Future Disney Vacation Club regional resorts

[marctav]

Will Disney ever revive there plans for future Disney Vacation Club regional resorts like Aulani, the White Mountains NH concept or a use for its land in DC.

 

[tjkraz]

Never say never but current Disney management doesn't appear particularly interested in off-site developments. Seemed to be something that Jay Rasulo was pushing during his tenure as Parks & Resorts chief. He was front-and-center on the Aulani announcement. Around the same time, Disney optioned some land outside of Washington DC, presumably for a combined hotel / timeshare.

But the DC land is out of the picture now and conventional wisdom suggests Aulani is not quite as successful as Disney had hoped.

Outfits like Great Wolf Lodge and Kalahari have built a business around regional destination / waterpark resorts. Kalahari even has a timeshare element. I don't see why Disney couldn't follow a similar model: Waterpark...character meals...stage show...even some sort of unique interactive "attractions." A lot of elements used on the Disney Cruise ships could be incorporated into a regional hotel setting.

Either Disney doesn't think margins are sufficient to make the venture worthwhile or they fear it will cannibalize more profitable business from the theme parks and cruise ships. If residents in the north east or midwest can get their Disney "fix" via a relatively cheap weekend stay at a nearby Disney-branded hotel, some would be less likely to book a week at Walt Disney World.

Future TWDC management may adopt a different philosophy but there aren't any signs that current management is pursuing such plans.

 

[rteetz]

Never say never but current Disney management doesn't appear particularly interested in off-site developments. Seemed to be something that Jay Rasulo was pushing during his tenure as Parks & Resorts chief. He was front-and-center on the Aulani announcement. Around the same time, Disney optioned some land outside of Washington DC, presumably for a combined hotel / timeshare. But the DC land is out of the picture now and conventional wisdom suggests Aulani is not quite as successful as Disney had hoped. Outfits like Great Wolf Lodge and Kalahari have built a business around regional destination / waterpark resorts. Kalahari even has a timeshare element. I don't see why Disney couldn't follow a similar model: Waterpark...character meals...stage show...even some sort of unique interactive "attractions." A lot of elements used on the Disney Cruise ships could be incorporated into a regional hotel setting. Either Disney doesn't think margins are sufficient to make the venture worthwhile or they fear it will cannibalize more profitable business from the theme parks and cruise ships. If residents in the north east or midwest can get their Disney "fix" via a relatively cheap weekend stay at a nearby Disney-branded hotel, some would be less likely to book a week at Walt Disney World. Future TWDC management may adopt a different philosophy but there aren't any signs that current management is pursuing such plans.

I think Aulani is absolutely stunning I've never been there but from the pictures and what I've heard it looks great. And if it isn't doing well why did they just expand and add more rooms and another pool?

 

[CMDTA]

The White Mountains would be very difficult. I live in NH. If you sneeze up there, someone will give you a dirty look.

They've been trying to run some Hydro power lines from Canada. It's been one legal battle after another. I don't think they are ever going to get approval.

If Disney aimed for the WMs they might run into a huge fight.

 

[Horace Horsecollar]

I think Aulani is absolutely stunning I've never been there but from the pictures and what I've heard it looks great. And if it isn't doing well why did they just expand and add more rooms and another pool?

The news about "expanding and adding more rooms" was just marketing spin on building out the interiors of the towers that were constructed before the resort even opened. The plan was always to build out the interiors in phases, and that's exactly what Disney did.

The additional pool, water play area, chair deck, and casual food service were necessary because Disney discovered that more Aulani guests spent their days at the resort, rather than exploring Oahu. The resort's original recreational facilities were often packed, even before all the rooms were completed.

Aulani is a stunning resort. Rates are high. Occupancy seems to be doing well, especially in the summer. But Aulani was a massively expensive project. And, in the end, it's largely a DVC project, so the real test will be how long it takes to sell all the DVC inventory.

 

[tjkraz]

I think Aulani is absolutely stunning I've never been there but from the pictures and what I've heard it looks great. And if it isn't doing well why did they just expand and add more rooms and another pool?

They didn't add more rooms. (In fact, to be specific, they actually removed a couple ground floor rooms from service so that the space could be used for new resort amenities.)

The pool and dining expansions were driven by guest feedback. Basically there weren't enough quick service dining locations and the pools were way too overcrowded even when the resort wasn't at full occupancy. Really Disney had no choice but to act on those complaints or risk losing business. This isn't WDW where guests can easily choose another resort their next trip or go to a theme park if the pools are overcrowded.

Even with those expansions, I'm hearing it's still hard to find a vacant pool lounger by mid-morning and people are lining up an hour before the (free) kids' club opens to grab a spot before it fills for the day.

It is a very impressive resort and I'm not trying to undermine the quality. But there have been a lot of rumblings of construction & operating cost overruns and lackluster DVC point sales. There was also the issue where DVC dues were under-estimated by about 25%. Big black eye for Disney and it speaks to the lack of oversight.

Disney doesn't really talk about the resort in shareholder meetings or earnings calls so a lot is just rumor and speculation. But it's likely a case of "where there's smoke, there's fire."

If Aulani was doing exceptionally well Disney WOULD be crowing about it's performance. If Aulani was doing well, they probably wouldn't have given-up the Washington DC land.

I've often heard that Aulani was a "pet project" of Jay Rasulo. Once he was moved out of the parks role, those off-site resort projects appeared to lose all of their backing.

 

[rteetz]

They didn't add more rooms. (In fact, to be specific, they actually removed a couple ground floor rooms from service so that the space could be used for new resort amenities.) The pool and dining expansions were driven by guest feedback. Basically there weren't enough quick service dining locations and the pools were way too overcrowded even when the resort wasn't at full occupancy. Really Disney had no choice but to act on those complaints or risk losing business. This isn't WDW where guests can easily choose another resort their next trip or go to a theme park if the pools are overcrowded. Even with those expansions, I'm hearing it's still hard to find a vacant pool lounger by mid-morning and people are lining up an hour before the (free) kids' club opens to grab a spot before it fills for the day. It is a very impressive resort and I'm not trying to undermine the quality. But there have been a lot of rumblings of construction & operating cost overruns and lackluster DVC point sales. There was also the issue where DVC dues were under-estimated by about 25%. Big black eye for Disney and it speaks to the lack of oversight. Disney doesn't really talk about the resort in shareholder meetings or earnings calls so a lot is just rumor and speculation. But it's likely a case of "where there's smoke, there's fire." If Aulani was doing exceptionally well Disney WOULD be crowing about it's performance. If Aulani was doing well, they probably wouldn't have given-up the Washington DC land. I've often heard that Aulani was a "pet project" of Jay Rasulo. Once he was moved out of the parks role, those off-site resort projects appeared to lose all of their backing.

Well wasn't just Rasulo, Rohde had a big hand in the resort as well. Per WDWInfo.com two new towers of rooms were added to the resort. A family pool, splash zone, and a quiet pool were added. Two quick service locations were added, and a new store. Through further research it seems as though those two towers were not part of the expansion but were added earlier in 2013.

 

[HockeyMomNH]

I live the White Mountains and I had never heard of this project. I'd offer up my back yard... beautiful Mt. Washington View that would be perfect

 

[Horace Horsecollar]

Well wasn't just Rasulo, Rohde had a big hand in the resort as well. Per WDWInfo.com two new towers of rooms were added to the resort. A family pool, splash zone, and a quiet pool were added. Two quick service locations were added, and a new store. Through further research it seems as though those two towers were not part of the expansion but were added earlier in 2013.

Joe Rohde was (and still is) the creative leader of Aulani, not the business executive. We can only thank Rohde for how the resort tells a story.

If White Mountain or National Harbor had been approved, they each would have had a senior Imagineer assigned too.

As Tim noted, Jay Rasulo was the executive who spearheaded the business case and green-lit the billion dollar resort -- along with Robert Iger, who was involved because of the project's size, scope, and longterm effect on the company.

Once again, the "two new towers" were not new structures. It was just PR hype for interior work (planned all along) within structures that were completed before the resort opened. The interior work was not an indication of financial success or failure.

As Tim and I both noted, the pool and food service expansion corrected a deficiency in the original design due to a miscalculation of how guests would use the resort. The pool expansion was not an indication of financial success or failure.

When Aulani was planned, Disney had no idea that the United States would plunge into its worst economic downturn since the great depression or that there would be an earthquake and tsunami in Japan. Given the huge capital cost and operating cost of Aulani, combined with a difficult timeshare sales environment (especially due to the Japanese economy), I suspect that Aulani is not meeting its financial goals.

From a guest perspective, I would call Aulani a success. It's a wonderful resort. However, that doesn't mean that Disney will want to build similar projects elsewhere.

 

[rteetz]

Joe Rohde was (and still is) the creative leader of Aulani, not the business executive. We can only thank Rohde for how the resort tells a story. If White Mountain or National Harbor had been approved, they each would have had a senior Imagineer assigned too. As Tim noted, Jay Rasulo was the executive who spearheaded the business case and green-lit the billion dollar resort -- along with Robert Iger, who was involved because of the project's size, scope, and longterm effect on the company. Once again, the "two new towers" were not new structures. It was just PR hype for interior work (planned all along) within structures that were completed before the resort opened. The interior work was not an indication of financial success or failure. As Tim and I both noted, the pool and food service expansion corrected a deficiency in the original design due to a miscalculation of how guests would use the resort. The pool expansion was not an indication of financial success or failure. When Aulani was planned, Disney had no idea that the United States would plunge into its worst economic downturn since the great depression or that there would be an earthquake and tsunami in Japan. Given the huge capital cost and operating cost of Aulani, combined with a difficult timeshare sales environment (especially due to the Japanese economy), I suspect that Aulani is not meeting its financial goals. From a guest perspective, I would call Aulani a success. It's a wonderful resort. However, that doesn't mean that Disney will want to build similar projects elsewhere.

I was just posting what I knew and had found. I hope to someday go to aulani as it looks amazing. I hope Disney doesn't let it go like some other places have either. I also don't think new regional DVC properties will come up any time soon either. All of this information is very helpful.

 

[tjkraz]

Well wasn't just Rasulo, Rohde had a big hand in the resort as well.

The Aulani project was announced in October 2007 . Groundbreaking occurred in November 2008. Rohde didn't get involved until fall 2009.

Like Horace said, he was a big influence on the creative side but its unlikely he had any influence on the initial business analysis.

From a guest perspective, I would call Aulani a success. It's a wonderful resort. However, that doesn't mean that Disney will want to build similar projects elsewhere.

Well said.

From a business perspective, imagine Disney builds a hotel/timeshare in the Chicago suburbs. Suddenly millions of people can get their Disney "fix" without ever boarding an airplane (or spending 20 hours in the car.) Instead of booking $5-10k vacation packages & cruises, they're spending $500 for a weekend getaway where they can still dine with Mickey, get a photo with Cinderella and ride the AquaDuck.

Certainly there are people who can never afford a WDW vacation or Disney cruise, who may be drawn to a more affordable hotel option. But Disney's lack of movement implies they are worried about cannibalizing business from the theme parks.

 

[rteetz]

The Aulani project was announced in October 2007 . Groundbreaking occurred in November 2008. Rohde didn't get involved until fall 2009. Like Horace said, he was a big influence on the creative side but its unlikely he had any influence on the initial business analysis. Well said. From a business perspective, imagine Disney builds a hotel/timeshare in the Chicago suburbs. Suddenly millions of people can get their Disney "fix" without ever boarding an airplane (or spending 20 hours in the car.) Instead of booking $5-10k vacation packages & cruises, they're spending $500 for a weekend getaway where they can still dine with Mickey, get a photo with Cinderella and ride the AquaDuck. Certainly there are people who can never afford a WDW vacation or Disney cruise, who may be drawn to a more affordable hotel option. But Disney's lack of movement implies they are worried about cannibalizing business from the theme parks.

With this being said what about Disney's Vero Beach resort is that successful? I have looked into that resort and to me it doesn't look as appealing as Aulani but the price difference is.

 

[tjkraz]

With this being said what about Disney's Vero Beach resort is that successful? I have looked into that resort and to me it doesn't look as appealing as Aulani but the price difference is.

Vero and Hilton Head were the 2nd and 3rd DVC resorts...both built in the early 90s after Old Key West. And neither was regarded as particularly successful. That's why about 15 years passed between HHI / Vero and Aulani.

 

[Horace Horsecollar]

With this being said what about Disney's Vero Beach resort is that successful? I have looked into that resort and to me it doesn't look as appealing as Aulani but the price difference is.

From a business perspective, Disney's Vero Beach Resort did not do well. It took so long to sell that Disney Vacation Development cancelled phase 2 and sold the land where phase 2 was supposed to be built. As a result, Disney's Vero Beach Resort has far fewer villas than originally planned.

Some buyers consider Disney's Vero Beach Resort to be a "cheap" way to buy DVC points for use at WDW. But Vero Beach has rather high per-point annual fees compared to DVC resorts at WDW. And anyone who buys a Vero Beach resale can't book at WDW until 7 months out, when choices at WDW can be limited.

From a guest perspective, Vero Beach another "successful" resort. I've never stayed there or even walked through it, but I've heard wonderful things about it.

 

[ChipnDale79]

Never say never but current Disney management doesn't appear particularly interested in off-site developments. Seemed to be something that Jay Rasulo was pushing during his tenure as Parks & Resorts chief. He was front-and-center on the Aulani announcement. Around the same time, Disney optioned some land outside of Washington DC, presumably for a combined hotel / timeshare.

But the DC land is out of the picture now and conventional wisdom suggests Aulani is not quite as successful as Disney had hoped.

Outfits like Great Wolf Lodge and Kalahari have built a business around regional destination / waterpark resorts. Kalahari even has a timeshare element. I don't see why Disney couldn't follow a similar model: Waterpark...character meals...stage show...even some sort of unique interactive "attractions." A lot of elements used on the Disney Cruise ships could be incorporated into a regional hotel setting.

Either Disney doesn't think margins are sufficient to make the venture worthwhile or they fear it will cannibalize more profitable business from the theme parks and cruise ships. If residents in the north east or midwest can get their Disney "fix" via a relatively cheap weekend stay at a nearby Disney-branded hotel, some would be less likely to book a week at Walt Disney World.

Future TWDC management may adopt a different philosophy but there aren't any signs that current management is pursuing such plans.

I can really see taking a long weekend to the Great Smokey Mountains and staying at a Disney Themed "Lodge".

Think Wilderness Lodge type of place in Gatlinburg or Pigeon Forge.

I've wondered why Disney doesnt try to compete with Great Wolf Lodge, it would be fun to take the kids away for the weekend and have dinner with Mickey and pals without having to go all the way to FL or CA.

 

[rteetz]

I can really see taking a long weekend to the Great Smokey Mountains and staying at a Disney Themed "Lodge". Think Wilderness Lodge type of place in Gatlinburg or Pigeon Forge. I've wondered why Disney doesnt try to compete with Great Wolf Lodge, it would be fun to take the kids away for the weekend and have dinner with Mickey and pals without having to go all the way to FL or CA.

My guess is disney wants to be that destination for a week or longer rather than just a weekend. I would think people would spend more with Disney being a destination than a place all around the country.

 

[Horace Horsecollar]

I've wondered why Disney doesnt try to compete with Great Wolf Lodge, it would be fun to take the kids away for the weekend and have dinner with Mickey and pals without having to go all the way to FL or CA.

The second part of your sentence might be the answer to the first part of your sentence. Disney wants you to go to Florida or California and spend thousands.

 

[ChipnDale79]

The second part of your sentence might be the answer to the first part of your sentence. Disney wants you to go to Florida or California and spend thousands.

I get what you're saying, but the flaw in that is I'd probably do both.

We'll take the kids down to WDW a for a week long vacation every year, however we still take weekend trips to other places as well.

On those weekend trips, I think it would be fun to stay at a Disney Hotel.

I don't believe anything like this will ever happen, at least under current Disney Management.

 

[rteetz]

I get what you're saying, but the flaw in that is I'd probably do both. We'll take the kids down to WDW a for a week long vacation every year, however we still take weekend trips to other places as well. On those weekend trips, I think it would be fun to stay at a Disney Hotel. I don't believe anything like this will ever happen, at least under current Disney Management.

Say perhaps Disney does build hotels across the country, Chicago, New York, San Fran, Dallas, and some other major cities. Now if I spend a couple weekends a year in Chicago at a $150 a night rate rather than spending 4-5000 for a week in WDW does Disney lose attendance at their major parks? I would think so people would see hey I can go get my Disney fix for cheaper here than spending the money in Florida. Now I'm not saying I wouldn't go back to WDW a but those trip may become less frequent and for shorter amounts of time like 3-4 days. Just a thought I don't think it will happen either.

 

[ChipnDale79]

Say perhaps Disney does build hotels across the country, Chicago, New York, San Fran, Dallas, and some other major cities. Now if I spend a couple weekends a year in Chicago at a $150 a night rate rather than spending 4-5000 for a week in WDW does Disney lose attendance at their major parks? I would think so people would see hey I can go get my Disney fix for cheaper here than spending the money in Florida. Now I'm not saying I wouldn't go back to WDW a but those trip may become less frequent and for shorter amounts of time like 3-4 days. Just a thought I don't think it will happen either.

I think you build them in major tourist areas, locations where people are already going and staying in non Disney Hotels.

I don't think you're competing against DLR or WDW, more so against other hotels and lodges.