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EDA, Kalahari change terms
EDA OKs Kalahari performance agreement changes


Date published: 6/15/2010

BY EMILY BATTLE

Fredericksburg's Economic Development Authority signed off yesterday on changes to the agreement that will govern Kalahari Resorts' incentives package.

This agreement was first approved by both the City Council and the EDA in May 2008.

Since then, Kalahari has changed some of the phasing of its project, and has had to delay its opening date as it seeks financing for the $260 million water-park hotel and convention center amid the global financial crisis.

The major changes to the agreement that the EDA approved yesterday are:

Moving the deadline for Kalahari to open for business from Dec. 31, 2010, to Dec. 31, 2013.

Changing the agreement's language about the phasing of the project to reflect updates to Kalahari's plans.

The minimum number of hotel rooms to be constructed in the first phase of the project has been raised from 700 to 800. Also, the requirement for Kalahari to build a 200,000-square-foot indoor water park in the first phase has been raised to require a 230,000-square-foot water park, indoor theme park and spa.

As a result, the required second phase of the project has been decreased from $25 million to $5 million. This is required within the first 10 years the resort is open. It is expected to include more hotel rooms and an outdoor water park.

These proposed changes were part of a package of Kalahari-related items put before the City Council last month.

City and Kalahari officials presented these approvals as necessary to allow Kalahari to move forward with selling a total of $270 million in bonds for the project this fall.

The council approved most of the items last month, including zoning exceptions for the height of the hotel building and for an electronic sign on Interstate 95.

The council held off on approving the proposed changes to the performance agreement, however, because the EDA hadn't approved them yet.

Last month, a few EDA members said they wanted to make other changes to the agreement, outside of the proposed adjustments.


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