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UAE prepares for theme park boom

United Arab Emirates: Monday, May 26 - 2008 @ 10:24

Nine major licensing deals have been struck in the past year between local investors and some of the top names in the global entertainment business such as Six Flags and Legoland.

Global film studios such as Paramount and Universal are also planning major attractions.

Dubailand focal point

Many of the parks are to be located in Dubailand, the $63.9bn mega-development being built on the outskirts of the emirate.

Although most of the parks are in the early stages of development, Dubailand plans to open a new attraction every six months by December 2010, according to Ahmed Tajedeen, the development’s director of marketing.

All told, Dubailand is planning to build 45 mega projects, including the centerpiece theme parks.

Tajedeen brushes aside concerns that there will be too many attractions in the development. ‘It is not right to say these parks are competing with each other. They will compliment each other,’ he says. ‘We are promoting Dubailand as one destination. It will be a place where you can take the kids on a seven or 10 day vacation because there is so much to do.’

Dubai is hoping to attract 15 million tourists a year by 2015, and theme parks are expected to play a huge role in helping to achieve this goal.

The emirate’s proximity to Europe, Asia, and Africa gives it huge advantage as a tourism hot spot, Tajadeen believes: ‘We think the volume will be there to support all of these parks. Look at the Mall of the Emirates. It is able to attract up to 150,000 people a day.’

Hotels bank on parks

Theme parks are also expected to play a vital role in keeping Dubai’s hotel occupancy rates high, which will be no small feat as the emirate is planning to more than double the number of rooms over the next four to five years, says Guy Wilkinson, a partner at Specialist Hotel & Property Development Advisers.

One worrying scenario for developers of new hotels in Dubai is whether there will be delivery delays in the leisure projects. Wilkinson thinks it is likely that many parks will fall behind schedule because of materials shortages and the difficulty of designing these parks to deal with the region’s heat.

Orlando has warm weather too, he points out, but visitors can still enjoy the rides in the summer. ‘Dubai is much hotter, so there will need to be a lot of shade in its parks,’ he notes.

Officials at Dubailand are confident that their parks will be successful despite the desert heat. ‘All of these aspects have been taken into consideration for our projects,’ says Mohammed Al Habbai, CEO of Dubailand. ‘For instance, 80% of Universal Studios is covered, shaded and has indoor rides in addition to the fact that Dubai has a nice weather for around eight months a year, which deals with any concerns that are related to the weather.’

One of the theme parks, Aqua Dunya, may be on time because it is largely a water park, Wilkinson predicts, but the big parks that do not have water rides may not be ready for three to five years.

This could create a glut of available hotel rooms until the attractions are ready. ‘There may be a trough in the growth curve in Dubai’s hotel occupancy rates over the next few years before the theme parks open,’ he predicts. ‘Seeing a decline in any growth curve is not something we are used to here.’

Another concern is whether there will be too many parks. ‘In order to be successful a large theme park will need to be able to attract about one million tourists per year,’ Wilkinson explains. ‘Presumably the developers have done their research to determine that there will be enough demand for their parks.’

But people should think twice before questioning the viability of these projects, Wilkinson believes. For example, the sheer number of projects being planned for Dubailand is no accident: ‘Dubai is aiming for a true critical mass, it is integral to its plans.’

Wilkinson used to doubt whether the emirate would be able to pull off all of its ambitions plans, but is now a believer. ‘We like to compare Dubai to Orlando or Disneyland, but there has never been growth like this anywhere else in the world. When it comes to projects like this, you just have to believe what Dubai has to say,’ he says.

Arab demand is questioned

One thing that developers are counting on is a large demand from Middle East tourists, partly because there are no other parks in the region. However, one industry expert who asked to remain anonymous said it is wrong to expect that these parks will be hugely popular with Arabs.

He notes that there is currently an amusement park in the creek area of Dubai that gets only about ‘15 visitors a day’. He said one problem is that locals from the region, especially women, do not like to go on ‘scare’ rides.

He also feels that locals will not be interested in the themes of the American franchises. ‘How many of them are going to know what ‘Terminator 3′ is?’ he asked.

And theme parks can quickly lapse into decline if visitor numbers are below expectations. ‘One ride can cost up to $100m to build, and similarly to a personal computer, it becomes outdated after a few years. If you are not getting the amount of visitors you hope to get, you will not be generating the revenue you need to upgrade the rides, and your park will seem old rather quickly,’ he said.

One project, the Legends in Dubailand, has already been cancelled, he noted. The project was slated to be home to three indoor theme parks.

Theme park rundown

Here is a look at plans announced by Hollywood studios and other entertainment companies for theme parks in the Middle East:

Marvel Entertainment is partnering with Dubailand to build a $1bn theme park based on characters like Spider-Man and X-Men.

Universal Studios is teaming up with Tatweer on a $2.2bn project using franchises such as King Kong and Jurassic Park.

Paramount Pictures is partnering with Ruwaad Holdings on a theme park as part of a $2.5bn complex in Dubai using movie themes such as Titanic.

Warner Bros. is teaming up with Aldar Properties on a theme park based on characters including Bugs Bunny and Superman.

DreamWorks Animation is partnering with Tatweer to bring franchises such as Shrek and Kung Fu Panda to Dubailand.

Budweiser brewer Anheuser-Busch’s entertainment division has announced a four-park plan, including a SeaWorld, in Dubai with partner Nakheel.

Theme park operator Six Flags is partnering with Tatweer on a thrill-ride section of Dubailand.

Metro-Goldwyn-Mayer is building an entertainment complex in Abu Dhabi with Sorouh Real Estate based on franchises including the Pink Panther and James Bond.

Legoland is building a new park in Dubailand, which will be the park’s first venture outside of North America and Europe.

See also:
Legoland is Dubailand’s latest building block
Dubai on track to hit tourism target

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Monday, May 26- 2008 @ 10:24 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.

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