Six Flags Inc. will start marketing its Denver property for sale this week. The city wants the site to continue as an amusement park, but some see it as a mixed-use development.
The owner of Denver's Six Flags Elitch Gardens amusement park is seeking $170 million for the 75-acre site, according to a real estate developer who has seen the offering.
Six Flags Inc., which operates 30 parks in North America, is saddled with more than $2 billion in debt and is considering selling Elitch Gardens and five other parks. It plans to send out marketing materials on the properties to interested buyers this week.
The park will be open for the season through Oct. 29. Last week, it laid off a number of entertainment workers who dressed as Looney Tunes characters.
New York-based Six Flags declined to comment on a possible sale price for Elitch Gardens.
But in a regulatory filing last week, Six Flags revealed that a recent amendment to a credit agreement gives the company permission to specifically sell Elitch Gardens and the others without a price cap. Previously, the company could sell only up to $300 million in assets.
"It's a number that is mind- boggling, but it may be worth it," said Stew Mosko of Denver's Fuller Real Estate, reacting to the $170 million price tag.
The former owners of Elitch Gardens purchased the original 67.7-acre parcel in the Central Platte Valley for $6.1 million in 1994. Several public sources helped the company finance the park's $95 million relocation from West 38th Avenue and Tennyson Street, including $10.9 million in bonds from the Denver Urban Renewal Authority and a $7 million loan from the city.
Of the DURA bond, $5.2 million is currently outstanding.
"It's a healthy project on our side of the table," said Cameron Bertron, redevelopment manager for DURA. "It makes its debt service on an annual basis and always has."
What would happen to the land if it does sell? It depends on whom you ask.
The city said it opposes a change in use at the site.
"The city invested more than $30 million in getting that property redeveloped for Elitch's," said John Huggins, Denver's director of economic development. "We're not particularly interested in having the property developed for a different use."
The property is zoned exclusively for an amusement park. A redevelopment would face substantial regulatory and environmental obstacles, Huggins said, "including additional floodplain improvements, further environmental remediation, and the property would have to be rezoned."
Mark Smith of East West Partners, which is developing nearby Riverfront Park, said he considers Elitch Gardens an "interim land use." He said he could envision a mixed-use project there with residential, commercial and retail components.
"I never thought it was the best use of that land," he said. "It could be an interesting, very close-in neighborhood."
Byron Koste, director of the real estate center at the University of Colorado at Boulder, agreed. The property is large enough to support both residential and commercial uses, he said, while another entertainment venue isn't likely to succeed.
"The (Colorado's Ocean Journey) aquarium never took off, and the amusement park has never really taken over either," he said. Ocean Journey is now Downtown Aquarium.
Developer Susan Powers said she doesn't think the site is well-suited for residential use because of the amount of traffic and noise generated by the Pepsi Center and the City Lights Pavilion concert venue.
"It feels like everything on that side of Speer Boulevard is really entertainment-oriented," she said.
Elitch's could be sold to another amusement park operator, which would please the Denver Metro Convention & Visitors Bureau. The park is the metro area's fifth-most-popular paid tourist attraction, according to market research firm Longwoods International.
"It's very popular with tourists," said bureau spokesman Rich Grant. "We'd certainly like to see it stay open."