H2Oasis Indoor Waterpark Anchorage
AK
0***
56,000 
200302
Lodge at Cedar Creek Resort Wausau
WI
140
50,000 
200406
Jellystone Park & 3 Bears Hotel Warrens-Tomah
WI
120
48,000 
200611
Grand Rios Waterpark Resort Brooklyn Park
MN
224
46,000 
200409
Cherry Valley Lodge  Newark
OH
200
45,000 
200612
Great Wolf Lodge Wisconsin Dells
WI
309
44,000 
199701
Massanutten Resort McGaheysville
VA
1400
42,000 
200507
7 Clans Casino Hotel Thief River Falls
MN
151
40,000 
200105
Blue Harbor Resort Sheboygan
WI
183
40,000 
200406
Country Springs Hotel & Waterpark Waukesha
WI
187
40,000 
200505
Notes: * Wilderness includes covered wave pool and 224 condos at Glacier Bay. 

** Schlitterbahn has a 428-room hotel adjacent. *** H2Oasis has no hotel.

Source: Jeff Coy & Bill Haralson, Hotel Waterpark Resort Research & Consulting, December 2006.


 

Profile of USA Hotel Waterpark Resorts by Number of Rooms

Among the Top 5 largest resorts by room count, the average number of hotel rooms is 896 with an indoor waterpark of 99,200 sf or 110 sf per guest room. Among the Top 5, this sizing ratio varies from 30 sf per guest room for the Massanutten Resort to 280 sf per guest room for the Wilderness Resort. The Top 5 resorts have an average of 7.2 waterslides, 2.0 pools and 1.8 hot tubs. All of them have one or more lazy rivers, 80% have a wave pool and 40% have a water coaster. The Top 5 resorts average 75,766 sf of meeting space and 42 meeting rooms. The Top 5 hotel waterpark resorts in 2007 have more rooms, bigger waterparks, more water features and more meeting space than the Top 5 resorts in 2006. Several of the Top 5 have condos pre-sold to individuals that are part of the hotel rental pool.
 

PROFILE OF LARGEST HOTEL WATERPARKS BY ROOMS
Avg #

Rooms

Avg SqFt

Indoor WP

Avg #

Slides

Avg #

Pools

Avg #

Htubs

Lazy

River

Wave

Pool

Water

Coaster

Meeting

SqFt

Number

Mtg Rms

Top 5
896
99,200
7.2
2.0
1.8
1.2
0.8
0.4
75,766
42
Top 6-15
376
58,500
6.7
4.1
1.8
0.8
0.5
0.2
15312
6
Top 16-25
277
41,220
5.6
3.1
1.6
0.8
0.2
0.0
3843
3
Top 26-50
207
28,424
3.4
2.5
1.5
0.5
0.2
0.1
30286
11
Top 51-100
122
16,335
2.5
2.0
1.2
0.3
0.0
0.0
6,084
4
Source: Jeff Coy & Bill Haralson, Hotel Waterpark Resort Research & Consulting. December 2006.

Among the next ten largest (Top 6-15) hotel waterpark resorts, the average number of rooms is 360 with an indoor waterpark of 54,000 sf or 150 sf per guest room.

Among the top resorts ranked 16-25 by room count, the average number of rooms is 274 with an indoor waterpark of 37,179 sf or 135 sf per guest room. Using the chart above, the waterpark developer can estimate the size of his hotel, indoor waterpark and its components. Depending upon size, all hotel waterpark resorts average from 2-8 waterslides, 2-4 pools and 1-2 hot tubs.

Almost all of the Top 25 Largest Hotel Waterpark Resorts have a lazy river while less than half of the smaller resorts have them.

About 70% of the Top 5 Largest Hotel Waterpark Resorts have a wave pool and less than 10% of the smaller resorts have them. Wave pools, while very attractive to surfers, take up a lot of space for the smaller number of guests who can use them. However, they generate a lot of entertainment value for spectators, and ski resorts seem to love them.

The Top 50 Largest Hotel Waterpark Resorts are clearly in the meetings & convention business to balance their seasonal and weekend-weekday mix of business.

Profile of USA Hotel Waterpark Resorts by Size of Waterpark

Hotels with the highest number of rooms don’t always have the largest waterparks. And vice versa. While there are many factors that determine sizing, a rule of thumb is the rooms to waterpark ratio. A direct relationship exists between the number of hotel rooms and the size of the indoor waterparks.

For example, hotels with indoor waterparks more than 70,000 square feet average 453 rooms and 105,250 square feet of indoor waterpark --- a ratio of 231 sf of waterpark per guest room. That ratio decelerates as waterparks get smaller.
 

PROFILE OF LARGEST HOTEL WATERPARKS BY SIZE OF WATERPARK
Hotels With An
Indoor Waterpark
Avg #
Of Rooms
Avg Indoor
Waterpark SqFt
Indoor Waterpark
Sq Ft Per Room
Rooms Per 1000 Sq Ft
Of Indoor Waterpark
Over 70,000 sf
453
105,250
231
4.9
50,000 to 69,999
194
61,600
221
3.2
40,000 to 49,999
346
43,125
179
9.7
30,000 to 39,999
225
32,893
143
7.5
20,000 to 29,999
227
21,916
156
7.9
10,000 to 19,999
106
12,537
107
9.4
Under 5,000
106
2,769
36
36.6
Source: Jeff Coy & Bill Haralson, Hotel Waterpark Resort Research & Consulting, December 2006.

To illustrate, hotels with waterparks 40,000 to 49,999 sf average 346 rooms and 43,125 sf of indoor waterpark --- a ratio of 179 sf per guest room. Notice that hotels with about 100 rooms vary widely in the sizes of their indoor waterparks. Hotel owners and developers can use the chart above to help size their projects.

Top Hotel Meeting Facilities with Indoor Waterparks in the USA

Among the Top 15 Hotel Meeting Facilities with an indoor waterpark, the number of rooms varies from 100 to 738 and the meeting facilities vary from 25,000 to 125,000 square feet.

Several of the largest hotel waterpark resorts are in the meetings & convention business. The 738-room Kalahari Resort & Convention Center in Wisconsin Dells WI is clearly the largest meeting facility (125,000 sf) with the largest indoor waterpark (125,000 sf).

The 194-room Grand Harbor Resort in Dubuque IA, with 25,000 sf indoor waterpark, is connected to a 120,000 sf convention center that it operates for the city.
 

TOP 15 HOTEL MEETING FACILITIES WITH INDOOR WATERPARKS
Name Location
Rooms
Indoor
Waterpark
Sq Ft
Meeting
Sq Ft
Kalahari Resort & Convention Center Wisconsin Dells
WI
738
125,000
125,000
Grand Harbor Resort & Waterpark Dubuque
IA
194
25,000
120,000
Kalahari Resort & Convention Center Sandusky
OH
596
80,000
95,000
Chula Vista Resort Wisconsin Dells
WI
300
30,000
70,000
BW Ramkota Hotel & Conference Sioux Falls
SD
226
3,000
60,000
Double JJ Ranch & Gold Rush IWP Rothbury
MI
235
60,000
50,000
Timber Ridge Lodge Lake Geneva
WI
225
30,000
50,000
Grand Prairie Hotel & KS Splashdown Hutchinson
KS
218
30,000
50,000
Great Wolf Lodge at Kings Island Cincinnati-Mason
OH
401
78,000
40,000
Lake Lawn Resort Condo Expansion Delavan
WI
222
31,000
Hilton Center City (730) Milwaukee
WI
250
20,000
30,000
Arrowood Resort & Conference Ctr Alexandria
MN
200
38,000
28,000
Arrowood Condo Resort & IWP Lake Okoboji
IA
100
18,000
28,000
Ramada Plaza Fargo
ND
185
10,000
25,000
Wilderness Glacier Canyon Wisconsin Dells
WI
224
25,000
Source: Jeff Coy & Bill Haralson, Hotel Waterpark Resort Research & Consulting, December 2006.

The Kalahari Resort & Convention Center in Sandusky OH has 95,000 sf of meeting space with an 80,000 sf indoor waterpark with another 93,000 sf of indoor waterpark space under construction for opening in late 2007.

These hotel waterpark resorts obviously target the individual leisure traveler segment. But these properties have the advantage of targeting another customer segment --- the group market --- to fill in hotel low periods and weekdays when kids are in school. Hotel waterpark resorts with substantial amounts of meeting space run higher annual occupancies than those with little or no meeting space.

Emerging Multi-Unit Owners

  • Great Wolf Resorts of Madison WI
  • Wave Development Inc of Milwaukee WI
  • Kalahari Resorts & Convention Centers of Wisconsin Dells WI
  • Wilderness Resorts Inc of Wisconsin Dells WI
  • Focus Development & Management of Valparaiso IN
  • FLG Hospitality Inc of Columbus OH
Emerging Hotel Waterpark Resort Management Companies
  • Wave-Sage-Horizon of Milwaukee WI
  • FLG Hospitality Inc of Columbus OH
Independent Versus National Branding

Of 184 hotel waterparks forecast to be open by end of 2007, 85 are affiliated with a national hotel brand while 99 are independent.

Brand names include AmericInn, Baymont, Best Western, Comfort Suites, Country Inn & Suites, Days Inn Hawthorn Suites, Hilton, Howard Johnson, Holiday Inn, Marriott, Microtel, Nickelodeon, Quality Inn, Ramada, Sleep Inn, Super 8 and Wingate.

Whether or not to affiliate with a brand is a major issue in this product sector of the hotel industry. Properties in resort locations tend to be independent while properties in urban, suburban and highway locations tend to be franchised.

We counted the Great Wolf Resorts as branded properties starting in 2005 as they are considered an emerging brand in the hotel waterpark resort industry. Great Wolf Resorts Inc signed a license agreement with Ripley’s Entertainment for its Great Wolf Lodge in Niagara Falls, Ontario --- which is a first step in becoming a franchisor in the hotel waterpark resort industry.

We counted the two Kalahari Resorts as independents, although this familiar name is another emerging national brand as they seek their third location.

Wave Development Inc of Milwaukee WI, in partnership with Sage Hospitality of Denver CO and Horizon Investments of Milwaukee WI, have created an emerging brand of indoor waterparks called CoCo Key Resorts in six locations that are open and two locations under construction. Of the eight locations, four are affiliated with Sheraton, one with Holiday Inn and one with Marriott.

When indoor waterparks first emerged, developers had to educate the major hotel chains about the concept. Now two hotel chains, Marriott and Holiday Inn, are creating indoor waterpark prototypes. Marriott announced it would participate with Nickelodeon to build up to 20 specialty resorts using SpongeBob SquarePants to attract the family market. Holiday Inns (IHG) is working on prototypes for converting holidomes into indoor waterparks, adding new indoor waterparks to existing hotels and building a new brand of waterpark resorts.

Recent Hotel Waterpark Resort Transactions

Tundra Lodge Resort --- Joe Buralli of Waterpark H2Otels USA LLC of McHenry IL purchased the 161-room Tundra Lodge Resort & Waterpark in Green Bay WI from Lombardi Ave Waterpark LLC in February, 2007. Closing is expected within 90 days. The resort has a 20,000 sf indoor waterpark. The resort had under-performed due to lack of conference space. "You have to sell rooms every day, including Sunday through Thursday," according to Buralli who plans to add 10,000 sf of conference space. He said the amount of lost business due to have no conference space is staggering. Buralli said he will contract with FLG Hospitality of Columbus OH to manage the operation. Regarding a flag, Buralli said Wyndham Hotels & Resort is interested in adding the Tundra Lodge to its network, but no decision has been made to affiliate with a brand.

Boyne USA --- In June 2007, Boyne USA purchased two ski resorts in Maine, Sunday River and Sugarloaf, from American Skiing Company for $77 million in cash. Closing is scheduled on or before July 31, 2007.

Sunday River features 131 trails spread across eight interconnected peaks serviced by 18 lifts, including four high speed quads, two full-service fractional ownership hotels, a recently constructed Robert Trent Jones golf course and other four-season resort offerings.

Sugarloaf USA boasts New England’s longest continuous vertical drop of 2,820 feet and only lift service above treeline skiing. The four season resort also features one fractionally-owned hotels, conference center and golf course.

Headquartered in Michigan, Boyne USA is a privately held company that has interests in seven North American resorts, including Big Sky Resort in Montana; Boyne Mountain, Boyne Highlands and Bay Harbor in Michigan; Brighton in Utah, Crystal Mountain in Washington and Cypress Mountain in British Columbia, Canada.

Boyne Mountain Ski Resort in Boyne Falls MI opened Mountain Grand Lodge, its 200-unit condo hotel and 57,000 sf indoor waterpark, Avalanche Bay, in May 2005 --- as part of their strategy to become a four-season resort. Could a indoor waterpark at a ski resort in Maine be far behind?

The Depot Hotel & Waterpark --- The Courtyard by Marriott at the Depot in downtown Minneapolis is under-going a multi-million dollar renovation, after which it will convert to Marriott’s more upscale Renaissance brand. The hotel has had somewhat of an identity crisis since it opened in 2000. "The downtown location draws business travelers during the week while the indoor skating rink and 10,000 sf indoor waterpark attracts families on the weekend," according Robb Hall, managing director. The owner, Minneapolis- based CSM Lodging, decided to switch to the full-service Renaissance flag in response to customer requests for more amenities. The hotel will add a business center, a conference room for teleconferencing, individual wireless work stations and a club room for frequent travelers. In mid May 2007, the hotel officially became The Depot, a Renaissance Hotel by Marriott.

Mt Olympus --- In March 2007, owners of Mt Olympus Water and Theme Park in Wisconsin Dells purchased the neighboring Treasure Island Resort and related properties that will be incorporated into a single Greek-themed entertainment complex.

The purchase included Treasure Island, Captain’s Quarters and Pleasant View lodging properties along with Bay of Dreams indoor waterpark and the former Family Land Outdoor Waterpark properties from Jim Mattei. All of the properties have been acquired by the sole proprietors of Mt Olympus, Nick and Eva Laskaris. All the properties will be renamed and upgraded to reflect the Greco-Roman theme.

The 156-acre Mt Olympus Water and Theme Park was created with the 2004 merger of Treasure Island and Family Land with a neighboring theme park that was co-owned Matei and the Laskarises.

Hotel Waterpark Resorts Opening in 2007

Twenty-two (22) hotel waterpark projects opened during the first half of 2007 with another twenty-six (26) scheduled to open in the second half of this year.
 

HOTEL WATERPARK RESORTS SCHEDULED TO OPEN IN 2007
Name Location Rooms Indoor
Waterpark
Sq Ft
Open
Clock Tower Resort Add IWP Rockford IL 252 60,000  200701
IWP at Sea Island on the Beach Myrtle Beach SC 149 10,000  200701
Holiday Inn & Suites & IWP Maple Grove MN 136 25,000  200702
Holiday Inn West Holidome Conversion Topeka KS 197 11,000  200703
Holiday Inn Express Add Rooms & IWP Dundee MI 176 25,000  200704
Bridges Bay Resort & IWP Spirit Lake IA 72 19,800  200704
Mt Olympus (former Capt Quarters) Wisconsin Dells WI 200704
Mt Olympus (former Familyland OWP) Wisconsin Dells WI 200704
Mt Olympus (former Pleasant View) Wisconsin Dells WI 200704
Harrah’s Casino Hotel & Domed Pool Atlantic City NJ 172,000  200705
Sheraton Resort IWP Addition Danvers MA 367 65,000  200705
Canad Inns Splashers at Alerus Center Grand Forks ND 192 40,000  200705
Flying L Ranch Add Rooms & OWP Bandera TX 76 200705
Kings Point Waterpark Resort Storm Lake IA 100 20,000  200706
Northern Bay Golf Resort & Marina Arkdale WI 225 20,000  200706
Quality Inn & Suites Rain IWP Addition Sandusky OH 89 5,000  200706
Chula Vista P2 Add Condominiums Wisconsin Dells WI 150 200706
Chula Vista P2 Add Dome Sports Center Wisconsin Dells WI 0 200706
Glacier Canyon Lodge Add Golf Course Wisconsin Dells WI 0 200706
Best Western Aberdeen Convert IWP Aberdeen SD 154 200706
Hotel Condos & Indoor Waterpark Seattle-Woodinville WA 150 200706
BW Ramkota Hotel Convert IWP Casper WY 229 200706
Isle of Capri Casino Hotel at Lost Island OWP Waterloo IA 200 200707
Splash Universe Waterpark Resort Shipshewana IN 154 25,000  200708
Holiday Inn Suites & Dome Waterpark Toledo-Maumee OH 106 22,000  200708
Holiday Inn Central Add IWP Omaha NE 383 40,000  200709
Grand Cambrian Resort & I-OWP Wisconsin Dells WI 308 35,000  200709
Radisson Resort & Waterpark Albuquerque NM 314 23,000  200709
Glacier Canyon Lodge Add to CC Wisconsin Dells WI 0 200709
Mt Olympus Treasure Island Add Timeshare Wisconsin Dells WI 24 200709
Great Wolf Lodge at Grapevine Grapevine TX 404 80,000  200710
Great Wolf Lodge Grand Mound WA 390 67,000  200711
Sheraton North Add IWP Coco Key Cincinnati-Sharonville OH 357 50,000  200711
Great Adventure Water Resort (Days) Bellevue-Omaha NE 129 30,000  200711
Great Wolf Resort Add CC Traverse City MI 200711
Kalahari Resort IWP Addition Sandusky OH 0 93,000  200712
Silver Mountain Resort & IWP Kellogg ID 268 45,000  200712
Crowne Plaza IWP Addition Asheville NC 0 42,000  200712
Red Jacket Mountain View Add IWP North Conway NH 162 40,000  200712
Embassy Suites & IWP Phase 2 Cincinnati-Forest Park OH 150 40,000  200712
Split Rock Resort IWP Addition Lake Harmony PA 500 40,000  200712
Westgate Timeshare Resort Add IWP Gatlinburg TN 0 40,000  200712
Silverleaf Resort IWP Addition Galveston TX 25,000  200712
Interlaken Resort & Spa Add Rooms & IWP Lake Geneva WI 414 20,000  200712
Wyndham Garden Condo & IWP Kent WA 150 6,000  200712
Kalahari Resort Condo Additions Sandusky OH 288 200712
Hotels (3) + Indoor Waterpark at BIA Buffalo NY 350 200712
Embassy Suites & IWP Phase 1 Cincinnati-Forest Park OH 250 200712
Source: Jeff Coy & Bill Haralson, Hotel Waterpark Resort Research & Consulting. June 2007.

Canadian Supply of Hotel Waterparks

In Canada, we have identified 114 hotel indoor waterparks that are open and operating in 2007. Most are located in the western provinces. World Waterpark at the West Edmonton Mall in Alberta is the largest indoor waterpark in the world. The Mall is the largest shopping center in the world, according the Guinness Book of World Records.

The Fantasyland Hotel at West Edmonton Mall was built in 1986 with 355 rooms. Technically, the Fantasyland Hotel is not a hotel waterpark, but it is closely connected. You can walk from the hotel through the mall to the 217,800 sf World Waterpark without going outside. So, the largest hotel in Canada associated with an indoor waterpark is the Fantasyland Hotel in West Edmonton.
.

2007F
2006
2005
2004
2003
2002
Province
42
42
41
41
38
35
Alberta
22
22
22
22
20
19
Saskatchewan
15
15
15
15
13
11
British Columbia
14
12
10
11
9
6
Ontario
10
11
11
9
9
7
Manitoba
6
6
6
6
6
2
Quebec
2
2
2
2
2
1
Prince Edward Island
3
3
3
2
2
1
Nova Scotia
Source: Jeff Coy & Bill Haralson, Hotel Waterpark Resort Research & Consulting. 

In Canada, hotel waterparks are different than in the USA. Many are really indoor pools that have been enlarged and enhanced with waterslides and water playthings. Many of the indoor waterparks in Canada are under 10,000 sf while many in the USA are over 10,000 sf.

Top 15 Canadian Hotel Waterparks by Size of Waterpark

While the 217,800 sf World Waterpark is not really a hotel waterpark, it is situated very closely to hotel rooms located at the West Edmonton Mall. And the 355-room Fantasyland Hotel is part of that same mall --- making a connection between the hotel and the waterpark.
 

TOP 15 CANADIAN HOTEL WATERPARK RESORTS BY SIZE OF WATERPARK
Name Location  
Rooms
Indoor Waterpark
Sq Ft
World Waterpark West Edmonton Mall Edmonton AB
0*
217,800 
Fallsview Indoor Waterpark Niagara Falls ON
125,000
Great Wolf Lodge Niagara Falls ON
404
103,000
Ameri-Cana Resort Niagara Falls ON
160
19,100
Travelodge World Hotel Ottawa ON
177
13,000
Ramada Hotel & Suites Lethbridge AB
119
13,000 
Best Western Jurassic Inn Drumheller AB
49
6,200
Medicine Hat Lodge Hotel Medicine Hat AB
193
6,000 
Travelodge Hotel Medicine Hat AB
92
5,600 
Riviera Hotel near West Edmonton Mall Edmonton AB
5,500 
Best Western Hospitality Inn Calgary AB
261
5,400 
Douglas Fir Condo Resort Banff AB
133
5,000 
Ramada Renaissance Hotel Saskatoon SK
144
4,800 
Remai Regina Hotel & Convention Center Regina SK
235
4,600 
Sheraton Cavalier Hotel Saskatoon SK
249
4,400 
Source: Jeff Coy & Bill Haralson, Hotel Waterpark Resort Research & Consulting. October 2006. 

* Fantasyland Hotel at West Edmonton Mall has 355 rooms.

The second largest hotel waterpark in Canada is the Americana Resort & Conference Center, which opened its 19,100 sf indoor waterpark in 2004 --- attached to its 160 guest rooms and 16,000 sf conference center in Niagara Falls ON.

Third largest is Travelodge World Hotel in Ottawa, which also opened its 13,000 sf indoor waterpark in 2004 --- connecting with its 177 guest rooms.

In Canada, the biggest concentration of hotel indoor waterparks is in the Economy Hotel sector, where room counts are typically under 100 rooms and indoor waterparks are less than 5,000 sf.

Mexican Supply of Hotel Waterpark Resorts

While most waterparks in Mexico tend to be outdoor waterparks, we have identified a few that are indoor-outdoor combinations and onsite, adjacent or nearby lodging that would tend classify them as hotel waterpark resorts.

We are in the process of surveying owners, consultants and suppliers in Mexico to gather more data and develop a better profile of hotel waterpark resorts in Mexico.
.

MEXICAN HOTEL WATERPARK RESORTS
Name Location
Hotel Balneario de Lourdes Sta Maria SLP Mexico
Hotel Balneario Spa La Caldera Abasolo GTO Mexico
CICI Acapulco Magico Waterpark Acapulco Mexico
Wet n Wild Cancun Mexico
Splash Hotel Parque Acuatico Nayrit Mexico City Mexico
Balneario Ixtapan Waterpark Mexico City Mexico
Persaventura Waterpark Piedras Negras COA Mexico
Balneario San Jose Waterpark Quiroga MICH Mexico
Balneario El Rollo Morelos Mexico
Tangamanga Splash San Luis Potosi Mexico
Parque Acuatico El Rollo Tlaquiltenango Mexico
Source: Hotel Waterpark Resort Research & Consulting.

What’s Ahead for the Hotel Waterpark Resort Industry?

Based on our review of consumer behavior, lifestyle changes and travel trends, here are 17 Predictions on the Future of Resort Development:

  • Regional drive-to resorts will attract more guests than national fly-to resorts.
  • Business travel will become more an elective and less a requirement.
  • More Americans will telecommute.
  • Mixing business & leisure 24/7 will lead to greater stress.
  • Never disconnecting will cause greater stress.
  • Lodging, recreation and entertainment concepts will continue to merge.
  • Resorts will become more like theme parks.
  • Resorts will grow faster than other types of lodging.
  • More resorts will become part of mixed-use developments.
  • Future resorts will focus more on guest participation and interaction.
  • Theme parks and resorts will use more simulators to create virtual reality.
  • Resorts will increasingly become a teacher.
  • Seasonal resorts will become year round operations.
  • Resorts will build more and more indoor recreation facilities.
  • Resorts will increasingly incorporate water into their designs.
Recent announcements indicate that these predictions are coming true at an accelerating pace.
 

Lots of Capital Looking for Hotels

Investors continue their hunger for hotels, according to a recent report by Jones Lang LaSalle. Five major public hotel companies went private in 2006. In January 2007, Morgan Stanley Real Estate spent $6.6 billion to acquire CNL Hotels & Resorts, an unlisted REIT that owns a share of two Great Wolf Lodge waterparks in Wisconsin Dells and Sandusky OH. Contributing to the frenzy for hotel assets are low interest rates, strong industry performance, a glut of capital and smaller returns in other types of real estate. Lodging demand is expected to remain ahead of the rising hotel room supply pipeline

Construction Growth Forecasts

Construction of office building, hospitals, hotels and other non-residential buildings will increase almost 7% in 2007, driven by growth in the economy, compared to growth of almost 6% in 2006, according to the American Institute of Architects in January. If this forecast holds true, 2006 and 2007 will be the best two-year period for construction since the late 1990s.

Hotels are expected to show the biggest increase in construction, with a growth rate of 13.1%. Amusement park and recreation properties are next with 9.9% growth, followed by office buildings at 9%.

Coming soon: Hotel Waterpark Resorts Construction Report 2007.

For more information regarding feasibility, supply and demand, contact Jeff Coy at 480-488-3382. Coy heads JLC Hospitality Consulting of Cave Creek AZ. Email jeffcoy@jeffcoy.com or go to www.jeffcoy.com. Or contact Bill Haralson at 505-802-1522. Haralson heads William L. Haralson & Associates of Alto NM. Email wharalson@aol.com or go to www.wlha-inc.com.

.
Contact:

Jeff Coy
HOTEL WATERPARK RESORT
Research & Consulting
JLC Hospitality Consulting
PO Box 4090, 39401 N. 67th Place
Cave Creek, AZ 85327-4090
480-488-3382 tel
Email jeffcoy@jeffcoy.com
Website www.jeffcoy.com
 

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Also See: Hotel Waterpark Resorts - Construction Report 2006; 73 Are Under Construction, Another 108 are planned / Jeff Coy and Bill Haralson / July 2006
Hotel Waterpark Resort Industry Report 2006; 33 New Hotel Waterparks Open, 70 Under Construction / Jeff Coy and Bill Haralson / October 2006
Hotel Waterpark Resort Industry Report 2005 23 New Hotel Waterparks Open, 52 Under Construction / Jeff Coy and Bill Haralson / October 2005
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