If every city has one of these, what’s the value of one of these?
A few years back it seemed every city and its brother wanted to build a giant ferris wheel.
Inspired by successful projects like the London Eye, cities across the world have been lining up to build these now-ubiquitous amusement rides to such an extent, The Atlantic’s Citylab posited the question: What happens when every city has a giant ferris wheel?
It’s a good question.
As more and more cities build these moving observation platforms, will their attraction value decrease? Will we see more of these systems fall into receivership, such as the Singapore Flyer or the Wheel of Brisbane? Or will investment continue apace?
My guess is that you’ll see a combination of scenarios.
Giant Ferris Wheels are clearly experiencing a trend—and like all trends, there will be three groups of investors trying to capitalize on it.
Firstly, there will be the first movers who can capitalize upon the prime markets of the world and establish themselves as market leaders. Think the London Eye, the Las Vegas High Roller and Staten Island’s New York Wheel.
There will be second movers who capitalize upon mid-tier markets who realize a nice profit but nothing compared to what the movers in markets like London and Las Vegas experience.
And lastly there will be a fair share of bandwagon jumpers more interested in riding the wave instead of understanding the wave. These people will build in whatever market is available to them and will likely find themselves holding onto a large piece of metal that has almost no chance of return on investment.
Why is that? Simple—tourists get bored easily. The tourist class are always on the hunt for the new, the unique, and the authentic. And if we accept that assumption as true, then for every additional ferris wheel that’s built, the less enticing every other ferris wheel on the planet becomes. That’s how trends work. The more you see of it, the less you want it.
I, like millions of others, would be more than happy to drop a few pounds on the London Eye. The Singapore Flyer? Not so much. Why? Because the London Eye was first. It was the original. It’s iconic. The Singapore Flyer is an also-ran and a copycat. Is that logical? Not even remotely, and that’s the point—logic doesn’t fit into the equation here.
Witness the world-record setting High Roller ferris wheel in Las Vegas. It is an original and is about as sure a bet as one can find in this gambling mecca. But did you know about that other ferris wheel? The Skyvue? The one that’s also located in Las Vegas?
Yeah, that one stopped construction a couple of years back and, if reports are to be believed, is dead on arrival. That didn’t stop a third consortia, however, from proposing a third ferris wheel for Las Vegas despite having virtually no chance of ever getting the necessary permits.
Because no city requires three ferris wheels because no tourist cares about three ferris wheels. No city requires two. In fact, most large geographic regions barely require one.
Once you’ve seen one ferris wheel, you’ve kind of seen them all. Sure the view is a bit different in each one, but only to a limited extent. That thrill wears off rather quick and only the most iconic of systems with the most iconic of views will be profitable in the long term.
So how does that relate to cable cars, you might ask?
We’ll deal with that question next week.