Future Disney Vacation Club regional resorts

[DPCummerbund]

I think Disney needs a few non-theme park resorts. Obviously, DVC appeals to people who do WDW every year. But there's probably a large group of people who go every 2-5 years, and if Disney is going to sell them on DVC, they need something to do with their points during those off years. So, Aulani helps boost DVC sales at WDW, and vice versa.

It's probably pretty easy to sell Hawaii as an off-year vacation from WDW, but there's no real benefit to Disney of having too many off-year resorts.

 

[rteetz]

I think Disney needs a few non-theme park resorts. Obviously, DVC appeals to people who do WDW every year. But there's probably a large group of people who go every 2-5 years, and if Disney is going to sell them on DVC, they need something to do with their points during those off years. So, Aulani helps boost DVC sales at WDW, and vice versa. It's probably pretty easy to sell Hawaii as an off-year vacation from WDW, but there's no real benefit to Disney of having too many off-year resorts.

See that's us we go every 2-5 years and we have looked into DVC but it hasn't caught us to buy in yet. I would really consider DVC if I could use points at a closer regional property and go to WDW every 3 years. We live in the Wisconsin and none of the none WDW or DLR DVC properties are close so that's why we just go to WDW.

 

[DizCaptain]

Disney had bought land at National Harbor here in MD a few years back. Nothing truly concrete was announced, but a mock layout of what the area would look like with the resort was posted a few places. It was more local clamor and hype about it. Disney ended up pulling out of the project. No reason was given, but I'm guessing they didn't see it as financially viable. It's a shame really. It would've been great to have had a piece of Disney closer to home. And then there's the whole Disney's America project.... Too bad that never came to fruition either...

 

[DebbieB]

When Disney builds a DVC resort, they look to sell the points as quickly as possible to recoup the construction costs. So the question is not would you want to go there for a weekend or even a week. The question is would you buy points there, including the dues that come along with it.

 

[jmail048]

I would love another out of theme park resort

 

[asunutgirl]

We are on the west coast and as a result, had no interest in DVC until Aulani. That is our home resort and we are very happy there. I'd love to see them build another DVC property at DLR - but where is the question?

 

[cedricandsophie]

We have been to Aulani twice and going again next week. It is just one of our home resorts and we have enough points for a week in a one bedroom ocean front. But I have never had a problem getting space there, even 5 or 6 months out. We go in the spring and not when school is out, but it just doesn't seem thst crowded. I'm excited to see the new pool but really never had a problem getting chairs before it was built. When we bought we got the lower maintenance fees that caused several executives to be let go. And they were giving a special deal where if you stay for at least 5 nights, they will give you two free nights with developer points. Even though we already had reservations, we took advantage of it because we were staying 9 nights. They put 100 points back in our account, the value of two nights in a one bedroom ocean front and substituted 100 developer points that cost us nothing. Hard to pass up. But that does seem to indicate that they have inventory to spare.

 

[lockedoutlogic]

All of Disney profits come from merchandise sales... What environment peddles the most merchandise?

I think you can fill in the blanks there.

"Disney" hotels in non sunny spots without space mountain would have occupancy issues and rob Them of what they covet...buy and large

 

[ABE4DISNEY]

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.

There will be no need for a Disney resort in Pigeon Forge after Dolly completes her Dream Resort being built right now. Google it. If you have ever visited Dollywood, you know that Dolly can out perform Disney. Dollywood is Frontierland on steroids and better at that!

 

[skier_pete]

We are on the west coast and as a result, had no interest in DVC until Aulani. That is our home resort and we are very happy there. I'd love to see them build another DVC property at DLR - but where is the question?

I think the same thing - I am very surprised that they haven't build more DVC in California. The only DVC at DLR is about 70 units at the Grand Californian. I would think DVC would sell very well in California as there are a TON of "locals" that would want points for multiple shorter stays. (I'm thinking those that live in California but not close enough to go for just the day.) With DVC in Florida now built at every single Deluxe resort (with the Poly coming soon), it seems like it's time to get something in California.

 

[rteetz]

I think the same thing - I am very surprised that they haven't build more DVC in California. The only DVC at DLR is about 70 units at the Grand Californian. I would think DVC would sell very well in California as there are a TON of "locals" that would want points for multiple shorter stays. (I'm thinking those that live in California but not close enough to go for just the day.) With DVC in Florida now built at every single Deluxe resort (with the Poly coming soon), it seems like it's time to get something in California.

I agree I think DVC in Disneyland should increase maybe add some more to the grand Californian and add some to the Disneyland hotel. You could even build a new resort entirely but that's less likely.

 

[Lewisc]

Disney was originally planning on building Disney Quests in large cities throughout the country. That idea is history.

Disney was originally going to build a hotel, presumably DVC, in National Harbor. Disney gave up the land.

Great Wolf Lodge was sold a few years ago. That could have been a fit if Disney wanted regional attractions with accommodations. I didn't read anything which suggested Disney was interested.

I haven't attended a DVC presentation in years. My memory is DVC is marketed to guests who only plan on visiting every 2 or 3 years. Can't owners bank and borrow points?

Can't DVC owners rent their points and use the money to stay wherever they want? Can't DVC owners trade their points through one of the large organizations ( RCI? Interval?) for a stay world wide?

I don't see anything which suggests Disney has a need for, or an interest in, building regional DVCs. That said what about building some kind of DVC near foreign Disney theme parks? I have no doubt many current DVC owners would like to stay at a DVC near DLP but I question how many guests would purchase points at such a resort.

 

[tjkraz]

I think the same thing - I am very surprised that they haven't build more DVC in California. The only DVC at DLR is about 70 units at the Grand Californian. I would think DVC would sell very well in California as there are a TON of "locals" that would want points for multiple shorter stays. (I'm thinking those that live in California but not close enough to go for just the day.) With DVC in Florida now built at every single Deluxe resort (with the Poly coming soon), it seems like it's time to get something in California.

There WILL be another Disneyland DVC...but not until Aulani is closer to being sold-out.

DVC doesn't want to create a situation where a DL-based resort option is in direction competition with Aulani for sales. Aulani cost somewhere in the neighborhood of $800 million to develop. And the DVC component is significant--at nearly 500 villas it's larger than Old Key West, Bay Lake Tower and Boardwalk.

Build a DL DVC now and every sale there is potentially a lost Aulani sale. The longer DVC has to keep marketing & selling Aulani, the more expenses they have attached to that project. If they can sell all of Aulani in 8 years (just to pick a number), it will be more profitable than if it takes 10 years or 12 years.

There are also more politics involved in DL construction since land is at a premium. The use of every square foot is scrutinized to the Nth degree because of the value of the land and its scarcity.

WDW has 30,000 hotel rooms and thousands of undeveloped acres. Compared to DL, it's a cakewalk to gain approval for new construction or DVC room conversions at WDW.

I don't see anything which suggests Disney has a need for, or an interest in, building regional DVCs. That said what about building some kind of DVC near foreign Disney theme parks? I have no doubt many current DVC owners would like to stay at a DVC near DLP but I question how many guests would purchase points at such a resort.

I don't know how you want to define "regional" but Aulani was a very significant non-park investment.

At this time, Disney hasn't shown any interest in creating many regional properties. That could eventually change...time will tell.

If Disney wishes to continue supporting the DVC business model, they will have to change their approach in the next few years. Dating back to the mid-90s, DVC's approach has largely been to add-on to existing WDW hotels or convert older properties (Disney Institute / Saratoga) to villas.

Grand Floridian will be sold-out by 2015. Poly will probably be gone by 2018. There are a few projects under consideration...a second tower at Contemporary, a building at Ft. Wilderness, possibly some units at Yacht Club. And they could always build a brand new resort (although it's an approach they haven't used in nearly 20 years.)

But from 2018 to 2042, they have about 24 years before first-gen resorts like BoardWalk and Beach Club start reverting back to Disney ownership to be renovated and re-sold. 24 years is a lot of time to fill with new construction if they wish to keep the DVC revenues coming in. The first 24 years of DVC brought 12 resorts and about 5000 villas.

DVC may need to start looking outside of the parks again both to broaden the appeal of the system--attract more buyers who do not want to visit the theme parks every single year. Aulani added a lot of value to the entire system. Other popular tourist destinations would do likewise. DC would have been nice to have on the list...it's a shame Disney bailed on that (although I read a lot of criticism over the specific location of that land in National Harbor.)

International parks may be an option, but there needs to be a viable market among buyers who are within close proximity to those resorts. There simply will not be a lot of US buyers for a timeshare at Disneyland Paris or Tokyo Disneyland. Few people will get there often enough to make it a worthwhile purchase.

Those international resorts also have issues with land scarcity (cost) and the ownership situations are much more complicated than DL and WDW.

 

[lockedoutlogic]

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.

Good guess...

average stay has always been one of their key driving numbers. No coincidence then that they have really downshifted construction in orlando when Animal Kingdom didnt kick the ball down the field in that department hardly at all...

they also spent about 15 years obsessing about the the recurrent customer - the DVC effect - sure seems like there's been a bit of a 180 on that of late.

 

[lockedoutlogic]

tjkraz,

You brought up one of the more fascinating "developing situations" at WDW...DVC running out of spots to slap on new villas like legos...

they have not done a "new development" since boardwalk in florida...and they obviously aren't interested in doing so one bit. This is a big turning point in the complex...not just for vacation club types...but all travelers.

they can't turn off the infusion of cash that has come since vacation club sales picked up in earnest...won't work. Both from the structure of the program and for the accountant's likings...

So...what now? the ft wilderness spot will probably be a go...whether they really want to or not...a matter of necessity...but then what?

if you want my opinion (as few people do )...
management would be wise to take the next ten years and really (seriously) throw the weight of their wallet (and all those $22 imax tickets for star wars) into adding a BUNCH of stuff in the parks and guest areas to increase draws...so they are in a position to rollout another heavy batch of new dvcs with high demand. I'm talking the equivalent of a new park (4 or so billion dollars in development cost conservatively) into specifically the ugly 3 stepsisters (pains me to say that on EPCOT...but the interest is waning) to bump them up.

just an idea...i'm not a ivy league accountant or former hedge fund manager...but my ideas tend to make a hell of alot more sense than they do.

 

[Horace Horsecollar]

One of the big costs that timeshare companies face is marketing. It's not unusual for timeshare companies to pay couples $100 to $200 just to listen to a sales pitch. Even then, it's not easy to convince someone to spend as much money as the cost of a car for something the prospective buyers never thought they wanted.

At WDW and Disneyland, Disney enjoys a tremendous marketing advantage. The Disney brand and on-site locations are meaningful to many guests. Disney's Deluxe and Moderate resorts can be quite expensive, so the DVC story resonates with potential buyers. There's no need to bribe people with $100 to $200 to learn more.

When Disney tries to build and sell somewhere other than WDW or Disneyland, Disney is just another timeshare company.

Over the years, people on DISboards have suggested various locations for a off-site DVC resorts, including the Smoky Mountains, ski areas, and Las Vegas. But what value does the Disney brand have in those places?

 

[mcd2745]

Great Wolf Lodge was sold a few years ago. That could have been a fit if Disney wanted regional attractions with accommodations. I didn't read anything which suggested Disney was interested.

Just based off the prices that the GWL in the Poconos charges, which is many times comparable with what WDW charges for their deluxes, it seems like it could be a good idea for Disney. Of course, they would have to be very selective in which markets they would do this. No doubt the Poconos GWL only gets those prices (and supposedly their occupancy rates are incredible), beacuse they are drawing from NYC and Philly markets. I once did a comparison of the Poconos location and 4-5 other GWL locations for the same dates and the rates at the Poconos location was generally 50%-80% higher than the others for identical rooms. So, if GWL could get away with charging such ridiculous premiums, Disney surely can. And I don't think it will cannibalize WDW or DLR business at all if Disney built something similar in the Poconos or Catskills/Adirondacks.

 

[lockedoutlogic]

One of the big costs that timeshare companies face is marketing. It's not unusual for timeshare companies to pay couples $100 to $200 just to listen to a sales pitch. Even then, it's not easy to convince someone to spend as much money as the cost of a car for something the prospective buyers never thought they wanted.

At WDW and Disneyland, Disney enjoys a tremendous marketing advantage. The Disney brand and on-site locations are meaningful to many guests. Disney's Deluxe and Moderate resorts can be quite expensive, so the DVC story resonates with potential buyers. There's no need to bribe people with $100 to $200 to learn more.

When Disney tries to build and sell somewhere other than WDW or Disneyland, Disney is just another timeshare company.

Over the years, people on DISboards have suggested various locations for a off-site DVC resorts, including the Smoky Mountains, ski areas, and Las Vegas. But what value does the Disney brand have in those places?

that is an excellent point.

disney has opened a few of those "sales centers" to try and increase their reach with dvc sales...but they sure seem to do it begrudgingly...

Its telling that DVC's main sales complex is at Saratoga...where you couldnt find much cheaper real estate

 

[tjkraz]

Over the years, people on DISboards have suggested various locations for a off-site DVC resorts, including the Smoky Mountains, ski areas, and Las Vegas. But what value does the Disney brand have in those places?

The value lies in affection for the Disney brand. Granted that isn't an enormous market, which is probably what has restrained development over the years.

Someone saw enough value to attempt at Vero, Hilton Head and Aulani. Unfortunately at least two of those ventures were marred by poor decision making. The Vero resort is charming but the area isn't enough of a draw to add value to the program. Hilton Head's location off of the beach undoubtedly hurt.

The key is striking a balance between units constructed and demand: What is the maximum number of units that they can build in any given destination, and still sell points at a decent price within a reasonable timeframe?

I don't think there's any question that destinations like Hawaii and Hilton Head add value to the entire program. There are many families where one member pushes strongly for the annual Disney parks visit while the other has reservations. Adding more neutral, non-park destinations to the program can only help those sales.

Omitting all financial issues, I think there would be demand for Disney timeshare accommodations in places like NYC, Washington DC and the midwest (suburban Chicago?) There are Disney fanatics who want that "fix" without burning their vacation time and spending thousands for transportation, food, park tickets, etc.

But then we get into the finances. Land acquisition costs are virtually non-existent at WDW and DL. Much more expensive elsewhere. Disney has its own local government in Florida rather than having to deal with local legislators. And they have tremendous resources in place at both WDW and DL...transportation system, human resources, laundry...so many necessary pieces are already in existence.

I don't think we've seen the last off-site DVC resort. At some point Disney will enter that market again.

But I'm not sure if we will ever see numerous stand-alone hotels scattered across the country. Operating costs would be higher than WDW or DL and without the wide range of commercial ventures (theme parks, dozens of restaurants, dozens of gift shops, golf courses, marinas, etc.), profit margins would be much lower than the theme parks.

Would hotels be profitable? Yes...probably. But not nearly as profitable as the theme park destinations. Why be content getting earning $400 for a weekend getaway when Disney stands to gross 10x as much by luring them to Florida or Anaheim?

 

[leeholmes1]

I would book a week in the NH mountains. I live in GA and WDW is pretty easy for me to get to. I love it but I also like to use my points for VB AND HHI. A Disney Ski vacation sounds wonderful.