News Reflections – A Disney Lakeside Lodge (Project 89 - Development near Fort Wilderness)

[Tom P.]

Either there are more uber-rich people or there are a bunch of people living beyond their means to the point of putting themselves in debt and getting loans just toC go on vacation.

Well, that's a societal problem in general, definitely. I would imagine there are very few people in the United States who take a vacation without going into debt. I'm not saying everyone goes out and takes out a second mortgage on their house. But I'm willing to bet the vast majority put their vacation on a credit card and don't pay it off at the end of the month. But the same holds true for just about everything in American life today, whether it's a new car, a college education, Christmas shopping, a vacation, or even a dinner at a nice steakhouse. We're a society built on debt. Which I think is headed toward getting us into a lot of trouble, but that's a separate discussion.

My point is, though, that if 21 million people a year, year after year after year, are making it to the Magic Kingdom, then clearly going to Disney isn't exactly something that is bankrupting the middle class.

 

[jbolen2]

What is the plan for all the extra traffic this will create going thorough the fort on that 2 lane road?

 

[MisterPenguin]

In 1889, Washington state joined the union. Is that the reference?

Or.. in 1889, Nintendo was founded as a producer of playing cards. Is this Universal's third gate?

 

[USofA scott]

They only want that because it's short sighted (initial) gains. Assuming a "measly" 3% increase per year on room rates, after 30 years the moderate hotel has brought in $3,473,005 where as the DVC contract may be for 30+ years has still only brought in the $1,092,000 for the initial point sales. Obviously there are many other variables such as buy backs. The big point is that the $1m covers the resort development costs up front with profit margins met. The fact that they put left over inventory into the resorts generates additional revenue annually should put it on par with a regular resort. I have no idea what percentage they are pulling from that, but as the DVC is deluxe, I'd venture a guess that it comes out about even.

Beyond that initial profit margin that bumps the books, I'm curious if there is that much of a difference over the long haul of the resort operation. I'd be interested to see the actual numbers that drive this model though.

the business model does not work. You can take that initial 1,092,000 from the point sales and then put it into the bank. even with a paltry 3% return on investment over 30 years will net 2,676,000 (Institutional rates are over 5% right now). A hotel room would still take 20 years even with a 3% rate increase. ROI is so much faster for DVC

 

[peter11435]

the business model does not work. You can take that initial 1,092,000 from the point sales and then put it into the bank. even with a paltry 3% return on investment over 30 years will net 2,676,000 (Institutional rates are over 5% right now). A hotel room would still take 20 years even with a 3% rate increase. ROI is so much faster for DVC

You also have to account for annual dues. The hotel room has operating and maintenance costs that Disney is responsible for. Those same costs on a DVC room are covered by the members.

 

[TiggerDad]

In 1889, Washington state joined the union. Is that the reference?

Wrong century. 1789 is when the US Constitution was ratified, and George Washington became the first President of the US. This must be the new incarnation of Disney's America theme park previously proposed for Virginia.

 

[MisterPenguin]

Wrong century. 1789 is when the US Constitution was ratified, and George Washington became the first President of the US. This must be the new incarnation of Disney's America theme park previously proposed for Virginia.

So, the Great Virginia Northwest!

 

[iheartdisney91]

River Country opening day, to it's present state fascinates me. I highly respect this small themed water park.
Super grateful I got to go with my family when it was still open. Even though the park now is a hazardous wreck, I still love it. Its astounding, and just really neat to see photos of it. (Certainly not "Disney" of them)
Whatever Project '89 is meant to entail I just hope the company pays tribute to their 1st water park, and they don't build anything that takes away from the "outdoor" feel of this resort.

 

[larryz]

Do you understand the premise of DVC and how it works?

Let's see. I give Disney anywhere from $23,000 to $40,000, and for the next 40 years or so I get to reserve any available rooms in their timeshare inventory for a couple of days as long as nobody else has already reserved them as much as 11 months out. I also get to pay a monthly maintenance fee, and I still have to buy tickets, food and transportation for my family and me. Then, when my "ownership" is over, I'm pretty much back to square one...

Is that how it works?

 

[CaptainAmerica]

One modetate hotel room will generate (assuming an average rate of 200 night) 73000 a year. DVC studio will generate (175 per point) with average of 120 points per week, 1,092,000 dollars. You tell me which one thatthey will want.
Be real, you are just making things up now.

What on Earth are you talking about?

 

[Thelazer]

Let's see. I give Disney anywhere from $23,000 to $40,000, and for the next 40 years or so I get to reserve any available rooms in their timeshare inventory for a couple of days as long as nobody else has already reserved them as much as 11 months out. I also get to pay a monthly maintenance fee, and I still have to buy tickets, food and transportation for my family and me. Then, when my "ownership" is over, I'm pretty much back to square one...

Is that how it works?

Works as in "to mickey's pocketbook" yes..

 

[HauntedPirate]

Let's see. I give Disney anywhere from $23,000 to $40,000, and for the next 40 years or so I get to reserve any available rooms in their timeshare inventory for a couple of days as long as nobody else has already reserved them as much as 11 months out. I also get to pay a monthly maintenance fee, and I still have to buy tickets, food and transportation for my family and me. Then, when my "ownership" is over, I'm pretty much back to square one...

Is that how it works?

Nailed it.

 

[CaptainAmerica]

Let's see. I give Disney anywhere from $23,000 to $40,000, and for the next 40 years or so I get to reserve any available rooms in their timeshare inventory for a couple of days as long as nobody else has already reserved them as much as 11 months out. I also get to pay a monthly maintenance fee, and I still have to buy tickets, food and transportation for my family and me. Then, when my "ownership" is over, I'm pretty much back to square one...

Is that how it works?

Don't be dramatic. At $40,000, you're not booking "a couple of days," you're booking two weeks. And you neglect that fact that paying cash for those two weeks would cost you something like $5,000 per year. So you can pay $40,000 today and $2,400 in maintenance fees every year, or $0 today and $5,000 in resort costs every year. It's roughly break even.

Disney doesn't profit from DVC because it's "more expensive" than paying cash, they profit from DVC because they're locking you in to visiting every year. If they could choose between a cash guest who visits every single year and a DVC guest who visits every single year, the cash guest is more profitable. The problem is, the cash guest can't be locked down.

For the record, I'm not a DVC member and would only ever consider joining via resale.

 

[deeevo]

Let's see. I give Disney anywhere from $23,000 to $40,000, and for the next 40 years or so I get to reserve any available rooms in their timeshare inventory for a couple of days as long as nobody else has already reserved them as much as 11 months out. I also get to pay a monthly maintenance fee, and I still have to buy tickets, food and transportation for my family and me. Then, when my "ownership" is over, I'm pretty much back to square one...

Is that how it works?

So... you pay them in advance to vacation at WDW over the next 40 years? Then they dont have to wait for you to spend the money on your vacation and they gain instant capital.

 

[SpaceMountain77]

Disney doesn't profit from DVC because it's "more expensive" than paying cash, they profit from DVC because they're locking you in to visiting every year. If they could choose between a cash guest who visits every single year and a DVC guest who visits every single year, the cash guest is more profitable. The problem is, the cash guest can't be locked down.

I have been a DVC member since 2012 and have points at three DVC resorts. Here are a few additional details, from my perspective:

(1) Unlike other timeshares, where the ownership interest is purchased rather than leased, DVC is essentially marketing prepaid vacations. It is a savings if you pay, in full, without financing. However, it seems that many members finance with Disney and I know that members with fair credit have 10-year interest rates of nearly 16%. With a 150 point purchase, 10% down on a major credit card, and the rest financed through Disney, the point cost, with interest, more than doubles over the life of the loan. Therefore, Disney makes money on both the purchase price and loan interest.

(2) It becomes increasingly difficult not to vacation at Walt Disney World. With the number of points I own, any other vacation seems to be costly. Yes, there is still airfare and food, but we have annual passes, Tables in Wonderland, and there is no additional cost for the room because it is booked on points. Last year, I considered booking a trip to Disneyland, but it was hard to justify purchasing passes when we already have annual passes for Walt Disney World. Plus, with Disney's Magical Express, there is no need to rent a car or pay for transportation to the Disneyland Resort.

(3) Now that we visit regularly, we spend more than we did when we casually visited as cash guests. Because we are so familiar with the parks, we regularly pay for upcharge offerings. Since becoming a DVC member, we have gone horseback riding at Fort Wilderness, taken behind the scenes tours, and enjoyed several carriage rides.

Simply put, DVC is a prepaid vacation offering that ensures that Parks and Resorts has vacationers for the next 50 years. The offering is profitable because it generates income through ticketing, merchandise sales, and food and beverage purchases.

 

[deWild]

If we can get back on topic, are there any new developments on this project?

 

[TeriofTerror]

Let's see. I give Disney anywhere from $23,000 to $40,000, and for the next 40 years or so I get to reserve any available rooms in their timeshare inventory for a couple of days as long as nobody else has already reserved them as much as 11 months out. I also get to pay a monthly maintenance fee, and I still have to buy tickets, food and transportation for my family and me. Then, when my "ownership" is over, I'm pretty much back to square one...

Is that how it works?

If you really want to shell out that sort of money, I suppose you can. I paid $6700, and pay $500-600 per year in maintenance fees. For that, I get 5-6 nights per year in the equivalent of a deluxe standard room, and a nice price break on APs. It's absolutely less money than I gave Disney before joining DVC.

 

[larryz]

If you really want to shell out that sort of money, I suppose you can. I paid $6700, and pay $500-600 per year in maintenance fees. For that, I get 5-6 nights per year in the equivalent of a deluxe standard room, and a nice price break on APs. It's absolutely less money than I gave Disney before joining DVC.

You bought resale, then?

 

[MagicHappens1971]

In 1889, Washington state joined the union. Is that the reference?

Or.. in 1889, Nintendo was founded as a producer of playing cards. Is this Universal's third gate?

MGM-Studios, with that, Star Tours and Indiana Jones. Typhoon Lagoon, Delta Dreamflight and Pleasure Island all opened in 1989. The Little Mermaid also came out in 1989. I would think 89 because Typhoon Lagoon in a way replaced River Country, which would be close to this project.

 

[SpaceMountain77]

MGM-Studios, with that, Star Tours and Indiana Jones. Typhoon Lagoon, Delta Dreamflight and Pleasure Island all opened in 1989. The Little Mermaid also came out in 1989. I would think 89 because Typhoon Lagoon in a way replaced River Country, which would be close to this project.

I am not sure if this has been said before, but I wonder if, in a nod to River Country, Disney would consider building a Great Wolf Lodge style wilderness/water park resort.