New Four Seasons Timeshare on Disney Property and Value Oriented West Side

[G8RFAN]

Interesting read. I saw the article in my local rag and figured there would be some heated discussions on this and of course there is. My take on this is that I am surprised. I'll be honest, we love to stay on Disney property, but we also like to stay at JW Marriott/Ritz-Carlton if we want to spend the weekend at SeaWorld. We stayed at the GF back in '99 and it resulted in our decision to try to stay on property for future visits and more importantly, to experience the theming at each resort no mater what the price point. I am sure there is going to be some canabalism of GF bookings when the 4 seasons comes on line, but the GF is not a 4 or 5 star hotel but a themed hotel like every other WDW deluxe resort hotel.

As far as giving up and bringing in other brands instead of creating more entertainment venues with the land, I do not think they will ever build a 5th gate based on the struggles that AK and MGM has had. Maybe AK could have been more, but everything they did right has been beyond expectations and people still aren't coming. Then there are complaints that AK and AKL is in the middle on nowhere, but so was MK when it first opened. I can't imagine what the general populous would say with a western park. Out of everything that I've read, if there is one thing this company should invest in is a complete park monorail system and reduce the mental madness of the buses. Thank goodness we have our car until then. BTW, I think the biggest problem WDW operating wise is human resources. There is no such thing as good affordable labor in central FL. Especially at the scale they need. Thus the substandard maintenance, service, food, etc, etc. I'm not sure how much organized labor has helped or hurt the situation, but I am really pressed to find an example where it has really helped. Anyway, I do think the 4 seasons franchise is a very good one but I am not so sure how well the two brands will compliment each other. For those that wash their hands of Disney, it's absolutely your $'s and time and Disney has failed you. Time to move on.

 

[Another Voice]

Like Exxon's Wolrd of Energy, or United Technologies the Living Seas?

Not at all. Those attractions were designed, built and operated by Disney. The companies you mentioned paid Disney to put their in the shows as advertising.

The Four Seasons will be designed, owned and operated by an outside company. Once Disney sells the land, Disney won't have any connection to if what so ever.

P.S. The rumor is significant portions of the development - both the Four Seasons and the vacation homes, are going to be on the shore of Bay Lake. That's why FS moved from Celebration to WDW - Disney gave them a choicer bit of land.

 

[daannzzz]

I actually don't see a problem with having a Four Seasons coming on board.

This statement along with "As a stock holder I see this as a great positive" Is what is wrong with the WDC now. Apparently those in charge don't see a problem with most of this either. Most anything that will make money is game whether it is the right choice or not. And with manyof the public agreeing with them, they will only take it farther and farther. So if bulldozing th parks would triple the worth of the stock should they do that?

 

[clkelley]

So if bulldozing th parks would triple the worth of the stock should they do that?

SHHHHHH Don't say that too loud. Opryland did that and built Opry Mills Mall. A unique park disappeared all in the name of profit.

 

[Dznefreek]

a little insight as to how the whole Four Seasons deal may have come around. There has been some corporate shakeup within the Four Seasons company lately where the hotelier’s two largest investors (Bill Gates and Prince Al-Waleed bin Talal) just finalized a deal two weeks ago to take the company private for an estimated $3.4 billion. If the name Prince Al-Waleed sounds familiar to you, he has been involved for some time in the EuroDisney Resort where he came in years ago to add financial support to the struggling resort in it’s first bout of bad times and now he apparently owns 10% of EuroDisney S.C.A., the second largest parner after Disney’s own 39.78% stake. It’s said that Prince Al-Waleed has been asking Disney for quite some time now to let him place a Four Seasons hotel on site at Walt Disney World in exchange for his continued and possibly additional financing support for EuroDisney SCA.

Food for thought. . . . .

 

[DancingBear]

BTW, I think the biggest problem WDW operating wise is human resources. There is no such thing as good affordable labor in central FL. Especially at the scale they need. Thus the substandard maintenance, service, food, etc, etc.

Certainly Central FL has had low unemployment and such, but what labor pool is the Four Seasons going to hire from?

 

[EUROPACL]

Certainly Central FL has had low unemployment and such, but what labor pool is the Four Seasons going to hire from?

 

[dunnhorn]

HA!

Seriously, they'll probably ship them in from the other properties. As for the housekeeping staff... it's anybody's guess.

 

[pouncingpluto]

Is anyone else concerned about the addition of so many hotel rooms (and other accomodations) without an announcement of a fifth park? It's the crowding at parks and other attractions that would bother me more than anything.

 

[MassJester]

Is anyone else concerned about the addition of so many hotel rooms (and other accomodations) without an announcement of a fifth park? It's the crowding at parks and other attractions that would bother me more than anything.

That's an interesting thought.

I've toyed with that myself, and I'm wondering if Disney isn't trying to marginalize other hoteliers in the area. There was a story about ending the distribution of park information to outside hotels earlier that might lend support to such a strategy.

I don't mind if that is the plan--someone has to make money off of all those folks staying there, why not Disney?

 

[Another Voice]

I don't mind if that is the plan--someone has to make money off of all those folks staying there, why not Disney?

So why can't Disney make a high end resort on their own? Certainly Disney's "magic" should be able to outdo Four Seasons in all areas. Why give up all that money to Four Seasons when Disney could keep it all?

 

[Mickmse2002]

Whew, this was a long read.....but figured I better read it before chiming in. As many may attest, I have generally tried to make arguments in support of the existing Disney corporate culture still understanding how to make magic. This one is hard to explain. I understand the short-term need to continue to meet Wall Street demands but I am troubled by the apparent corporate responsibility to produce quality on their own. I don't think yhe two have to be separate.

As for many, many, many comments about the historical perspective of Uncle Walt always managing to make magic on a shoestring budget that eventually paid dividends is, to a certain degree, not really relevant. When Disney "went public" Walt was very concerned about having to cut quality in order to make profits. The Wall Street environment of today is different then in his time. If a company misses a Wall Street projection by a penny you may see a slide in the stock price and subsequent loss of potentially billions of valuation. If Walt had to survive in todays climate he may not have been successful.

I too bemoan the loss of the spirit of creativity but I wonder how much we have all contributed to this through our demands of Wall Street? We all want our pensions and investments valuations to rise on the backs of companies that must compete for short-term profit.

 

[Another Voice]

If a company misses a Wall Street projection by a penny you may see a slide in the stock price and subsequent loss of potentially billions of valuation.

The difference it that today it's greatly, greatly easier to raise money from Wall Street than it was to raise capital in Walt's time. Losing pennies from the stock price is nothing compared to business pressure's yesterday.

Walt was financed by Bank of America. They had sole say on what Walt could do. There weren't hundreds of venture capital firms waiting to pour in money. There weren't mega finanical organizations ready to soak up cash from all quarters. There was a single Board of Directors with one banks worth of money (and back then, Bank of America could only operate in Califorina). There were no Euro bonds to float, no Asian money market funds.

Walt had a bunch of grey guys in suits smoking cigars. Can you imagine those guys understanding something like Disneyland in 1953??????

How is that easier than today's junk market market? Or getting capital from a single person - someone like Paul Allen could easily afford a project the scale of Disneyland all by himself (hell, Bill Gates could build Disneyworld if he wanted). The original founders of Dreamworks raised $5 billion on their own.

It's nothing but an easy excuse to say "they had it easy, we have it so hard". The reality is the exact opposite.

What's lacking today isn't capital to invest (a lot has been squandered on GO.com, ABC, airplane leases, etc.) - it's imagine, talent, the willingness to work hard and, mostly, the confidence to try. Money is the easy part. Having faith one's ability is hard.

 

[DisOrBust]

I highly doubt my 32 shares of EXXON stock has caused Wall street to go for the short term gain. I'm guessing the CEOs that have been "given" 100's of 1000's of shares that actually make these stupid short sighted decisions and make a mitfull of money have a bit more influence. Its greed pure and simple, without any thought for the long term.

 

[Mickmse2002]

It's nothing but an easy excuse to say "they had it easy, we have it so hard". The reality is the exact opposite.

I never said it was easier. I said it was markedly different and Bank of America was willing to give the company longer to succeed then you see today.

What's lacking today isn't capital to invest (a lot has been squandered on GO.com, ABC, airplane leases, etc.) - it's imagine, talent, the willingness to work hard and, mostly, the confidence to try. Money is the easy part. Having faith one's ability is hard.

Never said this either so I assume you were responding to someone else. My point is that the business models of 1953 may not be the best to ensure long term survival today. You're not comparing apples to apples.

 

[Mickmse2002]

I highly doubt my 32 shares of EXXON stock has caused Wall street to go for the short term gain. I'm guessing the CEOs that have been "given" 100's of 1000's of shares that actually make these stupid short sighted decisions and make a mitfull of money have a bit more influence. Its greed pure and simple, without any thought for the long term.

Your 32 shares no. The 32,000,000 shares held by a mutual fund you own do cause EXXON to seek the most profit possible.
Disney is no different. Institutional investors, whom represent each and every one of us, do care about profits, both short and long term. They don't care about blue sky phrases such as "magic" and "pixie dust". As long as the parks keep churning out cash then the investors are happy.

 

[DisOrBust]

As long as the parks keep churning out cash then the investors are happy.

But thats the point. I expect the manager of my mutual funds to look at a company such as Disney and think they are throwing the baby out with the bath water and therefore NOT to invest with them. As they did with the no confidence vote many mutal fund managers gave Eisner during the whole Save Disney campgain. Correct me if I'm wrong but Disney's stock has been weak compared to the rest of the market?
The Eisners/Igers of the world who do have 32,000,000 ( a guess) shares can make the "short term" gain decisions and sell a chunk of their shares and make quite the profit, walk away, not give a dam and feel like a master of the Universe.

 

[DancingBear]

Never said this either so I assume you were responding to someone else. My point is that the business models of 1953 may not be the best to ensure long term survival today. You're not comparing apples to apples.

I don't see where A-V is missing the point. He's just pointing out that there are actually ways in which things are actually easier in 2007 than in 1953. So Wall Street may be swinging up or down based on your quarterly numbers, but there is also a tremendous amount more capital out there. Disney's stock is very widely held I believe, so no institutional investor has any inordinate power over the price.

Nordstrom does pretty well with its high-customer-service model. Apple's emphasis on meaningful product development has paid off well. Pixar's mantra of "quality is a business plan" has led to an unbelievable string of hits. Berkshire Hathaway's longer-term outlook has paid off big-time. It can be done, but it takes management that's willing to refrain from pandering to the quarterly report pressures.

 

[Another Voice]

There is no one sitting in an office at Lake Buena Vista saying to themselves "I wish I could authorize keeping Animal Kingdom open an extra hour - but what would Wall Street think!".

There is no one sitting in Wall Street saying "I was going to buy three billion shares, but they overpaid for Gary Sinese's narration in 'Mission: Space' - those fools, Disney must be destroyed for the sake of capitalism!"

Wall Street wants profits. It doesn't really matter how a company gets them, they just want them. It's Disney choice as to how they earn them. Disney can either wow guests, creating magic and excitment and causing Earl in Toledeo to load the family in the car and head to Orlando 'cause he's got to witness these amazing sights - or Disney could cut the number of chicken fingers they serve and con suckers with photogrpahers holding a rope across Main Street.

Real Disney had the confidence to make products at such a high level they beleived that people would willingily pay for them. Today's "Magic" Disney doesn't have enough faith in itself to create popular shows - they're more trusting of marketing, gimmicks and just plain hucksterism to squeeze a couple more pennies from people. Making a brand new money is filled with risk, vomiting out Cinderella 2 at least means you'll get money from stupid and lazy consumers. Instead of creating something new to sell, Disney is trying to get more money from what already exists.

But they don't see that tactic is both damaging the present company and ruining the future of the company. It's Disney's management that's after the quick and easy buck, not Wall Street.

 

[Mickmse2002]

There is no one sitting in an office at Lake Buena Vista saying to themselves "I wish I could authorize keeping Animal Kingdom open an extra hour - but what would Wall Street think!".

There is no one sitting in Wall Street saying "I was going to buy three billion shares, but they overpaid for Gary Sinese's narration in 'Mission: Space' - those fools, Disney must be destroyed for the sake of capitalism!"

Wall Street wants profits. It doesn't really matter how a company gets them, they just want them. It's Disney choice as to how they earn them. Disney can either wow guests, creating magic and excitment and causing Earl in Toledeo to load the family in the car and head to Orlando 'cause he's got to witness these amazing sights - or Disney could cut the number of chicken fingers they serve and con suckers with photogrpahers holding a rope across Main Street.

There are managers in LBV that makie decisions which will affect the bottom line profitabilty and how Wall Street will respond. To believe otherwise is just not realistic. As usual this debate centers on perceived mismanagement and on some issues I am in complete agreement. There are fund managers and stock analysts who routinely meet with management and watch decisions very closely. Do they care about the number of chicken fingers? Nope, that's just silly. The one point that seems to be ignored is that the parks are doing very well for the Disney company and therefore keeping shareholders (including most of us here) happy.