Will lagging attendance impact Universal's decision to build a third park?

Six Flags attendance is up by 9%. That may be the answer.

To be sure, construction of a new theme park with multiple, groundbreaking attractions is a multi-billion dollar proposition. And beyond the initial investment building the park, there will be ongoing costs associated with operating and maintaining the property.

Meanwhile there are considerations regarding the development of attractions being developed at Walt Disney World – Star Wars, Toy Story and Avatar. There is the additional consideration of attractions like Skyplex Orlando pursuing a portion of Universal’s business – as it would be located between the current UO property and the recently acquired land.

There is a further concern that a new park could cannibalize the existing Universal parks. Make note of what happened when the original Harry Potter attractions opened at Islands of Adventure. For whatever its worth, the 2011 TEA/AECOM report (published in 2012) claimed that while IOA’s attendance jumped by 29% (an increase of 1.75 million guests), its sister park Universal Studios Florida (located a Sorcerer’s Stone throw away) increased by a paltry 2% (an increase of only 50,000 guests).

In other words, that third gate – working within an industry that is currently stumbling and that can expect greater and more intense competition) could end up drawing guests away from its own existing attractions.

Surely these considerations must be on the minds of the Comcast execs that are (allegedly) weighing the options of pushing a couple billion bucks into a third gate.

Here are some of the comments that appeared beneath Mr. Niles’ July 8th column -- a majority of which came from anonymous sources.

Anonymous poster 63.144.237.252: “Our Sea World numbers are down as are Universal's and Disney is so so,”

Anonymous poster 207.250.82.194: “I went to Aninal (sic) kingdom Yeaterday (sic) (the 9th) and it was not crowded at all …”

Anonymous poster 97.101.157.64 noted “The Magic Kingdom didn't have phase closures this year on July 4th. When's the last time that happened?”

Ouch!

Anonymous poster 23.123.208.14: “Just got back from Orlando after spending a week in the parks from June 20 to 26. We hit Both Universals, Sea World, and Magic Kingdom and in every place the attendance and lines were very light.” The same poster noted that even new attractions were virtual walk-ons, writing “(Sea World’s Mako wait time) was 10 minutes for the better part of the day!”

TPI regular Doug Jenkins: “Spoke with a few AP holders at Universal Florida and they were amazed how the July 4th crowds were so small.”

I jumped on and noted that Walt Disney World Cast members’ main gate passes were not blacked out for any park all summer long.

And apparently the slowdown is not limited to Orlando.

Anonymous poster 70.194.205.137: “Cedar Point has been doing near constant discounts and promotions in the local market. The deals on tickets are better than I can ever remember, thinking about getting a free entry ticket next week by making a Red Cross donation.”

What would the theme of a third park even be? Hopefully large lands dedicated to single IP's like LOTR, etc.

This is an election year. A recession is more likely than not, but long term, Universal has no reason to not pursue a third park especially since it purchased that big plot of land. Plus, it has a new license with Nintendo that's worth $7 Billion more with Pokemon Go. Dreamworks plus Secret Life of Pets gives Universal some great potential to expand its theme parks. Its third park must go younger in the 3 to 9 age group.

I largely think pricing has caused softness of attendance. Offer more discounts and forgo another price increase next year. That'll fix it.

Clearly, the answer is Pokemon Go 2.0. And I'm only half kidding.

I don't think one slow summer is enough to determine whether there is a trend in the industry. With a combination of ticket prices and the number of new attractions coming in future years, now would not be the time to visit even if the civil unrest wasn't a factor.

However, I question whether Universal Orlando really needs a third theme park. According to the latest attendance report, the two UOR parks combined have roughly the same attendance as Disneyland Park alone in California. Additionally, the Central Florida market is a lot more theme park saturated than the Southern California market, has a much smaller local base to support the parks, and with the price of a week-long vacation now reaching 5 figures for the average family it is unlikely the total number of visitors to Orlando is going to increase drastically in the near future. I think Universal is likely testing the waters with Volcano Bay, as they are promoting that as a third park. If that project is successful, development on an actual third theme park will likely begin. If it barely meets expectations or falls short of them, chances are Universal will focus on expanding their existing parks rather than developing a new one for the foreseeable future.

Brilliant post by Mr. Hummel. And while some are hoping for a third gate there are many reasons (something like 2 billion-plus) that Universal might be looking for other alternatives for its newly acquired I-Drive property.

I'm increasingly hearing more people are visiting Universal as their destination resort and alternating with Disney. The pricing makes visiting both resorts prohibited, plus each resort has enough to do to last a few days. The thing about Universal is it's mainly a weekend trip whereas Disney is a week long trip. It doesn't matter that Universal's attendance doesn't match Disney. Decisions are made based on economics. Stretching out an Universal destination vacation will make more people pick Universal over Disney. That's the goal.

I still can't believe DHS had higher attendance than USO and IOA in 2015. Maybe Universal should try to beat at least one Disney park before matching the whole resort

"Maybe Universal should try to beat at least one Disney park before matching the whole resort"

This would be called moving the goal posts. If Universal is persuaded to not open any parks because it hasn't caught up with any Disney park, it would never open any parks and neither would Disney. None of Disney's secondary parks matches the Magic Kingdom or the original Disneyland. Each Disney minor park is a lesser version of the original. Each more horrible in design and attendance. In contrast, each Universal park did much better than the original Universal Studios Hollywood park.

Universal Studios Orlando has much higher attendance than USH. Islands of Adventure and Universal Studios Orlando are about even now, but in some years IOA exceeded USO. Universal Studios Japan is doing much better than IOA and USO. USJ is the 5th best attended park in the world so YES, Universal does beat Disney theme parks.

TEA 2015 Report.

Rank Park and Location % change 2014 2013
1 MAGIC KINGDOM at Walt Disney World,
Lake Buena Vista, FL
4.0% 19,332,000 18,588,000
2 TOKYO DISNEYLAND, Tokyo, Japan 0.5% 17,300,000 17,214,000
3 DISNEYLAND, Anaheim, CA 3.5% 16,769,000 16,202,000
4 TOKYO DISNEY SEA, Tokyo, Japan 0.1% 14,100,000 14,084,000
5 UNIVERSAL STUDIOS JAPAN, Osaka, Japan 16.8% 11,800,000 10,100,000
6 EPCOT at Walt Disney World, Lake Buena Vista, FL 2.0% 11,454,000 11,229,000
7 DISNEY'S ANIMAL KINGDOM at Walt Disney World,
Lake Buena Vista, FL
2.0% 10,402,000 10,198,000
8 DISNEY'S HOLLYWOOD STUDIOS
at Walt Disney World, Lake Buena Vista, FL
2.0% 10,312,000 10,110,000
9 DISNEYLAND PARK AT DISNEYLAND PARIS,
Marne-La-Vallee, France
-4.7% 9,940,000 10,430,000
10 DISNEY'S CA ADVENTURE, Anaheim, CA 3.0% 8,769,000 8,514,000
11 UNIVERSAL STUDIOS at Universal Orlando, FL 17.0% 8,263,000 7,062,000
12 ISLANDS OF ADVENTURE at Universal Orlando, FL 0.0% 8,141,000 8,141,000
13 OCEAN PARK, Hong Kong SAR 4.2% 7,792,000 7,475,000
14 LOTTE WORLD, Seoul, South Korea 2.8% 7,606,000 7,400,000
15 HONG KONG DISNEYLAND, Hong Kong SAR 1.4% 7,500,000 7,400,000
16 EVERLAND, Gyeonggi-Do, South Korea 1.1% 7,381,000 7,303,000
17 UNIVERSAL STUDIOS HOLLYWOOD, Universal City, CA 11.0% 6,824,000 6,148,000

Of course Disney should fear the 3rd Universal park in Orlando. It might surpass USO and IOA and could be a breakout hit for Universal. It might break the Disney monopoly if families with many kids can be persuaded to have an Nintendo and DreamWorks vacation. Hint: Not hard. I propose a Pokémon themed hotel.

"For whatever its worth, the 2011 TEA/AECOM report (published in 2012) claimed that while IOA’s attendance jumped by 29% (an increase of 1.75 million guests), its sister park Universal Studios Florida (located a Sorcerer’s Stone throw away) increased by a paltry 2% (an increase of only 50,000 guests)."

How is this considered cannibalizing attendance? This is mere grasping of straws. Look at the TEA 2015 report, MK has 4% increase and every other minor park has 2% increase. No cannibalization, but paltry increase. Then look at USO with 17% increase while IOA with 0% increase. Seems like Universal Parks got a huge boost. (Disney increased by 1.4 Million, Universal increased 1.2 Million.) A Universal third park will definitely cause the first two parks to have a flatter increase, but the overall increase in attendance will be huge.

"Universal might be looking for other alternatives for its newly acquired I-Drive property"

Did you hear this rumor or its just your hope? For what reason would Universal/Comcast change its mind about their new property after having acquired it, which was previously sold from it's previous owner. It would be the oddest thing.

Keeping it fallow would the only other alternative; however, it seems unlikely for them to cutback on their plans especially with Disney on their heels for the upcoming big splash openings of Avatar and Star Wars Land.

According to news reports, the new land of 475 acres has enough room for 2 theme parks. (Universal Studios is 108 acres and Islands of Adventure is 101 acres.) Instead, I would think they should go BIG by building a supersized theme park, at least as large as Epcot (300 acres) with 3 hotel resorts (to start), a CityWalk2, and a transportation system to/from Universal Orlando. The outer park perimeter should have enough lots to add many more resorts surrounding the theme park as a buffer.

The news reports suggest they might just want to build a few resorts, some back of the house facilities, transportation, and widen the roads before starting on a third park. That's fine too, but that's hardly suggesting they will hold back on a third theme park.

I Wrote: "Universal might be looking for other alternatives for its newly acquired I-Drive property"

Anon Responds: "For what reason would Universal/Comcast change its mind about their new property after having acquired it..."

I Respond: My point was to suggest that perhaps they would use it to build something other than a third theme park. For example they could use it to build "3 hotel resorts" or "a CityWalk2" rather than a theme park.

TH: They can do that without ever ruling out doing a third theme park, which was what I already said and you didn't address. 475 acres won't ever just be hotel resorts and a shopping area It seems rather silly to not have a theme park next to the shopping area for who will go just for shopping. Universal isn't in the shopping mall business.

I have to agree with Anon here, 475 acres is a lot of space for hotels and a shopping area. I can't speak for everyone but I'm not travelling 2800+ miles to go shopping, almost any store they put there can be found much closer to home. They will need to have a park close by as a reason to bring you into the area and then shopping is something you do on the way out. That is the problem with Disney Springs, in my opinion, there is o reason t go there, it has always been we have a few hours before we need to go to the airport we can waste time here.
Without a theme park or water park there just wouldn't be enough incentive to go there.

Universal Orlando NEEDS a third theme park. Disney World understood the benefits of a third theme park leading up to 1989 with the opening of Disney-MGM Studios. Overnight, WDW went from a 3-4 day vacation option into a 5-7 day resort destination. WDW already had a "captive audience" in the 1980s with two quality theme parks, a water park and resort hotels, just as Universal Orlando has now, or will soon with the opening of Volcano Bay in 2017. With the opening of a third theme park, WDW completely monopolized the family week-long vacation. Universal Orlando's goal should obviously be the same. In the end, Universal Orlando can almost double guests' spending resort wide by adding another theme park. (Disclaimer: A family focused theme park.) Universal Orlando has done their part recently by improving the quality of their existing theme parks with cutting-edge attractions and immersive themed environments on par with WDW. New themed resorts have also more than doubled the rooms available resort wide. The next step for Universal Orlando is to add a third theme park to become a legitimate 7 day resort destination.

Posting this from EPCOT ... It is dead ... On a Saturday in July ... Scary.

In hindsight Volcano Bay would have made perfect sense with a boutique theme park on the property with a CityWalk2 and hotels.

In the area where the land is located...hotels can be supported also by convention business and other trade shows.

After going to Disney Springs last night for their event, I can safely say Disney added a "fifth park/day" if you count DAK as a full day park

At DHS ... 730 EDT ... TOT 20 minute wait

If Shanghai actually cost $5.5 billion to build then Universal's investment -- which would be based on economic projections extending over the next 15 years -- represents a substantial leap of faith. Especially if their plans would include "building a supersized theme park, at least as large as Epcot (300 acres) with 3 hotel resorts (to start), a CityWalk2, and a transportation system to/from Universal Orlando."

In my humble opinion I would contend that "(w)e must see if next year's TEA report" -- or, ya know, ACTUAL attendance data -- "makes the case for Universal's future plans."

But then what do I know about such things?

(Chuckle)

Anon writes: "Universal isn't in the shopping mall business."

I respond: Having witnessed the extraordinary, early success of Disney Springs, perhaps they should consider getting into "the shopping mall business."

TH: Interesting that you merely repost a bunch of my quotes and end up saying absolutely nothing. Universal must make a decision based on its own economic figures and projections for the Disney model makes no sense for Universal. They obviously cannot spend $5.5 Billion like Disney did in Shanghai. When Disney decides to do a quality product, they seem to spend too much. When they go cheap like California Adventure or Hong Kong Disneyland, they underperform. Universal is building ambitiously and finding customers willing to pay.

Anon: "TH: Interesting that you merely repost (sic) a bunch of my quotes and end up saying absolutely nothing."

I Respond: Actually I am posting quotes that illustrate that you concur with my perspective. I don't think I claimed that Universal should follow anyone else's model. Keeping in step the topic advanced by the thread, I made note of the substantial investment that would be required to build a theme park -- let alone "a supersized theme park, at least as large as Epcot (300 acres) with 3 hotel resorts (to start), a CityWalk2, and a transportation system to/from Universal Orlando." Whether Universal follows Disney to any degree or not, an investment in a new theme park would require (at least) $2 billion.

Getting back to the point of the thread, I pose the question will this summer's lagging attendance (anecdotal) hamper any plans Universal might have to build a third gate -- let alone "a supersized theme park, at least as large as Epcot (300 acres) with 3 hotel resorts (to start), a CityWalk2, and a transportation system to/from Universal Orlando."

Your initial response was "Universal has no reason to not pursue a third park especially since it purchased that big plot of land." Then (on another thread) you seemed to shift gears by posting "We must see if next year's TEA report makes the case for Universal's future plans."

I mean, that last quote from you seems to support the relevancy of the question posed at the beginning of this thread: "Will lagging attendance impact Universal's decision to build a third park?"

TH: You continue to miss your own arguments. You said you wonder if Universal should do something else instead of the third park. "And while some are hoping for a third gate there are many reasons (something like 2 billion-plus) that Universal might be looking for other alternatives for its newly acquired I-Drive property." That's nonsense. I already responded numerous times.

In case of a delay... "Keeping it fallow would the only other alternative"

Otherwise, adding hotel resorts and CityWalk2 are precursor to the eventual third theme park. Why build hotel rooms and shopping in a recession when customers are not arriving? Makes no sense.

Your question is based on pure speculation and you admit the perception of a downturn in attendance must be confirmed. All around weird way of argument.

Anon: writes: "TH: You continue to miss your own arguments. You said you wonder if Universal should do something else instead of the third park. 'And while some are hoping for a third gate there are many reasons (something like 2 billion-plus) that Universal might be looking for other alternatives for its newly acquired I-Drive property.' That's nonsense."

So then what did you mean when, on another thread you posted "We must see if next year's TEA report makes the case for Universal's future plans"?

TH: So you want context when you cut out the pertinent lines? Please post the first two lines!! That's not a request.

Well, the entire post reads, "Disney's Typhoon Lagoon and Blizzard Beach hover at around 2 million in yearly attendance. It's hard to use the new water park to gauge potential for an actual third theme park, but I suppose they already have other indicators like occupancy at the new Sapphire Falls Resort. We must see if next year's TEA report makes the case for Universal's future plans."

So ... Not sure what you your getting at?

The other thread is about the water parks. Has nothing to do with making the case for third park. Universal must make a case based on its attendance from its two parks in Orlando. Thus, it can continue to build in its newly acquired land. It can do something or nothing or instead of as you said. Doesn't seems like they will do nothing. No evidence yet they will do nothing. The TEA report is for our own reading pleasure. I'm sure Universal has the actual numbers regardless.

But the line I pull from your post IS about how theme park attendance might impact Universal's decision related to building a third park ("It's hard to use the new water park to gauge potential for an actual THIRD THEME PARK, but I suppose they already have other indicators like occupancy at the new Sapphire Falls Resort. We must see if next year's TEA report makes the case for Universal's future plans."

Again, the question posed by this thread asks if lagging attendance might impact Universal's decision to build a third theme park.

Sure, but pure speculation. And you said they might do something instead of the third theme park. Huh? Universal already proposed another hotel resort after opening Sapphire Falls.

"universal Orlando has filed paperwork for a new hotel planned on their property. The new location would be southwest of their newest hotel, Loews Sapphire Falls Resort, which is scheduled to open in July."

So TH, Universal isn't stalling.

I'm here today. Shrek had a 60 minute wait.(!) Whatever lags there are certainly isn't showing.

I would have thought a downturn was the perfect time to start building, that way its online and ready to go as the economy recovers. Plus labour is cheaper as fewer folk are hiring.

So Chad...

Caracas Disneyland sound good? Universal Studios Rio De Janiero? Six Flags Moscow?
Hehe. I kid.

Economy be darned! Build a third park in Orlando, Comcast!

Just left a meeting where someone mentioned that they were at Magic Kingdom yesterday (Sunday). They said the park was very quiet ... Walked on to everything.

My ex still lives in Orlando and is an AP holder at Disney, and she said Soarin was a 25 minute wait...on a SUNDAY. Sure, they added a theatre, but it was regularly 75-90 minutes.

She doesn't go to Universal, so I can't comment on that. But she said many of the non-Disney restaurants like Chilis and Red Lobster are also light on customers. If the general downward trend in Central Florida continues, Universal will likely put plans for a third park on hold.

I'd still like to see them keep the land open, and maybe start by building a hotel and transportation infrastructure to connect the new and old.

Gabriel: You still talk to your ex? You discuss Disney theme park stuff too. Wow. That's really funny. You should have stayed together.

Orlando public radio WMFE: "Universal Orlando eliminated “blockout dates” for the rest of the summer. Those are designed to limit crowds by blocking people with less expensive passes on the busiest days. The lifting of blockout days may seem counterintuitive as Universal just debuted its new Reign of Kong attraction. ThrillGeek theme park blogger Clint Gamache said he thinks Universal lifted blockout days because attendance is down. 'As earning reports come out later you’re going to see it, that this summer was kind of, not a dud, the parks have been busy but they haven’t been summer busy,' said Gamache."

Beginning to wonder if the whole "every time we build a new attraction we will see record attendance" approach to theme parks continues to have legs. WDW opens 'Frozen Ever After' and there are five hour waits during the first few weeks (or was it days). Will the same be true for Pandora? If so, it would seem dubious to assume that Universal would toss $2-$3 billion at a whole new park rather than look at expanding or re-working the existing parks (Toon Lagoon, Lost Continent, Terminator, KidsZone, Barney etc.)

Frozen Ever After calmed down to 60 minute wait. It's not a bad wait for a new attraction. Soarin' has a 65 minute after adding a 3rd theater and a new film. Test Track has a 80 minute wait since it's still the most popular ride of the park. I hope they fix the lackluster Imagination that has a 30 minute wait and Energy that has no wait. Frankly, I don't think Frozen Ever After will increase Epcot's attendance much. The ride isn't that ambitious and the Anna and Elsa meet and greet has no wait.

What does Epcot and Pandora has to do with Universal? I have no idea. I doubt Universal can move the needle like Disney with "record attendance" each time it opens a new attraction. It just doesn't happen. Wizarding World is a great success, but it is only one such property that Universal has. Disney has many valuable IP that it can exploit to increase attendance to record levels. So far, none of that is coming to Epcot. However, I do think if Universal wants an reason to break ground for a new park, Nintendo should be the reason especially with Pokémon at the height of its popularity. It's another once in a lifetime lightning strike that will benefit Universal.

Are all three Soaring theaters open?

Signed guests into the Magic Kingdom today. Crowds were VERY healthy. Took a stroll. Buzz 50 minutes. SDMT 90 minutes.

Just got done with lunch at Bahama Breeze on 192. We were house hunting in Davenport. Several years back British vacationers were buying holiday homes (4/2s with pools) for a song. Now with Brexit and the collapse of the pound against the dollar and vacationers dropping you can grab one for next to nothing.

If only I had a pal who could get me a bump at Golden Oaks ... Hint, frickin' hint.

Heading to the Springs ... Will report on crowds later.

Disney Springs was fairly busy ... and HOT! The first three levels of the Lime garage was full. Level 4 had about three dozen spots open and Level 5 was open.

Again it was hot ... I am sure the cooler temperatures after sunset attracted a ton of people.