The revival of an amusement park flooded by Hurricane Katrina has suffered a setback after the cable television network Nickelodeon said it has ended its relationship with a Louisiana company trying to redevelop the abandoned site in eastern New Orleans.
Nickelodeon said Monday it had nixed a licensing agreement with Southern Star Amusement Inc., a Baton Rouge company that hopes to get $100 million in Gulf Opportunity Zone bonds to reopen the shuttered site. The announcement threw into doubt the site's future.
The amusement park is located on city-owned land on the eastern edge of New Orleans, an area bounded by swamps and marsh that was flooded badly when levees broke after Katrina hit in 2005. Eastern New Orleans' recovery has lagged behind other parts of the city.
When Katrina hit, the park was operated by Six Flags Inc. After the storm, Six Flags decided not to reopen. In June, Six Flags filed for Chapter 11 bankruptcy protection, saying it had $2.4 billion debt.
Danny Rogers, the president of Southern Star Amusement, was adamant Tuesday that his startup company would find the financing without Nickelodeon, which is owned by media giant Viacom Inc.
"They're not the only fish in the sea," Rogers said.
The idea was to make it a Nickelodeon-themed park, but Rogers said Southern Star might be able to find a new partner to lend their brand name to draw visitors to the park.
Rogers said the redevelopment has been hampered by Six Flags' slow bankruptcy proceedings and the difficult economic climate.
James Richardson, an economist at Louisiana State University, said the theme park faced a number of obstacles _ from tight credit markets to the slow growth of New Orleans east.
"It's going to take all the stars to line up very perfectly for (the park) to take off," Richardson said.
Despite the obstacles, Rogers said New Orleans east was the "perfect place" for the theme park because it was located next to Interstate 10 in a quiet section of New Orleans and it had no competition. He said the closest equivalent amusement parks were in Georgia, Florida and Texas.
As for the flood threat, Richardson said Southern Star wants to build a floodwall around the site to protect it.
Southern Star envisions using $100 million in Go Zone bonds, which were set aside for rebuilding along the Gulf Coast following the 2005 hurricanes, and up to $60 million in other financing to fix the park's buildings and rides and add new attractions.