Urban Air Adventure Park Logo

Urban Air Adventure Park

UATP Management, LLC
https://www.urbanairparks.com
1-877-203-2192
2350 Airport Freeway, Suite 505, Bedford, Texas 76022

Initial Investment Range

$3,111,409 to $8,382,109

Franchise Fee

$1,338,640 to $1,778,650

As a franchisee of Urban Air Adventure Parks, you will operate an adventure park that serves as a venue for recreational activities, birthday parties, and other group events.

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Urban Air Adventure Park April 14, 2025 FDD Risk Analysis

Free FDD Library AI Analysis Date: July 16, 2025

DISCLAIMER: Not Legal Advice - For Informational Purposes Only. Consult With Qualified Franchise Professionals.

1

Franchisor Stability Risks

Start Here
Total: 10
3
2
5

Disclosure of Franchisor's Financial Instability

High Risk

Explanation

The parent company, UA Holdings, LLC, has a history of significant net losses, including $(68.7) million in 2024, and a large accumulated deficit. These losses are driven by substantial debt. Due to its financial condition, the franchisor was required by the state of Maryland to secure a surety bond. This financial situation could potentially impact the franchisor's ability to provide long-term support and grow the brand.

Potential Mitigations

  • An experienced franchise accountant should thoroughly analyze the parent company's audited financial statements, including all footnotes, to assess its financial health.
  • It is important to discuss the franchisor’s debt structure and path to profitability with your financial advisor.
  • Your attorney should explain the protections, if any, afforded by the parent company guarantee and any state-required surety bonds.
Citations: Item 21, Exhibit H, State Specific Appendix (Maryland)

High Franchisee Turnover

Low Risk

Explanation

This specific risk was not identified in the FDD. The data presented in Item 20 shows a very low rate of franchisee terminations, non-renewals, and cessations of operation over the past three years. Generally, high franchisee turnover can be a major red flag, potentially indicating systemic issues such as lack of profitability, poor franchisor support, or an unsustainable business model.

Potential Mitigations

  • Engaging with a franchise accountant can help you analyze the Item 20 tables to calculate annual turnover rates.
  • Speaking with current and former franchisees is crucial to understand their satisfaction levels and reasons for any departures from the system.
  • Your attorney can help you frame questions for the franchisor regarding any trends observed in the franchisee turnover data.
Citations: Not applicable

Rapid System Growth

Medium Risk

Explanation

The franchisor has a very large number of signed franchise agreements for parks that are not yet open (206 as of year-end 2024). This projected rapid expansion could potentially strain the franchisor's capacity to provide adequate site selection, development, training, and ongoing operational support to all franchisees. You should assess if the franchisor's support infrastructure is prepared to handle this significant growth.

Potential Mitigations

  • Discuss the franchisor's plans for scaling its support staff and systems to manage this growth with your business advisor.
  • It is important to ask current franchisees about the present quality and responsiveness of franchisor support.
  • Your accountant should analyze the franchisor's financial statements to assess if they have the capital to invest in necessary support infrastructure.
Citations: Item 20

New/Unproven Franchise System

Low Risk

Explanation

This risk was not identified, as the franchisor, UATP Management, LLC (UATP), has been operating and offering franchises for over a decade and has a substantial number of parks in operation. An unproven system typically presents higher risks, including the lack of an established brand, underdeveloped operational procedures, and potential instability, which do not appear to be primary concerns here.

Potential Mitigations

  • When evaluating any franchise, it is prudent to review Items 1, 2, and 20 with a business advisor to assess the system's age and experience.
  • An accountant can review the financial statements in Item 21 to determine if a young franchisor has adequate capitalization.
  • Consulting with an attorney is wise to understand the risks associated with investing in a newer, less established franchise system.
Citations: Not applicable

Possible Fad Business

Medium Risk

Explanation

The adventure park concept, which relies on specific recreational attractions, could be subject to shifting consumer trends and entertainment fads. A decline in the popularity of these activities could impact long-term revenue and profitability. The high initial investment required for this business model may increase the risk if the concept's appeal proves to be short-lived.

Potential Mitigations

  • Engaging a business advisor can help you conduct independent market research to assess the long-term consumer demand for this type of entertainment in your area.
  • It is important to evaluate the franchisor's history and plans for innovation and introducing new attractions to maintain customer interest.
  • Your accountant can help you model different revenue scenarios to understand the financial impact of potential shifts in consumer demand.
Citations: Item 1, Item 7

Inexperienced Management

Low Risk

Explanation

This risk was not identified in the FDD. Item 2 shows that the key executives at the franchisor and its parent company, Unleashed Brands, have substantial experience in franchising and related industries. In general, a lack of management experience in both franchising and the specific business sector can pose a significant risk, potentially leading to inadequate franchisee support and poor strategic decisions.

Potential Mitigations

  • A thorough review of the executive biographies in Item 2 with a business advisor is a crucial step in any franchise evaluation.
  • It is wise to research the past performance of companies where the key executives previously held leadership roles.
  • Talking to current franchisees can provide valuable insight into their perception of the management team's competence and support.
Citations: Not applicable

Private Equity Ownership

High Risk

Explanation

The franchisor's parent company, UA Holdings, LLC, is controlled by a private equity firm. This ownership structure may create pressure to prioritize short-term investor returns, which could potentially lead to decisions like increasing fees or reducing franchisee support. The franchise agreement also allows the system to be sold again without your consent. The company's high debt load, common in such structures, is a related financial concern.

Potential Mitigations

  • With your business advisor, research the private equity firm's reputation and track record with other franchise systems it has owned.
  • It is critical to ask current franchisees about any changes to fees, support, or system focus since the private equity acquisition.
  • Your attorney should review the assignment clauses in the franchise agreement to understand your rights if the system is sold again.
Citations: Item 1, Item 17, Item 21, Exhibit H

Non-Disclosure of Parent Company

Low Risk

Explanation

This specific risk was not identified. The FDD clearly discloses the franchisor's parent companies, including the ultimate parent UA Holdings, LLC. Furthermore, the FDD includes audited financial statements for the parent company and a guarantee of performance. Full disclosure of parent companies is crucial for assessing the overall financial strength and stability backing the franchise system.

Potential Mitigations

  • An attorney should always verify that the FDD properly discloses all parent and affiliate companies as required by law.
  • When a parent company guarantees performance, your accountant should review the parent's financial statements, not just the franchisor's.
  • Consulting with a business advisor can help you understand the potential influence of parent companies on the franchise system's operations.
Citations: Not applicable

Predecessor History Issues

Low Risk

Explanation

This risk was not identified, as FDD Item 1 does not list any legal predecessors for the franchisor, UATP Management, LLC. In franchise offerings where a predecessor exists, it is important to scrutinize their history for issues like litigation, bankruptcy, or high franchisee turnover, as these could indicate unresolved problems that have been carried over into the current franchise system.

Potential Mitigations

  • It's important to have an attorney review Item 1 of the FDD to identify any disclosed predecessor entities.
  • If a predecessor is identified, a business advisor can assist in researching its history and reputation.
  • Speaking with long-term franchisees who operated under a predecessor can provide crucial insights into the system's evolution.
Citations: Not applicable

Pattern of Litigation

High Risk

Explanation

Item 3 and the Maryland state addendum disclose a history of litigation. This includes a pending action against a group of franchisees for non-payment and a significant past dispute with a key supplier that resulted in a $5 million settlement payment by the franchisor's parent. This litigation history may suggest a contentious operating environment and could be a concern for a prospective franchisee.

Potential Mitigations

  • A thorough review of all litigation details in Item 3 with your franchise attorney is essential to understand the nature and potential implications of these disputes.
  • Your attorney can help you conduct independent research on the disclosed cases to gain more context beyond the FDD summary.
  • It is crucial to discuss the litigation history with current and former franchisees to understand their perspective on the franchisor's relationships.
Citations: Item 3, State Specific Appendix (Maryland)
2

Disclosure & Representation Risks

Total: 15
4
4
7

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

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3

Financial & Fee Risks

Total: 10
4
6
0

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

4

Legal & Contract Risks

Total: 16
8
6
2

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

5

Territory & Competition Risks

Total: 5
3
2
0

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

6

Regulatory & Compliance Risks

Total: 10
4
4
2

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

7

Franchisor Support Risks

Total: 4
1
3
0

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

8

Operational Control Risks

Total: 14
5
6
3

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

9

Term & Exit Risks

Total: 18
10
5
3

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

10

Miscellaneous Risks

Total: 1
1
0
0

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.