Dells goes upscale

WISCONSIN DELLS, WIS. -- Down the road from the Land of Once Upon a Time, Kelli Trumble is doing her best to help guests at the Sundara Spa transcend the material world.

Stressed out? Take a Purifying Bath Ritual, which starts with a Cambrian sandstone body polish. Or set off on a yogi-guided hike around Mirror Lake.

And when blissed-out guests started leaving notes saying they wished they could live at Sundara, the former Dells waitress and Duck Boat guide obliged. Trumble built eight $799,000 luxury townhouses with private "spa gardens" featuring river stone reflexology paths, open-air waterfall showers and cedar soaking tubs.

Long considered a kitschy family getaway known for seasonal fudge shops and water-ski shows, the Dells is going upscale.

Hundreds of new condominiums are a big part of the change. They're aimed at second-home buyers such as Sharon and Richard Beyer, dairy farmers from Rollingstone, Minn., who plan to use their new condo to help escape the milking parlor.

"When I was young it was just a boat ride down the river," said Sharon Beyer, who said they bought their unit primarily as an investment. "And when our kids were little it was the go-carts and a ride on the Ducks, but since then it's just expanded in every direction."

The Dells, 3½ hours east of the Twin Cities, still draws most of its visitors with quirky tourist attractions, including actors in storybook costumes and an authentic Russian Mir space station. And rising mortgage interest rates may yet crimp this luxury building boom.

But the evolution of the Dells already is spawning new attractions, including a steakhouse that has won several awards of excellence from Wine Spectator magazine, a brand-name outlet mall and a new Broadway Dinner Theatre.

These days, you can't take an amphibious Duck Boat ride in the Dells without passing a sign for "Condos For Sale."

The Wilderness Hotel and Golf Resort has stopped building the hotel rooms that once were the mainstay of its business and is focusing exclusively on for-sale condominiums, including Glacier Canyon, a 224-unit condo project that opened July 1.

Already, buyers have reserved more than 200 units, which start at $369,900. The latest project includes a 4-acre water park and a 25,000-square-foot conference center that will be completed this winter.

"People like to be entertained," said Jean Baker, a Wilderness real estate broker. "People's lives are busy and hectic and this gives people the best of both worlds -- everything is right at their doorstep."

The new developments also are attracting investors who never plan to set foot in the Dells. Geri and David Meyer of Mendota Heights, for example, cashed in their retirement accounts to buy a Dells condo.

The Meyers say they're optimistic that their rental income eventually will help cover their mortgage payment. They shopped for condos in Florida, Mexico and Michigan, but chose the Dells because of its proximity to Minneapolis and Chicago.

"I don't think it's a cheap vacation, but maybe cheaper than going to Mexico," Geri Meyer said.

Dells full of changes

Though the Dells still has its share of $69 motel rooms, the landscape is changing.

The Glacier Canyon units, for example, have granite countertops, big-screen plasma TVs and whirlpool spas. The company has sold all of its $849,900 golf course cabins, which sleep 20 and have a home theater, leather seating and whirlpool spa, said Joe Eck, the resort's director of sales and marketing.

"People want to vacation and stay at a place that's as nice or nicer than what they have at home," he said.

Low mortgage interest rates and the belief that real estate is a better investment than the stock market have helped fuel the trend.

But with interest rates rising and hundreds of units in the pipeline, the high-end Dells condos aren't selling as quickly as they used to.

Barbara Drolson, a broker with Re/Max Preferred in the Wisconsin Dells, said the number of units on the market is about 20 percent higher than last year at this time. But she's hopeful the community is becoming a year-round destination that will attract more regular visitors.

The city of Wisconsin Dells has annexed land from nearby communities several times, and has a new Home Depot, Wal-Mart, Starbucks and Applebee's.

On a drive around Lake Delton in a cherry-red Lexus with Dave Schultz, a longtime Dells real estate broker with First Weber and a former City Council member, it's apparent that the ma-and-pa resorts that offered weekly and monthly rentals are going the way of the mini-golf courses that once were a primary attraction until the water parks came along.

The Pine Beach Resort, for example, is among the most recent tear-down casualties. Its cabins, now boarded and vacant and surrounded by tall weeds, likely will be demolished to build a 90-unit condo resort with its own indoor water park.

And the best shoreline along the glacially carved Lake Delton, selling for $3,000 to $4,000 a linear foot -- if you can find it -- is being taken over by high-end projects such as the New Castle condominiums. Across the lake, construction is underway on a massive 17,000-square-foot house being built by a local water park owner.

Schultz, who now focuses on brokering land deals and commercial projects, isn't particularly sentimental about the changes that have taken place.

"If you're not willing to change along with the community, you're always free to move," he said.

A spa in the Dells?

Trumble grew up in the Dells and was the longtime executive director of the Visitor & Convention Bureau.

The idea to build a spa came to her on a plane ride home from a visit to a West Coast spa. That epiphany led to an across-the-country spa tour and two unpaid spa internships aimed at learning the ropes. She put together a business proposal and convinced investors that the Dells was ready for $499-a-night luxury hotel rooms.

Trumble, whose Katie Couric smile complements her determination to make guests happy, says that, after a slow start, the spa concept has been a hit. In just three years, the spa is operating at a 77 percent occupancy rate.

But are buyers willing to take the next leap and spend nearly $800,000 for a luxury townhouse in a community with a torture museum?

That idea might be slightly ahead of its time, Trumble conceded. Only three of her eight Lifestyle Villas have sold so far, all to investors who have enrolled them in the spa's rental program.

For now, Trumble remains focused on maintaining a high level of service that visitors -- and employees -- don't necessarily expect in the Dells.

For workers, "it's very difficult to deliver five-star service to a guest who is expecting something really elegant if you've been selling tickets to an attraction or life-guarding at a water park," she said.

Jim Buchta • 612-673-7376 • jbuchta@startribune.com