The U.S. theme park sector and its surrounding hospitality industry are grappling with declining attendance and reduced hotel bookings, driven by economic strain and unfavorable weather conditions. Middle- and lower-income guests have been most affected, altering their travel behavior and opting for shorter visits or skipping overnight stays altogether. While major destination resorts like Disney and Universal continue to draw consistent crowds, regional parks and nearby lodging facilities are experiencing financial pressure. n nSix Flags Entertainment CEO Richard Zimmerman highlighted a notable drop in attendance during the first half of the year, citing weaker sales and renewals of season and single-day passes. External data from Consumer Edge supports this, showing a 5% year-over-year decline in overall spending at U.S. theme parks. Economic uncertainty has led cost-conscious consumers to reevaluate discretionary spending, particularly on multi-day trips that include accommodations. n nHotels located near regional attractions are feeling the impact. David Sangree, president of Hotel & Leisure Advisors, noted that many guests who previously booked overnight stays are now choosing day trips. Cell phone mobility data confirms reduced foot traffic across several regional parks. In response, some operators, including Great Wolf Lodge, have removed resort fees to boost appeal. However, such tactics may have limited success if broader economic conditions persist. n nHersheypark in Pennsylvania exemplifies these trends. Elias Thompson of the Shaner Hotel Group reported lower summer bookings, linked to reduced regional travel. Although the park offers additional amenities, the typical surge in local hotel demand did not materialize this year. Guests are favoring shorter visits, reflecting a shift in consumer priorities amid rising costs. n nIn contrast, large-scale destination parks in Orlando remain resilient. Walt Disney World and Universal Studios benefit from year-round appeal and international draw. The upcoming launch of Universal’s Epic Universe in May is expected to further stimulate demand. Despite initial slow momentum, new hotel developments in the area have not compromised occupancy rates, signaling sustained visitor interest. n nChantal Wu from CoStar explained that Disney tends to attract families with young children, while Universal appeals more to older kids and adults. New attractions have expanded overall market engagement rather than diverting it. n nLuxury accommodations continue to perform well, with high-income travelers maintaining spending on premium experiences. In Orlando, revenue per available room (RevPAR) has grown due to higher average daily rates. Universal’s variable pricing model for tickets helps regulate attendance while optimizing income. n nMiddle-class households, however, face tighter budgets, making them more sensitive to price increases. Meanwhile, top-tier hotels keep pushing rate limits, indicating a bifurcated market. n nAs economic and climatic factors reshape consumer behavior, regional parks and associated hotels must adapt. Major destinations demonstrate durability through scale and diversified offerings, but smaller players may need innovative strategies to remain competitive. Balancing affordability with profitability will be key for the industry moving forward. n— news from Hotel News Resource
— News Original —nU.S. Theme Parks Face Economic Roller Coaster: Attendance and Hotel Stays Decline n nThe U.S. theme park industry, along with the surrounding hospitality sector, is experiencing a downturn in demand. This decline is attributed to economic uncertainties and weather-related disruptions, which have particularly affected middle- and lower-income visitors. While major destination parks, such as Disney and Universal, have shown resilience, regional parks and their associated hotels are feeling the financial pinch. n nDecline in Theme Park Attendance n nDuring a recent earnings call, Six Flags Entertainment CEO Richard Zimmerman reported a significant drop in attendance during the first half of the year. The decline was attributed to lower renewal rates and sales of season and single-day passes, which were influenced by extreme weather and economic uncertainty. This trend is mirrored in data from Consumer Edge, which noted a 5% decrease in overall spending at U.S. theme parks year-over-year. The economic pressures have made lower- and middle-income visitors more cautious with their spending, while wealthier guests continue to spend at high-end parks. n nImpact on Regional Parks and Hotels n nThe downturn in theme park attendance is a concern for the hotel industry, particularly for properties near regional parks. David Sangree, president of Hotel & Leisure Advisors, highlighted that many visitors who might have stayed overnight are now opting for day trips. Anonymized cell phone data supports the observation of declining attendance across various parks. The rising costs of park visits are also a contributing factor. n nIn response, some parks, like Great Wolf Lodge, have eliminated resort fees to attract visitors, although this strategy has its challenges. The economic pressures faced by consumers may limit the effectiveness of such measures. n nCase Study: Hersheypark n nHersheypark in Pennsylvania serves as an example of how regional parks are affected. Elias Thompson of the Shaner Hotel Group noted a dip in bookings this summer, attributing it to a decrease in travel to the market. While Hersheypark offers attractions beyond the park itself, the usual compression effect on the local hotel market was less pronounced this year. Shaner’s hotels near Hersheypark observed changes in visitor patterns, with guests opting for shorter stays or day visits instead of overnight trips. n nDestination Parks Maintain Resilience n nIn contrast, major destination parks like Walt Disney World and Universal Studios in Orlando have shown resilience. These parks benefit from a lack of seasonality and continue to attract visitors year-round. The opening of Universal’s Epic Universe park in May has driven demand in the Orlando area, despite initial slow growth. The addition of new hotel rooms has not adversely affected occupancy rates, indicating sustained interest. n nChantal Wu from CoStar noted that Disney and Universal cater to different demographics, with Disney appealing more to families with younger children and Universal attracting older children and adults. The introduction of new attractions has not cannibalized demand but rather increased overall market interest. n nEconomic Pressures and Pricing Strategies n nDespite the challenges, the upper-tier hotel market remains robust, with wealthy visitors continuing to spend on luxury experiences. The Orlando market, for instance, has seen growth in revenue per available room (RevPAR) due to increased average daily rates. Universal’s dynamic pricing strategy for admission tickets helps manage visitor numbers and maximize revenue. n nThe economic pressures are more pronounced among middle-class visitors, who are feeling the financial squeeze. However, the luxury segment appears less affected, with high-end hotels continuing to push rate ceilings. n nConclusion n nThe current economic climate and weather disruptions have significantly impacted U.S. theme parks and their associated hospitality sectors. While regional parks and hotels are experiencing a decline in demand, major destination parks, such as Disney and Universal, remain resilient. The industry faces challenges in balancing pricing strategies and maintaining visitor interest amid economic uncertainties. As the year progresses, theme parks and hotels will need to adapt to these changing dynamics to sustain their operations and attract a diverse range of visitors.