Bluegrass Boardwalk opening delayed until 2014

"Because all improvements and additions would become the property of the state fair board, the organization said it will not develop the deteriorating park without state and local incentives, according to the development plan."

That sentence for me kind of says what is wrong with anyone investing in Kentucky Kingdom. I didn't look into all the details/legalities, but I am assuming the situation is set up like a "lease," BB runs the property but never really owns anything outright(?) and simply gets a percentage of any profit generated, I am assuming. What kind of incentive is that for all the hard work, time and effort?

Some might point to CA Great America being in a similar situation but at least there Cedar Fair actually "owns" the investments they put into the park and they simply pay a lease on the land a small percentage of the profit generated.

I give the Koch's a lot of credit for pushing forward on this, I just have to wonder if it really is worth the effort and expense.

Due to the 50 year terms of the lease, I wouldn't see any early investments being a concern in this arrangement. I am pretty certain that even major costs incurred would be made back by then. However, this may come up later...let's bring it up again around 2052. ;-)

I wouldn't be sure of that^, it's not impossible for parks to fail. And this one doesn't have a great track record so far, blame who you will.

True. Perhaps I am a bit too optimistic and assume success in this venture, which is probably not wise given the history of this property. Without knowing the full details of the lease agreement I can't speak with certainty about it, however I would assume that the Koch's were diligent in their homework before moving forward with an arrangement that was not beneficial to them.

They should just add a whole bunch of big rides. That will bring people down from Michigan.

Restrooms still contain human waste and were not winterized, causing further damage.

Wow, that's gross.

Gromithere said:

True. Perhaps I am a bit too optimistic and assume success in this venture, which is probably not wise given the history of this property.

But still, your original statement is exactly the point of entering a commercial lease like this. The Koch's don't have to buy the rides, land, other assets of the park. They just have to handle lease payments and make the improvements. In exchange, the assets stay with the fair board at the end of the lease. They certainly hope that the park's operations in the meantime make up for the original cash injection but that's a risk in any business.

Gonch submitted this "story" with an Ed Hart interview, but given its age and and its clear agenda, I couldn't post it as news. It's filled with innuendo and accusations.

Suggesting that the Kochs were getting involved for any defensive reason is pretty asinine. Holiday World grew for the last decade while Kentucky Kingdom was operating, and declining.

I'd always assumed that the reason that CF acquired Geauga Lake & Michigan's Adventure was also "a defensive business move to protect their park," even though CP's attendance was fairly steady. And, lo & behold, GL is a waterpark with no rides.

It would also explain DK's obsession with KI, even though it had not hurt CP's attendance significantly in 30 years.

To be fair to Hart, he does say “It’s good business. They’re [the Kochs] not the villains. They’re not the villains. They’re not doing anything wrong."

Yeah, I knew it wasn't really 'news' - but I still think it's an interesting read.

Really? You're still holding on to "they bought GL to close it?" At this point, I suspect that mistake has cost them nine digits, a sum that wouldn't be made up in 50 years of "competition."

I never said they bought it to close it. I said I believed that GL and MiA were "defensive" acquisitions. Why else would CF buy parks in states that were in economic decline AND provided no geographical diversification?

It is better to be your own competition.

I have always maintained that CF's mistake at GL was trying to keep both parks open. From 1970 through 2000 the business model at GL & Sea World was 2 Parks, 2 Admissions, 2 Overheads. SF changed the model to 1 Park, 1 Admission, 2 Overheads. CF should have kept the water park at GL and sold off the Sea World side, i.e. 1 Park, 1 Admission, 1 Overhead. Not doing that, IMO, was the "mistake [that] has cost them nine digits." (Although, IIRC, they only claimed a $54m writeoff.)

It is interesting that Hart has said the most viable business model at SFKK is a waterpark with a few rides. I have never been there, but that is how people describe MiA. And obviously CF wanted GL to be, in large part, a waterpark--note the initial plan for $50m in investment on the waterpark side. (It is also how many describe Dorney, another park that I've never been to.)

Makes sense. Draw people to GL, MiA or BK with a huge waterpark and some rides. If they want more or bigger rides they go to CF/HW. Either way, you get the $$$.

My point was that Hart is claiming that HW is implementing a business model that, IMO is similar to what CF did with MiA and intended to do at GL, not that CF intended to close GL.

Captain Hawkeye said:

I never said they bought it to close it. I said I believed that GL and MiA were "defensive" acquisitions. Why else would CF buy parks in states that were in economic decline AND provided no geographical diversification?

Because Dick was in charge. The GL purchase, I suspect, was more about his ego. As for MiA, there was nothing defensive about that as it really doesn't share CP's market. That one just made sense, given the high margin business it is.

I was told by a person who would definitely know that Dick was deathly afraid that the Henningers would buy GL thus putting the Kennywood family in Cedar Point's back yard.

That may have been a legitimate fear, but my understanding was that Geauga Lake was not for sale, and Cedar Fair wasn't looking to buy, until Kinzel and Story met each other on the IAAPA show floor. In the course of a brief meeting, Six Flags got an opportunity to raise some cash, and Cedar Fair got an opportunity to make sure nobody else bought Geauga. The rest, as they say, is history.

Oddly enough, I was at IAAPA that year, and might have seen one end or the other of that meeting. I remember being surprised that Kinzel was even there, and thought it interesting that he was hanging out with the competition. Then when the news broke about the sale, along with a description not entirely unlike what I outlined above, I realized what I had probably seen...!

--Dave Althoff, Jr.

Did you see them exchange the secret park owners' handshake?