We believe this project is a game-changer for Round Rock, and we have a track record of providing incentives to businesses that provide significant, long-term positive impacts to the local economy.
The project being proposed is a family resort and convention center. The resort will feature a minimum of 975 guest rooms, a convention center, an indoor/outdoor water park, and other potential indoor and outdoor activities. The development will also include additional entertainment, recreation and other mixed uses on 351 acres on U.S. 79 across from the Dell Diamond and Old Settlers Park.
Kalahari Resorts, a family-owned, privately held company with an outstanding philanthropic reputation. Todd Nelson operates the business with his wife and five children and several key executives.
The project will bring needed diversity to the Round Rock economy, in addition to significant convention and hotel space. We believe this is the highest and best use of this property, in that it will generate significant new revenues to the City while demanding fewer City services than other likely types of development on this site.
This project will diversify the property tax base by bringing a new industry – the resort/convention business – to Round Rock. We expect this project to generate millions of dollars in annual revenue to local governments and the state, and will provide many jobs for varying experience levels including: full time, salaried, part-time and hourly opportunities. Kalahari intends to invest at least $350 million in the project, which will create significant property tax revenue to the City, Williamson County and Round Rock ISD. And, while the City has successfully diversified our sources of sales tax revenue over the past 10 years, we have not had a single project add this much value to the property tax rolls. We anticipate the project will bring in approximately $4.7 million in annual net, direct tax revenues to the City in the first 10 years of operations. The City believes the development will also attract additional business, development and investment in Round Rock and Williamson County. Updated Dec. 9, 2016
Kalahari will generate millions of dollars in annual revenue and bring hundreds of new jobs to Round Rock. A company like Kalahari is highly prized as a corporate citizen, making recruitment very competitive and incentives often necessary. The City has used incentives in the past to attract other highly desirable companies to Round Rock and has a proven track record of providing performance based incentives to businesses that expand employment opportunities and the tax base. Examples are Dell, Dell Diamond, Round Rock Premium Outlets, IKEA, Bass Pro and Emerson. These companies are assets to the community and our economy.
The agreements provide for Kalahari to employ a minimum of 700 and invest at least $350 million in a 975-room resort, 200,000-square-foot indoor/outdoor water park and 150,000-square-foot convention center. The City will own the 351-acre tract of land, which will be leased to Kalahari for up to 99 years. In addition, the City will issue bonds to provide $40 million in net proceeds to construct the City-owned Convention Center, and $30 million to construct city-owned improvements. Also, the City will waive most development fees.
After the debt payments are made each year, the City and Kalahari will share remaining select State and City tax revenues, with 75 percent going to Kalahari and 25 percent to the City in years 1-10 and 50-50 in years 11-40. Based on projected revenues, the incentive payments to Kalahari are estimated to be $7.5 million annually for years 1 through 10. The City expects to receive $4.7 million a year in new tax revenue after debt and incentive payments are made for years 1 through 10. You can find more details about the incentive agreements here
. Updated Dec. 9, 2016
An MOU is a written agreement between two or more parties that expresses mutual accord regarding a matter between the parties. MOUs are not legally binding but they carry a degree of seriousness and mutual respect, and are significantly stronger than a “handshake.”
There are two other feasible options. One is for mixed-use development and light industrial, the other is single family residential:
- Option 1, Commercial/Mixed Use – There is already zoning in place for mixed uses on the 145-acre Bison property in the form of a Planned Unit Development (PUD). The PUD allows for a 35-acre “Main Street” style development that would include a hotel up to 15 stories tall, and 50,000 square feet of retail and 350,000 square feet of offices. It also allows for a 47 acre business park development, with building heights from 2 to 5 stories, 400 units of townhome development, 8 acres of retail development and 20 acres of open space and greenbelts. There is an additional 218 acres at the site with planned zoning for light industrial, with 5-story maximum building heights. That would yield up to 4.3 million square feet of business park/light industrial development.
- Option 2, Residential – If the 351 available acres were developed as a residential neighborhood – which has been proposed to the City, but does not meet our future land use plans – there could be up to 1,404 homes built.
Both of these options have the potential to impact traffic (particularly on U.S. 79) to a much greater extent than Kalahari. For example, Kalahari’s traffic from tourists and visitors does not peak at a particular time of day, unlike that of mixed-use facilities and residential neighborhoods whose employees and residents leave for work and come home during peak travel periods. Water use is likely to be about the same for options 1 and 2 compared to the Kalahari project, which has an excellent track record with green initiatives. Updated Dec. 9, 2016
The project will bring significant new tax revenues to support Round Rock ISD while not adding significant numbers of new students. If Option 2 above were to happen, we estimate it would add more than 900 new students to the district at build out.
Economic changes due to national and world upheavals can sometimes affect local decisions and those of the developers.
There is nothing like this in Central Texas. The Kalahari property will offer needed meeting space and hotel rooms to the area. The hotel market in Round Rock is very strong. Kalahari property guests will also take advantage of other Round Rock amenities like restaurants, the Dell Diamond, retail shops, etc.
While Rock’N River is much more than your average municipal pool, it’s not serving the same market as Kalahari, a true year-round vacation destination and convention center. Rock’N River is designed as a local destination, geared for repeat business. Rock’N River pricing is designed to target guests who will come four or five times during the summer. Kalahari offers a unique vacation experience that compliments the City’s Sports Capital of Texas tourism program. Many families combine sports tournaments and vacations, and we expect Kalahari to tap into that market, among others.