Disney Shelves Opening of 5,760-Room Hotel

ORLANDO-In the clearest signal yet that metro Orlando’s hospitality industry is crippled, Walt Disney World is indefinitely postponing the opening of the two-building, $460 million, 5,760-room Pop Century Resort until the economy improves. The hotel was first scheduled to open in December, then postponed until March 2002.

Meanwhile, Gaylord Entertainment Corp. of Nashville, TN says it still plans to open the 1,400-room Opryland Hotel, the 360-room Emerald Tower hotel and the adjoining 178,000-sf convention center in February as previously reported by GlobeSt.com. The three projects, with an estimated hard construction cost of $376 million, are one mile from Disney’s main entrance.

Hilton Hotels Corp. of Beverly Hills, CA previously announced its was holding off on construction of new timeshare properties in metro Orlando. Hilton is undecided on the tentative opening in 2003 on a planned 1,000-room, $100 million hotel on 26.4 acres next to the Orange County Convention Center on International Drive in Orlando’s tourist corridor.

Disney’s decision to shelve the Pop Century Resort comes as Smith Travel Research Inc. of Hendersonville, TN reports preliminary September occupancy in Central Florida at 44.6%. In August, average occupancy was 62.1%. Some of the 427 area hotels and motels have been reporting 10% occupancies following the Sept. 11 terrorist attacks on New York and Washington, DC.

The industry considers 65% occupancy the break-even point in a hotel’s daily operations. Some industry analysts predict the lodging industry won’t see a turnaround until third quarter 2002.

Robin L. Webb, a hotel consultant and operator for 30 years and currently vice president/managing broker, Arvida Realty Services Commercial Division, Winter Park, FL, tells GlobeSt.com many tourists on tight budgets are switching to mid-priced or lower-priced rooms after initially considering class A hotels.

That scenario would have helped Disney’s Pop Century Resort whose rooms were planned to sell for an average $80 per night. The resort is being completed next to the 350-acre Disney Wide World of Sports attraction.

Even with the postponement of the Pop Century, Disney remains the largest innkeeper in Central Florida with 18 lodges totaling 20,942 rooms. That is 18% of the total 111,618 rooms tracked monthly at 427 area hotels by Smith Travel Research.