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Guest Column: Step back from Riberia Point

April 3, 2014 | By More

NANCY SHAVER

NANCY SHAVER

Guest Column: Step back from Riberia Point

Nancy Shafer
St Augustine, FL

Dear Historic City News readers:

I wrote to St Augustine City Manager, John Regan to urge him to take a big step back from his plans to engage with Shawn Heister to build an aquarium at Riberia Point. If this feels like déjà vu to each of you, it feels that way to me, too.

I think we can all recall the Applied Coral Technology proposal, where no adequate vetting was done, and the scam was finally revealed. While a bit different, this is also not worth the City investing half a million in services, let alone the $60K in a site plan.

Here’s why:

1)    Shawn Heister claims no experience either building or operating aquariums, but he claims credible partners on his Marine Conservation Partners website that cannot be verified:

a)    The National Aquarium in Baltimore has no knowledge of any partnership

b)   Dynasty Marine is a provider of animals to aquariums that he has contacted as a possible supplier

c)    The Oklahoma Aquarium has not responded to two inquiries, nor has Oklahoma Bay Aquatic Solutions (which is a one-person consultancy in aquatic exhibit design )

d)   Others have not responded to inquiries

2)   Aquariums are almost universally non-profits and often have significant financial support from the municipalities in which they are located.  The key reason is their very high operating costs, primarily energy costs associated with water temperatures, pumps, filters etc which must run 24/7.

3)   The proposed aquarium will have a very difficult time being profitable.  Based on my research the operating costs for the proposed 25,000 square foot aquarium, with a 110,000 gallon tank, will be between $2.5 and $3M year (and that doesn’t include any debt service).  At an average ticket price of $15 which is the market, Heister would need 170,000 to 200,000 visitors annually to just break even.  By way of comparison, the ten times larger Florida Aquarium in Tampa draws only 550,000. So profit is not likely to happen. (It’s worth reading the history of the Florida Aquarium which fell on hard times and had to be taken over by the City)

4)   Profitable aquariums are indeed run by Merlin Entertainment based in the UK.  They operate the 50,000 square feet Kansas City Aquarium among many other SeaLife aquariums.  Building costs are around $15M. They only have 5000 species and the largest tank is the same size that Heister is proposing.  Operating costs are lower, and they focus on the entertainment value.  But they need to be in a major market that is typically land locked to be profitable. We aren’t a major market and we aren’t land locked, so the formula likely won’t work here, but a simple inquiry might be worthwhile.

Beyond these substantive concerns, the language on the City’s website states:

“The aquarium will be a privately held “for profit” business of marine aquarium, botanical park, retail, restaurant and out-parcel.”

This gives Heister the freedom to build whatever he wants —maybe a bar/restaurant with a few fish tanks, like those in your dentist’s office? The land is a bargain, and the City will pay 5 times the sale cost of the land to provide services. Heister is seeking a low cost SBA loan. His “aquarium” just might be profitable after all.

There is no need at all to rush forward with this questionable enterprise. I would like to suggest that if we are serious about for-profit enterprise on Riberia Point, engage a reputable commercial real estate broker to seek out a good fit; one that is properly vetted and financially able.

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Category: Editorials