Prime Income to Build $733M Resort in Germany

Dallas-based Prime Income Asset Management and Port Olpenitz GmbH are ready to break ground on the approximately $733 million, 425-acre Port Olpenitz, a holiday resort located in the northeastern section of Schleswig-Holstein, Germany. The company plans to start work on the site in the fall, and it will be located on the site of the former Olpenitz naval base between the mouth of the River Schlei and the Baltic Sea. Upon completion, it will be the largest holiday resort in Northern Europe. The naval base closed in 2006, but left behind a deep-water port with an open expanse of land that currently holds warehouses and military barracks. The area will be transformed into a destination with vacation homes, hotels, conference and meeting space, an 18-hole golf course, an open-air arena, retail space, a marina, a boat yard and a heater winter storage facility for yachts and motor cruisers. “The location was one factor, but the existing naval base left us a wonderful constructed marina that we wouldn’t have been able to afford to build today,” Cal Rossi, a Prime Income vice president, told CPN. In addition to the holiday resort atmosphere, he said the company also envisions it as a second-home and retirement community, and plans to start marketing and selling units by November. The entire resort is anticipated for a late-2012 completion. The FIFA World Cup soccer tournament, which was held in Germany in 2006, particularly helped Germany’s global image as a holiday destination, according to a market snapshot by Jones Lang LaSalle Hotels. Also, the southern regions of the country benefited from Austria and Switzerland hosting the UEFA EURO 2008 soccer championship in June. Tourism trends in particular have indicated the growing importance of city destinations in both primary and secondary markets. In 2006, international guests accounted for more than 15 percent of all bed nights, with many coming from the Netherlands, Italy, U.S. and U.K. In the future, strong growth potential lies in the Asian countries, particularly China. Overall, sustainable growth rates in Germany will largely depend on economic development in both the domestic and major foreign source markets, the report said. Many of the German markets were expected to develop positively with the ongoing boom in low-cost airline carrier business and an anticipated increase in the number of leisure travelers flying into Germany over the coming years. Despite the positive outlook on the tourism side, hospitality investment has taken a hit from the global credit crunch. In 2007, German hotel investment volume was at $3.4 billion, unchanged from 2006, according to Jones Lang LaSalle Hotels. However, the first half of 2008 saw a strong decline due to the volatile economy, and as of June, hotel investment volume was only $856 million.