The wheels are in motion for Challenger Acquisitions Ltd (LON:CHAL) and its investments to make progress this year, according to chief executive Mark Gustafson.
Those wheels are the New York Wheel (NYW) and the Eye of Texas (EoT) – attractions Challenger has stakes in and has every confidence of delivering returns for the company and its shareholders.
Land secured for Eye of Texas
The leisure-and-entertainment-focused company has invested US$300,000 towards the pre-development costs of EoT, with the option to invest up to US$1mln in tranches.
The remainder of the US$3mln of pre-development costs is being raised by local developers.
Gustafson said the land for the 165-metre-high observation wheel has been secured in Dallas and he expects development to begin next year.
Challenger is the first external investor to EoT and has an option to become a potential operator of the project.
The company said its decision to invest in the Texas project is in line with its strategy to acquire interests in the leisure and attractions sector that offer both near and long-term revenue prospects.
“We are incredibly excited to have now made an investment in our second Giant Observation Wheel Project, marking an excellent start to 2018,” Gustafson said.
“An entertainment complex and the improvements to mass transportation will attract tourists outside of this highly populated area of 7.2mln people, and as such we anticipate strong traffic to the EoT.”
To fund its initial investment, Challenger has received the remaining £400,000 from its £1mln convertible note facility.
New contractor for New York Wheel to come on board
Gustafson said the project complements the company’s US$3mln equity stake in the 192-metre tall NYW, which is being built on the New York Harbour.
Construction of the NYW has been postponed since the dismissal of contractor, Mammoet-Starneth, in July last year but Challenger remains confident the project will get rolling again soon.
The owner of the project, New York Wheel Investors, has been in talks with American Bridge Co. to take over construction.
In December, a lawyer for the NYW said the developer of the project is continuing to work with American Bridge to reach the final terms of a deal.
“So from our perspective we’ve been saying to our shareholder don’t worry about our investment it will ultimately get built, it will ultimately pay off, it’s going to be a good project,” Gustafson said.
“I think 2018 you’re going to see a new contractor come on board and you’re also going to start to see the components starts to arrive on site.”
Film fan convention set for May
Giant observation wheels are not Challenger’s only investments.
The company is also backing private company, Star Sanctum, which is set to launch an action film fan convention.
Star Sanctum will hold the event at the Mermaid Centre in London from May 5-7.
A variety of television and film actors have been engaged for the convention, including Benedict Cumberbatch and Chiwetel Ejiofor.
“It’s a small investment for us but it’s a really unique one and it could develop into something much larger,” Gustafson said.