Tribal Council commits $324 million to sports-related brand and resort projects

During the Annual Council on Oct. 24, the Tribal Council approved “Project Coda,” a $324 million venture to control “a globally recognized brand” and invest in multiple resorts to be developed across the country .

“This tribe has spent almost 20 years looking for a brand that they could use to earn trademark royalties rather than pay trademark royalties that would allow them to have a globally recognized brand that was similar and in some ways with a broader demographic than some of the more popular ones brands is out there. Kituwah LLC CEO Mark Hubble told the Tribal Council during an Oct. 24 meeting. “It definitely meets those criteria.”

The cryptic resolution describes the brand with 70 years of intellectual property across all major sports and sporting events with a global reach of 70 million people. The tribal council discussed the motion during a 90-minute closed session earlier in the day, which was introduced as a walk-through resolution tabled by the Kituwah Economic Development Board and Chief Chief Richard Sneed. Lawyers have suggested that Kituwah use a codename for the time being to avoid smuggling around the opportunity, Hubble said.

Hubble said the deal originally came to the LLC as a chance for a minority stake in a single Orlando resort. The investment would have been about $75 million for a project in a “phenomenal location” touching a busy outlet mall and at one of Disney World’s seven main entrances.

“The quiet moment was when it was like, ‘We don’t know you. We don’t know how you treated your other stock investors. We don’t know how you did that,'” Hubble said. “And the only way we can do that is if we can gain the same control over the brand itself to protect these incredibly expensive commitments.”

This resulted in the project outlined in the resolution, which would provide $75 million annually over four years for the development of multiple resorts, plus an initial investment of $24.5 million for branding, branding loans and documentation fees. Each individual resort is expected to offer a 20% annual return on investment, and the brand’s return is expected to be “significantly higher” than 25% per year, Hubble said. Enrolled members of the tribe would receive Founder Perks, which include half entry into any “Project Coda” branded hotel or resort in which the tribe has made an equity investment.

Through Kituwah LLC, the Eastern Band of Cherokee Indians will receive 80% of the Project Coda brand and 37.4% of the equity of the brand itself, the resolution said, in exchange for a $5 million equity investment and a $5 million loan. on which the LLC receives interest. The tribe will also have “certain first refusal rights and options” to match the best bids for all casino projects in the United States.

While discussion began as an opportunity to invest in a single resort in Orlando, multiple locations are planned, Hubble said. Each resort will cost hundreds of millions of dollars to build, and Kituwah won’t be the only equity investor in any of them. The LLC will have equity and control rights in each resort in proportion to its investment, and the brand owns not only the trademark rights but also the development company.

One site already has 1,200 acres involved, with “hundreds of millions, if not billions” of dollars already invested in a development that will include timeshares, condos and hotels.

“It’s also a very sporting event,” Hubble said. “It’s the only project built specifically for the type of sporting event they run here in the United States.”

Another project in Austin will include a full-fledged amusement park, he said.

In 10 years, Hubble said, the brand will be worth an astronomical amount of money.

Over the past two years, the Tribal Council has approved $180 million in appropriations to Kituwah LLC, including $55 million at the same October 24 meeting. Of the total, $110 million is earmarked for the development of a 200-acre property off Interstate 40 in Sevier County.

The tribe has also approved many other investments, including a $275 million expansion of Murphy’s Valley River Casino; $250 million to purchase casino operations at Caesars Southern Indiana; a 30 percent interest in a $54.5 million hotel development in Pigeon Forge; a 49.5% interest for the EBCI Holdings LLC division in a $650 million casino development project in Danville, Virginia; and $39 million for the new hotel at Sequoyah National Golf Club.

Since most of the discussion on the subject appears to have taken place off-air, the resolution passed with little talk or debate. The entire item on the agenda, including the reading of the resolution to be recorded, lasted almost 14 minutes.

The tribal council approved the initiative with broad support. Yellowhill MP David Wolfe offered the only dissenting vote. Big Cove MP Teresa McCoy was not present for the vote. Sneed signed the resolution.

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