This article is from the Australian Property Journal archive
ARDENT Leisure has flagged the potential development of land next to its Dreamworld theme park as it looks to reverse a slump in returns following the fatal tragedy at the park last year.
The group announced yesterday that it had initiated a review earlier this year of its 2015 master plan for the Dreamworld precinct, saying it is “located on prime real estate adjacent to the new Coomera town centre and core infrastructure”.
“As part of this review Ardent has appointed a town planner to assess the feasibility of rezoning parts of the precinct,” Ardent said.
Its landholding covers a total of around 60 hectares, with Dreamworld taking up only 35 hectares – leaving around 25 hectares offeringpotential significant value upside.
“Ardent has, and will continue to, engage with third party developers to discuss potential development opportunities and timing for any redevelopment within the precinct,”
Ardent said the review is considering “(i) the impact of recent events at Dreamworld; (ii) the feasibility of rezoning parts of the site for alternate uses; and (iii) analysis of the existing Dreamworld footprint to identify potential opportunities for unlocking value.
“Notwithstanding the review of the Master Plan, Ardent will continue to invest in Dreamworld to facilitate its recovery and ensure it remains one of the Gold Coast’s key tourist attractions.”
At the end of the March quarter, its theme parks business recorded unaudited revenues of $3.1 million, down 34.3% over the year, and at its monthly update earlier in May said the division would lose as much as $4 million over the full financial year.
Ardent said the Gold Coast had experienced a 159% increase in total rainfall in the month of March, which had impacted the general recovery trend since the Dreamworld accident on the Thunder River Rapids ride that claimed four lives in October last year.
Ardent closed the site for 45 days following the incident and incurred a loss of $49.4 million from $95.2 million in reported costs as a result.
As recently as February, outgoing chief executive officer Deborah Thomas dismissed the prospect of residential use for the extra land surrounding the park.
“At the moment the zoning is parks and entertainment. Obviously, different zoning such as residential and commercial could increase that value quite significantly, but at the moment, the highest and best use is certainly as a theme park,” she said following the announcement of the group’s interim results.
Thomas will be moving into a new role as chief customer officer and chief operating officer (Australasia) after two years in the position, to be replaced by former Nine Entertainment chief operating officer and chief financial officer Simon Kelly from July 1st.
As part of yesterday’s ASX announcement, Ardent revealed that two activist investors had challenged for board positions in recent weeks.
Dr Gary Weiss and Kevin Seymour, directors of Ariadne Australia Ltd and Kayaal Pty Ltd that together have a 7.9% stake in Ardent, approached the group about being appointed to Ardent’s boards.
“The Ardent Board has not formed any view with respect to this request. Ardent has established a process to consider the request and has invited the proposed nominees to meet with the board to, amongst other topics, outline their views with respect to Ardent’s strategy. That meeting has not yet taken place,” Ardent said.
Ardent also announced it had engaged management consulting firm L.E.K. to undertake a review of its Main Event business model and strategy, as it considers appointing up to two US-based non-executive directors to its board given the success of the America-based operations.
It said the review was initiated “with the objective of ensuring the business is best positioned for ongoing growth and operational excellence in areas including customer acquisition, customer experience, roll-out strategy, site selection, procurement and technology”.
Australian Property Journal
