Shell Factory gets new financing from Orlando bank
This year is primed to be the biggest year in the history of the 78-year-old Shell Factory & Nature Park.
Attendance at the nature park is up 40 percent from last year, while overall attendance, boosted by the addition of the Monday night Cruise-ins, has increased 23 percent.
It just took adherence to a proven marketing plan – and some faith.
In 2014, the iconic landmark faced a financing challenge after BB&T, which had bought out Colonial Bank, sought payment on a $1.2 million balloon loan and would not extend the time period in which to pay.
The Shell Factory was able to form a private placement group to pay off the bank and has now refinanced again through Orlando-based Bank United.
Mike Geml, who headed the private placement team that kept the Shell Factory on track, called it nothing less than a renaissance.
“It’s a story of a turn-around and a renaissance and an opportunity for the Shell Factory to move forward on a solid foundation,” Geml said.
Rick Tupper, CFO and marketing director of The Shell Factory, said the attraction has overcome hurricanes, fire and many economic cycles. But it has been the sheer will of the ownership, management team and employees that got them through.
“The Shell Factory is a place that grows on you. It’s really an old Florida roadside attraction on steroids,” Tupper said. “We are grateful to our local residents along with our seasonal guests for the support they have given us especially over the last five years.”
The Shell Factory struggled in 2011 but subsequently enjoyed double-digit growth across the board for the next few years only to then face the refinancing stumbling block.
The private placement group led by Geml was formed to pay off BB&T. The two dozen partners in the group were then paid by Geml (who was paid by the Cronins, who own the Shell Factory). Geml said it was an investment that paid off quite handsomely as the Shell Factory continued to experience revenue growth in 2014 and 2015.
“They were paid a very handsome return for their investment. I would get calls saying ‘It’s wonderful you’ve done this, but what am I going to do with the money?'” Geml said. “They were all friends and business partners and it was an opportunity to give back to them for what they’ve done over the years.”
The growth enhanced their chances of locking up permanent financing. Geml got in touch with several financial institutions. After a sizzling first quarter of 2016, two institutions issued a term sheet, which outlined the conditions of the loan.
Around mid-May, Bank United converted the term sheet to a firm commitment. Those terms were not disclosed, but Geml said they will work out well for the historic attraction.
“I can tell you as a 36-year community banker that I have never seen such an attractive package,” Geml said. “It has provided them with a stable foundation to advance the Shell Factory for many years to come.”
What makes the deal so great are the two components: a first real estate mortgage loan over 25 years with fixed payments at about half the interest that was being paid to the private placement, and a revolving line of credit, which can be fallen back on during slower times.
After five years of sustained growth, the financing provided by Bank United will ensure that local residents and future guests continue to enjoy all The Shell Factory has to offer for future generations, Tupper said.
Meanwhile, during the first quarter this year, many improvements were made to the facility.
“We are trying to keep the old Florida charm of the place while updating the facility itself,” Tupper said.
The Shell Factory is located at 2787 N. Tamiami Trail in North Fort Myers. For more information, visit www.shellfactory.com.