What I want: A new Star Wars theme Hotel.

[DDLand]

Where in my comments do I mention that the hotels that pay a license to Disney won't make money? I'd bet the farm that every hotel chain in the US has approached Disney at least once to discuss either planting their own flag or offered up to run those resorts. And it has little or nothing to do with their (Disney's) ability to financially support the hotel operation, it's just that Disney is no longer interested in that area. If they were would they not be constructing additional resorts? Why cannibalize existing properties in favor of DVC if the 'regular' hotel business was so profitable? Why go the Flamingo Crossings route instead of developing that property on their own?

And what 'massive increases in occupancy' are you referring to? Disney is either getting close to or has reached a price point on the hotels that the cash paying customer is starting to take notice (meaning walk away for something cheaper). No way would they be converting half of the Polynesian if that sucker was filling to capacity. They would instead expand that capacity. Same goes with the Wilderness Lodge.

You're saying that WDW is obsessed with profit. There's clearly profit to be made in the hotel business. Disney can command prices that no one else can charge. They'd be leaving profit on the table if they tried outsourcing. No one has ever shared a convincing reason why they'd start giving up that profit.

Saying "it's just Disney is no longer interested in that area," is not convincing. Why? Because they've let a vestige of the Rasulo age sell down market hotel rooms to sports teams? They're going after families. They're going after those who have money and kids who will buy the princess merchandise. Not poor high schoolers or cheerleaders who lead to guests complaints.

DVC? They've been targeted at only one segment of the market, deluxe. Moderate and Value continue to perform well. They've actually added room capacity over the last decade. Any rooms lost due to Poly, BLT, and DAK is offset by the 100s of new hotel rooms activated. Instead of shuttering 100s they've added 100s. They're just targeted at a different market.

You can look at the SEC fillings as easily as I can. You can see the trend. You can also read the part about revenue increases due to increased volume in part due to higher occupancy at WDW and Aulani. You can also search for the Rasulo comments about how capacity are at levels where they traditionally would've added occupancy.

 

[Eoghann]

You're saying that WDW is obsessed with profit. There's clearly profit to be made in the hotel business. Disney can command prices that no one else can charge. They'd be leaving profit on the table if they tried outsourcing. No one has ever shared a convincing reason why they'd start giving up that profit.

It's not profit that their interested in, it's ROS. This is true of pretty much all large companies. It may seem crazy on the face of it, but to a large company some profits are just not worth the effort involved in getting them.

Most companies have ROS % targets and things that fall below those targets have to be justified some other way if they are to continue.

 

[DDLand]

It's not profit that their interested in, it's ROS. This is true of pretty much all large companies. It may seem crazy on the face of it, but to a large company some profits are just not worth the effort involved in getting them.

Most companies have ROS % targets and things that fall below those targets have to be justified some other way if they are to continue.

You're absolutely right, but as I've already pointed out, Disney is already in a low margin business. Or at least so says the several business publications (seems crazy when companies like Universal Parks with 30% margins are considered a low margin business). This trend goes accross theme parks and the hotels. Disney is committed to these businesses. They're willing to accept the lower margins in return for the security and profit it brings to the company, even with bloated CapEx, high costs, and liability.

In my view, launching a new value resort (which they didn't have to do, they could've let the thing rot for another decade) shows that it is in their interest to operate these hotels. It is a profit margin positive. Why shouldn't it be? Insanely priced Fairfield Marriott relying on the existing infrastructure and scalability of the existing support structure, it should be pretty profitable.

 

[skier_pete]

It's one thing to argue "Disney won't build a new ride based on an original concept" when they haven't done so in 10 years (Everest) and have multiple heavy-IP based rides coming in.

It's a different thing to claim "Disney won't self-run any new resorts on property" when they did so just three years ago, and haven't farmed out a resort in more than 20 years. In other words - I'll believe the claim when I see it happen even once.

 

[wallrock]

You're saying that WDW is obsessed with profit. There's clearly profit to be made in the hotel business. Disney can command prices that no one else can charge. They'd be leaving profit on the table if they tried outsourcing. No one has ever shared a convincing reason why they'd start giving up that profit.

Saying "it's just Disney is no longer interested in that area," is not convincing. Why? Because they've let a vestige of the Rasulo age sell down market hotel rooms to sports teams? They're going after families. They're going after those who have money and kids who will buy the princess merchandise. Not poor high schoolers or cheerleaders who lead to guests complaints.

DVC? They've been targeted at only one segment of the market, deluxe. Moderate and Value continue to perform well. They've actually added room capacity over the last decade. Any rooms lost due to Poly, BLT, and DAK is offset by the 100s of new hotel rooms activated. Instead of shuttering 100s they've added 100s. They're just targeted at a different market.

You can look at the SEC fillings as easily as I can. You can see the trend. You can also read the part about revenue increases due to increased volume in part due to higher occupancy at WDW and Aulani. You can also search for the Rasulo comments about how capacity are at levels where they traditionally would've added occupancy.

What they added over a decade ago is inconsequential as the mindset was different. The focus of the discussion is what Disney is doing now.

But since the subject has come up, since 09/11 Disney has opened only one resort, and that was the unfinished remains of the original Pop Century layout. No telling if Art of Animation would have been built had the foundation not existed, but it's here so we'll include it. That added just shy of 2000 cash payment rooms. In the same timeframe they've added that plus a thousand more on the DVC side with the Wilderness Lodge coming right up. Clearly the room building 'frenzy' is focused more on DVC and not the cash paying customer. Even more interesting is that they have gone further down the rabbit hole by not adding rooms via DVC, but cannibalizing existing ones. Half of the Polynesian is now DVC. No telling if that same cannibalization rate will go with the other resorts. My bet is it will.

As far as comments by the executive leadership…we'll go with the oft-used and very reliable 'trust only the shovels'. Once again, look at Flamingo Crossings - the question still stands on why Disney isn't developing that as one of their own resorts.

 

[Rose mcconkey]

Love Pop Century and think a star wars section would be fun

 

[DDLand]

What they added over a decade ago is inconsequential as the mindset was different. The focus of the discussion is what Disney is doing now.

But since the subject has come up, since 09/11 Disney has opened only one resort, and that was the unfinished remains of the original Pop Century layout. No telling if Art of Animation would have been built had the foundation not existed, but it's here so we'll include it. That added just shy of 2000 cash payment rooms. In the same timeframe they've added that plus a thousand more on the DVC side with the Wilderness Lodge coming right up. Clearly the room building 'frenzy' is focused more on DVC and not the cash paying customer. Even more interesting is that they have gone further down the rabbit hole by not adding rooms via DVC, but cannibalizing existing ones. Half of the Polynesian is now DVC. No telling if that same cannibalization rate will go with the other resorts. My bet is it will.

As far as comments by the executive leadership…we'll go with the oft-used and very reliable 'trust only the shovels'. Once again, look at Flamingo Crossings - the question still stands on why Disney isn't developing that as one of their own resorts.

I was giving you a pass. If you want to talk about the last 5 years or so, the proportion of new hotel rooms to timeshares becomes even more lopsided. You said it yourself, 2000 new rooms. That towers above any DVC development. It doesn't matter that it was partially built. They took on the additional staff, took on management of facilities, and decided to add thousands of rooms in extra capacity. According to WDW officials, it was the value and moderates and that helped the resorts successfully navigate the economic turmoil of the recession. Before Art of Animation and Poly both were launched, WDW had 75% of rooms falling in the value or moderate camps. That's only gotten more extreme since then.

If they want to keep chipping away at their deluxe rooms which make up around 20% of keys, that's fine. They also don't represent the vast majority either.

Flamingo Crossings was a much more ambitious project, but is now pathetic at best. They're currently planning at full build out to have 7 hotels that you could find anywhere on I-95. Instead of the meticulously planned shopping dining center, you'll find hotel islands. Additionally, the elephant in the room on this front is Disney had originally been planning to have 4000-5000 hotel rooms total. So far, rumors have called for around 7, with only 3 confirmed. If each one sticks to their consistent 250 room number (and they should seeing as each building plots is fairly constrained) they'll have added 1750 rooms. Those seven hotels are a bit off from the nearly 20 hotels and timeshares (funny huh?) they had been planning previously.

Could Flamingo Crossings end up being huge? Eventually, sure. I even saw something on the sentinel that said in a decade they'll be back on track with the original plan they revealed in 2007 (that is slow construction, 15 years+ from announcement to completion) It's just that Disney announced this fast approaching a decade ago, and things are barely materializing. You'll also notice how things changed with who they're marketing it towards. Sports teams. Also from the sentinel:

"The hotels could be competition for Disney's budget accommodations. However, those hotels are closer to the theme parks and have unique features...

"It's a very strategic move on their part to make it good enough, but not as good as or superior to what Disney has to offer," Smith said."

They're not in the same market.

 

[PirateSAM]

How about a super-value Death Star resort where the rooms are modeled after cells in the detention block? Thousands of very tiny rooms!

 

[wallrock]

I was giving you a pass. If you want to talk about the last 5 years or so, the proportion of new hotel rooms to timeshares becomes even more lopsided. You said it yourself, 2000 new rooms. That towers above any DVC development. It doesn't matter that it was partially built. They took on the additional staff, took on management of facilities, and decided to add thousands of rooms in extra capacity. According to WDW officials, it was the value and moderates and that helped the resorts successfully navigate the economic turmoil of the recession. Before Art of Animation and Poly both were launched, WDW had 75% of rooms falling in the value or moderate camps. That's only gotten more extreme since then.

If they want to keep chipping away at their deluxe rooms which make up around 20% of keys, that's fine. They also don't represent the vast majority either.

Flamingo Crossings was a much more ambitious project, but is now pathetic at best. They're currently planning at full build out to have 7 hotels that you could find anywhere on I-95. Instead of the meticulously planned shopping dining center, you'll find hotel islands. Additionally, the elephant in the room on this front is Disney had originally been planning to have 4000-5000 hotel rooms total. So far, rumors have called for around 7, with only 3 confirmed. If each one sticks to their consistent 250 room number (and they should seeing as each building plots is fairly constrained) they'll have added 1750 rooms. Those seven hotels are a bit off from the nearly 20 hotels and timeshares (funny huh?) they had been planning previously.

Could Flamingo Crossings end up being huge? Eventually, sure. I even saw something on the sentinel that said in a decade they'll be back on track with the original plan they revealed in 2007 (that is slow construction, 15 years+ from announcement to completion) It's just that Disney announced this fast approaching a decade ago, and things are barely materializing. You'll also notice how things changed with who they're marketing it towards. Sports teams. Also from the sentinel:

"The hotels could be competition for Disney's budget accommodations. However, those hotels are closer to the theme parks and have unique features...

"It's a very strategic move on their part to make it good enough, but not as good as or superior to what Disney has to offer," Smith said."

They're not in the same market.

If you want to shave off a few years on the construction timeframe just so your numbers look more favorable then go ahead. By your calculation methodology one could suggest that in 2012 Disney added 2000 cash rooms and no record of any DVC coming in, therefore cash rooms are dominating Disney's building plans. Massage the numbers enough and I'm sure you'll get something favorable.

Bottom line, since 09/11 Disney has constructed over a thousand more DVC rooms than cash ones. There's nothing on the horizon to indicate that a new cash resort is on its way and plans are already drawn up to expand the DVC footprint.

As far as Flamingo Crossings being pathetic…you're certainly entitled to your opinion, but with a goal of around 5000 rooms I'd call it far from pathetic. And suggesting the slowness of the development is sidestepping the point of the argument - the development is NOT going to include a Disney exclusive resort.

The question still stands…why is Disney not developing its own resort?

 

[DDLand]

If you want to shave off a few years on the construction timeframe just so your numbers look more favorable then go ahead. By your calculation methodology one could suggest that in 2012 Disney added 2000 cash rooms and no record of any DVC coming in, therefore cash rooms are dominating Disney's building plans. Massage the numbers enough and I'm sure you'll get something favorable.

Bottom line, since 09/11 Disney has constructed over a thousand more DVC rooms than cash ones. There's nothing on the horizon to indicate that a new cash resort is on its way and plans are already drawn up to expand the DVC footprint.

As far as Flamingo Crossings being pathetic…you're certainly entitled to your opinion, but with a goal of around 5000 rooms I'd call it far from pathetic. And suggesting the slowness of the development is sidestepping the point of the argument - the development is NOT going to include a Disney exclusive resort.

The question still stands…why is Disney not developing its own resort?

There was a miscommunication, I understand where you're coming from. I was talking about the relevant Hotel Room to DVC conversions, but I see you're talking total about the less relevant total DVC added. My bad. You do realize this business can walk and chew gum at the same time right? They can add hotel rooms over a time period (which they did), and also add DVC at the same time (which they did). Over the last two decades, decade, or 5 years they've increased capacity at both hotels and DVC.
To say Disney isn't interested in the hotel business is a farce when they've never had more moderate or value hotel rooms. No one is saying that they're getting ready to build a new deluxe, but to say they're not interested in the hotel market is ridiculous when they hired the new staff, spent money on infrastructure, and launched a brand new resort.

DVC is great. So are cash payment rooms. The two of them together make for a powerful lodging base.

4000-5000 by 2024. Even that's in doubt. There's been rumblings that they're not going to see it through. As it stands, Flamingo Crossings right now should be a bustling shopping, dining, and hotel district. It's not even opened its first hotels.

Why not Disney? Because they're targeted towards different markets. They're cheaper and lower margin. They've specifically targeted this to let the values have more capacity to take in more families, instead of the sports teams. @rteetz will know that they never have problems filling up values, at least says Spirit. The big question you should be asking yourself is why Disney is letting timeshares be built at Flamingo Crossings. By your logic Disney is abandoning the time share business too.

Or maybe they're targeted towards different markets.

 

[rteetz]

There was a miscommunication, I understand where you're coming from. I was talking about the relevant Hotel Room to DVC conversions, but I see you're talking total about the less relevant total DVC added. My bad. You do realize this business can walk and chew gum at the same time right? They can add hotel rooms over a time period (which they did), and also add DVC at the same time (which they did). Over the last two decades, decade, or 5 years they've increased capacity at both hotels and DVC.
To say Disney isn't interested in the hotel business is a farce when they've never had more moderate or value hotel rooms. No one is saying that they're getting ready to build a new deluxe, but to say they're not interested in the hotel market is ridiculous when they hired the new staff, spent money on infrastructure, and launched a brand new resort.

DVC is great. So are cash payment rooms. The two of them together make for a powerful lodging base.

4000-5000 by 2024. Even that's in doubt. There's been rumblings that they're not going to see it through. As it stands, Flamingo Crossings right now should be a bustling shopping, dining, and hotel district. It's not even opened its first hotels.

Why not Disney? Because they're targeted towards different markets. They're cheaper and lower margin. They've specifically targeted this to let the values have more capacity to take in more families, instead of the sports teams. @rteetz will know that they never have problems filling up values, at least says Spirit. The big question you should be asking yourself is why Disney is letting timeshares be built at Flamingo Crossings. By your logic Disney is abandoning the time share business too.

Or maybe they're targeted towards different markets.

They don't have a problem with values or moderates really. Values fill pretty easy these days as deludes and even moderates continue to rise in price. However I don't think we see a moderate resort anytime soon. A value resort is likely but I'm also willing to bet that value resort is very similar to AoA and has family suites. I've said this before but there is some speculation that even Pop could be getting ready to convert to some family suites.

 

[DDLand]

They don't have a problem with values or moderates really. Values fill pretty easy these days as deludes and even moderates continue to rise in price. However I don't think we see a moderate resort anytime soon. A value resort is likely but I'm also willing to bet that value resort is very similar to AoA and has family suites. I've said this before but there is some speculation that even Pop could be getting ready to convert to some family suites.

The thing about moderates, is they've actually moved into what once was deluxe pricing before. Values have moved into what was once moderates. Deluxe has gone crazy. FC actually fills the void of where values used to be priced.

I think you're right about leaning value. There's a niche there where people want themed Disney rooms, but not for insane prices. Value fills that niche.

 

[Mr Mannn]

How about a super-value Death Star resort where the rooms are modeled after cells in the detention block? Thousands of very tiny rooms!

Ya know, I stay at values because I ONLY sleep there. I'm at the parks the rest of the time.
This is not a bad idea.

 

[lockedoutlogic]

It's one thing to argue "Disney won't build a new ride based on an original concept" when they haven't done so in 10 years (Everest) and have multiple heavy-IP based rides coming in.

Ok...why am I missing on this angle of approach?

Sorry...I deleted the good part...

I mean the "Disney just did one 3 years ago" when talking of hotels...

Do we havetb go over the history of Hotel construction again? Because it shows ZERO desire by Disney to build new hotel rooms...only timeshare and specialty...and I mean flamingo and four seasons by that.

The last disney planned, built, and executed according to plan rack hotel was opened in April of 2001...

And THAT has been retrofitted since.

Those are facts...I can tell the history of pop, mothballs, and art of animation...but I find it highly unlikely that anyone arguing here doesn't already know it. And they are being intentionally misdirecting if they are trying to use it as proof of Disney's willingness to open more hotels. It's actually 100% the opposite.

 

[apwagner]

Taking one of the All Star resorts and converting it to a Star Wars theme is another possibility. Naturally with an upgrade in price to a glorified moderate

This is the best idea Ive seen in this whole thread. IMO those resorts need a little life put back into them and a Star Wars resort is a great option.