Jonathan Litt calls on Six Flags to “monetize” its real estate

Activist shareholder’s firm Land & Buildings Investment Management acquired a 3 percent stake in amusement park operator

Land & Buildings Investment Management's Jonathan Litt (Getty, Land & Buildings Investment Management)
Land & Buildings Investment Management's Jonathan Litt (Getty, Land & Buildings Investment Management)

Activist investor Jonathan Litt’s firm Land & Buildings Investment Management, which has accumulated a 3 percent stake in Six Flags, has called on the amusement park operator to shed its real estate holdings to boost its flagging share price, the Wall Street Journal reported.

Litt said in a presentation to investors that the real estate — which he values more than its $1.7 billion market cap — can be sold or spun off and leased back to Six Flags, which runs 27 theme and water parks in North America.

Litt said in a press release there are numerous real-estate and private equity firms that would be interested in the real estate.

This isn’t the first time Litt waged a campaign to overhaul companies, including hospitality giant MGM Resorts, retail investor Taubman Centers, developer Forest City Realty Trust, Saks Fifth Avenue parent Hudson’s Bay Co., and casino real-estate owner Gaming and Leisure Properties Inc.

In 2016, MGM Resorts created MGM Growth Properties, a REIT that owned several casino resorts. This year, MGM Growth Properties was sold for $17.2 billion to VICI Properties, according to the release.

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The move could double Six Flags’ share price over the next 18 months, according to Litt.

L&B isn’t the only, or even the biggest, activist shareholder at Six Flags, according to the Journal. The company’s largest shareholder is H Partners Management —which has a seat on the board — recently agreed with Six Flags to increase its common stock stake in the amusement park operator to 19.9%.

The pandemic took its toll on the amusement park giant, which temporarily closed its parks for up to a year. Six Flags’ CEO Selim Bassoul, who took the reins at the company in late 2021, increased prices and removed discounts, believing consumers would be willing to pay more for amusement parks after having limited entertainment options since March 2020.

But the company’s shares are down more than 50% this year, and reported revenue in the period ending Oct. 2 dropped 21% from the prior year, according to WSJ. Attendance had also declined 33 percent to about 8 million visitors, with the price hikes and removal of free perks attributed to the falloff.

— Ted Glanzer