Friday morning, a new and exciting chapter begins at Six Flags (NYSE:PKS). Guests will check into the Six Flags Great Escape Lodge for the very first time, in a move that may eventually be replicated throughout the chain.
Located in Queensbury, N.Y., on the foothills of the Adirondack Mountains, the woodsy-themed lodge features 200 suites and a 38,000-acre indoor water park. The resort is situated near the company's Great Escape, but unlike the modest regional amusement park, the lodge will be open year-round.
With plans to open an upscale hotel at Six Flags Great Adventure -- a much larger park that could certainly use a hotel property, given the scarcity of nearby lodging -- Six Flags is finally starting to take advantage of its thrill-park destinations by cashing in on park guests on both sides of the turnstile.
This wasn't an initiative of the new regime at Six Flags. Dan Snyder and new CEO Mark Shapiro inherited the property as one of the few things that Kieran Burke did right in his final years at the chain's helm.
Adjacent indoor water parks have become a hot trend for park operators. Cedar Fair (NYSE:FUN) opened Castaway Bay at Cedar Point 15 months ago, and CBS (NYSE:CBS) has teamed up with niche leader Great Wolf Resorts (NASDAQ:WOLF) to open another one at its Kings Island park later this year.
So Six Flags will have to do more than just build family-friendly hotels -- or eventually contract with a Great Wolf or Kalahari to bankroll the projects -- to stand out in a crowd. Shapiro has spent the past few weeks visiting the various Six Flags amusement parks. He knows what he's doing. He's been taking area media along, to get word out to local communities that Six Flags is planning some serious improvements to its parks and its customer service.
That's an important move. After Six Flags hiked ticket and parking prices in the offseason, guests will need motivation to return to the park in 2006. The park is positioning itself to make more money with fewer guests this year, though I'm guessing that Six Flags would like to have its cake and eat it too. Shapiro isn't interfering with any new ride installations, but he's placed greater emphasis on beefing up concessions and park entertainment.
A simple initiative, like a dramatic increase in the number of costumed characters, may not seem like much on the surface. But if it means happier kids and more snapshot keepsakes, it's a blessing. Six Flags' publicity for moves like initiating smoke-free policies and hiring full-time bathroom attendants is no accident. These strategic shifts that will help grow the number of young families at the park. Shapiro and Snyder covet the demographic; young families are likely to spend far more at the park than a penny-pinching teen maxing out his seasonal pass with dozens of fruitless visits.
The hotels will also come in handy for drawing families in. So here's hoping that those checking in to the Six Flags Great Escape Lodge get a good night's sleep tonight. They may feel fortunate to be breaking in a brand-new resort, but it's bigger than that. Those guests are actually planting the seeds of what may be the mother of all turnarounds at the debt-bound operator.
Cedar Fair became a Motley Fool Income Investor newsletter recommendation last year, given the company's smooth performance and uninterrupted track record of annual payout hikes. For more stocks with dizzying dividend potential, sign up for a free 30-day trial.
Longtime Fool contributor Rick Munarriz enjoys taking his family on coaster treks over the summer. He has a few Six Flags parks on his itinerary -- and a stint at the new lodge -- but it's written in pencil until he sees Shapiro's true colors. He owns shares in Great Wolf and units in Cedar Fair. T he Fool has a disclosure policy. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.
