Legoland Hopes to Begin Construction This Year on $500M Theme Park Project

John Jordan | April 20, 2017

Phil Royle, head of community & project relations for LEGOLAND New York Photo by JOHN VECCHIOLLA

GOSHEN—The developer of LEGOLAND New York hopes to secure approvals for its much anticipated, but somewhat controversial, $500-million theme park here by sometime this summer, which would allow the firm to begin construction before the end of this year.

From left: Bob LaPolla, Seely & Durland Insurance; Phil Royle and Hayley Coriaty, LEGOLAND New York; John Barrett, HGAR CID President; Ann Garti HGAR COO; Summer Mangels and Michael Muldoon, Valley National Bank.

Phil Royle, head of community & project relations for LEGOLAND New York, speaking before about 70 attendees of the Hudson Gateway Association of Realtors Commercial Investment Division on April 20th, said developer Merlin Entertainments PLC is currently finalizing its Final Environmental Impact Statement on the project. The firm expects to submit the FEIS to the Town of Goshen in the next several months. Royle said that if that timeline can be achieved, Merlin Entertainments, the developer and operator of LEGOLAND New York, hopes to secure municipal approvals by this summer and open the theme park in the summer of 2019.

Among the key takeaways from Royle’s presentation at the Harness Racing Museum & Hall of Fame in Goshen was that Merlin plans to sign a Project Labor Agreement with the Hudson Valley Building & Construction Trades Council and plans to move forward with a much more expensive transportation program to help mitigate traffic concerns on Route 17.

The multi-million dollar infrastructure plan calls for a relocated Exit 125 that would include a new bridge over Route 17 to provide direct access to the theme park property. Merlin earlier this year stated that the new reconfigured exit would alleviate traffic impacts on local roads by removing Legoland traffic from South Street and Harriman Drive. The reconfigured Exit 125 would also provide improved access to Glen Arden and Orange-Ulster BOCES properties, which are also located on Harriman Drive.

John Barrett, HGAR CID President.

Royle said that Merlin would pay for most of the costs associated with the new Exit 125, but did note that New York State would also shoulder some of the cost since the project would put the exit into conformance with New York State Department of Transportation and Federal Highway Administration standards, including federal interstate standards in connection with the future conversion of Route 17 into Interstate 86.

“Our original traffic plan was going to cost about $15 million,” Royle said. “Our new traffic improvements with this full motion interchange will be between $30 million to $35 million.”

Editor’s Note: Merlin Entertainments in May announced it had enhanced its incentives being offered to the Town of Goshen. At that time, a Josh Sommers, a Legoland spokesman, told Real Estate In-Depth that the estimated cost of the road improvements now is approximately $40 million.

Merlin is seeking a zone change from the Town of Goshen on 153 acres of the 523 acres it controls on a parcel that abuts Route 17 between exits 124 and 125. The project has prompted some local opposition and Michael Sussman, a Goshen-based attorney representing some project opponents, has stated that he expects to file litigation against the project sometime in the future. Earlier this year, New York State Supreme Court Judge Robert A. Onofry dismissed an Article 78 proceeding filed by the Concerned Citizens for the Hudson Valley and a group of property owners that reside nearby the proposed development site against Merlin Entertainment, the Town of Goshen Planning Board, the Town of Goshen and others.

The developer will initially invest $350 million in the development and a total of more than $500 million over the first five years of the theme park and resort’s operation. In December 2016, LEGOLAND New York was awarded $3 million in funding commitments from New York State’s Consolidated Funding Application program. Previously the project secured $3.1 million in committed CFA funding in 2014 and another $1 million in 2015. It should be noted that the $7.1 million in CFA funding commitments for the project thus far have yet to be funded and forwarded to Merlin since the project has not secured approvals as yet from the Town of Goshen.

The proposal for the LEGOLAND New York resort includes a theme park with more than 50 rides, shows and attractions and a 250-room LEGOLAND Hotel. In addition, a 35,000-square-foot aquarium will open within three years of the park’s initial park’s opening. Unlike most other Legoland facilities, the Goshen theme park will not include a water park.

The theme park will be geared toward families with children aged two to 12 and therefore will not attract the same demographic as amusement parks, such as Six Flags or even Disney World, Royle related.

Merlin operates seven Legoland parks, including two in the United States in California and Florida. In March, LEGOLAND Japan opened for business and last October opened LEGOLAND Dubai. Merlin operates a total of 120 attractions worldwide and 28 in the United States.

During the presentation, Royle attempted to address some issues raised by opponents of the project, including traffic and land use concerns. He noted that in addition to the new Exit 125 project, the theme park will not charge customers upon entrance, but rather if necessary, on exit from the park, thus relieving bottlenecks on Route 17 and the roadway leading into the park.

From left: Summer Mangels and Michael Muldoon, Valley National Bank.

The project is expected to create 800 construction jobs during development and 500 fulltime positions, as well as 500 seasonal and 300 part-time jobs. The theme park will run from April to October, although the LEGOLAND Hotel, aquarium and education center would operate year-round.

“We will be signing a PLA (Project Labor Agreement). It will be union labor that will be building this park,” Royle said.

He noted that along the Route 17 corridor from Harriman to Sullivan County, there will be an additional estimated 6.7 million visitors each year by 2019. LEGOLAND New York estimate that it will attract 1.5 million to 2.5 million visitors each year, while the Montreign Resort Casino in Sullivan County, currently under construction, is expected to bring 4 million patrons to the region. The casino is expected to open in March 2018. The new developments will complement other major tourism destinations in the corridor including Woodbury Common Premium Outlet, which sees about 14 million visitors each year.

Bob LaPolla, Seely & Durland Insurance.

Royle characterized Norwegian Airlines beginning international flights from Stewart International in Newburgh to Ireland and Scotland as a “game changer” for the region. He also said that Gov. Andrew Cuomo’s $150-million plan to make improvements, including high-speed tolling by Exit 131 and Woodbury Common, will foster improved traffic on Route 17.

He asked attendees of the session to visit the LEGOAND New York Welcome Center at 6 North Church St. in Goshen to learn more information about the project and do their own research about their other theme parks in the U.S. and abroad.

In his presentation, Royle noted that according to the Polk County Appraiser Office, home values within one mile of its Winter Haven, FL theme park, which opened in 2011, have increased from a 2011 median of $110,000 for a single-family home to a $154,250 median price in 2016. The price per square foot of a typical home nearby the park has risen 38% during that same period.

Royle said he expects the LEGOLAND New York park will have similar positive impacts on residential prices in and around its Goshen property.

Sponsors of the CID event were Valley National Bank and Seely & Durland Insurance of Warwick.

On May 1st Merlin announced it that as part of its bid to secure approvals of its plan from the Town of Goshen it had increased the proposed host community benefits of LEGOLAND® New York for Goshen residents.

These increased benefits from the existing proposal include:

• Every year, LEGOLAND New York will host two Community Days for the Town of Goshen and donate 50% of the revenue from the sale of tickets to the Park to the Town of Goshen.

• A 50% discount on standard one-day tickets to LEGOLAND New York for all Goshen residents for their own use. Valid proof of Goshen residency required for each ticket.

• LEGOLAND New York would pay the Town of Goshen $500,000 of the Host Community Fee at the beginning of each calendar year, with the balance depending on actual attendance paid at the end of the calendar year.

• The theme park would pay the town’s actual costs to develop additional drinking water resources to supplement the existing water supply for Arcadia Hills

• LEGOLAND New York is offering to pay the Town of Goshen a host community fee for every visitor to the Park. For each visitor up to two million, LEGOLAND New York would pay the Town of Goshen 65 cents, and 20 cents for each visitor thereafter—with no cap on payments. The developer estimates the new fee structure would provide the Town of Goshen with at least $1.3 million annually, based on two million visitors, and substantially more depending on the success of the Park. Previously, Merlin Entertainments agreed to include a minimum payment based on 800,000 visitors, and to increase the annual rate by 1.5 percent per year. These payments would continue for 30 years, even though LEGOLAND New York has reduced its PILOT request from a 30-year to a 20-year term – which means that the Town would receive full tax revenue and the host community fee simultaneously between years 20 and 30.

The revised and improved benefits to the Town of Goshen will be included in a Host Community Benefit Agreement that will be voted on by the Town Board, to take effect if the Town Board votes to pass a local law modifying the zoning to allow the LEGOLAND project.

Over 30 years, the Town of Goshen is anticipated to receive approximately $71 million in revenue from the host community fee, PILOT payments and tax payments.

Editor’s Note: While the project still has a number of major approvals to secure, on May 15th the Goshen Town Board approved the proposed Host Agreement with LEGOLAND New York by a 4-1 margin. The developer also filed the project’s Final Environmental Impact Statement on the theme park proposal.



John Jordan
Editor, Real Estate In-Depth