Hawaiian Falls management is out and Typhoon Texas is in following a lease agreement and a $4.5 million commitment by the Katy-based company to oversee Pflugerville’s sole water park.
Pfllugerville Hawaiiann Falls water park leaving; Typhoon coming in
The change in management starts a new chapter for the beleaguered entertainment destination that has struggled to turn profits and adhere to an agreement with the city’s economic development arm.
The City Council late Thursday night unanimously approved relinquishing the current management, Source Horizons LLC, from its leasing contract and turn it over to Typhoon Texas.
The council took action after nearly two hours of discussion behind closed doors with the Pflugerville Community Development Corp., which penned the initial agreement with Source Horizons. Corporation Executive Director Amy Madison told the council the new agreement will provide both economic and community-oriented opportunities to the city.
“It provides jobs,” she told the council. “It increases opportunities for economic development for retail and commercial in the area with a focus on Texas 130. We have so much land available, we know this will increase land opportunity for those areas.”
Council Member Doug Weiss, who prior to his election to the council served as president of the PCDC board, said the water park brings numerous benefits to the community. When the original agreement was made, he said, there were contingency plans in place for this type of scenario.
“This plan in front of us tonight is better than any contingency plan we could ever have,” he said.
Mayor Victor Gonzales said the water park was not meeting the needs of the community. He cited Source Horizon’s inability to build a planned splash pad as one example.
Typhoon Texas is “going to bring new elements into the water park, some new and exciting rides that will be geared toward families and smaller kids,” he said.
Source Horizons had struggled to make its monthly payments to the PCDC. It missed two payments in late 2015 and has been missing payments since Sept. 30.
Gonzales said he was impressed by business partners representing Typhoon Texas. “I think they are very conservative. They’re very deliberate,” he said. “They know what they’re doing in terms of development.”
Ray DeLaughter, co-founder of Typhoon Texas, said extensive research showed the market area is strong for a water park. It will be the company’s second operation after opening Typhoon Texas in May.
“The problem we saw with the (Pflugerville water) park is that it’s just a bad product for a good market,” he said. “Our thesis was if we could offer a better experience — a better all-around product — it could be successful.”
Part of creating a better product entails focusing more on children’s attractions like a new splash pad to be built on the water park’s island area. A larger structure with slides is also planned to cater to smaller children, he said.
In terms of the viability of the water park, both Gonzales and DeLaughter said management played a role in the park’s inability to be a profitable enterprise.
“From my experience, with Hawaiian Falls in the past, is that I think that came down to operator experience and the fact that they didn’t involve a lot of things they said they would do,” Gonzales said.
As it became clear it could not hold its end of the agreement, Madison said, Source Horizons helped the city explore different management options for the water park.
“We’ve been looking at options throughout the year, and when Hawaiian Falls realized they wouldn’t have a profitable operation and we were unhappy, they teamed up with us to help,” she said.
DeLaughter said Typhoon Texas explored managing the water park about a year ago, but the timing was not right.
“This time, it’s the right time,” he said.
Details of the agreement
The Pflugerville Community Development Corp. and Typhoon Texas are penning an agreement for management of what is now Hawaiian Falls water and adventure park.
Typhoon is set to pay $1.15 million annually to the PCDC in order to pay off a $25 million loan with Capital One. That payment is about $470,000 less annually than what Hawaiian Falls paid annually — through monthly payments — to the PCDC. Madison said the reduction in loan payments is due to Typhoon committing $4.5 million to renovate and add extra attractions to the water park.
The city also provided $7 million from its general fund to purchase 23 acres to build the park.
Mike Parker, Austin Community Newspapers Staff, Community Impact, 12/19/16, Community Impact