Amusement Park Company Cedar Fair announced on Tuesday that the California’s Great America theme park has sold the land that the park is on and will be closing within the next 10 years, likely trigging local, regional, and statewide political fallout.
Opened in the city of Santa Clara in 1976 as Marriott’s Great America, the park has gone through numerous ownership changes throughout the years, including being bought by the city in 1985, by Paramount in 1993, and by Cedar Fair in 2006. More recently, 1n 2014, Levi’s Stadium, home of the San Francisco 49ers, opened next door, putting some stresses on parking lots around the area. Five years later, in 2019, Cedar Fair had purchased the land that the park is on from the city of Santa Clara for $150 million, following over 40 years of lease agreements.
When the COVID-19 pandemic hit in 2020, the amusement park industry was decimated by mass temporary closures due to concern over the spread of the virus in crowds. California’s Great America didn’t even open in 2020 due to the pandemic, and was only opened on a limited basis in 2021. Cedar Fair saw huge losses company-wide as a result. During a strategic revue in 2021, the company saw an opportunity to sell the land in Santa Clara, with a $310 million finalization with Bay Area real estate company Prologis earlier this year.
“Cedar Fair intends to use proceeds from the land sale transaction to accelerate progress on its strategic priorities of reducing debt to achieve its $2 billion target, investing in high-return projects within its portfolio such as upgrading resort properties, and reinstating a sustainable unitholder distribution,” noted the company.
The sale was announced on Tuesday, with Cedar Fair CEO Richard Zimmerman announcing that “We chose Prologis as our partner because of their deep ties in the Bay Area and their reputation for working closely with local communities on large developments. For our investors, the sale and lease agreements allow us to monetize a high-value asset in the heart of Silicon Valley at a very attractive multiple.”
A lease agreement has been made though, ensuring the park will continue to operate in the short-term for several more seasons, but with an ultimate closure by 2033.
Political implications of sale
Many observers were quick to point out how the deal was almost solely based on money, and not about the park itself or concern for locals.
“It doesn’t take a genius to see what happened,” Alex Dunn, a Bay Area based real estate advisor who assists in land deals across the state, told the Globe on Tuesday. “The company was still hurting after COVID and they saw a chance to over double their land investment from only a few years ago to get some quick cash to help the company out to reduce debt. Not once did they even consider what this would do to the local population, or the amount of jobs this will cost, or anything like that it seems. Their press release was purely financial, which is odd coming from an amusement park company.”
“Whenever an announcement like this is made, attendance usually craters. Look up the history of any sold sports team that announces they will move in a few years and see what the fans do. They usually made a surprise, like Astroworld in Texas when they closed rather quickly so they didn’t have to face a huge decline. It’s obvious that they failed to see the big picture in all this. And you can say that includes the political implications.”
On Tuesday, the city of Santa Clara would not say what the economic impact would be, due to no plans for the land being submitted yet, but did note the future loss of the park.
“The city does not know of any plans on how the California’s Great America property will be used in the future by the new property owner, so we cannot comment on the economic impacts or benefits,” said the City of Santa Clara in a statement. “However, like all our businesses, large or small, we value and appreciate what California’s Great America has brought to our community since establishing in the City of Santa Clara in 1976. They have impacted millions and millions of visitors throughout the world and locally. The City of Santa Clara has enjoyed the partnership with California Great America.”
Mayor Lisa Gillmor noted the importance of the park and the hope that it would remain open for as long as possible.
“On the surface, it appears Great America will change in the short term,” said Mayor Gillmor. “My hope and goal is to keep Great America there as long as possible in the long term.”
Many political experts noted that the closing can be used as ammunition in races in the area for years now.
“The loss of a major amusement park, especially one with strong memories, can definitely cause waves,” said Paula Ward, a political researcher who focuses on how the entertainment industry influences local elections, to the Globe on Tuesday. “When local parks, like Chicago’s Riverview Park or Boston’s Revere Beach closed in the 60’s, same with Pacific Ocean Park in Santa Monica, local elections were upended. Same with closures in the 2000’s, like with Astroworld in Houston. Many politicians were charged with not doing enough to save them.”
“Here, the city sold the land in 2019, so you can bet there will be some digging into who exactly was behind this, and if they were elected in, it won’t look good. If not for not saving the park, but literally throwing $160 million down the drain by not holding the land for a few years. I mean, my god that is a lot. And with this, plus locals furious for losing such a place, Santa Clara suddenly has a huge political issue standing around for the next several years. They were hoisted by their own petard on this one.”
California’s Great Adventure is expected to close by 2033 under the new sale and operating lease.
