What does discount carrier Allegiant Air know about the resort industry?
The short answer is that it knows enough to spend close to $500 million to build a new resort on Florida’s gulf coast.
With ground broken last month on the 22-acre property, the first for Allegiant’s new Sunseeker Resorts brand, the complex in Punta Gorda, Fla., is expected to be done in early 2021.
“People don’t understand the Allegiant business model,” said Micah Richins, executive vice president and COO for Sunseeker Resorts, and a former longtime MGM Resorts International employee. “The name of the company is actually Allegiant Travel Co., which would connote more than being just an airline.”
Last year, Las Vegas-based Allegiant hired Richins and Jason Shkorupa, another former MGM hospitality pro, to oversee the Sunseeker project. Allegiant President John Redmond, himself a former MGM executive, and chairman and CEO Maurice Gallagher wanted to find a way to take advantage of the large number of passengers the airline flies in and out of the Punta Gorda Airport and other nearby Florida airports.
“People ask why in the world we’d want to fly into Punta Gorda,” Richins said. “When you look up and down the southwest (Florida) coast, you have Tampa, St. Petersburg and Sarasota and then, from the south, you’ve got Naples, Marco Island and Fort Myers. In the middle of that, you have Charlotte County, and there hasn’t been a lot of development there.”
Plans are for the first phase of construction, on seven acres, to include 500 hotel rooms, a nearly 40,000-square-foot convention center space and a variety of restaurants, bars and retail stores. Allegiant also recently purchased the nearby 18-hole Kingsway Country Club golf course.
Richins and Shkorupa plan to relocate later this year to Florida to oversee the project from ground zero.
“Allegiant takes a million to a million-and-a-half people into Punta Gorda every year,” Richins said. “This is an opportunity for us to leverage that database.”
Allegiant flies about 8 million people in and out of Florida annually. The presence of the new resort, the company said, would likely attract an additional 300,000 visitors to Charlotte County each year.
To make room for the resort, Allegiant spent about $50 million to purchase nearly two dozen parcels of land. That’s in addition to the approximately $420 million it will take to erect the resort.
“There’s been a ton of work that’s already been done,” Shkorupa said. “To get the land cleared, roadwork, utilities, working with the Army Corps of Engineers because we’re building on an estuary, there’s been so much that’s already been done. It’s been two years in the making to this point.”
Allegiant is expected to eventually hire close to 800 permanent employees for Sunseeker Resorts Charlotte Harbor, which will be the official name for the complex.
If all goes according to the company’s plan, more such resorts could follow.
“If we prove that we’re able to leverage the database in Punta Gorda, it would make sense that there’d be other opportunities for us to do similar things in other destinations,” Richins said. “We feel like we’re going to create the bar in Punta Gorda, because there’s just not a lot of competition there. People ask if we’d do something like this in Las Vegas and the answer, while you never say never, is probably not, because there’s so much competition here.”
As their pending relocation shows, Richins and Shkorupa aren’t supervising from a distance. The pair have been spending many days in a $1 million makeshift hotel lab that’s gone up in one of the buildings at Allegiant’s Summerlin headquarters.
Everything — from hallway carpet design pattern decisions to the fit of the kitchen cupboards in the makeshift suite units — has been labored over.
“There’s nothing on that coast that’s going to be remotely like this from a quality perspective,” Shkorupa said. “Micah and I spent 26 years with MGM Resorts watching what’s morphed in Las Vegas. We’re not trying to compete with Vegas — we’re not building a casino — but we’re going to be the newest product in our competitive set in this area of Florida.”
Richins and Shkorupa said they’re grateful the company’s leadership allowed the Sunseeker lab to go up.
“People think that we have a bunch of airline people building hotels now,” Richins said. “Nothing could be further from the truth. We have spectacular airline people who run the airline — if you’re an investor, the trajectory is going exactly how you would want it — but (Allegiant) has brought in hoteliers, food and beverage people, and operators to augment the Sunseeker team. We’ve been building this team.”
To Richins’ point, Allegiant Travel Co. finished the day Wednesday trading at just over $134 per share on the Nasdaq stock exchange. At the end of 2018, the stock traded for just over $100.
In a statement sent out last month on the Sunseeker groundbreaking, Redmond said it’s all part of Allegiant’s evolution as a company.
“Sunseeker Resorts Charlotte Harbor will be nothing short of extraordinary,” Redmond said. “It marks the launch of an unprecedented pairing — a world class hospitality brand with an airline at its head — which will bring synergies to our customers and spark innovation in truly transformative ways.”