Arms Race: Who is Enchanted Parks?

 

As of January 9th, some trademarks were filed for a company known as "Enchanted Parks Holdings." It appears as though they are in the works of making some moves on a lot of the smaller Six Flags properties including Six Flags St. Louis, Michigan's Adventure, Oceans of Fun, Great Escape Lodge, and Schlitterbahn Galveston among others. It has been well-known public information that the struggling Six Flags chain has been interested in offloading some "non-core" properties for quite some time to reduce their scope and recover some funding to help alleviate debt.

There has been great speculation ever since the announced closure of Six Flags America last year, and it seems as though we have uncovered at least the start of the Six Flags purge. I will say that I have heard of a group of parks behind the scenes that were being discussed for sale or transfer of operation. Two of the parks that were discussed are listed above. However, the operator interested in making the move must have gotten cold feet, as Enchanted Parks was not the name discussed. I am quite intrigued if there are still talks happening behind the scenes regarding the additional properties, or if this right here is it as far as Six Flags is concerned in the present time for downsizing.

To me, I am skeptical if this is an outright sale of the properties from Six Flags to Enchanted Parks. Some sleuths on Reddit have followed the clues and have linked Enchanted Parks with a company known as Innovative Attraction Management (IAM). IAM currently operates several small-scale water parks, resorts, and family entertainment centers. They list on their website that they are "actively seeking to acquire high performing water parks and amusement parks." Also, "the company aims to partner with top-tier attractions for long-term growth and success."

These sound like buzz words for a park operator, not necessarily an owner. I find it hard to believe that a small startup company has the capital or ability to obtain a loan for some of these properties which may exceed hundreds of millions of dollars to purchase. This is why I am leaning towards Six Flags leasing the operation of the parks to Enchanted as opposed to selling them.

Leasing the properties gives Six Flags some advantages over owning and operating them completely. IAM/Enchanted will be responsible for the day-to-day operation of the properties. This includes hiring and managing staff, running the attractions, spending money on maintenance and upkeep as well as potentially capital investments, as well as other tasks. Six Flags essentially sits back, collects the yearly paycheck for rent, and goes about their business elsewhere. Reducing the scope of their corporation allows them to focus more on their "core" assets, while they still have the ability to profit off the parks they own, though not as much as if they operated the parks as well.

Unless there are more trademarks coming in the near future, I believe that this is the most likely option at play here, mainly because it would be extremely strange if properties such as Oceans of Fun and the Great Escape Lodge would be broken up from their main entities and act as competition under the complete control of Enchanted Parks.

Six Flags is no stranger to this form of setup, as they already operate a few properties that they do not outright own. La Ronde, Frontier City, Six Flags Darien Lake, Six Flags over Texas (partially-owned), Six Flags over Georgia (partially-owned, but SF will completely own it in 2027), and Six Flags Qiddiya are all owned by separate entities but operated by Six Flags. 

Six Flags over Texas has actually been in the news this past week for this exact reason, the topic of the park's ownership. Being the original Six Flags park, a deal was worked out for a private investor, Texas Flags Ltd. to retain ownership of the land and essentially lease it out to Six Flags for operation. This gave them more financial benefit for investment being a small startup at the time. As part of the contract, the option to buy the park outright at the end of 2025 has existed, which Six Flags has declined to act upon. With the payment due in 2028, it tells me one thing. A chain that is actively trying to downsize and currently has poor financials currently does not have the money (or it would be a difficult pill to swallow) to have acted on the purchase at this point.

There are many worried folks out there who are thinking that Six Flags over Texas is doomed and imminently going to close or be sold. The fact of the matter is that it cannot just simply happen. A layer of protection exists over Six Flags over Texas, and all of SF's leased properties, as Six Flags has a contractual obligation to operate the properties. They simply cannot just back out, close the parks, or sell them because they do not outright own them. It is not unheard of for Six Flags to force the hands of their "landlords" before and negotiate their way out of a lease. Six Flags New Orleans and Six Flags Kentucky Kingdom are examples, however there were very desperate circumstances at play for both properties upon termination of the lease. 

Six Flags possibly would have liked to dump some of the smaller scale leased parks above, but the option to do so would have been complicated and costly for the chain, whereas Michigan's Adventure, St. Louis, etc are outright owned.

As far as over Texas goes, I don't think there is any need to worry about a sale or closure. It is a historic park in the chain, a mid-tier or better performer annually, and is seeing investment going into the park. Tormenta Rampaging Run is a headlining, expensive attraction for the park, and some other investment has gone into the property in recent years. With Jeffrey Siebert overseeing the park now as regional director for the park, his vision and commitment to investment and guest experience will be seen. A lame duck park would not be exercising the option to build what is likely a $25-$30 million dollar giga coaster.

Here are some direct thoughts about each property that has shown up in the trademark listings:

- Michigan's Adventure: The writing has been on the wall here since the legacy Cedar Fair days. A low-tier (but consistent) performer has not seen significant investment in decades. Despite being the only major park in Michigan, many locals will take the drive and prefer to attend Cedar Point or other nearby parks instead. Six Flags likely doesn't see the park as a major competitor for their larger parks. The park has been rumored for a sale for a very long time now.

- Six Flags St. Louis: This one is the cream of the crop for this bundle deal. The largest of all the properties, Six Flags St. Louis was one of the three original Six Flags parks. Attendance here is steady, but the park is still a low-mid tier performer for the chain. The park has seen small investments in recent years, but nothing noteworthy. An interesting note here is that the park does contain a decent amount of DC Comics theming. Attractions such as Batman: The Ride, Catwoman Whip, Joker Carnival of Chaos, and Justice League: Battle for Metropolis will have to be stripped of any likeness to DC characters and rebranded or removed from the park. 

- Oceans of Fun: I am most intrigued by how this deal will work out. Oceans of Fun has been in operation since 1982, and at 64 acres in size is one of the largest water parks in the Six Flags chain. There has been some slight recent investment, but portions of the property are quite dated. Worlds of Fun is similar in performance to St. Louis, being a mid-low tier performing park, leaning more towards mid-tier. Oceans of Fun and Worlds of Fun are a combined ticket, meaning separate fees aren't required to enter both parks. So there's a few options available here: 1. The parks will continue to operate as normal, but Enchanted Parks will operate the water park and share revenue with Six Flags. 2. Oceans of Fun will be gated off and operate as a separate ticket (this will upset the guests). 3. Six Flags is also planning on unloading the dry park at some point. One park I worked at decided to gate off our water park and offer it as an upcharge ticket. This only lasted for a few years, as it royally upset the guests, and the water park-only tickets were not popular enough to support staffing a separate gate.

- Great Escape Lodge: One of Six Flags' few resort properties, the Great Escape Lodge offers an indoor waterpark that operates year-round. While the Adirondack area can be a popular tourist destination for winter sports, I cannot see the hotel doing major business, especially in the summer season. Again, Great Escape by itself is not a large performer for the chain, but the Lodge may do even less business. Being a resort and water park attraction, this one is right up Enchanted Park's alley.

- Schlitterbahn Galveston: Schlitterbahn is a beloved name in the water park industry, with the original park in New Braufnels Texas winning the Golden Ticket Award for best water park for over 20 years straight. However, their other branded properties have not been so fortunate. Three other properties (Kansas City, Corpus Christi, and South Padre Island) since have been closed or sold since Cedar Fair bought the chain in 2019. The Galveston location is quite popular and successful, but nowhere near any other major Six Flags properties, and is a standalone entity. This will leave only the original Schlitterbahn to remain in operation by legacy management. 

It will certainly be interesting to see the results of this story, and if the scope of this transfer may be expanded. I don't know how much of a splash can be made for these properties immediately by Enchanted Parks, as there will certainly be a period for them to get their feet and make the necessary changes to de-brand the Six Flags parks.

Maybe there are some similarities between Enchanted Parks and IB Parks led by Gene Staples. It was not too long ago that he entered the amusement industry and began "saving" small-scale amusement parks from closure. It is in the news today that IB Parks will also pick up the beloved Lake Winnie in Georgia to operate going forwards. While a good job has been done so far for Indiana Beach itself for a novice in the industry, I'm not so sure the same can be said about Niagara Amusement Park and Clementon Park, whose investment and success can be debated. 

As far as Six Flags goes, hopefully this is a positive for them as well. With the company being so bloated and large now, relieving some of their parks may be the key to reduce scope and put more focus and investment to the larger parks. They are certainly not out of the water yet financially or with guest perspective.