It makes sense on paper: Regional park operator Cedar Fair (NYSE:FUN) is tearing down most of its struggling Geauga Lake amusement park on the outskirts of Cleveland. The gated attraction will transform into a smaller, stand-alone waterpark for the 2008 season.

The park has been a mess since Cedar Fair acquired it from Six Flags (NYSE:SIX) three years ago. Its star attraction was its 30-acre waterpark; narrowing its focus to that watery oasis will free up hundreds of acres that Cedar Fair can cash out to developers or build out on its own.

If this sounds good to you, it's probably a swimsuit wedgie cutting off circulation to your brain as you come off the torpedo slide. This is a lousy move. It's also likely a transitory step, letting Cedar Fair prepare to sell what's left of the park before it has little choice but to close it down completely.

Cedar Fair might not realize that just yet -- but it will.

The fall and further fall of Geauga Lake
Cedar Fair was dealt a bad hand, and played it poorly. It knew it was getting distressed goods when it bought Six Flags' Worlds of Adventure amusement park in 2004 for $145 million. The new park was too much for Six Flags to handle -- sadistically close to the Cedar Point thrill haven, and an unwieldy combination of the Geauga Lake traditional amusement park with Anheuser-Busch's (NYSE:BUD) Sea World Ohio marine life park.

Cedar Fair got rid of the sea life attractions right away. Then it began to pick away at the attractions, shipping them out to needy parks in its growing chain of destinations. Many of the remaining coasters and flat rides will work their way through the Cedar Fair parks, but don't expect too much from what stays behind come 2008. If Cedar Fair couldn't get folks through its turnstiles when the park was loaded with attractions, no one's expecting it do more with less next year.

Normally, that wouldn't be a problem. Waterparks have shorter operating seasons, but they're also not as capital-intensive as conventional thrill parks. Unfortunately, waterparks also draw from a tighter geographic range. That's going to sting, because the locals can't be too happy over the dismantling of their beloved 119-year old Geauga Lake park.

Cedar Fair knows that its image will take a hit over this. Why else would it announce this at the end of the season? It could have milked a welcome bump in traffic by giving locals one last season to enjoy the rides. Sure, an early announcement would have been a human-resources disaster, with even the part-time help giving up on the park. Still, this appears to be a shifty, end-of-the-season move done to keep in-park protests to a minimum.

The company shouldn't have to worry about such protests next year -- it'll be lucky to find anyone in the park at all, given the kind of venom the locals are currently spewing:

Cedar Fair had to discount its park admissions, and it still couldn't win back the patrons who faulted the operator for pouring out its ocean critters. Those folks certainly aren't coming back now, and I'm wondering whether that anti-Cedar Fair sentiment will drift 80 miles westward to the company's flagship Cedar Point amusement park.

That seems unlikely, even if three years of flat attendance make Cedar Point appear vulnerable.

Cedar Fair is all wet
Cedar Fair knew it was in for a losing battle at Geauga Lake from the beginning with. It failed to invest in marquee attractions over the past four seasons, no doubt fearing they would cannibalize Cedar Point's turnstile clicks.

That's no way to run a park, though. Even Disney (NYSE:DIS) would rot on the vine if it didn't refresh its parks from time to time with new thrills and attractions. Islands of Adventure -- the state-of-the-art park in Florida owned by General Electric (NYSE:GE) and Blackstone (NYSE:BX) -- has seen attendance fall sharply in recent years amid a dearth of notable additions. Even a park that panders to nostalgia like Geauga Lake can't get by on yesterday's rides alone.

Maybe Geauga Lake is cursed. Maybe Six Flags simply moved the headstones -- and not the bodies -- before handing it over to Cedar Fair. In the end, it was just never given a chance to shine.

Even in Ohio's depressed real estate market, Cedar Fair stands to make a good chunk of its initial investment back in land sales. Distributing the dismantled rides will give it a cost-effective way to refresh its remaining regional amusement parks. On paper, it looks good. In reality Cedar Fair's reputation -- like Geauga Lake itself, come late May of next year -- is all wet.

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