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Major Theme Park Coming to a Sad End

A popular Northern California theme park will be closing its doors permanently after its owner sold its land beneath the park to a developer.

Theme parks in the U.S. are resilient. It's very rare for one to shut down permanently.

One of the most recent notable theme park closings was Six Flags New Orleans, which originally opened as Jazzland in 2000 at the intersection of Interstate 10 and Interstate 510, and permanently closed after suffering devastating damage from Hurricane Katrina in 2005.

The theme park opened on 140 acres at a $130 million cost, according the City of New Orleans website, and was bought out of bankruptcy by Six Flags  (SIX)  in 2002 for $69 million. Six Flags added several rides, but closed the park in 2005 after 4-7 feet of hurricane flood water sat on the park grounds for a month due to a pump failure.

New Orleans terminated the 75-year lease with Six Flags in 2009 and is currently seeking to redevelop the site.

California Great America Lead JS

The rare occurrence of a theme park closing will soon happen again as Cedar Fair  (FUN) , which owns California's Great America in the heart of the Silicon Valley in Santa Clara, Calif., said on June 27 that it has sold the land beneath that theme park to San Francisco Bay Area developer Prologis for $310 million, according to a company statement.

The sale includes a lease agreement that allows Cedar Fair to operate Great America for up to 11 years and then close the park operations at the end of the lease.

California's Great America was originally developed in 1976 by Marriott Corp. to coincide with the nation's bicentennial celebration, along with its sister Great America theme park in Gurney, Ill.  Marriott's Great America in California was sold in the mid-1980s to the City of Santa Clara, and the theme park in Illinois was sold to Six Flags in 1985.

Marriott sold the park operations to Paramount Communications in 1992, the parent company of Paramount Pictures, which renamed the park Paramount's Great America. Cedar Fair bought the park from Paramount in 2006 and renamed it California's Great America.

Cedar Fair purchased the Great America land in 2019 for $150 million from Santa Clara after the State of California dissolved redevelopment agencies, which required the city to cede its ownership of the property to pay off existing debt, according to the statement. Cedar Fair had leased the property for over 40 years.

Cedar Fair said it intends to use proceeds from the land sale transaction to address its strategic priorities of reducing debt to achieve its $2 billion target, investing in high-return projects within its portfolio such as upgrading resort properties, and reinstating a sustainable unitholder distribution. 

High-Tech Firms and 49ers Surround the Theme Park

When the California theme park opened, the only developed properties in the surrounding area were the Great America theme park and a Marriott hotel. In the two decades following the opening of the theme park, Silicon Valley high-tech firms would sprout up in much of the land surrounding it.

However, a neighboring parcel in 2014 is the location of the National Football League San Francisco 49ers' Levi's Stadium. One of the Levi's Stadium parking lots is located right next to the theme park.

The 112-acre theme park has over 50 rides and attractions. Cedar Fair owns 12 theme parks, including Knott's Berry Farm in Southern California.