The Real Deal New York

The New York Wheel is delayed and costs have ballooned. But will the project pay off?

To break even, 3M people need to visit the wheel annually
October 31, 2017 09:50AM

Rendering of the New York Wheel (Credit: S9 Architecture/Perkins Eastman)

Construction of the New York Wheel on Staten Island has been shutdown since July. But even when completed, will the Ferris wheel ever pay off for its developers?

According to Crain’s, the wheel needs 3 million visitors each year — at $35 per person — to break even. The project’s backers have estimated that the wheel will attract an annual 4 million visitors, a figure bolstered by existing nearby attractions, like museums and the New York Yankee’ minor league stadium, as well as the under construction Empire Outlets.

But the projected cost of the wheel has ballooned to $590 million, more than twice what was initially estimated. And similar wheel projects in Beijing, Singapore, Orlando, Berlin and other cities have faced similar challenges.

“Any one-off attraction can be a very risky venture,” Robert Hunden, head of Hunden Strategic Partners of Chicago, told Crain’s. “Whether it’s the world’s largest Noah’s Ark or the world’s largest wheel, there’s just not a lot of comps out there for a developer to say: ‘Hey, this did really well in 10 other places.’”

In July, the developers fired the project’s design and build team Mammoet-Starneth, delaying the project indefinitely. The project’s developers have maintained that they expect the wheel to succeed. [Crain’s] — Kathryn Brenzel