West Greeley project economic impact draft study shows expected countywide impact and costs

GREELEY — A draft study by CBRE Inc. into the feasibility of a waterpark-hotel-ice arena and events center in west Greeley has determined costs, recommended building at least 400 hotel rooms, and suggested that the project bring in a second professional sports team to make the numbers round out.

In all, the report suggests that the costs of the project will be greater than other similar projects, but it also will generate an immense amount of revenue.

The City of Greeley released the 114-page draft report Wednesday, Jan. 8, which assumes costs and revenues that would affect the entire Greeley metropolitan statistical area, which includes all of Weld County.

The entire project —  which would relocate the Colorado Eagles minor-league hockey team to Greeley in a new arena, add additional ice for youth hockey and national tournaments, build a hotel and convention center, and build a massive indoor water park with 12 wrap-around slides, plus additional restaurants and retail —  is expected to cost $1.1 billion, all of which the City of Greeley would guarantee. 

Greeley City Council mayor pro-tem Dale Hall, who sits on the subcommittee for the west Greeley project, said the group is not necessarily looking for a specific number on the revenue side, but more of it as a catalyst for the future.

“The main object we’re looking for, as an economic development incentive to allow for not only that particular project but that would be the catalyst that would bring other development,” Hall said in an interview.

In all, Hall said he believes based on what he’s seen, the city can afford the project, which is foreseen in the CBRE report.

“In my understanding, it’s a very conservative number where they’ve taken the highest concept of expenses and the lowest concept of revenues and put them together and it’s still penciling out,” Hall said.

Presenting a small portion of the report to the Greeley City Council this week, Economic Development Director John Hall said the report is not final. Councilmembers asked for the report anyway, and it was made public Wednesday. The council asked Hall to come back with more Greeley-specific numbers that show the direct impact on Greeley in terms of revenue, jobs and economic impact.

The council still must decide how to fund the project, which includes building not only the development but also the associated infrastructure, such as water and sewer lines, to supply expected residential and commercial development around the project. The project would be funded in a variety of ways: through the revenues it generates once it opens; $793 million in bonding for the hotel, arena and water park; $235 million for infrastructure, to be financed general improvement district bonds; and $62 million in bonding for water and sewer infrastructure. The main bonding for the project would be through a “conduit borrower,” set up as a 501(c)3 agency by Provident Resources Group out of Baton Rouge, Louisiana.

While the CBRE project numbers suggest economic impacts to the Greeley MSA, it also assumes a user base that dips well into Denver and all of Northern Colorado.

The CBRE report assumes the expected net operating income of the project would be almost $24 million in its first full year of operation and increase to almost $100 million a year in five years. The first year of operation, 2028, would be six months only.

The CBRE report broke down the following expected expenses and revenues:

• Expenses of roughly $44,000 per arena seat.
• Expenses of roughly $764,000 per room for the hotel and water park.
• Construction of the project alone could bring $400 million a year to the economy through wages and spending.
• The operations for the hotel and water park are estimated to generate about 551 jobs from direct, indirect, and induced demand.
• The facilities are expected to add around $18.7 million in local earnings annually.
• Overall economic output is estimated to be about $79.2 million annually.
• Visitor spending is expected to generate an impact of $17 million a year.
• It is expected to generate $4.8 million a year in sales-tax revenue and $800,000 a year in lodging tax.

Overall, the CBRE report notes that the project can be profitable, and it evaluates three different scenarios involving fewer visitors and 350 hotel rooms, less meeting space and fewer events in the arena. The lowest operating income in the scenarios is $16.9 million a year in the first full year, while year five would grow to $18.6 million a year.

The report does recommend bringing in a second professional sports team to ensure success and keep the arena busy with events. The report mentioned bringing in either a Women’s National Basketball Association team, which does not have a Colorado team, or a Major Arena Soccer League team.

The report also suggested becoming the home of the Denver Nuggets basketball G team, which now practices in Michigan.  

“Most other G League teams are in much closer proximity to their NBA affiliates,” the report stated. “G League teams typically play in similarly sized facilities as the proposed Greeley venue.”

Contacted via text while on vacation, Windsor developer Martin Lind, who has pitched the project to the city as Cascadia, said he is not pursuing a second professional sports team at this time.

“This is a world-class building,” Lind said. “There’s no question that there’s gonna be many opportunities for other tenants. At this moment in time, we’re focusing on the bird in hand, which is the Colorado Eagles, and ironically the Colorado Eagles are best in class as well, even out of a very undersized building.

“I think this is a typical deal where if we make it work with what we have, anything that we have to add on later only enhances the model and continues to assure the success of the project. But right now, the project will be successful with the Eagles as the anchor tenant and the associated concerts and other venues that occupy many other dates.”

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