Ericson submits formal development agreement
Tuesday, February 12, 2008 Memphis Business Journal - by Andy Ashby Staff writer
A development group headed by Memphis-based Ericson Group Inc. hand delivered copies of its $300 million development agreement for the Pyramid and Mud Island to city and county leaders Monday.
The agreement states that the development group, which is comprised of Pyramid Park Memphis LLC, Prosperity International LLC and Essex Investment Partners LLC, will design and build two themed areas, Pyramid Resorts and Harbor Island, with hotels restaurants, shopping and themed attractions.
In a statement, Ericson Group president and CEO Greg Ericson said the overall development, called Pyramid Harbor, will provide more than 3,000 new jobs and bring in more than 2 million visitors annually.
Ericson also said the development group will save the historic Zippin Pippin roller coaster and Grand Carousel, which formerly were at the Mid-South Fairgrounds.
The Pyramid Harbor agreement states that the development team won't take title to the Pyramid and its 40 acres of land until the development has been completed and the building's debt has been paid off.
Similarly, the Ericson development group would not take possession of the 50-acre Mud Island until it has completed Pyramid Adventure.
The group also agrees to pay all operation expenses and debt service on the Pyramid during planning and construction.
Also, the Ericson group would agree to pay the city and county $10 million if it terminates the agreement.
No local tax dollars are required for the development and the city and county have 36 months to secure federal funds, Ericson said.
If the city and county approve the Ericson development agreement, the three entities would form a joint venture to develop the Pyramid and Mud Island.
The agreement was addressed to Robert Lipscomb, who is heading the Pyramid reuse committee; Scott McCormick, chairman of the Memphis City Council; Jim Huntzicker, Shelby County chief administrative officer; and Shelby County Commission chairman David Lillard.
City officials are currently negotiating with Bass Pro Shops on the Missouri-based retailers' development agreement.
Currently, Bass Pro is asking for a year to determine whether it would develop the Pyramid. The agreement includes Bass Pro paying $35,000 a month in rent. The company could also abandon the project without incurring penalties.
The Bass Pro development agreement is scheduled to be presented to the City Council on Feb. 19.
aashby@bizjournals.com | 259-1732
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