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Will New Thrill Ride Top Kong?

If the past is any indication of the future, Universal Studios — and the tourism industry that depends on it — can expect a thrilling summer with the opening next month of “Transformers: The Ride 3D.” Observers say the new ride, which has an estimated price tag of at least $50 million, should give a substantial boost to ticket sales. Universal Studios Hollywood could see attendance soar by 15 to 20 percent, if not more, they say. The challenge will be to top “King Kong 360 3-D”, which catapulted ticket sales at Universal by 26 percent when it opened in 2010. As with King Kong, Universal is going all out. “‘Transformers: The Ride 3D’ will set the bar for unparalleled, immersive themed rides,” said Universal spokeswoman Audrey Eig. “And we have developed the marketing campaign to have equally unparalleled impact for this blockbuster franchise attraction.” The company declined to say how much Universal is spending to promote the new attraction. The ride features 2,000 feet of track running 60 feet high; 14 immense 3D screens promise to envelope guests in an alternative reality that, according to Universal, will leave “guests hard-pressed to discern what’s real and what’s 3D media.” Universal partnered with Transformers director Michael Bay, the Oscar-winning special effects team Industrial Light & Magic, and toy creator Hasbro to create the attraction. The investment in new rides and attractions comes as the theme park business is trying to recover from a global economic slump, which hit Universal hard in 2009. Attendance at the park dropped 6 percent that year to 4.3 million, according to data compiled by the Themed Entertainment Association, which represents theme park ride creators and developers, and the global consulting firm AECOM. The new rides, starting with King Kong, have helped reverse the slide and prove that so-called “e-ticket” attractions can lure visitors despite the sluggish recovery. “Reinvestment in significant e-ticket rides and attractions is probably the most important driver of attendance in any theme park,” said Christian Aaen, partner with Entertainment & Culture Advisors (ECA), a theme park and entertainment advisory firm in Beverly Hills. “These major rides and attractions can have a significant impact on attendance of 10-15 percent or more.” New rides King Kong 360 3-D raised attendance by 26 percent to 5.04 million in 2010, making Universal Hollywood the fastest growing park that year behind only Islands of Adventure at Universal Orlando, according to Themed Entertainment Association/ AECOM. King Kong helped Universal Studios Hollywood break into the top 10 domestic theme parks in 2010. Islands of Adventure, meanwhile, saw attendance shoot up by 1.7 million people to 5.9 million – a whopping 30 percent increase in 2010 — after the opening of the “Wizarding World of Harry Potter”. These numbers show what an entertainment juggernaut like the Harry Potter franchise can do for a park. So one can imagine that Transformers will set the stage for potentially even bigger gains at Universal Studios in 2016, when the installation of the “Wizarding World of Harry Potter” debuts. The three Michael Bay Transformers movies combined took in $2.5 billion to date, according to Universal, making it the seventh largest film franchise globally. It ranks behind Harry Potter, with estimated revenues of more than $7 billion. Still, Transformers is popular with the all-important tween boy audiences that account for much of the thrill ride business. The franchise also has national and international appeal, so the new ride should help spill over into the larger tourism market, resulting in higher hotel occupancy rates — at least at nearby facilities such as the 483-room Hilton Los Angeles/ Universal City and the 451-bed Sheraton Universal. “We expect the new Transformers attraction to continue to drive attention to our destination here on the hill,” said Mark Davis, assistant general manager of Hilton Los Angeles/ Universal City. “This will definitely be the shot of adrenaline we are all looking forward to.” The boost would add to what’s already been a solid year for San Fernando Valley hotels. Despite the sluggish recovery, the valley’s hotels achieved a 71.1 percent occupancy rate last year, the highest in four years, and an average daily room rate of $103.59, according to the Los Angeles Convention and Visitors Bureau. So far in 2012, Valley hotels are reporting a 4.8 percent growth in rooms sold, compared to the same time last year, and a 2 percent increase in room rates. PKF Consulting expected the Los Angeles North region, which includes the Valley, Valencia, Santa Clarita, and the Antelope Valley, to have a 2 percent increase in occupancy rates and a 10 percent increase in room rates. Coming soon Tourism is likely to spike again when the “Wizarding World of Harry Potter” opens in 2016. “Transformers appears to be the lead-up to the bigger investment with Harry Potter,” Aaen said. That investment — expected to cost “several hundred million dollars” — could boost attendance even more significantly, he said, potentially as much as 30 percent, as happened in Orlando. That ride is also expected to produce some 3,400 construction jobs in the next four years as well as 600 permanent jobs. With the addition of these new rides, theme park executives seem to have recognized the critical importance of offering attendees new thrills with a fair amount of frequency, said Gene Jeffers, executive director of the Burbank-based Themed Entertainment Association. “I think they feel the investment in new attractions is paying off,” Jeffers said. “With Transformers, they are continuing the momentum.” The numbers certainly reflect that. After falling by .2 percent to 185.6 million, total attendance at the top 25 theme parks globally began to reverse in 2010, increasing 1.9 percent to 189.1 million. Universal saw revenues inch up in 2010. GE, which had a 49 percent stake in NBC Universal until the division was sold to Comcast Corp. late last year, reported record operating profits in its theme park business in the third quarter of 2010. Operating profits during that quarter were up 59 percent from the same period in 2009, due in large part to soaring attendance at the new Harry Potter attraction in Orlando. Comcast Corp. does not break out the theme park revenues. Transformers promises to combine the visual excitement of 3D with the physical thrill of the ride system ushered in by “The Amazing Adventures of Spider-Man” in Orlando. Universal embarked on two Transformers installations, one in Singapore, which opened in December, and the other in Hollywood. The Hollywood installation required the theme park to shuffle around some attractions. The company removed its Backdraft and Special Effects stages in 2010 to make way for Transformers. Backdraft closed and Special Effects has been relocated to the Upper Lot.

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