jedimaster1227 Posted October 21, 2014 Share Posted October 21, 2014 (edited) http://www.sec.gov/Archives/edgar/data/1261159/000119312514336782/d786049dex991.htm September 12, 2014 Dear Shareholder: CNL Lifestyle Properties, Inc. (the Company) was formed with the goal of investing in and owning a diversified portfolio based on a lifestyle-oriented, demographically driven investment approach. When aggregated by initial purchase price, our holdings consist of approximately 25 percent ski and mountain lifestyle, 19 percent golf, 19 percent senior housing, 22 percent attractions and waterparks, 6 percent marinas, and 9 percent additional lifestyle properties. Our equity offering was completed on April 9, 2011. In March 2014, we engaged Jefferies LLC, a leading global investment banking and advisory firm, to assist management and our board of directors in evaluating various strategic alternatives to provide liquidity to our shareholders. Consistent with this strategy, in June 2014, we signed a purchase and sale agreement to sell our golf portfolio to a third-party buyer, and we expect to complete the sale by the end of 2014. As we continue to explore liquidity strategies, our focus will remain on seeking attractive exit alternatives for the remainder of our property portfolio. Approaching the end of our life cycle, our board of directors has determined it is in the best interest of the Company to discontinue the distribution reinvestment plan (DRP) effective September 26, 2014. Beginning with third quarter distributions, which will be paid in September 2014, participants in the DRP will receive their distributions in cash instead of common stock. For IRAs and other qualified accounts, the cash distributions will be remitted to the shareholder’s custodian of record. Our board of directors also approved the suspension of the Company’s share redemption plan. We will accept redemption requests received up until the close of business on September 26, 2014; however, redemption requests will not exceed the $3.0 million quarterly cap, and will only be processed based on qualified hardship circumstances resulting from death, qualifying disability, bankruptcy and unforeseen emergency. All other requests will be placed in the redemption queue and will remain there, in the event the redemption plan is reinstated in the future. Both of the above actions are typical for a mature company nearing a liquidity event or events – like CNL Lifestyle Properties. The board of directors continues to evaluate the distribution rate on an ongoing basis and will make adjustments, as necessary, based on current and projected portfolio and Company performance, asset sales or other events. If you have any questions, please contact your financial advisor or Client Services at 866-650-0650, option 3 and then option 0. Sincerely, LOGO Stephen H. Mauldin President & Chief Executive Officer cc: Financial Advisors Edited October 21, 2014 by jedimaster1227 Link to comment Share on other sites More sharing options...
Shavethewhales Posted October 21, 2014 Share Posted October 21, 2014 It's a pretty safe bet that Darien will go to HFEC. There just aren't any other legit buyers unless Premier goes out on a limb and out-bids them somehow. Frontier City will go to Premier, which will be tremendous for both the park and the company. Both of these parks have had some spurts of significant improvement under the new managing companies, but they need to cut the cords with CNL quick before they suffocate again under the current capital ex. freeze. Both parks need some solid attraction investments to get over the hump, but they're so close otherwise. Link to comment Share on other sites More sharing options...
VF15 Posted October 21, 2014 Share Posted October 21, 2014 This would not be a bad thing if CNL sold off it's parks because, in recent years, they seem to have forgotten that they even exist. CNL just doesn't invest enough in new attractions at their parks, and that's why they can't compete with Six Flags and Cedar Fair parks. Parks like Darien Lake and Elitch Gardens could certainly benefit from an owner like Herschend. Hopefully that is what happens. Link to comment Share on other sites More sharing options...
Midgetman82 Posted October 21, 2014 Share Posted October 21, 2014 Sounds kind of exciting for the parks you guys listed, actually. It'd be great to hear those parks finally get some love it deserved under a company that can actually give it to them. I'm just hoping they don't end up pulling a Six Flags and suddenly choose to close or abandon some of the parks instead, but I don't see that happening... Link to comment Share on other sites More sharing options...
coasterchitchat Posted October 21, 2014 Share Posted October 21, 2014 Looks like CNL has sold their golf courses. http://www.bizjournals.com/orlando/morning_call/2014/10/cnl-lifestyle-properties-sells-11-golf-courses-for.html A New York private equity firm has bought 11 Arizona golf courses and country clubs as part of a $307 million deal involving golf properties in 13 states.Arrowhead Country Club in Glendale, Tatum Ranch Golf Club in Cave Creek and Raven Golf Club at South Mountain were among the Phoenix-area golf properties sold by Orlando-based CNL Lifestyle Properties to an entity called CF Arcis X LLC. CF Arcis is an arm of New York-based Fortress Investment Group LLC (NYSE: FIG). The $2.8 billion private equity firm helped finance last year's purchase of the Arizona Coyotes hockey team. Nine Valley golf course properties were sold in the CNL-Fortress deal for just under $76 million. Ancala Country Club and Continental Golf Course in Scottsdale, Stonecreek Golf Club in Phoenix, Superstition Springs Golf Club in Mesa, Kokopelli Golf Club in Gilbert and Legend at Arrowhead Golf Resort in Glendale also were part of the sale. Link to comment Share on other sites More sharing options...
DarienLaker Posted October 21, 2014 Share Posted October 21, 2014 I Can't imagine Premier buying Darien Lake, but didn't Six Flags bought out Premier? Link to comment Share on other sites More sharing options...
redsd2121 Posted October 21, 2014 Share Posted October 21, 2014 I Can't imagine Premier buying Darien Lake, but didn't Six Flags bought out Premier? Premier bought Six Flags in 1998 and then took on the Six Flags name in 2000 Link to comment Share on other sites More sharing options...
DarienLaker Posted October 21, 2014 Share Posted October 21, 2014 I was just wondering if it was the same Premier that took the Six Flags name or what? Link to comment Share on other sites More sharing options...
Golddisk Posted October 21, 2014 Share Posted October 21, 2014 (edited) I'm just hoping they don't end up pulling a Six Flags and suddenly choose to close or abandon some of the parks instead, but I don't see that happening... They actually can't as they need to sell the properties to repay the investors their original investment back plus whatever they made on it. For investors who purchased into this portfolio, it was almost like buying a bond. You invest an initial amount of money, the investment makes money over awhile, and then once it reaches its maturity, you get your money back plus whatever was made. CNL's portfolio of lifestyle properties reached that maturity point, and is now repaying the investors. I was just wondering if it was the same Premier that took the Six Flags name or what? No, its a different company. It is however managed and owned by people who used to be apart of Six Flags. Edited October 21, 2014 by Golddisk Link to comment Share on other sites More sharing options...
Golddisk Posted October 21, 2014 Share Posted October 21, 2014 accidental double post Link to comment Share on other sites More sharing options...
ajfelice Posted October 21, 2014 Share Posted October 21, 2014 A pipe dream of mine would be to purchase Darien Lake and invest into the untapped potential that property has. There aren't too many properties out there that have a decent-sized amusement park, fairly modern water park, secluded campground, decent hotel, and huge concert venue with extra land still available. Just imagine the possibilities with the resort that could be fully developed there. Unfortunately I believe that Herschend is becoming less and less of a possibility of a potential buyer which puts a damper on the ongoing improvement efforts. Like my beloved Cleveland Browns, Darien Lake has a problem with establishing continuity for any ownership or management group's plan to really take effect and be successful. There is no overnight solution to Darien Lake that can bring the park back to it's glory days of attracting around 1.5 million people a year. Hopefully whoever takes the reigns of Darien Lake outright owns the property, and is not as stingy as CNL was with allocating financial resources for improvements. Link to comment Share on other sites More sharing options...
loop-de-loop Posted October 22, 2014 Share Posted October 22, 2014 ^Why does Herschend not look likely to buy Darien Lake? They are already involved with the park and with CNL out of the way, they can make their own financial decisions about the park (ex Lake Monster). Hopefully Herschend will turn Darien Lake around and turn it into an amazing property like Dollywood and Silver Dollar City. Link to comment Share on other sites More sharing options...
thesman Posted October 22, 2014 Share Posted October 22, 2014 Do you think any of the parks will become independent parks? Link to comment Share on other sites More sharing options...
jedimaster1227 Posted October 22, 2014 Author Share Posted October 22, 2014 (edited) It is always a possibility for a new company to be formed to run the park (like with Kentucky Kingdom), but it seems more likely that a chain with growth potential like Herschend Family Entertainment would pick up the more developed parks with Elitch Gardens, Magic Springs and Darien Lake coming to mind. Some of the smaller waterparks are definitely a possibility for independent operation. But I think a lot will depend on the desirability of the business' acquisition. Does a park make enough money to not only take on (with whatever baggage it might have, be it financial, staffing, maintenance, etc) but to invest in with the significant chance of financial return? Even the largest chains undergo major developments to prep for changing of ownership/management. The SeaWorld Parks got rid of their free beer, shuttered their Clydesdale Barns and had to renegotiate the rights to continue using the name Busch Gardens, selling Busch beers and continuing to offer the established Military/Veteran ticket programs that had been staples for the parks for years. The parks also changed many of their facilities' names and uses to maximize profitability and reduce the need for licensed trademarks in the parks (Seafire Pizza is a great example of this at SeaWorld Orlando). All of these motions were made in an effort to maximize profitability and reduce the workload that prospective buyers for the chain (there were several interested parties) would have to assume were they to buy the parks and operate them. Edited October 22, 2014 by jedimaster1227 Link to comment Share on other sites More sharing options...
Shavethewhales Posted October 22, 2014 Share Posted October 22, 2014 To further answer the question on the last page about Premier, a few years ago the old CEO and COO of the original Premier chain went and started their own chain under the same name. They operate Frontier City and Elitch Gardens under CNL, and own Clementon and a water park in Nashville. More about them here: http://en.wikipedia.org/wiki/Premier_Parks,_LLC I'm not sure how much capital Premier has. Anyone think they could buy Frontier City and Elitch? If they had to choose, which one would they go after? Elitch doesn't seem to have a whole lot of easy growth potential like Frontier City has, but it's in an awesome location in a bigger city. I also wonder about Magic Springs... it wasn't long ago that they were rumored to be looking at getting rid of the amusement park portion since they weren't doing well. I don't see a lot of people rushing to buy them out, but who currently operates it? Whoever the current operator is, they seem to be doing a good job and the place looks like it's doing better. Link to comment Share on other sites More sharing options...
larrygator Posted October 22, 2014 Share Posted October 22, 2014 It's a pretty safe bet that Darien will go to HFEC. I would not bet any money on this. It would take a lot of money to turn DL into a Herchsend type property Link to comment Share on other sites More sharing options...
Woodie Warrior Posted October 22, 2014 Share Posted October 22, 2014 It's a pretty safe bet that Darien will go to HFEC. I would not bet any money on this. It would take a lot of money to turn DL into a Herchsend type property I agree. It would take years to transform Darien Lake into a Herschend-quality park in terms of quality rides, theming, food choices, and customer service. I see the park either becoming independent or going to a smaller chain. Link to comment Share on other sites More sharing options...
coasterkid124 Posted October 22, 2014 Share Posted October 22, 2014 ^and^^ Herschend from what I hear is very interested in the property. There is a lot more work that they need to do, but the last two big investments really show their commitment to the park. Not only that, a lot of the old rides are already being refurbished or removed. Three or four older rides have already bitten the dust. Plus you have to see Darien as not only a theme park, but a major money making property. There is also a campground, hotel, and major concert venue that is one of the largest around. Any theme park chain would be interested if and only if the price was right. Edit: I stand corrected. Apparently Premier is taking over Darien now Link to comment Share on other sites More sharing options...
ajfelice Posted October 22, 2014 Share Posted October 22, 2014 ^Why does Herschend not look likely to buy Darien Lake? They are already involved with the park and with CNL out of the way, they can make their own financial decisions about the park (ex Lake Monster). Hopefully Herschend will turn Darien Lake around and turn it into an amazing property like Dollywood and Silver Dollar City. First of all, Lake Monster was a part of a guest survey. Never an official concept released to the public or the industry. HFE never said they intend to convert Predator to Lake Monster. Everyone got ahead of themselves. Second of all, while Darien Lake has improved there is still a ton of work to be done. Look at the fact that many of their coasters are peeling paint and only operating one train. Look at the fact that rides have slowly went away with no replacement or indication of replacement. Look at how guest reviews continue to tank the park's public perception. I'm pretty sure any modest attendance expectations were not very close to meeting forecasts. With CNL being an investment portfolio, they are looking to get the best return on their investment. I am willing to bet that the price CNL wants is not even close to what HFE is willing to pay based on the condition of the park. There is a world of opportunity with the property as I have mentioned in my pipe dream, but in the end my pipe dream is in fact a pipe dream. While HFE may have had great intentions for Darien Lake, the price has to be right for a purchase to make business sense. Anything they have already put into the park is a "sunk cost," and basic finance education will tell you that sunk costs mean nothing when you evaluate future investment opportunities. It all comes down to the present asking price, not what you put into the park in the past. Link to comment Share on other sites More sharing options...
Shavethewhales Posted October 22, 2014 Share Posted October 22, 2014 I am willing to bet that the price CNL wants is not even close to what HFE is willing to pay based on the condition of the park. There is a world of opportunity with the property as I have mentioned in my pipe dream, but in the end my pipe dream is in fact a pipe dream. While HFE may have had great intentions for Darien Lake, the price has to be right for a purchase to make business sense. I agree with this, but I still think HFEC is interested, and I think when push comes to shove next year when CNL really needs to get rid of this property HFEC will still be holding the best offer. HFEC doesn't necessarily need to bring this park up to SDC/DW quality. They haven't done that with Wild Adventures, and they have a huge array of properties that are all run differently. They have been wanting to expand to more parks for a long time now though, and this property falls right in line with their strategy. A few coats of paint and a couple new trains with better operations and this place would turn around in a heart beat. I mean it comes down to this: CNL has to sell the park before the end of 2015, and there are only a few people to sell to who are willing to take this diamond in the rough and invest in it for the long term. I don't doubt they tried to squeeze HFEC for a crazy price to turn over the park early, but they'll soon be forced to bring their price down to the market reality. I don't see Premier or Six Flags being willing to purchase the park, so that leaves Parques Reunidos, Cedar Fair, and maybe a couple other random smaller operators. Now I don't doubt there are other bids that are going to be made, but I'd still bet on HFEC to pursue this to the end. All just speculation from me though. Link to comment Share on other sites More sharing options...
Zamperlafan Posted October 27, 2014 Share Posted October 27, 2014 I've been reading TPR for a while. After finding out about CNL, it seemed like a perfect opportunity to join. I'm really interested in how this will turn out. My local park is Wild Waves, and honestly it could use a lot of work. I hope that a good company buys up these properties. We all know they could benefit quite a bit from it. Who knows, maybe Wild Waves will finally get a noteworthy new attraction. Link to comment Share on other sites More sharing options...
Golddisk Posted October 27, 2014 Share Posted October 27, 2014 I agree with this, but I still think HFEC is interested, and I think when push comes to shove next year when CNL really needs to get rid of this property HFEC will still be holding the best offer. HFEC doesn't necessarily need to bring this park up to SDC/DW quality. They haven't done that with Wild Adventures, and they have a huge array of properties that are all run differently. They have been wanting to expand to more parks for a long time now though, and this property falls right in line with their strategy. A few coats of paint and a couple new trains with better operations and this place would turn around in a heart beat. I mean it comes down to this: CNL has to sell the park before the end of 2015, and there are only a few people to sell to who are willing to take this diamond in the rough and invest in it for the long term. I don't doubt they tried to squeeze HFEC for a crazy price to turn over the park early, but they'll soon be forced to bring their price down to the market reality. I don't see Premier or Six Flags being willing to purchase the park, so that leaves Parques Reunidos, Cedar Fair, and maybe a couple other random smaller operators. Now I don't doubt there are other bids that are going to be made, but I'd still bet on HFEC to pursue this to the end. I would also imagine the price that Darien Lake would sell for would also be pretty high and I somewhat doubt Premier would have the capital on hand or even be able raise enough to purchase it. Link to comment Share on other sites More sharing options...
TheDarkMaxim Posted October 27, 2014 Share Posted October 27, 2014 This thread is not entirely correct. CNL is NOT saying they are selling their properties. Yes they sold the gold properties, but not everything. They are saying "liquidity". Which doesn't mean sell completely, it also means file an IPO. CNL is still continuing to buy properties to this date, so it seems like they haven't made up their mind on what they are going to do. Link to comment Share on other sites More sharing options...
Golddisk Posted October 27, 2014 Share Posted October 27, 2014 This thread is not entirely correct. CNL is NOT saying they are selling their properties. Yes they sold the gold properties, but not everything. They are saying "liquidity". Which doesn't mean sell completely, it also means file an IPO. CNL is still continuing to buy properties to this date, so it seems like they haven't made up their mind on what they are going to do. This line in the SEC filing indicates differently: As we continue to explore liquidity strategies, our focus will remain on seeking attractive exit alternatives for the remainder of our property portfolio. Based on that line, as of right now, they are looking for ways to offload the remainder of their properties while leaving the door open to say that they could consider doing something else (basically the first part of the statement). Link to comment Share on other sites More sharing options...
TheDarkMaxim Posted October 27, 2014 Share Posted October 27, 2014 And filing an IPO is an exit alternative. As the REIT would be dissolved, and effectively everyone would sell out of the company. Link to comment Share on other sites More sharing options...
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now