Aquaria Ltd., which plans to develop a $375 million retail and entertainment project in Eilat, Israel, near the border of Jordan in an area referred to as the Red Sea Riviera, has hired Sonnenblick-Goldman Co. to raise $305 million in venture and construction financing for the project.
The 300-acre development, dubbed Aquaria Entertainment City, includes a water-themed amusement park, a 10,000-seat arena, a 2,500-seat amphitheater, shops, restaurants and an 18-hole golf course. Using planners and designers that helped create Walt Disney Co.'s Epcot park in Orlando, Fla., Aquaria also will offer amusement rides mixed into areas that mimic the look of other cities, including Hollywood, New Orleans, San Francisco, Rio de Janeiro, St. Tropez, Venice, St. Petersburg and Bangkok.
The Israeli government is providing a $45 million grant and is leasing the land to Israel-based Aquaria, whose mostly U.S.- based principals are putting up about $25 million. Sonnenblick-Goldman, a New York real-estate investment banking firm, is raising $100 million in equity and $205 million in debt.
Eli Lankri, Eilat's deputy mayor, hopes Aquaria will rejuvenate international tourism, which has fallen off since 2000 due to the violence in the Middle East. Last month, the U.S. State Department issued a travel warning urging Americans to defer travel to Israel after a U.S. citizen was kidnapped in the West Bank. Mr. Lankri also hopes Aquaria, which is expected to create 2,000 jobs, will help reduce Eilat's 8% unemployment rate.
Arthur Sonnenblick, senior managing director of the firm that bears his name, says Sonnenblick-Goldman will target investors in the U.S. and Europe, and doesn't believe the violence in the region will be a deterrent. "I don't like to take on projects that I don't feel comfortable that I can get done," he says. "I think the returns will be attractive to investors."
The project is expected to generate returns of 18% to 20%, says Joseph Bernstein, Aquaria's Delray Beach, Fla.-based co-president. He says Aquaria's feasibility relies on the 2.5 million Israelis who visit Eilat annually -- and not on the return of international tourism. And if the government moves forward in allowing casinos in Eilat, "we may make a bid" for those operations, he adds. Construction will start next year for a 2008 opening.
So Far, So Good
As of late yesterday, things have been quiet for the shifts of volunteers from the Building Owners and Managers Association of New York and the Real Estate Board of New York, who have been manning phones and computers at the New York Office of Emergency Management's Emergency Operations Center since last Friday.
When activated, the Emergency Operations Center serves as a 24-hour crisis command post and information clearinghouse for the public and private sectors during an emergency or a high-alert event, such as this week's Republican National Convention.
First tested during the Y2K rollover, the center is staffed by more than 80 representatives from city, state and federal government agencies and the private sector, including representatives from the securities, banking, and insurance industries and small businesses.
The volunteers from BOMA New York and REBNY are staffing the center from 6 a.m. to midnight through Saturday to provide up-to-the-minute information to the real-estate industry as emergencies occur, such as a bomb threat. They also answer questions, such as when the lights will come back on in the event of a power outage.
"So far, nothing has happened -- which everyone is grateful for," says Bobbi McGowan, BOMA New York's executive director, although she did hear that "a bomb sniffing dog had come by the center and people were excited about having their pictures taken with him."
"I told the volunteers to bring some work or a novel," says Marolyn Davenport, a senior vice president at REBNY.
Bill Proceller, asset manager at Rockrose Development Corp., who manned the BOMA New York desk at the center for five hours yesterday afternoon, says the highlights of the day were the Chinese food served for lunch and an impromptu contest a representative from the National Oceanic and Atmospheric Administration held by asking if anyone knew what category level Hurricane Frances had reached.