NPS Extends and Revises Concession Prospectus for Blue Ridge Parkway Lodgings

A view of Peaks of Otter Lodge from the top of Sharp Top Mountain. Photo by David and Kay Scott.

Following an unsuccessful attempt to drum up interest in several commercial properties on the Blue Ridge Parkway, the National Park Service has extended the submission date and issued a revised and scaled-down prospectus.

The revised prospectus includes only the commercial operations at Peaks of Otter, with an invitation, but not a requirement, of also bidding for the restaurant at nearby Otter Creek, and the lodging, gift shop, and restaurant operations at Doughton Park.

Rocky Knob Cabins that was included in the original proposal is not part of the current prospectus. Pisgah Inn on the southern end of the parkway is operated by a separate concessionaire and not part of either the old or new prospectus.

Bluffs Lodge and the accompanying coffee shop were closed for both the 2011 and 2012 seasons. Peaks of Otter Lodge, which had in previous years been open year-round, closed in November when the current contract with Crestline Hotels and Resorts reached its termination. Rocky Knob Cabins continued in operation, but under a temporary contract.

Peaks of Otter, with 63 guest rooms, is by far the largest concession of the group, generating nearly $2.8 million in revenues during 2011. Bluffs Lodge has only 24 guest rooms and Rocky Knob Cabins includes only seven rental units. Interestingly, each of the properties generates more revenue from food operations than from lodging. This is especially true at Doughton Park where Bluffs Coffee Shop in 2010 (the last year of operation) generated over one-and-a-half times lodging revenues.

In addition to excluding Rocky Knob Cabins and deleting the requirement to bid on the Doughton Park/Bluffs Lodge operation, the new prospectus differs in several respects from the earlier proposal. The possessory interest at Peaks of Otter has been reduced by nearly half, to $800,000. This represent monies that must be paid to the prior concessionaire for investments it made in the property. In addition, the repair and maintenance fee has been reduced from 3.1 percent to 2.5 percent of gross receipts. Both changes were made in order to make the property more desirable to potential bidders.

The NPS is estimating an initial investment of just over $2 million for a new concessionaire at Peaks of Otter. The initial investments required for Doughton Park and Otter Creek, are estimated at $297,000 and $126,500, respectively. Neither of the latter two properties are required as part of the bid for Peaks of Otter.

Offers for the 10-year contract must be received in the Atlanta NPS office by February 6, 2013. Site visits to Peaks of Otter, Doughton Park, and Otter Creek are scheduled for mid-December. The due date under the earlier prospectus was July 27.