SANTA CLARA — The final rides at the Great America theme park are in sight now that one of the Bay Area’s biggest real estate developers has purchased the land beneath the iconic Santa Clara amusement center for $310 million.
The beloved amusement park could close from now in six years — and no more than 11 — under the terms of a real estate deal filed Monday with federal regulators that this news agency has reviewed.
Prologis, a mega-developer whose specialties include industrial centers and logistics hubs, bought the land from Cedar Fair, which has been trying to reduce debt, including through asset sales such as the land deal in Santa Clara.
“We chose Prologis as our partner because of their strong ties in the Bay Area and their reputation for working closely with local communities on major developments,” said Richard Zimmerman, CEO of Cedar Fair.
CBRE, a commercial real estate company, arranged the real estate transaction, which will see the park close in up to 11 years, although the exact timing is unclear.
Under the terms of the agreement, Prologis paid $310 million to Cedar Fair to purchase the land. Prologis simultaneously agreed to lease the land to Cedar Fair.
San Francisco-based Prologis agreed to lease the land to the amusement park company for six years, under the terms of a lease agreement that was outlined in a Cedar Fair filing with the Securities and Exchange Commission. Monday.
Cedar Fair also has the option to extend the lease agreement with Prologis for up to five additional years for a total of 11 years, according to SEC filings.
Some verbiage in the leasing agreement language described in the SEC filing could point to an even shorter event horizon for the theme park before it closes.
“The lease is subject to a right in favor of Prologis to terminate the lease early on at least two years’ notice,” Cedar Fair said in the SEC filings.
Cedar Fair, based in Ohio, is one of the largest operators of regional amusement parks in the country. These businesses have been devastated by the economic fallout from sweeping shutdowns ordered by government agencies to combat the coronavirus.
“Cedar Fair will continue to operate the park for up to 11 years and then close existing park operations at the end of the lease term,” the company said Monday.
Cedar Fair purchased the land from the city of Santa Clara in 2019 following the disbanding of municipal redevelopment agencies orchestrated by the state government to help address an earlier budget crisis.
Prior to the 2019 transaction, Cedar Fair had leased the land below the park for about 40 years.
Cedar Fair appears to have made a big profit from the ongoing sale of the amusement park land for $310 million.
The assessed value of parcels held by a subsidiary of Cedar Fair, as of mid-2021, was $154.8 million, according to documents filed with the Santa Clara County Assessor’s Office.
“The sale and lease agreements allow us to monetize a high-value asset in the heart of Silicon Valley at a very attractive multiple,” Cedar Fair CEO Zimmerman said in a prepared statement.
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