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Will Disney still build stand-alone hotels?

The Orlando Sentinel takes an in-depth look at Walt Disney Co.’s progress building stand-alone hotels in light of last week’s news that Disney abandoned plans to build one.

Since it scrapped plans to build a hotel in suburban Washington D.C., Disney doesn’t have a single stand-alone hotel project in its publicly known development pipeline, Monday’s story notes.

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What happened last week: Disney said it would not go forward with plans to build a 500-room hotel in Washington’s suburbs at National Harbor, where Gaylord runs a large conference center hotel. Disney made the decision, blaming bad timing, despite having spent $11 million on 15 acres along the Potomac River two years ago, the Sentinel tells us.

The move comes after Disney opened its first stand-alone resort this past summer with some problems.

Disney had to temporarily suspend time-share sales at the $850 million Aulani hotel and time-share in Hawaii after realizing it had underestimated the annual fees needed to cover operating costs, according to the Sentinel, which watches Disney closely.

Other challenges for Disney standalone hotels highlighted by the Sentinel:

  • No theme park: One challenge for Disney with stand-alone hotels is the fact that they can’t rely on theme-park visitors to fill rooms.
  • Leadership: Several senior execs who were at Disney when the company first announced stand-alone hotel plans are no longer with Disney’s theme parks division.
  • Tighter wallet: Disney executives promised Wall Street to cut capital spending once they complete projects such as Aulani, two new cruise ships and theme park expansions.

Disney comments

Disney told the paper that its Washington project decision wasn’t related to Aulani’s time-share problems; the Washington hotel wasn’t being planned with a time-share component.

The company isn’t completely ditching the concept of opening more hotels outside of Central Florida and Southern California. Disney spokeswoman Tasia Filippatos told the paper:

“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.”

Read the Sentinel‘s article for more information.

Readers: Do you think Disney should follow through with the idea of developing hotels away from its theme parks? Why – or why not?

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