Paramount Murcia, official press conference confirms land option agreement

Paramount Murcia Theme Park

2011-02-07

At last a formal press conference took place today to give some concrete facts, albeit few, in relation to the proposed Paramount Theme Park development in Alhama de Murcia, Murcia.

The press conference was hosted by Jesús Samper, of Proyectos Emblemáticos, Pedro Cruz, Consejero of Culture and tourism, and Salvador Marín, Consejero de Universidades, Empresa e Investigación, business development.

This whole project has been dogged since day one by press speculation, due in the main part, to the fact that its possibilities were unveiled in the early days of its inception, rather than once the project was in a more advanced stage.

Allied with the high unemployment and construction downturn currently being faced by the region, indeed Spain as a whole, it could offer huge potential which could kickstart the regional economy, tourism and property prices  should it come to fruition, and whilst derided by opposing political groups as being merely a propaganda tool, it could conversely be a lucrative investment for those buying at the right time, hence the international interest it is attracting in what can only be described as a very bony bear property market. 

One of the biggest stumbling blocks the project is facing is the expectation that this will somehow be a miracle cure for the economic woes of the property and employment markets, and whilst it undoubtedly will provide a much needed stimulus, like all projects on this scale, will take years from inception to opening, and has to develop at a sustainable pace.

Paramount is not going to deliver a miracle cure, and it´s certainly not going to do it quickly if it does it at all, which is the point Jesús Samper was trying to make today.

In reply to press pressure, his stance was very much along the lines that a project on this scale is a long term project and the pieces have to be slowly put in place one at a time.

He talked about the projected timescale in realistic terms, from the inception of the project to this point, and then beyond.

Once having discussed the possibility of this project taking place in the region, the first stages were to assess the viability,  obtain a provisional licensing agreement, set up a company and team to move the project forward, establish the criteria for the land required and then search for a suitable location.

This was followed by a visit from the American Paramount team who´s approval is "paramount" in all of this, and then open negotiations to secure the land which best fits the economic parameters for a project of this scale.

Only once this groundwork has been completed is it possible to formulate the full project specifications and drill down the exact costs of a project with all the "what if´s" factored in and calculated correctly. 

No matter how much this project may be desired from those with a vast range of motives, this project will only attract the investment required should investors believe that it will return a profit on their investment or open other commercial avenues to their associated businesses.

So once all the building blocks have been positioned without the morter anchoring them into place, the search can then begin for the finances to move the project forward.

Sr Samper indicated that he has received approaches from a number of interested parties, but as in any business arrangement of this nature, it would be foolhardy to prejudice a potential deal by naming names too early.

So where are we now?

In today´s press conference it was confirmed officially, straight from the horses mouth , that an option has been agreed to purchase 1.716,000 square metres, which comprises 15 different adjacent fincas, currently the property of Infraestructura Terrestre S.A.; Desarrollo Antrade S.A.; Sierra de Alhama Golf Resort S.A.; Gispafruit S.L., and SAT Cancarín.

The price of the option is 15.6 million euros, is for a one year period, and should the investment not be found, then no money will change hands for the land and the option will lapse.

Sr Samper was adamant that this quantity of land was adequate for the needs of the project, "más que suficientes" he said.

He also said that there are different levels of classification on the lands, which would necessitate adjustments to be made by the Town hall of Alhama de Murcia, a process which would probably take 12 to 15 months, although the Town hall had agreed to co-operate fully and speed up the process as much as possible. 

He estimated that the park would be functioning in approximately four years time , should investors be forthcoming. 

There are plans for Paramount Executives to visit for a second time, possibly at the end of March/ beginning of April, and now that the lands have been secured the next step is to obtain the full licensing agreement from Paramount Licensing. 

Although not mentioned directly at this press conference, it has been widely quoted that 2 million euros has been paid for the provisional license, a figure which will rise to 6 million euros once the full license is granted. 

When pushed about the identity of the potential investors, Sr Samper explained that the financing of a project such as this would be complicated because so many different elements were at play, the park comprising leisure, hotel and business elements, each of which would require specific capital sums and be attractive to a specialised business, all of which would take time to piece together.

Pedro Cruz talked about projected visitor figures.

The Consejero for tourism and culture, Pedro Cruz, focused his presentation on the potential  visitor figures which the park hopes to achieve. The potential audience was calculated based on the demographic population distribution within defined radii of the projected site.

Using this method it had been calculated that within a 50km radius of the park there were 1.5 million potential visitors, within a 300km radius, 7.8 million, then 59 million within 850km or 200 million for 1700km.

It was hoped that the park could attract 4.5 million a year.

Although this was not mentioned at the press conference, universal acceptance of this potential projection could minimise criticism that the concession granted for the new Corvera airport was based on unrealistic traffic figures, as were this level of traffic to be achieved then the calculations were a clever calculation.

The risk at the moment is that they are being used as a political slingshot by the opposition party in the run -up to local elections, who say they are unrealistic and therefore the concession granted,  suspect. ( that´s politics!)

Projected figures for Corvera have been widely quoted as 1.5 million, rising to 3 million, prior to the inception of this project, so although these figures may be realistic based on attendance at other theme parks, it could be a little dangerous to be talking at this stage of 4.5 million projected visitors when this is an optimistic multiplication of current tourism visitors to the region, but if the project is to stack up as a viable return for potential investors, the figures have to be widely accepted as being reasonable and achievable.

The IU have already issued a press release this afternoon calling the project " an electoral montage", and early indications on the forums are that great care should be exercised with these projected visitor figures which could attract ridicule to the project and cast doubts on its feasability.

Whilst dedicated marketing can achieve astonishing results ( such as the last american election result) it, in turn, requires investment, and if this level of visitors is a realistic possibility, will need to have a substantial budget.

The Consejero was at pains to assure the press that the role of the Regional administration was purely as a facilitator, and that whilst supporting the project in every way possible, would be taking no active financial role in the proceedings.

Salvador Marín said that proposals would be made for the project to be declared as being of Bien de Interés Empresarial.

This official press conference today should take the heat off the speculation and now enable the project to move forward at a realistic pace, secure the license and form into a tangible product which can be presented to the world in late spring time.

Undoubtedly there will be an urgency to ensure that a viable and believable project is presented before the May elections, as already the Paramount theme park and tourism model is becoming an electoral hot potato.

As unemployment rises and discontent bubbles due to the spending cuts forced on the region by the refusal of central government to permit the region to refinance its debts, pressure will be applied to culture and tourism to pull a white rabbit out of the hat and bring the tourists flocking into the region to spend some money.

The news which emerged late today that central government is allowing Cataluña to refinance its debt will undoubtedly lead to a howl of outrage from the Region of Murcia tomorrow, and probably result in a record turnout for the next protest march against regional spending cuts.

Let´s just hope that the Paramount pied piper can bring some investors bouncing along in its wake.

Paramount Theme Park Murcia

 The full story of the project including present day status can be found by using the link to the history of the Paramount Theme Park Murcia