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  1. #1

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    DCA's Remodel and its Impact on DLR's Future

    I was just wondering what everyone thinks about the success, or lack there of, of the DCA remodel/expansion will have on the likelihood of DLR getting a third gate. Iíve read a few people throw out figures like 8 million a year would be considered a success enough to justify building the third gate. What do you think about this?

    Do you think that itís smart of Dis to decide whether or not to build a third gate based on the success of DCA? Could other criteria besides DCAís gate figures justify a third gate? If DCAís attendance is still lackluster, do you think the third gate idea should be abandoned and the strawberry field made into hotels and maybe a water park, as some have suggested might happen. Would it be smarter to still save that land for a third gate eventually even if DCA is still struggling? Just curious what people think about these issues.

  2. #2

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    Re: DCA's Remodel and its Impact on DLR's Future

    If DCA fails to meet expectations, it's hard to see how they'd have the will to start in on a Third Gate.

    I just think they shouldn't have put all their eggs in one basket. To throw absolutely everything they've got towards DCA.....and not leave a little money left over .......

    If I were running things, I simply wouldn't have spent as much on a remodel of DCA. I don't think they they left themselves much flexibility in terms of reducing the costs, or scaling back, depending on the economy, consumer demand, and the desire to begin other projects early ---including a Third Gate.

    The way it is now, its kind of an all-or-nothing type thing given the exhorbitant cost of this DCA remodel. Throwing this amount of money towards a remodel, it ties up their finances and construction for years and years and years, leaving anything, and everything, else to fall by the wayside.

  3. #3

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    Re: DCA's Remodel and its Impact on DLR's Future

    [FONT='Verdana','sans-serif']um....tossing all your eggs in one basket was walts way of life. time after time he'd tied up all of his resources into his current project, and most of the time it paid off. he had a few missteps but i think it's that kind of thinking and drive that makes something great.[/FONT]

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    Re: DCA's Remodel and its Impact on DLR's Future

    Quote Originally Posted by Pisces View Post
    If DCA fails to meet expectations, it's hard to see how they'd have the will to start in on a Third Gate.

    I just think they shouldn't have put all their eggs in one basket. To throw absolutely everything they've got towards DCA.....and not leave a little money left over .......

    If I were running things, I simply wouldn't have spent as much on a remodel of DCA. I don't think they they left themselves much flexibility in terms of reducing the costs, or scaling back, depending on the economy, consumer demand, and the desire to begin other projects early ---including a Third Gate.

    The way it is now, its kind of an all-or-nothing type thing given the exhorbitant cost of this DCA remodel. Throwing this amount of money towards a remodel, it ties up their finances and construction for years and years and years, leaving anything, and everything, else to fall by the wayside.
    That's what they had been doing for the past 7 years. Incremental fixings like adding Flik's Fun Fair, the Tower of Terror, swapping Superstar Limo out for Monster's Inc. and turning the Soap Opera Bistro into Playhouse Disney and almost completely redoing the Animation Building.
    It was not enough and the piecemail approach did not fix some of DCAs grander shortcomings and while attendance has certainly improved over the last several years it still is nowhere near Disneyland.
    I am all for them putting the money to fix this park. If it means the rest of the Resort (Disneyland included) will have their major projects tabled for five years. Fine. DCA is currently weakest link. Once it is strengthened then truly Disneyland can become a multi-day resort which will only then allow for the opening of the thirdd park.
    I would rather have 2 awesome parks rather than 3 mediocre (or in the case of Florida, 4 mediocre) parks.
    "If we cut the budget are you going to be the one standing at the exit explaining to guests why the ride they just rode is a piece of crap?" - - John Lasseter

  5. #5

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    Re: DCA's Remodel and its Impact on DLR's Future

    With respect to Walt, himself:

    We are talking about a very changed economy from 1955, and Walt had nothing to do with DCA. DCA was generated in a completely different way from how Walt built theme parks. The dollar was worth more, and vendors didn't price gauge, and inflate prices....not as much.

    Walt wasn't into renovation projects or wholescale rethemeing---I don't think.

    My sense is that Walt wanted his theme parks to constantly evolve and grow. But, what they're doing at DCA is more than just an expansion...they are completely retheming.

    You can take risks, but I like the idea of taking measured risks, and always leaving yourself an out. Flexibility.

    It could work. I'm not saying DCA won't be a success, eventually. I hope.

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    Re: DCA's Remodel and its Impact on DLR's Future

    Quote Originally Posted by Wally View Post
    That's what they had been doing for the past 7 years. Incremental fixings like


    But that's not what I'm talking about. I'm talking about going foreward with World of Color and Toy Story....where the money was already earmarked, and then expanding the Park with respect to new shopping and dining, that would accompany World of Color. Upgrading all dining and shopping throughout, and better use of theming, landscaping, music loops etc....

    That's a little bit more than incremental. And, if all that were completed at the same time, you'd have virtually a new park, done for much less money, and create a wholly new nighttime crowd. Once they had the nighttime business, they could think about doing more.

    That's not what I'm saying. I'm saying to go forward with World of Color, and expanded shopping and dining to, at least bring in a nighttime crowd to begin with. And, then maybe do all the other stuff...


    Quote Originally Posted by Wally View Post
    I would rather have 2 awesome parks rather than 3 mediocre (or in the case of Florida, 4 mediocre) parks.
    Yes, I agree. In a perfect world, that would be enough. But the law of unexpected consequences....and things don't always go as planned.....

    And then you are out all that money.

    But I really hope things go the way Disney would like it to. I'm rooting for them and DCA. Wish it didn't cost as much, but I really want it to be a success!!! Truly !!!

  7. #7

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    Re: DCA's Remodel and its Impact on DLR's Future

    I have to point out that as much money as it seems like they are spending, it really is not that much when you're talking about major construction these days. There is a condo building being constructed right near my office that reportedly has an almost 400 million dollar budget and it's really nothing special. I think the Wynn in Vegas was almost 3 billion (I didn't look it up, so I might be wrong, but I don't think so), I could easily see Dis having to spend well over $1000 or more a square foot, for attractions, if you throw in ride systems and decor in addition to the expensive structural and mechanical systems these buildings must also have. So I know 1 billion sounds like an unbelievable amout to you and me, but its really not that much, sadly, these days.

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    Re: DCA's Remodel and its Impact on DLR's Future

    Pisces-
    In some ways what you suggest is kinda what they already are doing. I mean they are going to do everything in stages and its totally possible that some of the things that they've announced won't be done in the end, as has already started to happen. We have to keep in mind that Dis partially made an early announcement before much was finalized due to the SunCal housing proposals.

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    Re: DCA's Remodel and its Impact on DLR's Future

    Well, some math:
    6 million guests in 2007
    That's 16,438 guests per day (which I find highly unlikely -- I think that number includes parkhoppers who first entered DL, but it's just a suspicion).

    If expansion can bring in 13,561 more paying guests, making daily average a round 30,000 (Al has stated that 32,000-35,000 were expected daily in the first year of operations, so I am being very conservative), then at, say $50 average entrance fee, that makes $247,500,000 revenue increase per year.
    And, the expansion pays for itself in about four years.

    Now, if half the extra guests are not paying any more than their once-a-year payment fee, then it will take eight years to pay for itself, and that's a bit below average, for Wall Streeters. (Not that the Wall Streeters deserve any more than a undisneyeque four-letter-word-off, as the years after the first eight will be hay-making while the sun shines.)
    And if 80% of the extra guests are not paying more, perhaps somewhere near its current average, then it will take twenty years.
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    Re: DCA's Remodel and its Impact on DLR's Future

    Sed, good points. It's a nice simple analysis that gives some sense of the scope of costs. Its obviously a little more complex once you also add in operations costs and food and merchandise sales, plus I'm sure some big tax write offs for Dis. Once all is said and done it seems like 1 billion is probably a pretty reasonable amount from a business perspective. (And nobody ever said that the accounteers aren't at least good at the math part of business.)

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    Re: DCA's Remodel and its Impact on DLR's Future

    Quote Originally Posted by Uncle Bob View Post
    Sed, good points. It's a nice simple analysis that gives some sense of the scope of costs. Its obviously a little more complex once you also add in operations costs and food and merchandise sales, plus I'm sure some big tax write offs for Dis. Once all is said and done it seems like 1 billion is probably a pretty reasonable amount from a business perspective. (And nobody ever said that the accounteers aren't at least good at the math part of business.)
    Definitely simple math, but you get what you pay for here.

    My analysis is looking at increases in attendance. The fixed costs of operating won't increase proportiately to increased attendance. They will increase some, but they shouldn't double with doubled attendance.
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  12. #12

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    Re: DCA's Remodel and its Impact on DLR's Future

    I'm not sure that the success of DCA will determine IF there ever will be a 3rd gate. I'm pretty certain that there will be one regardless.

    There is no doubt that DCA will benefit from this investment. It will surely increase park attendance. The only question is to what extent and whether it will be a perminant dramatic increase or a temporary spike.

    Even though $1.2 billion is a lot of money, I don't believe that this investment alone is the make-or-break thing for DCA. It's the amount of money it will take to just get the engine running again. There is no way that this investment won't have a positive impact on the park.

    This particular investment is what it will take to get people to re-experience DCA, form a new opinion about it and hopefully view it as a more complete park. But it will take continued investment beyond the 5-year plan in order to continue to get DCA to a level that makes it a more formidable, but friendly rival to DL.

    When they feel that they've at least plugged enough of the holes to keep DCA comfortably afloat and feel that they have created a better foundation to build upon, I think that it would be then when the window would open for the possibility of a 3rd gate.

  13. #13

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    Re: DCA's Remodel and its Impact on DLR's Future

    The expansion of DCA will help but it might not be the totals Disney is hoping for. So in that situation, third gate will come out. The reason for this is that THREE parks has a higher pulling power than two. And with a third park fully operating, you're guaranteed to have more seats in DCA as well.

    This is just from a tourist stand point. Disney wants Disneyland to be a resort that sells as much as WDW. It won't be able to do that on two parks alone, and not one of DCA's quality.

    I'd personally like to see Gate 2 be turned into a destination upon itself. Even with the expansion, it's not quite there yet for me.


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  14. #14

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    Re: DCA's Remodel and its Impact on DLR's Future

    Kissman-
    Good points, I hope you're right, but I do fear that if DCA continues to not pull in the numbers they want then the third gate will not get greenlighted. Whether rightly or not, I fear that at some point, if DCA is still not getting the number of guests that they want, they'll just decide that Cali is not a good market and that they'll be better off investing more money elsewhere.

    I'm just keeping my fingers crossed that this expansion is successful, so we continue to get more improvements at DCA and the third gate.

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    Re: DCA's Remodel and its Impact on DLR's Future

    Coheteboy-
    I agree with you that DCA will still not be a true stand alone park yet, even with these improvements. (But you could argue that about some of WDW parks too.) It’s probably only the first big step in the long term plans for the park. I don’t think equaling WDW’s income will be possible, there’s just not enough space. But you do make an interesting point about the fact that three gates would offer a lot more to the tourists then two. I hope you’re right and that the third gate plans will not be hampered by DCA if it continues to struggle, but I have heard rumors that it will not happen unless DCA is more successful. These rumors may be wrong, but it does make sense that Dis would be weary of spending more if this money seems like it was a bad investment. I don’t think that’s going to happen, but I’m still a little worried it might.

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