Do you think Shanghai will go for another expansion next or go for a second gate?

[BrianLo]

isn’t there a road in the way ?

Yes, that assuredly will be removed and the quarter of the ring road completed circumnavigating the second gate.

Circled in orange is abandoned Shendi faculties that will be leveled. But the road seemed to be to support that retail a decade ago.

 

[Haymarket]

Yes, that assuredly will be removed and the quarter of the ring road completed circumnavigating the second gate.

Circled in orange is abandoned Shendi faculties that will be leveled. But the road seemed to be to support that retail a decade ago.

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BrianLo, what are your thoughts on whether a second park announcement is coming next year? Have you heard any buzz about it?

 

[BrianLo]

BrianLo, what are your thoughts on whether a second park announcement is coming next year? Have you heard any buzz about it?

I don’t know anything other than my own intuition. Which honestly isn’t the worst.

I’m sure there are conversations and long term planning underway. 2024 park performance gave the consortium the green light. But I think that’s 7-10 years out from reality. Unless the China or global market suddenly goes sideways, I think we’ll have word by end of decade.

 

[BrianLo]

Also to reiterate this thread. There is still oodles of unallocated capital for the two Asian parks in Disney’s 10 year roadmap. Upwards of 16B between partner and Disney’s own contributions. Asymmetrically that will go to Shanghai.

I don’t expect they’ll need to spend Abu Dhabi money (10B), but they’ll need to fork over more than SDL in nominal 2015/16 dollars. In spite of the resort being much more ready for development.

I certainly hope and expect there are more attractions on the docket for SDL, but it will culminate on a new gate. They’ve left themselves that amount of capital in their roadmap. Whether they were willing to talk about it yet in 2023 is a different matter. Though they heavy handedly said so in the original press, which was very focused on cruises and the Asian parks. Likewise there are two unannounced cruise ship orders that I suspect they have options on for 32/33 (or plus a year).

 

[denyuntilcaught]

Also to reiterate this thread. There is still oodles of unallocated capital for the two Asian parks in Disney’s 10 year roadmap. Upwards of 16B between partner and Disney’s own contributions. Asymmetrically that will go to Shanghai.

I think this is exactly what gave it away. There's an ample sum to fund a second gate, almost as if it was earmarked.

That said, I think the 7-10 year timeframe is too long - it misses the moment, limits attendance growth or demand that no single attraction or land can fulfill, and is out of line with the rapid expansion SDL has exhibited thus far.

 

[Robbiem]

I wonder if the timing of Abu Dhabi will impact on a second Shanghai gate? As well as the capacity of imagineering I could see the Emerarti’s having a clause preventing Disney from opening another park for a time period or Disney delaying a second gate to let the new resort establish itself

 

[marni1971]

I wonder if the timing of Abu Dhabi will impact on a second Shanghai gate? As well as the capacity of imagineering I could see the Emerarti’s having a clause preventing Disney from opening another park for a time period or Disney delaying a second gate to let the new resort establish itself

They’re not exactly close neighbours so I’d doubt it

 

[Rush]

They’re not exactly close neighbours so I’d doubt it

The Abu Dhabi park is meant to attract tourists from the Middle-East, Africa, Eastern Europe, South Asia and China. I firmly believe had Abu Dhabi not been a thing, a Shanghai second gate would've already been greenlit and given the go.

 

[marni1971]

The Abu Dhabi park is meant to attract tourists from the Middle-East, Africa, Eastern Europe, South Asia and China. I firmly believe had Abu Dhabi not been a thing, a Shanghai second gate would've already been greenlit given the go.

Paris is closer than Shanghai. Territorial dominance is a non starter. If there’s any concerns, Shendi would be pushing to open another park sooner than later.

 

[Haymarket]

The Abu Dhabi park is meant to attract tourists from the Middle-East, Africa, Eastern Europe, South Asia and China. I firmly believe had Abu Dhabi not been a thing, a Shanghai second gate would've already been greenlit and given the go.

Where did China come from? Do you mean western China?

I thought the big number was that a third of the global population is within 4 hours of Abu Dhabi.

Shanghai is 8–9 hours away.

Even the western-most big city in China, Urumqi, is 18 hours away due to limited flights.

I'm pretty sure it's primarily for markets in South Asia, Africa, and the Middle East.

Here's four hours on a 787 at average speed.

 

[Rush]

Paris is closer than Shanghai. Territorial dominance is a non starter. If there’s any concerns, Shendi would be pushing to open another park sooner than later.

The UAE is an emerging destination for Chinese tourists, and I'm sure both Disney and Miral factored in this happening and to which extent it might affect the AD park.

 

[Haymarket]

It's primarily a regional park. I think that's why they chose four hours.

Iger:

Disneyland Abu Dhabi will be authentically Disney and distinctly Emirati – an oasis of extraordinary Disney entertainment at this crossroads of the world that will bring to life our timeless characters and stories in many new ways and will become a source of joy and inspiration for the people of this vast region to enjoy for generations to come.

Robert Niles at Theme Park Insider:

As Iger said during Disney's earnings call yesterday, "It was very obvious to us that there were many people - basically hundreds of millions in the world that are income qualified - where a trip to one of our six locations was pretty lengthy in nature and expensive. And so, we felt the best way obviously to reach those people is to basically bring our product to them."

The biggest hole in Disney's donut extends from Africa through the Middle East to India. Any nation on Earth would welcome a Disney theme park, if offered. So the company enjoys the opportunity to locate a new park in the location that best serves its needs.

The Middle East lies in the middle of the donut hole that Disney wants to fill, so that's an obvious first choice for its next resort. A Disney park in the Middle East can serve not just people in that region, but millions more who live a relatively short flight away in North Africa and India.

 

[networkpro]

The only issue I see is financing from the local government for their 51% portion. Local governments in China are dependent on income from local government financing vehicles to keep running, Local governments in China cannot issue municipal bonds and cannot borrow money from banks. These LGFV's are off the books and represent what's basically unsecured debt.

 

[lazyboy97o]

Miral not wanting Disney working on another park wouldn’t necessarily have to do with the customer base, but could do with the talent base. A new proper Disney or Universal scale park requires a lot of people and not just direct employees. Universal Studios United Kingdom won’t be as ambitious as Epic Universe but it’s still a decently sized park. The Middle East still doesn’t quite have its own industry, and top talent/resources are still associated with the US and Europe.

 

[BrianLo]

Miral not wanting Disney working on another park wouldn’t necessarily have to do with the customer base, but could do with the talent base. A new proper Disney or Universal scale park requires a lot of people and not just direct employees. Universal Studios United Kingdom won’t be as ambitious as Epic Universe but it’s still a decently sized park. The Middle East still doesn’t quite have its own industry, and top talent/resources are still associated with the US and Europe.

I‘ve gotten the impression that Miral was the chaser here? I don’t know if they’d be in a position to make contract demands that would pigeon hole the companies own planning.

That said logistically I don’t think they wholly overlap. For the resource reasons you say. Hence Shanghai more towards mid decade. It gives WDI clear employment security for a while.

 

[BrianLo]

The UAE is an emerging destination for Chinese tourists, and I'm sure both Disney and Miral factored in this happening and to which extent it might affect the AD park.

Universal Osaka and Tokyo Disney barely share population demographic overlap. Shanghai and Abu Dhabi are a non-existent full percentage point and the only ones it would share are the Disney brand freaks (of which I am one).

It’s a smart market, because it is a completely unserved market by Disney. Even a South Korean park wouldn’t budge the needle on the other Asian ones.

 

[Haymarket]

Discussion about the second park from the Main Street News.