As the number of theme parks in Asia rise, Asian Property Review examines its impact on the surrounding properties.
In 2017, a study in America concluded that there are no direct correlation between prices of real estate and a nearby theme park. Neighbourhood protests were held to protest against the building of a Legoland theme park in the vicinity of the neighbourhood of Goshen’s Arcadia Hills in New
York. The protesters were arguing that the building of a theme park would cause traffic congestion, noise and air pollution, harm flora and fauna, ruin the town’s character, overburden emergency services and bring undesirable crowds to the neighbourhood.
On the other hand, New York’s Orange County Office of Real Property Tax Service released a report claiming that the property values of neighbours of Legoland would increase if a park was built. But the report was based on the recent rising prices of residences that have been in the vicinity of
theme parks in Florida and New York City for decades.
NO EMPIRICAL STUDIES?
“Existing research has found insufficient evidence to conclude that the building of a theme park would decrease values of surrounding properties,” says the study. The report was however based on the effect of sports stadiums, not theme parks, as very few theme parks were built after 1990s.
In what is considered the biggest market for theme parks, China’s tourism estate industry, although emerging in the 1990s, has also not been empirically examined. Such tourism real estate is characterized by the development of largescale tourism resources (e.g. resorts and theme parks) along with residential properties, under the assumption that they would increase property value. “However, the effects of such “built” tourism resources on housing value have not been empirically examined,” says a report.
There is an attempt though to find out the impact – a pricing model was built using a sample of 294 real estate transactions in the Overseas Chinese Town area of
Shenzhen, China in 2015. Findings indicated that while distance to the metro and the architectural features of the property itself had significant positive effects on tourism real estate value, distance to theme parks was found to have a negative effect on price.
As the constructions of theme parks alongside residential/vacation properties represent a typical model of tourism real estate, the findings urge the industry to reconsider the development of theme parks and its impact on the surrounding environment.