Florida's Largest Hotel Opens, Offering $55 Rates

LAKE BUENA VISTA, FL-Walt Disney World, the largest hotel owner-operator in Florida, has opened its biggest property to date–the 2,880-room Pop Century Resort with opening promotional room rates of $55 per night.

That price matches many of the Mom-and-Pop-owned motels and hotels on the 15-mile hotel strip of US 192 in Osceola County, forcing several operators out of business, hospitality industry consultants tell GlobeSt.com.

The Pop Century is the 23rd hotel Disney opened over its 32-year presence. Disney’s total 25,172 rooms gives it a 6% market share of the estimated 400,000 hotel rooms in Florida and about a 25% market share of the estimated 120,000 rooms in Central Florida, industry consultants tell GlobeSt.com. Marriott International, Disney’s closest competitor, has about 10,000 rooms in Florida. The 2,880 rooms at Pop Century is more than the total 2,703 rooms in the entire Osceola County and more than the 2,004-room Orlando World Center Marriott when it opened in 1986 as the state’s largest hotel.

Robin L. Webb, a hospitality industry consultant for 30 years and the Central Florida Region managing broker at Coldwell Banker Commercial NRT in Maitland, FL, tells GlobeSt.com the Pop Century opening has some positive notes. “There is good news which is being overlooked,” Webb says. “While it clearly brings more competition–and stiff competition it is–all professional observers would agree that Walt Disney World is a wise and sophisticated marketing machine which evaluates its direction thoroughly before taking action.”

Webb says, “Setting the course which they have is a clear statement that the Disney organization has bought into the travel recovery in Central Florida. With over 2,000 employees, their annual payroll expenditure for the new resort alone will exceed $40 million.”

The broker-consultant says, “On the opposite side of the coin, however, is the impact of the competition in the marketplace. Heretofore, Disney has considered a ‘budget’-priced room to be $79 within the attraction. However, the published rate of $55 to $59 for the new property is very threatening to properties in the surrounding area, particularly the US 192 corridor.”

Webb says that according to Smith Travel Research, the average daily rate on west US 192 is just over $50. “That means that for a family of four, they can move from West 192, outside of the park, into the park at a Disney hotel for an additional $2.25 per person per night, or about the cost of a soft drink inside the attraction.”

Webb adds, “You can count on the Disney marketing team to make that fact well known to the consuming public.”

Outside of the theme parks in the area, the broker-consultant expects “that 2004 will actually see more rooms removed from the market in Central Florida than will be added, resulting in the first decrease in supply since Disney opened in 1971.”

Webb says that fact, “coupled with the recovery in travel, bodes well for the marketplace in the year ahead.