Since there is already a water area on the bottom of the village, you should introduce a navy and docks, with a whole new set of barracks and troops fed with magical water or something like that. Troop ideas could include like mermaids, squids, sea monster, etc. defenses could be underwater mines and torpedoes, hidden submarines, etc. There could be new spells like the oil spell that disables defenses , the whirlpool spell which creates a whirlpool and does damage, the tsunami spell, etc.

