News Reedy Creek Improvement District and the Central Florida Tourism Oversight District

[HauntedPirate]

It says minimum of 8 billion under the economic development terms in Exhibit C:

"Disney agrees to make at least an initial capital investment of $8billion dollars within the first ten (10) years of the term of the Agreement, consisting of capital investment in existing infrastructure, new construction and technology investment."

They may well end up not doing all 17 in the first 10 but that is a pretty typical safety measure to guard against unforeseeable economic issues (think 9/11, housing crash or Covid) where you need to drastically reduce spending.

Personally I don't think they do all of it in 10 years as I expect a new CEO to come in long before many of the projects that money would go towards have started, halt everything to evaluate the potential projects, can a number of them and restart the whole design process pushing things back years.

That's been the caveat that so many have missed all along - Things change.

And so many were saying, "nope, Bob said it, they filed papers with the SEC, they are LOCKED IN on that $17 billion in the next 10 years, baby, they're going to build tons of new things!!!!!!!!1!!!1!". No common sense, no peeling back a layer on the onion, just keep their pixie dust drip going strong and everything is fine.

 

[Advisable Joseph]

Yes, Disney made that clear in the run-up to the proxy fight at the shareholders' meeting.

The agreement says, abut the $8 million minimum:

capital investment in existing infrastructure, new construction and technology investment

Attractions and hotels aren't infrastructure (see the previous plans where they are differentiated), so the money from this amount going to attraction and hotels would have to be "new construction."

New Construction vs. Existing Property

When deciding what real estate property to invest in, you will likely also have to decide whether to choose new construction or an existing property.

...

While you’ll likely be able to receive higher rents from an investment in new construction, an existing property that needs renovations is usually where the money is at.

https://www.nasdaq.com/articles/5-factors-you-should-consider-when-investing-real-estate

I guess adding a new tower to a hotel or expanding a ride would be "new construction" but simple renovation or maintenance would not?

 

[MisterPenguin]

That's been the caveat that so many have missed all along - Things change.

Yeah, they'll wind up spending a lot more.

 

[LSLS]

Honestly the numbers worked out to something very similar to what they had done the previous 10 years. So a few rides, 2-3 new DVC or so, and 1-2 new mini lands. And in all honesty, they are right on their way to that $17 bil investment. TBA, Poly, Tropical Americas, a Moana ride, Lion King ride, and potentially Beyond Big Thunder would pretty much do it on top of the other stuff they spend on. The question really isn't if they use that money, but what they spend it on, and I'd say there's a lot left to be desired on that front.

 

[MisterPenguin]

Honestly the numbers worked out to something very similar to what they had done the previous 10 years. So a few rides, 2-3 new DVC or so, and 1-2 new mini lands. And in all honesty, they are right on their way to that $17 bil investment. TBA, Poly, Tropical Americas, a Moana ride, Lion King ride, and potentially Beyond Big Thunder would pretty much do it on top of the other stuff they spend on. The question really isn't if they use that money, but what they spend it on, and I'd say there's a lot left to be desired on that front.

It's basically a promise not to go back to the doldrums of a previous era. Something new every year...

...once they start building it...


...and finishing it.

 

[Advisable Joseph]

Still looks like considerably more than last decade, much more than what has been announced, especially if attraction/hotel maintenanced is not included in the pledged amount.

Anyway I saw this weirdness on page 5 of the agreement, page 13 of the document packet:

Land Use	Comprehensive Plan Approved	Updated Comprehensive Plan Minimum Development
Hotel/Motel (keys)	53,467	53,467
Office (gsf)	1,032,000	1,258,564
Retail/Restaurant (gsf)	1,732,887	1,732,887
Major Theme Park (each)	5	5
Minor Theme Park (each)	5	5

Emphasis mine.

What does minimum development mean here?

 

[BrianLo]

If you think what will happen 10 years from now is what they are saying will happen today I've got some prime south Florida land you will be interested in......

That's been the caveat that so many have missed all along - Things change.

Well of course. That's been the case before this as well too.

But what it does provide is a slight downside buffer. 8 billion in inflation adjust terms would be about 75% of the spend of the last decade. Which wasn't by any means a cheap decade with five fairly noteworthy projects between Springs, DHS, DAK/Pandora, Epcot and the usual DVC/transport portfolio/mild MK spending.

This agreement provides some downside risk that even in some economic disaster, they can't exactly dial the spending to nothing. It's some vague assurance that the current DAK/Magic Kingdom/Big Thunder/DVC projects and maintenance will continue unabated.

It's not a guarantee that the rest of what we don't know will occur, but it is a reaffirmation that they still do intend on 'more'.

In inflation adjusted terms we've had far worse decades than the 8 billion they are now somewhat bound to, so it's certainly not a bad floor.

 

[Advisable Joseph]

In sum, it looks like Disney (inadvertantly?) agreed to a development program resulting in 5 major parks? Maybe this is what WESH saw?

I'm trying to figure out what they actually meant. To begin with, I think the word "minimum" in the table and the agreement text was supposed to be "maximum." I'd think they were asking the District to make the right column (below, from my previous post) the new maximum, but then what is the left column? It is not the currently allowed development (2020 plan).

The text of the agreement seems to say that the right column (Column B) is the development program to be spelled out in the Comprehensive Plan and Land Development Regulations.

Still looks like considerably more than last decade, much more than what has been announced, especially if attraction/hotel maintenanced is not included in the pledged amount.

Anyway I saw this weirdness on page 5 of the agreement, page 13 of the document packet:

Land Use	Comprehensive Plan Approved	Updated Comprehensive Plan Minimum Development
Hotel/Motel (keys)	53,467	53,467
Office (gsf)	1,032,000	1,258,564
Retail/Restaurant (gsf)	1,732,887	1,732,887
Major Theme Park (each)	5	5
Minor Theme Park (each)	5	5

Emphasis mine.

What does minimum development mean here?

 

[HauntedPirate]

There is no 5th park coming. People need to get this utter twaddle out of their minds and stop clicking on moronic articles.

 

[Stripes]

In sum, it looks like Disney (inadvertantly?) agreed to a development program resulting in 5 major parks? Maybe this is what WESH saw?

I'm trying to figure out what they actually meant. To begin with, I think the word "minimum" in the table and the agreement text was supposed to be "maximum." I'd think they were asking the District to make the right column (below, from my previous post) the new maximum, but then what is the left column? It is not the currently allowed development (2020 plan).

The text of the agreement seems to say that the right column (Column B) is the development program to be spelled out in the Comprehensive Plan and Land Development Regulations.

The “minimum” refers to CFTOD promise to increase certain densities and intensities by a certain amount in the the next comprehensive plan. This seems to only have an impact on office space.

 

[JoeCamel]

In sum, it looks like Disney (inadvertantly?) agreed to a development program resulting in 5 major parks? Maybe this is what WESH saw?

I'm trying to figure out what they actually meant. To begin with, I think the word "minimum" in the table and the agreement text was supposed to be "maximum." I'd think they were asking the District to make the right column (below, from my previous post) the new maximum, but then what is the left column? It is not the currently allowed development (2020 plan).

The text of the agreement seems to say that the right column (Column B) is the development program to be spelled out in the Comprehensive Plan and Land Development Regulations.

Its basically what was already in place.

 

[flynnibus]

In sum, it looks like Disney (inadvertantly?) agreed to a development program resulting in 5 major parks? Maybe this is what WESH saw?

No, it means the district is agreeing that the forth coming comprehensive plan will include intensities that will allow, at a minimum, the numbers cited in the table.

 

[flynnibus]

Some highlights reading through the Agreement...

"The District recognizes that Master Developer’s past and present efforts in developing the Project and Master Developer’s support of the District’s construction of public infrastructure paid for, in large part, with Master Developer’s tax payments to theDistrict, has provided a benefit to the Central Florida community."

After all the hubub about if RCID served a purpose... seems like a nice little insertion here to get the district to go on record that the relationship and concept is beneficial to the state.

"Modification or Cancellation. Any modification or cancellation of all or any portion of this Agreement requires the express written consent of the District and MasterDeveloper."

So a true two party agreement... yet another sign Disney is fully confident they have the 'say' with this district model going forward they want.

An interesting highlight from the Buy Local initiative...
"Master Developer is committed to continuing its role as an economic engine in the state ofFlorida. Master Developer will implement a Buy Local program which will ensure a minimum of fifty (50) percent of all dollars spent for development of the Project are spent with businesses located in the state of Florida"

Note it only requires that the business be LOCATED in the state of florida. Not locally owned, not Florida based, etc.. just 'located' in Florida. Open a Florida office.. and you'd be covered. Seems like a really toothless commitment.

On Affordable housing... note
"Master Developer, at its sole discretion, will fund attainable housingefforts by partial funding of construction costs for approved, to beconstructed attainable housing projects, or, in the alternative, by paymentto a County or City affordable housing trust fund to be mutually agreed upon by the District and the Master Developer"

Note what is lacking...
- any thing about initiatives WITHIN the District (or any location for that matter)
- it even gives them an out to just make a contribution $$ and be done with it

Basically this is a $10M payoff due 10yrs from now... with zero requirements that it actually changes anything within the District or for Disney employees.

There is a list of typical public works and road infrastructure projects the District commits to build (Exhibit E).

So really besides a vague promise to spend $8Billion on the property in the next 10years... there really isn't any big concession from Disney here.

 

[Advisable Joseph]

The “minimum” refers to CFTOD promise to increase certain densities and intensities by a certain amount in the the next comprehensive plan.

I'm not sure how you get that from "Updated Comprehensive Plan
Minimum Development." Again, "maximum" would make more sense. I think that may be a typo?

Even the text refers to the column as a development program that the district must memorialize in the plan. Does "development program" imply "maximum" somehow?

 

[flynnibus]

I'm not sure how you get that from "Updated Comprehensive Plan
Minimum Development." Again, "maximum" would make more sense. I think that may be a typo?

Even the text refers to the column as a development program that the district must memorialize in the plan. Does "development program" imply "maximum" somehow?

Read the text that precedes the table and it will make more sense.

"The District agrees to adopt the Updated Comprehensive Plan on terms and conditions that are consistent with this Agreement, and memorializing, at minimum:
- The development program (types and intensities) reflected in Table B, Updated Comprehensive Plan Project Development Table, Column B."

It's literally a commitment to say the new Comp Plan will include allowances that AT LEAST this much will be allowed in the Comp Plan.

The Comp Plan is itself defining the maximums allowed for the property.

So this text is saying the new agreement should include maximums that are AT LEAST as large as Table B, Column B.

 

[Advisable Joseph]

Read the text that precedes the table and it will make more sense.

"The District agrees to adopt the Updated Comprehensive Plan on terms and conditions that are consistent with this Agreement, and memorializing, at minimum:
- The development program (types and intensities) reflected in Table B, Updated Comprehensive Plan Project Development Table, Column B."

It's literally a commitment to say the new Comp Plan will include allowances that AT LEAST this much will be allowed in the Comp Plan.

The Comp Plan is itself defining the maximums allowed for the property.

So this text is saying the new agreement should include maximums that are AT LEAST as large as Table B, Column B.

Again, you are getting "maximum" in here somehow.

But anyway, I think it is a typo: unless the minimums actually get enshrined in the Plan or the LDR (see subsection C and the syntax is ambiguous), it would be irrelevant.

The only thing making me wonder if it was an intentional decision is the notion that the fifth gate could be part of the price of the settlement. Desantis seemed to want another park.

 

[flynnibus]

Again, you are getting "maximum" in here somehow.

YES - because as I said... THAT'S WHAT THE COMP PLAN DEFINES

This is an agreement that says the new comp plan must include AT LEAST these thresholds.. and the comp plan's PURPOSE is to define the maximums for the property.

The issue isn't a typo - it's your lack of understanding of the comp plan and what these numbers are for. You are fixated on text that says 'this number must be a minimum of 5' and not understanding what '5' is used for. The comp plan does not define that there must be 5 theme parks - it says there can be UP TO 5.

 

[BrianLo]

So really besides a vague promise to spend $8Billion on the property in the next 10years... there really isn't any big concession from Disney here.

Which is already a bit of a platitude. Let's commit to spending half of what we are already spending anyways. Similarly to DL Forward. They are likely intending to spend double what they promised Anaheim as well.

We'll have to see the teeth of the Master Agreement. At least the Anaheim one has actual clauses and means of verifying they met their spending commitments.

 

[DCBaker]

The CFTOD Board of Supervisors meeting to discuss the Developer's Agreement is about to begin:

 

[LudwigVonDrake]

No real details except the $17 billion and $8 billion numbers. They approved it and the final approval is June 12