Theme parks can be significant sources of revenue, but before the cash can flow, the developer of a park must acquire land for the park’s construction. As most everyone knows, the land near Disney World in central Florida has proved its value as a venue for successful theme parks. One such company, Fourth Watch Acquisitions, thought it had a binding contract to purchase a tract of land adjacent to Universal’s proposed Epic Universe park. When Universal announced that it had sold the same parcel to another party, Fourth Watch Acquisitions sued Universal for interference with contract and $250 million in damages.
Before this controversy arose, Universal owned two tracts of land along Universal Boulevard, and it had previously announced plans to build the Epic Universe park on one tract. According to the complaint filed by Fourth Watch, the two parcels were unconnected, and Universal wanted to preclude any competitor from acquiring an interest in either tract by purchasing the intervening parcel.
The current controversy
Fourth Watch alleges that it entered into a binding contract with the Universal subsidiary that owned the two parcels to purchase one of the intervening parcels from Universal for $125 million. The complaint further alleges that Universal interfered in the purchase contract between Fourth Watch and Universal’s subsidiary, Universal City Property Management III.
A newsletter that covers real estate happenings near Orlando reported that Universal City Property Management sold land along Universal Boulevard to another subsidiary of Universal, SLRC Holdings, LLC in April 2018 to settle an earlier lawsuit. Fourth Watch’s complaint alleges that the property transferred in this settlement was the same tract that it had agreed to purchase for $125 million. Fourth Watch further alleges that the conveyance of this tract interfered with its ability to close on the earlier purchase agreement for the land.
Fourth Watch alleged that its plan for the disputed tract included a “multi-faceted theme park [and] a thrill-seeker’s extravaganza.” Projected usage envisioned 10 million people traveling to Orlando to visit the park. Plans also include a 2,000-room hotel. This lawsuit is likely to require years to resolve. Anyone involved in a complex lawsuit involving a multi-million dollar project may wish to schedule an early consultation with an experienced business or real estate lawyer for an evaluation of the case and advice on how to proceed.