SeaWorld Orlando's Future Plans

[GAcoaster]

Disney wanted to buy Discovery Cove by itself when InBev put the parks up for sale. They might want to buy SeaWorld Orlando just to keep Universal from buying the property.

I think this could be a multi-party or multi-step deal with Merlin buying it all then selling the parts they don't want to help pay for it.

 

[zg44]

They could buy them, then develop/sell off the land. Ironically that’s what SeaWorld did a long time ago to eliminate Circus World.

Yeah, I suppose the biggest issue is just who gets stuck with all the debt that SeaWorld is holding. Right now it has $1.3 billion in stock + another $1.5-2 billion in debt. Depending on how that debt is proportioned; it probably makes the most sense for somebody who wants to actually keep the park (or renovate the Orlando/San Diego parks) to take it over.

Comcast is a bit more likely to be able to achieve that in terms of tying the park to the Universal parks with a full rebrand of sorts, but it all depends on what their master plan is for the 2nd resort and whether they can tie that in...

Disney wanted to buy Discovery Cove by itself when InBev put the parks up for sale. They might want to buy SeaWorld Orlando just to keep Universal from buying the property.

I think this could be a multi-party or multi-step deal with Merlin buying it all then selling the parts they don't want to help pay for it.

It sounds that way; technically, Merlin is probably the optimal buyer for the whole company (Legoland San Diego could tie in with SeaWorld San Diego and then they could tie Legoland Florida with SeaWorld Orlando and Busch Gardens), but Merlin is apparently not interested in at least trying to renovate/change the SeaWorlds to match their investment requirements (apparently they don't want to get involved with the larger sea-animal parks).

Comcast is probably the next best option for the SeaWorlds at least even though SeaWorld San Diego is a fair distance away from USH.

SeaWorld Orlando could be revamped to fit into a 2nd resort strategy, but it all depends on cost and whether there's a way to make it fit.

I'm skeptical though that Disney would get involved just because the SeaWorld parks are carrying a significant amount of debt, and it would take a very committed buyer to make them successful. Comcast has that motivation in terms of building a 2nd resort nearby in Orlando at least. I'm not sure anybody else does.

 

[shiekra38]

Disney wanted to buy Discovery Cove by itself when InBev put the parks up for sale. They might want to buy SeaWorld Orlando just to keep Universal from buying the property.

I think this could be a multi-party or multi-step deal with Merlin buying it all then selling the parts they don't want to help pay for it.

Yeah, I suppose the biggest issue is just who gets stuck with all the debt that SeaWorld is holding. Right now it has $1.3 billion in stock + another $1.5-2 billion in debt. Depending on how that debt is proportioned; it probably makes the most sense for somebody who wants to actually keep the park (or renovate the Orlando/San Diego parks) to take it over.

Comcast is a bit more likely to be able to achieve that in terms of tying the park to the Universal parks with a full rebrand of sorts, but it all depends on what their master plan is for the 2nd resort and whether they can tie that in...


It sounds that way; technically, Merlin is probably the optimal buyer for the whole company (Legoland San Diego could tie in with SeaWorld San Diego and then they could tie Legoland Florida with SeaWorld Orlando and Busch Gardens), but Merlin is apparently not interested in at least trying to renovate/change the SeaWorlds to match their investment requirements (apparently they don't want to get involved with the larger sea-animal parks).

Comcast is probably the next best option for the SeaWorlds at least even though SeaWorld San Diego is a fair distance away from USH.

SeaWorld Orlando could be revamped to fit into a 2nd resort strategy, but it all depends on cost and whether there's a way to make it fit.

I'm skeptical though that Disney would get involved just because the SeaWorld parks are carrying a significant amount of debt, and it would take a very committed buyer to make them successful. Comcast has that motivation in terms of building a 2nd resort nearby in Orlando at least. I'm not sure anybody else does.

A couple of possible scenarios I see:

1. Comcast waits for Sea World to die and purchases land after it's torn down. Merlin buys BGT and starts investing in the parks again, Florida's first Giga, and Lego comes to the parks. Disney builds the Wizarding World of Star Wars and Guardians of Energy

2. Sea World dies, land is sectioned off for housing and vacation homes. Discovery Cove continues on under a new name. Merlin buys BGT and starts investing in the parks again, Florida's first Giga, and Lego comes to the parks. Disney builds the Wizarding World of Star Wars and Guardians of Energy. Universal continues to invest in itself as well.

3. Sea World continues to sputter under Blackstone for a long while, BGT is sold off and bought by Merlin and starts investing in the parks again. Sea World continues to be what it is until the Orcas die

4. idk, they get the hint and start building more coasters and rides at Sea World and start realizing they are a locals park and not Universal or Disney


The two major detriments to Sea World that aren't going away are 1) Brand tarnishing and 2) Whatever they are planning with the fourth gate, and continued additions to the Universal parks already established...I really don't see Comcast or Disney buying Sea World...The benefit isn't there for Comcast and Disney has to fix the parks they already have

 

[Mad Dog]

Blackstone is gone, finally. They sold their stake during the past year.

 

[Scott W.]

Blackstone is gone, finally. They sold their stake during the past year.

Praise the theme park gods.

 

[zg44]

A couple of possible scenarios I see:

1. Comcast waits for Sea World to die and purchases land after it's torn down. Merlin buys BGT and starts investing in the parks again, Florida's first Giga, and Lego comes to the parks. Disney builds the Wizarding World of Star Wars and Guardians of Energy

2. Sea World dies, land is sectioned off for housing and vacation homes. Discovery Cove continues on under a new name. Merlin buys BGT and starts investing in the parks again, Florida's first Giga, and Lego comes to the parks. Disney builds the Wizarding World of Star Wars and Guardians of Energy. Universal continues to invest in itself as well.

3. Sea World continues to sputter under Blackstone for a long while, BGT is sold off and bought by Merlin and starts investing in the parks again. Sea World continues to be what it is until the Orcas die

4. idk, they get the hint and start building more coasters and rides at Sea World and start realizing they are a locals park and not Universal or Disney


The two major detriments to Sea World that aren't going away are 1) Brand tarnishing and 2) Whatever they are planning with the fourth gate, and continued additions to the Universal parks already established...I really don't see Comcast or Disney buying Sea World...The benefit isn't there for Comcast and Disney has to fix the parks they already have

Re: your last point, that's exactly why nobody has bought SeaWorld yet; it'd be a very cheap purchase for anybody at this point (insomuch as $1.5 billion cash with $2 billion in additional debt is cheap for companies worth over $150 billion), but the taint of the Blackfish scandal hasn't gone away, and 2 of their main parks are in the most competitive markets in the US (Orlando and South California). Even Cedar Fair and Six Flags don't necessarily want to jump headfirst into the Central Florida theme park market because they know just how strong Disney/Universal are in Orlando and how difficult it is to take market share from them.

As for possible scenarios, I agree with most of what you suggested. The reality is that SeaWorld Orlando has been in a decline and with the impending threat of a 2nd Universal resort next door; it's just tough to see how they can rejuvenate themselves with their limited position.

The land that they have is valuable, but it's not worth paying $1bn+ for a park sitting on 200-300 acres of land just for that land. The best scenario is probably a split up of the parks with different buyers taking different pieces.

And the reality is, I'll be surprised if SeaWorld Orlando is alive in its current form after the 2nd Universal resort is built. It's just going to be so difficult to compete against that next door.

 

[GAcoaster]

How much did Universal just pay for the land on Universal Blvd? That land has legal problems, zoning issues, remediation of toxic chemicals required and sits right next to the sewage treatment plant. It is still valuable and will be valuable for development, but the SeaWorld property is already approved for a theme park, is strategically located, and is just as large (if not larger) than the Lockheed site without the problems. The land is worth big bucks to a developer.

 

[zg44]

How much did Universal just pay for the land on Universal Blvd? That land has legal problems, zoning issues, remediation of toxic chemicals required and sits right next to the sewage treatment plant. It is still valuable and will be valuable for development, but the SeaWorld property is already approved for a theme park, is strategically located, and is just as large (if not larger) than the Lockheed site without the problems. The land is worth big bucks to a developer.

Comcast paid around $130 million for the 475 acres. Stan Thomas still holds around 800 or so acres that tie the various parcels together but the most valuable land is in the Comcast package (the largest parcel zoned for parks especially).

As far as the SeaWorld Orlando property goes, it's around 200 acres and SeaWorld Orlando would probably cost north of $1bn (including debt assumed). That land is probably worth at least $100 million clean.

It really just depends, as you point out there's always been issues (the Lockheed weapon testing cleanup etc.) with the UCPM III/FQP land, and the dual ownership at the moment doesn't help.

Either way, nothing is cheap, and you have to build at least 1 theme park on the new property (whether you tie in SeaWorld as a 2nd park or buy more land and build a 2nd park eventually). There isn't really anything simple about this.

 

[WAJAS]

Comcast paid around $130 million for the 475 acres. Stan Thomas still holds around 800 or so acres that tie the various parcels together but the most valuable land is in the Comcast package (the largest parcel zoned for parks especially).

As far as the SeaWorld Orlando property goes, it's around 200 acres and SeaWorld Orlando would probably cost north of $1bn (including debt assumed). That land is probably worth at least $100 million clean.

It really just depends, as you point out there's always been issues (the Lockheed weapon testing cleanup etc.) with the UCPM III/FQP land, and the dual ownership at the moment doesn't help.

Either way, nothing is cheap, and you have to build at least 1 theme park on the new property (whether you tie in SeaWorld as a 2nd park or buy more land and build a 2nd park eventually). There isn't really anything simple about this.

SWO itself is 200 a red, but the amount of property they own down there total is much larger. Your argument still holds though.

 

[GAcoaster]

As far as the SeaWorld Orlando property goes, it's around 200 acres and SeaWorld Orlando would probably cost north of $1bn (including debt assumed). That land is probably worth at least $100 million clean.

It's actually closer to 400 acres when you add Discovery Cove, Aquatica, the support buildings across the street, etc.

 

[zg44]

SWO itself is 200 a red, but the amount of property they own down there total is much larger. Your argument still holds though.

It's actually closer to 400 acres when you add Discovery Cove, Aquatica, the support buildings across the street, etc.

You're both right.

Either way the backbone of the 2nd Universal resort will be built on the 475 acres of new land (1 theme park + 2nd CityWalk-style feature + at least 2 hotels for somewhere in the range of $3-4 billion).

The question is really how will it expand beyond:

Does it make more sense to haggle with Stan Thomas for more land for a more full 2nd resort that will likely cost $3-4bn (i.e. another theme park, water park, more hotels)?

Does it make more sense to try to buy SeaWorld Orlando for at least $1-1.5bn in cash+debt and rebrand/rebuild it for somewhere north of $2 billion into the 2nd half of the 2nd resort?

There's no simple answer there. The easiest path as somebody else pointed out would be for an eventually closing and bankruptcy sale of SeaWorld Orlando to Comcast for an eventual rebuild of that land.

The problems are how to deal with the larger animals and what kind of changes could make the attendance at a Universal-run SeaWorld comparable to USF and IoA.

 

[Magic-Man]

You're both right.

Either way the backbone of the 2nd Universal resort will be built on the 475 acres of new land (1 theme park + 2nd CityWalk-style feature + at least 2 hotels for somewhere in the range of $3-4 billion).

The question is really how will it expand beyond:

Does it make more sense to haggle with Stan Thomas for more land for a more full 2nd resort that will likely cost $3-4bn (i.e. another theme park, water park, more hotels)?

Does it make more sense to try to buy SeaWorld Orlando for at least $1-1.5bn in cash+debt and rebrand/rebuild it for somewhere north of $2 billion into the 2nd half of the 2nd resort?

There's no simple answer there. The easiest path as somebody else pointed out would be for an eventually closing and bankruptcy sale of SeaWorld Orlando to Comcast for an eventual rebuild of that land.

The problems are how to deal with the larger animals and what kind of changes could make the attendance at a Universal-run SeaWorld comparable to USF and IoA.

You do have a point..... Seaworld is kinda small though.

 

[s8film40]

This weekend will be the test to see if it was just BAF or not. I won't be at the park, but I'm in a SeaWorld group on FB that will have plenty of people there that day who will report on crowds.

I went today. It was definitely still another packed day at SeaWorld! It seemed slightly less crowded at the entrances, but the Spooktacular stuff was all busier than last week. Still a lot of people coming in when we left. It took us a long time to get through the lines for food at lunch, to the point my wife said she wants to avoid Saturdays from now on.

It's really kind of funny to read through this thread and other stories about SeaWorld not doing well then go there and deal with these huge crowds.

 

[zg44]

I went today. It was definitely still another packed day at SeaWorld! It seemed slightly less crowded at the entrances, but the Spooktacular stuff was all busier than last week. Still a lot of people coming in when we left. It took us a long time to get through the lines for food at lunch, to the point my wife said she wants to avoid Saturdays from now on.

It's really kind of funny to read through this thread and other stories about SeaWorld not doing well then go there and deal with these huge crowds.

It's the nature of the beast that it's difficult to judge these things from any single visit, but I'd say that from SeaWorld's various earnings statements they've pointed out that their local attendance numbers (within 300 miles) have been much stronger than their non-local crowds. Just recently their 2nd quarter numbers were an actual improvement over the previous year 2nd quarter.

But it's tough to judge, overall SeaWorld has reported declining overall attendance for 5 years now, but it's possibly stabilizing. Of course, the other factor is the overall numbers don't tell us the mix. Some parks might be doing much better than others. They cut more jobs at San Diego than the other parks from what I understand, and that should be related to it performing worse.

 

[Mad Dog]

And the other side of the coin, as we've talked about previously, is that Sea World Orlando used to get one third of their attendance from foreign visitors (per Sea World Exec. public statements). That's generally a heavy spending per guest clientele. I would doubt that they achieve those types of percentages any more. Generally, per guest spending figures, are the most significant to the bottom line.

 

[s8film40]

It's the nature of the beast that it's difficult to judge these things from any single visit, but I'd say that from SeaWorld's various earnings statements they've pointed out that their local attendance numbers (within 300 miles) have been much stronger than their non-local crowds. Just recently their 2nd quarter numbers were an actual improvement over the previous year 2nd quarter.

But it's tough to judge, overall SeaWorld has reported declining overall attendance for 5 years now, but it's possibly stabilizing. Of course, the other factor is the overall numbers don't tell us the mix. Some parks might be doing much better than others. They cut more jobs at San Diego than the other parks from what I understand, and that should be related to it performing worse.

Yeah, there's definitely a lot more to it. I visit the park fairly regularly though and I would characterize their overall attendance as healthy. They have some strong holidays especially considering very heavy competition with Disney and Universal. The food and merchandise booths also seem to do really well for the events. I would assume that SeaWorld Orlando on it's own is not a problem at all and makes decent profits, could be the other parks are being somewhat supported by it and a few others.

 

[shiekra38]

Blackstone is gone, finally. They sold their stake during the past year.

Thank the Maker

How much did Universal just pay for the land on Universal Blvd? That land has legal problems, zoning issues, remediation of toxic chemicals required and sits right next to the sewage treatment plant. It is still valuable and will be valuable for development, but the SeaWorld property is already approved for a theme park, is strategically located, and is just as large (if not larger) than the Lockheed site without the problems. The land is worth big bucks to a developer.

To be honest, I'm not an expert on the legality issues....I would imagine there are three possible reasons why Universal purchased the land it did...

1) They had a history with it, and wanted it back
2) It's a blank slate and a blank parcel in the middle of Orlando
3) It has no association with Sea World

Imagine the headlines: "Universal buys Sea World's land" or "Universal to control Sea World's fate" or "Harry Potter: and the order of eviction" (I dig this one)...That could potentially associate Universal with something they don't want to be associated with

I also imagine contracts would stop Universal from being able to rip, tear and shred Sea World apart

So yeah, I'm starting to think a blank slate, with the potential of some toxic clean up needed, may be the better option for Comcast and Universal as a whole

 

[MakoMania]

The general praise for Merlin on this forum baffles me. The state that Alton Towers, Thorpe Park and Heide Park are in is a disgrace.

Heide Park is down by 6 rides, Alton Towers is down by 7, Thorpe Park is down by 2 with 2 more shut for the rest of the season due to cost cutting, not to mention the complete decimation of live entertainment in their parks. If people think that Merlin will increase/improve the offering at the Busch parks, Merlin's track record shows the opposite.

They treat their Legoland and non Legoland parks very differently, they have to keep guest satisfaction up in order to keep the lego license.

 

[s8film40]

The general praise for Merlin on this forum baffles me. The state that Alton Towers, Thorpe Park and Heide Park are in is a disgrace.

Heide Park is down by 6 rides, Alton Towers is down by 7, Thorpe Park is down by 2 with 2 more shut for the rest of the season due to cost cutting, not to mention the complete decimation of live entertainment in their parks. If people think that Merlin will increase/improve the offering at the Busch parks, Merlin's track record shows the opposite.

They treat their Legoland and non Legoland parks very differently, they have to keep guest satisfaction up in order to keep the lego license.

Yeah, they do a great job with Legoland. I'm not a fan of the Eye/wax museum/aquarium, but it is also very nice for what it is. I wonder if in addition to keeping things good with the Lego license if competition of lack of competition is a factor. Of the parks you mentioned are there other competing parks reasonably nearby or is it one of those cases where it's the only park in the region so it's that or nothing?

 

[MakoMania]

Yeah, they do a great job with Legoland. I'm not a fan of the Eye/wax museum/aquarium, but it is also very nice for what it is. I wonder if in addition to keeping things good with the Lego license if competition of lack of competition is a factor. Of the parks you mentioned are there other competing parks reasonably nearby or is it one of those cases where it's the only park in the region so it's that or nothing?

The main competition to Merlin's UK parks consists of Blackpool Pleasure Beach, Flamingo Land, Drayton Manor & Paulton's Park, but the Merlin parks are much more dominant in terms of market share. However in Germany, Heide Park is in a similar situation to the Busch parks (particularly Tampa) with lots of nearby competition, but this doesn't seem to have changed their cost cutting approach.