ORLANDO, Fla. — Nearly five years after it outlined an ambitious vision of standalone hotels, niche parks and retail centers built in outposts far beyond its world-famous theme-park resorts, the Walt Disney Co. today has no such projects in its public development pipeline.
That’s the case after the company late last week abandoned plans to build a roughly 500-room, Disney-branded hotel near Washington, D.C. Disney, which spent $11 million to buy land in the area in early 2009, said the timing simply wasn’t right for the project.
The move follows an early stumble at Disney’s first big foray into standalone resorts: Aulani, the roughly $850 million hotel and time share that opened Aug. 29 on the Hawaiian island of Oahu. Disney was forced to suspend sales in the project for two months this summer after it realized it had underestimated the annual fees needed to cover the resort’s operating costs; Disney will now have to subsidize the fees paid by early time-share buyers for the next 50 years.
At the same time, Disney Co. executives have pledged to investors to reduce capital spending once the company completes a current slate of projects that includes the Hawaiian resort, two new cruise ships, and park expansions around the world.
“They have more than enough to chew on for the next three to four years,” said Tony Wible, a media-and-entertainment equities analyst at Janney Capital Markets.
Disney says it may yet build more hotels outside of Central Florida and Southern California, where it operates its massive Walt Disney World and Disneyland resorts.
“We have seen tremendous enthusiasm for Aulani, and all of our key sales locations for Aulani are performing well. Based on our experience to date, additional standalone resorts in the future are a very real possibility,” Disney spokeswoman Tasia Filippatos said Tuesday.
Disney said the decision to back out of Washington was entirely unrelated to Aulani’s time-share problems; the company says it never planned to include a time-share component in the D.C. project.