The mountain may remain open, but is the magic gone?

After floating the plan to close Magic Mountain and sell it as real estate, Six Flags Inc. took the idea off the table last week--surprising few people on Wall Street.

The Valencia park is expected to remain open indefinitely, though it's still unclear whether the New York-based theme park operator will remain the owner.

"We believe there is greater value in the park as an operating theme park," said Wendy Goldberg, a Six Flags spokesperson. Company Chief Executive Mark Shapiro made the announcement in a conference call, saying he wanted to end speculation about the park's fate.

Analysts who studied the idea of selling off the 262-acre theme park for real estate, even in the burgeoning Santa Clarita Valley, say the numbers simply didn't add up.

The park has been open since 1961 and has become one of the pre-eminent thrill parks in the nation with 16 roller coasters. It features the Superman roller coaster, which accelerates to 100 miles per hour in under six seconds, and Goliath, which has the world's largest drop at 255 feet.

David Marsh, an analyst with Friedman Billings Ramsey & Co. Inc., said he worked closely with his firm's real estate analysts and determined that the park might be worth about $400 million, while if it was razed and sold for its pure land value it might only garner $100 million--much less than what the Six Flags would have sought.

"You would have to have a developer willing to pay $2 million an acre and then construct a residential development," Marsh said. "If it was in Malibu maybe, but not up there."

In addition, a residential development could have threatened the sale of other parks Six Flags wants to sell to reduce its $2 billion debt as part of its restructuring plan. Six Flags is marketing the parks as a package, but such a deal wouldn't make sense without Magic Mountain. Of the 30 parks operated by Six Flags, Magic Mountain is one of the largest, and the only one open year-round.

"No private equity firm is going to bid for the package without Los Angeles included," said analyst David Miller, of Sanders Morris Harris Group. "It doesn't make any sense."

That's the prevailing wisdom even though Six Flags announced last week that the Valencia park had an off year, with its attendance down 12 percent. But there has been speculation that the reports earlier this year of a possible sale may have led some people to believe that the park was already closed.

Six Flags officials now say they plan to market the park more aggressively, offer season discounts and enter into a series of partnerships to counteract the decline.

"They had a down year, but it's a good operation," Miller said.

Meanwhile, officials in the city of Santa Clarita, which abuts the park, reacted favorably to the news that the park will not be sold for real estate. The city has maintained that the park is a key draw and economic driver for the valley.

"We value the relationship we have with Six Flags," said Gail Ortiz, the city's spokeswoman. "It's a huge partnership for us."

The sentiment was offered despite a recent plan offered by City Manager Ken Pulskamp to consider changing the name of Magic Mountain Parkway, one of the roads that leads both into the park and the city from the Golden State (5) Freeway.

City auto dealers are pushing to have the thoroughfare renamed Auto Center Parkway. But Ortiz said the name would remain the same on the west side of the freeway where Magic Mountain is located and the city has no jurisdiction.

Roller Coaster Ride

Magic Mountain is heaven for coaster fanatics, but the number of visitors has declined.

* Acres: 262

* Year Opened: 1961

* Admission Price: $59.99 adult; $29.99 children

* Attendance: Exceeds 2 million annually but fell 12 percent during key June through December period

* Number of Roller Coasters: 14 steel, two wooden

* Featured Attractions: Tatsu floorless mega-coaster; Batman ride with zero gravity; Colossus, the tallest and fastest wooden coaster in the West; Superman roller coaster, accelerates from zero to 100 miles per hour in under six seconds; Goliath, with the world's largest drop at 255 feet.

By EMILY BRYSON YORK

Staff Reporter