Start Date
8-1-2011 10:30 AM
End Date
8-1-2011 11:45 AM
Track
1. Track 1 – Formal Paper Presentation
Subject Area
Travel and Tourism
Faculty Member
Youcheng (Raymond) Wang, Ph.D. raywang@mail.ucf.edu
Abstract
There is an industry “rule of thumb” that when planning for the construction of a theme park, developers should anticipate investing $100 per expected first-year guest. In other words, if the goal is to attract a million paying guests per year, the total investment needs to equal $100,000,000. This ratio is quite common in the literature, but it has never been investigated formally. This study reveals what the investment per guest has been overall for the approximately 75 theme parks that have been constructed in the United States since 1955.
The research design was to collect the initial investment costs of as many of the parks built in the United States, convert that investment into modern dollars, and then divide that dollar cost by the first-year attendance figures. This resulted in a dollar figure that was used to evaluate the investment costs of opening a theme park regardless of when or where it was constructed.
The overall mean or average among the subject parks was $109.61 invested per first-year guest. This figure is very close to the industry “rule of thumb” of investing $100 in construction costs for every desired first-year guest. When compared to the average, 63 percent of the parks fell below this investment figure and 37 percent of the parks exceeded this investment figure.
Keywords
theme parks, construction costs
Theme Park Development Costs: Initial Investment Cost Per First Year Attendee
There is an industry “rule of thumb” that when planning for the construction of a theme park, developers should anticipate investing $100 per expected first-year guest. In other words, if the goal is to attract a million paying guests per year, the total investment needs to equal $100,000,000. This ratio is quite common in the literature, but it has never been investigated formally. This study reveals what the investment per guest has been overall for the approximately 75 theme parks that have been constructed in the United States since 1955.
The research design was to collect the initial investment costs of as many of the parks built in the United States, convert that investment into modern dollars, and then divide that dollar cost by the first-year attendance figures. This resulted in a dollar figure that was used to evaluate the investment costs of opening a theme park regardless of when or where it was constructed.
The overall mean or average among the subject parks was $109.61 invested per first-year guest. This figure is very close to the industry “rule of thumb” of investing $100 in construction costs for every desired first-year guest. When compared to the average, 63 percent of the parks fell below this investment figure and 37 percent of the parks exceeded this investment figure.