With a burgeoning middle class and increasing influx of western visitors, the phenomenal growth of Asia’s theme parks and amusements industry shows no sign of abating, writes Adrian Lennox.

Since 2008, many of the world’s key economies have been suffering at the hands of the world financial meltdown, the like of which has not been seen since the end of the Second World War.

Struggling markets across, in particular, Europe and North America have not only led to spluttering growth in domestic theme park and attractions sectors, but have also had a negative impact on research and manufacturing output, leading to what many consider to be a damaging freeze in the industry’s future development.

However, while the term ‘global economic downturn’ is often used as a catch-all reference to the current climate, it must be noted that the malaise is not, indeed, universal. The opposite, in fact, has often been the case in key developing markets across South America and Asia, the latter of which continues to report strong growth in its amusements and attractions industry.

The ‘Goldilocks’ continent

According to the latest figures from the Themed Entertainment Association and global think-tank AECOM, the growth of Asia’s theme park, waterpark and amusement industry continues at pace.

"In 2010 Korean theme parks saw an increase of more than 10 per cent due to the influx of Chinese tourists; parks in other Asian countries benefited as well," said Chris Yoshii, global director of AECOM in the latest Global Attractions Attendance Report. "China’s growing prosperity is driving a lot of theme park development in Asia.

"The attendance increase at Disney parks in Japan and Hong Kong (800,000 and 600,000 respectively) can be attributed to three things – increased tourism from China, aggressive marketing and new attractions," said Yoshii. "Hong Kong Disney added the Autotopia ride and Stitch Encounter and is continuing with additional investment/expansion plans adding three new lands in as many years."

In China itself, the six-month Shanghai 2010 World Expo, which closed in October of that year, was the largest world fair in history, in physical size as well as attendance. The successful mega-event drew significant international participation, attracted 73 million visits and was the catalyst for major infrastructure improvements – subways, highways, airport expansion and new high speed trains.

"It was a huge investment and not many cities in the world could have done it," observed Yoshii. Commercial and residential redevelopment of the expo site is underway; some of the attractions are still open, including the exhibition centre, sports arena and China Pavilion, reportedly still drawing 10,000 people a day.

Also in Shanghai, groundbreaking has taken place for the new Disney park. "Design work is moving forward very quickly," said Yoshii, "and the hotels are also starting major construction this year. With the opening targeted for the end of 2016, it will be a very aggressive construction schedule.

"The project is creating a lot of excitement and interest. Whenever these big park operators come into a market, it stirs interest in theme parks and a lot of developers are now looking at projects in various cities. The growth of the middle class in Asia is phenomenal and will drive huge investments in theme parks in the coming decade. Ocean Park Hong Kong posted a record year in terms of attendance – 5.1 million visits.

"Ocean Park is implementing an eight-year reinvestment plan, rebuilding and expanding the park section by section. They’re adding new rides and shows and a lot of capacity. The new Aqua City area offers a fantastic aquarium experience and night-time spectacular that have extended the average length of stay by 30 minutes."

Universal Studios Singapore, which held its grand opening in May 2011, tallied more than two million visits during its nine-month soft-open period in 2010. USS is part of Resorts World Sentosa. "The resort business model is drawing a lot of interest as a way of cross-subsidising the expense of a theme park with a casino," noted Yoshii.

Waterparks in Asia are also faring well. In South Korea, Caribbean Bay at Everland posted a very good 2010 with a 20 per cent uptick in attendance. "Jakarta is emerging as a new market, with a lot of interest in waterparks as well as theme parks and indoor attractions," said Yoshii, citing redevelopment of Jaya Ancol, home to Dunia Fantasi theme park and Atlantis waterpark.

A healthy foundation

While the TEA/AECOM Global Attractions Attendance Report remains the most accurate indicator of growth across Asia, research from other bodies suggests that growth across the region is set to continue.

According to IBISWorld’s Amusement Parks in China market research, during the five years through 2012, the country’s amusement park industry experienced rapid development, growing 14.4 per cent per year on average to an estimated US$2.3bn in 2012.

China’s economy developed rapidly over this period and household disposable income levels improved dramatically. As a result, the number of people paying for leisure activities increased significantly, resulting in strong visitor growth for this industry.

There has been a steady increase in the number of amusement parks in China as households look for new and exciting ways to spend some of their leisure time and as amusement park firms get better at marketing themselves. As a result, IBISWorld said revenue for the amusement parks industry in China has been increasing over the five years through 2012 at an annualised rate of 14.4 per cent.

The top four operators account for about 13.6 per cent of total revenue in 2012 and this share is expected to increase, as visitor numbers and gate receipts for the industry’s largest amusement parks increase steadily. Fewer new players will enter the industry due to its high and increasing barriers to entry.

Looking ahead, Mickey Mouse, Hello Kitty and Lego bricks will all find new homes in Asia over the next few years as the disposable incomes of the region’s newly affluent fuel a boom in theme park construction.

Disney has broken ground on a US$3.6bn outpost in Shanghai; Legoland plans to open a park in Johor, Malaysia this year; and Sanrio will open a theme park dedicated to Hello Kitty in eastern China in 2014.

Meanwhile, Hong Kong’s two theme parks are in the throes of a US$1bn expansion to keep up with the competition. In addition, a rash of smaller, quirkier theme parks have sprouted up, including ones in China dedicated to the smartphone app Angry Birds and the online game World of Warcraft.

"Asia’s large populations are now moving up into the bottom rungs of the middle classes," said Yoshii. "There’s been a tremendous increase in discretionary spending on things like travel, which theme parks are part of."