Dubai startup aims to disrupt Mena theme park sector

Supplied/HyperSpace

• Old format theme parks to be joined by ‘new garde’ of entertainment
• Venues feature tech-enabled content creation for gamers and Gen Zs
• 100,000sq ft House of Hype to open in Dubai Mall this year 

Traditional, ride-based theme parks are being challenged by Dubai-based startup HyperSpace’s “physical parks for a digital world”, including AYA and House of Hype. 

HyperSpace opened the 40,000sq ft AYA, a digitally immersive experience park with interactive gardens, observatories and other spaces in Dubai’s Wafi Mall in December, bringing a metaverse dimension to the emirate’s entertainment offering.

It plans to open its second venue, the 100,000sq ft House of Hype in Dubai Mall, in the coming months. 

• Middle East on a roll as fastest growing theme park market
• The metaverse is alive and kicking
• The digital world increasingly feeds into the real world

Chief executive Alexander Heller told AGBI that HyperSpace saw an opportunity to build “new format digital worlds” designed to appeal to social media savvy Gen Zs and millennials, gaming enthusiasts and Instagrammers. 

Both AYA and House of Hype feature tech-enabled content creation beamed through real-life spaces that visitors can walk through, effectively gaining a physical version of a virtual reality experience. 

“More than half of Mena’s population is aged under 30,” Heller said. 

“Their attention spans are shorter, they choose destinations based on where they can take good pictures and they enjoy digital experiences. There has previously been little [in the region] catering to them.” 

HyperSpace’s venues are intended for short visits rather than days out and they are set within malls with existing food and beverage and retail offerings, making them cheaper than large-scale theme parks to establish and run, he added. 

The company has struck revenue-based deals rather than leasing deals with its landlords, which benefit from a share of HyperSpace’s footfall.   

“The traditional models work now but they won’t in future,” Heller said. “Old format parks will become less viable, and rollercoasters will be replaced by a new garde of entertainment.” 

HyperSpace is part of a trend towards increasingly sophisticated entertainment being brought to the Middle East as operators tap into new demographics and global trends.

Gone are the days when an amusement park simply meant rollercoasters and candy floss. Today, while these elements remain, a broader range of experiences are being added to the mix.

In Saudi Arabia, the RIG, a floating theme park for extreme sports, is being built on an offshore oil rig in the Arabian Gulf.

Dubai Parks and Resorts, part of state owned Dubai Holding Entertainment, is planning a Real Madrid football club-branded park.

Miral in Abu Dhabi is adopting AI and machine learning to offer personalised entertainment packages to customers. 

This is in addition to a host of other new and existing attractions being developed in the region. Mena is forecast to be the world’s fastest-growing entertainment park market over 2020-2024, according to the International Association of Amusement Parks and Attractions (IAAPA).

Consumer spend at Mena theme parks and related venues is projected to grow at a compound annual growth rate of 10.9 percent to $474 million. 

Peter van der Schans, executive director and vice-president for IAAPA Emea, told AGBI this month: “Countries [in the Middle East] have a pile of money and need to reform their economies away from oil. Many are creating destination economies and establishing new markets for tourism, aviation and hospitality.”

Fernando Eiroa, chief executive of state-owned Dubai Holding Entertainment, parent of Dubai Parks & Resorts, said customers in the region are demanding more options for “thrills and memorable experiences”. 

“Amusement parks are a great representation of the experience economy – a growing preference among consumers to spend on experiences rather than products,” he said.

HyperSpace is part of this trend, and its chief executive plans to expand the business to meet demand.

“We are definitely shifting our focus towards the Saudi market this year and are planning to announce [a project there] soon,” Heller said, declining to reveal further details.

“Never before has there been such enthusiasm and activity for entertainment in all shapes and forms in the kingdom, and the immediate opportunity is fantastic.” 

Under Vision 2030, Saudi Arabia aims to grow its tourism industry to attract 100 million visitors per year and account for 10 percent of gross domestic product, from 3 percent. 

Heller founded HyperSpace in 2020 and took the company through a successful seed funding round in 2021, raising $11 million from investors led by Mohammed Afkhami’s Magenta Capital Services. HyperSpace is now working on a larger, series A round. 

Demand for more traditional parks is still “stronger than ever”, insists Mohamed Abdula Al Zaabi, group chief executive of Miral, operator of Abu Dhabi’s Ferrari World and whose upcoming attractions include the Wizarding World of Harry Potter and SeaWorld Abu Dhabi. 

Miral recorded its best-ever year in 2022 in terms of visitor numbers, Al Zaabi added, declining to provide figures.

“It’s important to strive for constant evolution,” he said. “We have witnessed over the last few years how technology has revolutionised the customer experience, so introducing digital enhancements is important as expectations are higher than ever.” 

HyperSpace has a “smart business model”, conceded IAAPA’s van der Schans, but there will always be a place for the traditional amusement park, which elicits “shared thrills and emotions” and caters to multiple interests. 

“A mix of attractions is part of the diversified offering emerging in Mena and the world, and there is space for it all,” he said.