Here is an article explaining pretty much everything you ever wanted to know about the Swan and Dolphin's ownership etc. A Disney Resort Remodels for Business Travelers By MICHAEL BRICK - New York Times Oct 30, 2002 LAKE BUENA VISTA, Fla. — The advertisements for restaurants in the Walt Disney Swan Resort and the Walt Disney Dolphin Resort hotels here include a place with "Disney Character Dining Opportunities," as illustrated by a young girl grinning at a person dressed as a dog who holds a thumbed paw the size of a steering wheel atop her blond head. For more sophisticated travelers, a steakhouse, the promotional literature states, features "a pleasant, intimate atmosphere, surrounded by Miami Dolphins memorabilia." Marlin Evans, here from Birmingham, Ala., to attend a convention of the Chartered Property and Casualty Underwriters Society, finished his ice cream cone one day last week at the Dolphin Fountain, a malt shop near the lobby. "You do have to accept the fact that you're going to be around children," he said, as Buddy Holly's voice on a jukebox pledged an indefatigable affinity for Peggy Sue. "It's not your typical businessman's place." The Tishman Hotel Corporation, a wholly owned unit of the Tishman Realty and Construction Company of New York that owns these hotels in partnership with MetLife, is spending $75 million to brush away just enough of that imagery to make the Swan and Dolphin hotels, which are operated by the Starwood Corporation, appeal to more business travelers and conventiongoers. The task is delicate, in part because the Walt Disney Company owns the ground beneath the hotels and has a veto over any modifications and in part because the site of the two hotels within Disney World makes it imperative that Tishman not turn its back on the family market altogether. But the company has calculated that it sorely needs the grown-ups. Revenue from the 2,267 rooms, priced from $199 to $405, are expected to fall to about $200 million this year from a peak of $225 million in 2000, according to John A. Griswold, president of Tishman Hotel. "We're trying to cater to what those markets expect," he said. "For the price that we're charging, they're expecting a little more contemporary, a little more hip." Travel is still off all over the country, industry analysts say, although leisure travel is rebounding far better than business travel. Average revenue generated by each available hotel room nationally — the common industry gauge for the real estate side of the travel business — declined 7 percent in 2001, according to Smith Travel Research. The accounting firm PricewaterhouseCoopers has predicted another decline of 2.3 percent this year. The Orlando area, with 450 hotels and 109,946 rooms, has been hit especially hard. The area is among the worst in the country for unpaid loans, with $177 million in delinquencies on 29 properties, said Stephen P. Taylor, a managing director in the Florida office of Horwath Hospitality Investment Advisors, a consulting and brokerage firm in San Francisco. "In Orlando, you've actually got a lot of properties that should have been bulldozed," Mr. Taylor said. "We're underdemolished." Nationally, though, foreclosures and delinquencies are relatively low. Delinquencies peaked at 5.5 percent of all outstanding loans to the lodging industry earlier this year, compared with a high of 16 percent during the recession in 1991, according to Bjorn Hanson, an industry analyst for PricewaterhouseCoopers. The reasons include the aversion of lenders to actually running hotels themselves and the fact that most hotels built in the last decade were capitalized with 30 percent equity instead of just 5 percent, he said. That has been a disappointment for real estate investors who are hoping to buy distressed hotel assets, said Daniel H. Lesser, managing director of the hotel practice at Cushman & Wakefield, the commercial real estate services firm. "There was a tremendous amount of equity gathering up to seize on this opportunity," Mr. Lesser said. But "buyers are pricing distressed properties off of historical trailing 12-month income and sellers are pricing an asset based on future opportunities, and there's a big spread between the bid and ask prices." So transactions have actually declined, he said. But the problem for hotel owners like Tishman is that rates for leisure travelers are deeply discounted, and so some hotels, especially in resort areas like Orlando, are hoping to use the lull to remake themselves as business destinations. The reward comes when business travelers take to the skies in great numbers again, whenever that may be. And a race of sorts has begun. Nearby, Marriott International is building a Ritz-Carlton with more than 400 rooms and a J. W. Marriott with more than 1,000, hoping to attract the same business travelers that Tishman desires. "It's not unlike the reverse of what Vegas did 10 years ago," said Doris Parker-Grossman, a principal in charge of hotel asset management for LendLease Real Estate Investments, remembering an effort by hotels on the Las Vegas Strip to remodel and become more appealing to families during the early 1990's. "You go after one segment, and if it becomes sluggish or price-sensitive, you go after the other," she said. Tishman has been going after wealthy American and British families and honeymooners from Japan since it built the hotels here a little more than a decade ago. After a lawsuit and settlement in the mid-1980's involving covenants among the various companies regarding their marketing, Tishman and MetLife won the right to build the Swan and Dolphin near the center of the 28,000-acre Walt Disney World property, between Epcot Center and MGM Studios. They built 2,267 rooms and 200,000 square feet of meeting space, which has since been expanded to 327,000 square feet. The Swan and Dolphin are operated under a land lease from Disney granting Disney a percentage of revenue from the hotels, one that has escalated over the years. The $350 million complex was paid for with $50 million in equity, half from MetLife, 25 percent from Tishman and 25 percent from Aoki of Japan, a share Tishman bought in the mid-1990's. The balance was paid with construction loans from Japanese banks, and have been refinanced several times as interest rates have fallen. The architect Michael Graves decorated the lobbies and breezeways with fountains flowing around cartoonish swans and dolphins and painted the hallways with beach scenes. He decorated the rooms in pink, blue and yellow pastels, with pineapple-shaped wooden lamps and sketches of palm trees on the cabinets and light fixtures. A standard-issue hotel ashtray in this setting gives the appearance that a 10-year-old child lives here and frequently entertains George Burns and Tom Waits. "The focus was very much about kids," said Patrick J. Burke, a principal at Michael Graves & Associates who is in charge of redesigning the rooms. "We wanted to go back and recognize that there are people doing business here." To Tishman, much of the redesign centers around a new style of bed, white as a nurse's smock in the morning, bursting with down and marketed as "heavenly." "The heavenly bed is a huge deal in the hotel industry," Mr. Griswold of Tishman said. "The guests want to see this fluffy, thick, pillow-topped mattress." All this emphasis on the bed has been a challenge to the designers, and the nonnegotiable requirement for white comforters was a sign that the new room design would not revolve around the tastes of families with small children, Mr. Burke said. "There was a press release they sent to us to see if there was anything we wanted to add, and it was a story about the bed," he said. "It's a good bed, it's a comfortable bed. I don't think I have anything to add." The new beds will be complemented by a lower dresser with more workspace, room safes that can hold laptop computers, natural maple headboards and frames and tiled entryways. Mr. Griswold said Tishman is also finalizing a deal with Todd English, a chef who owns restaurants in Boston, New York and Las Vegas, to open an upscale seafood restaurant in the hotel with a spacious private dining area, a raw bar and a lounge.