With so much that still needs to be rebuilt in New Orleans, the tragedy of Katrina is hard for some to put behind. A quick drive through some parts of the area and you’d think the hurricane hit last year, not 2005. Rebuilding a financially-strapped area is tough; understandably the last to receive aid and insurance claims would be the private recreation industry.
Mired in legal battles with the insurance carriers and the city of New Orleans, Six Flags has indicated they don’t intend to rebuild the theme park. The cost to do so was prohibitive, as was the cost of demolition. While the park may never re-open, it does provide for an amazing photographic tour.
In 2002, Six Flags signed a 75-year lease with the City of New Orleans for the property. It was almost a turn-key operation for Six Flags; the park had previously opened in 2000 as “Jazzland”, operated by Alfa Smartparks.
Two years later, financial problems overcame Alfa and Six Flags assumed the lease.
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When Katrina hit in 2005, the failed levees left the entire park submerged under 4-7 feet of standing floodwater for weeks.
Understandably not a priority for recovery crews, Six Flags wasn’t drained for nearly a month. By the time crews could drain the water, engineers reported over 80% of all structures were a total loss.
Only one attraction – Batman: The Ride – was salvageable, and in 2008 it was moved to the Six Flags in San Antonio and re-badged “Goliath.” Six Flags estimated Katrina caused $32.5 million in damage, but to date insurance carriers have only paid out $11.5 million.
It is doubtful Six Flags would have rebuilt the park even if the entire insurance claim had been paid; the location had been a loss-leader for the Six Flags Corporation for years.
In the eyes of some shareholders, Katrina euthanized the park for management.
Struggle with New Orleans
Following Katrina in 2005, Six Flags stopped making lease payments while they were waiting for the expected ‘total loss’ insurance settlement.
By 2009 Six Flags had yet to recover their full insurance claims and were still neglecting their financial obligations to the city.
New Orleans started to apply pressure over the lease agreement prompting Six Flags to try and formally break the lease, citing “irrecoverable damages and financial loss.”
New Orleans, hurting for money themselves, were not going to let Six Flags off easy; they were fined $3 million dollars for prior obligations and as a settlement for breaking the lease.
New Orleans did try to offer incentives to other amusement park companies in an effort to re-develop the area.
There was a proposal to build a Nickelodeon-branded water park in 2009, but this fell through when the supposed bond offering by the city (and intended to fund the project) failed to materialize.
The park’s exit signs: 2006 & 2009
In 2008 Southern Star Amusement, Inc. proposed to take over the park with aggressive plans to expand it to over 60 rides. Southern Star was even going to construct an RV park next door to what was to be called “Legend City Adventure Park.”
During this time, Six Flags had been quietly pulling recoverable equipment from the site without doing demolition; “looting” their own property for what could be re-appropriated.
The removal of everything of value also removed any appeal to suitors to purchase and restore the park. By late 2008 the theme park had been looted and vandalized beyond the point of repair; Southern Star pulled all plans and bowed-out of the bidding process.
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New Orleans was unhappy Six Flags wasn’t honoring its financial obligations, and when they discovered Six Flags was pilfering the site prior to insurance settlement – the city had enough.
A cease and desist mandate was given to Six Flags, with New Orleans reminding them they signed a lease; legally when payments of debt are not made, all associated property on the land belongs to the city.
Hoping to recoup some of their investment, Southern Star Amusement also sent requests to Six Flags for a return of the various equipment removed after Katrina.
Coaxing from the city of New Orleans brought Southern Star Amusement back as possible suitors in 2009, albeit with much smaller plans for the park.
Instead of expanding the park with a $50 million, 60-ride build-out, Southern Star reduced plans to a mere renovation.
What Does the Future Hold?
Today, the delays surround funding. There were suggestions to offer Go Zone bonds to raise the $35 million just needed to re-open the park with basic improvements, but these have been unpopular so far in legislature.
In 2011 Southern Star Amusement officially released its letter of intent for the site, and the draft for a 75-year lease is currently being reviewed. In the meantime cleanup and demolition around the site has begun in earnest.
It’s unclear if the cleanup is due to the efforts of the city, Six Flags, or Southern Star, since responsibility for care of the land has been debated since Katrina.
According to Six Flags the east New Orleans site is not ideal for a theme park, a comment likely grounded in their experience being unable to see reasonable profit at the location over time.
If the profitability fears are true, Southern Star Amusement just might have their work cut out for them.