Our Attraction Development and Operating Business Model
Currently, Sim Leisure’s business model involves us working with landowners/developers positioning the ESCAPE Park as an integral part of their overall offering and fully funding the project capital investment. This business collaboration works best where it forms part of an integrated resort and/or residential development, where ESCAPE Park becomes a 'catalyst' and destination ‘crowd-puller’.
Sim Leisure designs, builds, and operates the ESCAPE park with a required capex ranging from RM20m - RM50m, land size between 20 - 100 acres and minimum lease period of 30 years, depending on the location and the size of the local population/tourists arrival.
In return for the landowner/developer funding the initial upfront (one-time) capex investment, Sim Leisure will guarantee to pay the landowner/developer:
- 10% of the gross turnover (all revenue including F&B, lockers, retails, photos, other services within the park) or
- 10% of the capex per annum; whichever is higher.
In addition to the 10% contribution stated above, Sim Leisure will also reserve a minimum of 5% of the Gross Turnover (GTO) annually towards future capex over the life of the project.
The 5% GTO reinvestment is to ensure the park continues to expand and grow with ongoing new attractions.
In short, the landowner/developer funds a one-time capex investment with subsequent phases of the development self-funded by Sim Leisure through the 5% GTO.
Through this collaborative approach the landowner/developer can avoid the pitfalls of very heavy upfront capex investments for roller coaster theme parks (typically 10x more the capex than ESCAPE Parks) and investing in attractions which are not core to their business and most likely will fail, as has been shown with many such projects throughout Asia.
Sim Leisure’s collaboration method enables landowners/developers to tap into the growing trend of nature-based adventure self-directed play, which has been further accelerated by COVID-19 and is on-trend with the millennial generation and offers a guaranteed return on investment.