Disney selling off hotels?

[Rocket]

Disney is a very diverse company and hotel management is not their strength. On the other hand, they have a corporate culture that demands complete control of the "brand" and the "message". So it is unlikely that the current Disney would divest the hotels as they would lose control of an important part of the "experience".

On the other hand, if they were taken over by another company - and it has been very close to happening more than once in the past - then the new owners would not be part of the existing "culture" and could do just about anything. Including selling off bits and pieces of the company to someone else, outsourcing hospitality, licensing the brands, etc.

The probability of a bus driver having the inside scoop is nil.

 

[Anal Annie]

I'm just waiting for them to install coin boxes on the buses.

 

[wildernessDad]

I wonder how that would work out with places like WL/VWL. So the WL part would be taken over but VWL would be operated by Disney? I don't see that as being a likely scenario, one that I would enjoy anyway.

 

[DVCPAT]

I am suprised by how many are saying no way to this. It may not be right now but it could happen. Look at what they have already done. PI and some of DTD in private hands. Additional private hotel development on property besides what is already in place. Outsourcing of all sorts of services. It is the classic landowner no longer wanting to run the whole lot but willing to sell/rent the space and collect the money. I am sure there are all sorts of conditions, covanents language etc just like our own DVC contract that would let them step back in for whatever reason. If people still pay and still think of the overall experience still a Disney brand they would not care who is running it if its more profit for them. Welcome to the world of the Disney franchise. I want to be the owner/operator of the Haunted House!!! Oh and all the mountains!! HAHAHAHA!

I agree……A few years ago, I would have said no way. Disney has already sold property and hired outside vendors to perform work previously done by Disney employees. Why not continue the trend if it increases profits? When today’s Disney management hires outside vendors, it basically says we don’t have the creativity to solve our own problems. Lets wash our hands of the issues and let someone else do it.

 

[TDC Nala]

Not saying it couldn't happen. Just that if it came from a bus driver I'm not paying attention.

 

[hakepb]

While on one hand it's hard to imagine this happening in any variation or form, the rumors are starting to have a more ominous sound to them.

...although in this economy, I think every employee, even the self-employed ones , have been hearing an inceasing number of omnious rumors about their employer..

 

[JimC]

...Also in Orlando, you have to remember how depressed the area is. They've been hit really hard by this recession. Almost everyone living there has a bit of Chicken Little syndrome kicking in.

Just to provide a bit of perspective.

"In Florida, where unemployment is now at 11 percent, it's projected to peak near 12 percent. To be truly healthy, the rate should be south of 6 percent. Rebecca Rust, chief economist with the Florida Agency for Workforce Innovation, says for Florida that point may be eight or nine years away. Most would welcome just a return to single digits, which itself may be more than a year away."

As to selling hotels -- market conditions change over time. Owning hotels is capital intensive, though so is a theme park. Yet some sort of sale lease back or sale with management rights or long term land lease is not totally out of the question. I think it would be prudent for senior execs to explore ways to free up capital, lower fixed operating costs, improve long term earnings, maintain control of the guest experience and preserve domination of the governmental entity. Not to mention ways to jack up the stock price for their equity laden compensation packages.

Yet, there are many variables that come into play. One which is very important right now is the ability to package accommodations, dining and admission media to keep guests coming during the recession.

 

[disneynutz]

If I have learned anything over the last few years, it's that Disney Management is in it for the money, even at the expense of the Guest experience. Disney is outsourcing more all the time. Restaurants, Valets, food kiosks, DME, Imaginer's, IT services, resort TV, telephone, Internet, and Bell Services.

If selling off the resorts makes financial sense on paper, they would do it in a heart beat. The above rumor has been around for a while and repeated here on the DIS before, you just never know.

Bill

 

[Sammie]

Sure it could happen, but I also think there are plenty of disgruntled Disney employees right now that love nothing better than to start something they know will end up here.

 

[Mr_Potts]

I think it will never happen. Disney's future direction is in opening smaller Disney experiences around the world. So far, this looks like the projects in DC and Ko Olina, which are essentially hotels. It is already doing an excellent job as a resort operator and why would it abandon something at which it is at the top of its game? Also, Disney would risk losing its hold on guests if it outsourced its hotels. Something would be lost from the all-immersive experience.

 

[DebbieB]

I wonder how that would work out with places like WL/VWL. So the WL part would be taken over but VWL would be operated by Disney? I don't see that as being a likely scenario, one that I would enjoy anyway.

Disney could contract out services at DVC resorts even though they still own them. Valets and housekeeping are already contracted out (and bellman?). They could very easily contract out the rest of the operations.

 

[stopher1]

Never say never - it's totally possible at some point in the future. Ultimately whether any of us agree with that "option" or not doesn't matter since we aren't the decision makers for the corporation. Management can work around/through any issue if they believe it'll be in the long-term best interest of the company's bottom line. Whether it ever happens or not remains to be seen.

 

[tjkraz]

Disney could contract out services at DVC resorts even though they still own them. Valets and housekeeping are already contracted out (and bellman?). They could very easily contract out the rest of the operations.

To the best of my knowledge, the only housekeeping services outsourced are a small number of individuals (IIRC, less than 100) who do maintenance work at the resorts during "third shift" late night hours. The hundreds of folks who clean guest rooms on a daily basis are Disney CMs.

Bell services staffers are also Disney CMs.

As for Disney selling the resorts or farming-out management, I'd file that under "never say never." Speaking in DVC terms, 40-50 years is a long time for philosophies to change throughout the company. Disney could easily see 2-3 different CEOs come and go before my DVC ownership ends. Who knows what sort of philosophy they may have toward the parks and resorts.

In the immediate future, I don't see it happening. It was just within the last 1-2 years that Disney was reportedly going to operate and manage hotels in Anaheim's GardenWalk development--hotels which would be owned by another party. GardenWalk has stalled a bit so I'm not sure where this entire project stands. But that overall philosophy suggests that Disney intends to stay involved in the hotel management business, not that they are looking to get out of it.

 

[jlewisinsyr]

It is already doing an excellent job as a resort operator and why would it abandon something at which it is at the top of its game?

You consider not being able to manage or operatate a 5-star resort of consistantly 4 star quality excellent?

Disney is great in pulling cash from average, but it's not great at operating resorts.

 

[fishermouse]

 

[tjkraz]

You consider not being able to manage or operatate a 5-star resort of consistantly 4 star quality excellent?

Disney is great in pulling cash from average, but it's not great at operating resorts.

Disney has never tried to earn the 5 star designation at any of its resorts. Michael Eisner envisioned the Grand Floridian as a possible 5 star destination, but they never fully committed to it. There are certain minimum requirements necessary to even be in the running for a 5 star award--things like daily newspaper delivery, fresh flowers in all guest rooms, 24 hour room service, etc. Even the GF balked at offering many of those elite services.

Based upon my (admittedly) limited experiences, I'd say the GF is a solid 4 star establishment. Most other Disney deluxe resorts are probably 3 star at best. They have really never striven for any particular level of excellence (IMO) beyond the attractive resort designs.

Disney may charge 4/5 star prices for many of its hotels but that's mostly because...well...they can! They have a (virtual) monopoly on the "on site" designation and leverage it to the max.

I do wish Disney had higher standards for its hotels but I just don't see it happening. Fortunately we're pretty low maintenance people so it isn't anything I dwell upon. Theme park fans should try spending a couple nights in one of the Loews hotels at Universal. The differences are immediately evident. Not a big fan of the Universal parks, though, nor do I like paying the big $$$ for Universal hotels. So I'm content to stick with Disney/DVC.

 

[Barnum01]

WDW bus drivers get paranoid because they know the people-mover could replace them at any time

As they should, after all in 1966 the idea was that "nowhere in Disney World will a signal light ever slow the constant flow of traffic."

Then again, on some of the buses I've been on, the drivers seem to embrace this 1966 concept while the passengers embrace a mild case of whiplash!

Make mine a WEDway!

 

[DenLo]

Please!

Think about it. If it was true Disney sold off their hotels, and if that meant the hotels would have to provide their own Disney shuttle services, then who do you think the hotels would hire to drive their shuttle busses? Why, ex Disney bus drivers looking for a job.

So this rumor fails in the logic test from the getgo. Bus drivers are upset they may lose their jobs? But the change would just mean a shift in employer. Same job, different benefits.

Maybe at a lower rate of pay? But someone already said Mears operates the buses. So the drivers probably already took a pay cut.

 

[jarestel]

Rumors are almost always patently ridiculous...
Until they become facts.

The "rumors" of DVC at AKV and BLT were 2 rumors soundly pooh-poohed by most of the Disney experts in the beginning. So who knows... que sera sera!