Walt Disney Co.'s $3.75 billion Shanghai Theme Park

[Figment!]

Summary of News & Updates

4-08-10:

Shanghai Disney Resort breaks ground in China

4-03-10:

Disney announces Special Event in Shanghai

11-05-10:

Disney signs agreement for Shanghai theme park

[Figment!]

Disney signs agreement for Shanghai theme park

By Melanie Lee
Reuters
November 5, 2010


SHANGHAI--The deal was reached with Shanghai Shendi Group, which was specifically created for the development of the Disneyland project, the official Xinhua news agency said on Friday.

Disney confirmed the Xinhua statement and said it was still awaiting final approval from China's central government regarding the incorporation of the related joint venture companies and the completion of regulatory procedures.

"For quite some time, we have been involved in discussions with the Shanghai government about building a Disney theme park. We can confirm the statement from the Shanghai government that we have taken another step forward in the approval process," a Disney spokeswoman said in an emailed statement to Reuters.

Shanghai's Disneyland is expected to cover around 4 sq km and cost about 25 billion yuan ($3.75 billion), Xinhua said. Disney itself gave no further details.

It was not clear what the ownership structure of the park would be like, but state media reported last year that an investment company controlled by the Shanghai municipal government would own a majority stake in the park.

Disney received approval to build a Disney theme park in Shanghai a year ago, but discussions about the specifics have been ongoing and few details have been released publicly.

Disney has long sought to build in Shanghai, a wealthy city of about 20 million people that is ringed by the prosperous Yangtze River Delta, home to tens of millions more potential visitors.

It was less enthusiastic about building near Beijing, which has fewer large population centers in the immediate vicinity.

Disney's foray into the China market has been mixed so far, with its Hong Kong Disneyland park reporting a loss last year.

Additional reporting by Sally Huang in Beijing

[Scar]

Hopefully Disney is not putting much, or any, money into this and just licensing out their brand.

[Melanie]

There goes my goal to visit all the Disney parks worldwide.

[Gator]

Why put one in China? There's one in Hong Kong and China already "owns" that country.

[Figment!]

Why put one in China? There's one in Hong Kong and China already "owns" that country.

It is perceived as inconvenient (or otherwise undesirable) for the large, wealthy mainland China population centers to travel to the Hong Kong park.

Since opening, only 40% of Hong Kong Disneyland Guests were estimated to be from mainland China.

The expectation is that building a new park closer to a wealthy population source will attract new mainland China Guests and increase the frequency of the mainland China Guests who were already visiting the Hong Kong park.

Pundits have brought-up the question of market saturation, but Disney and the Chinese government have both insisted that the addition of the second Chinese resort will lead to an overall increase in Disney park attendance. How? This hasn't been made exactly clear, but it is postulated that the those with the means to visit both resorts will be compelled by product differentiation to do so and those who would have otherwise visited no park will now be compelled to visit the much closer Shanghai park.

[BrerGnat]

There goes my goal to visit all the Disney parks worldwide.

Just out of curiosity, why?

[Ms. Mode]

If they have a large wealthy population of people who don't want to visit Hong Kong; they could always take a road trip and visit WDW in Florida.

[Melanie]

Just out of curiosity, why?

Because I don't ever see myself traveling to Asia again. Maybe, but it's a long shot.

[BrerGnat]

Because I don't ever see myself traveling to Asia again. Maybe, but it's a long shot.

Oh, okay. So, have you been to the Hong Kong park then?

[Melanie]

Yep, we went for Christmas '08.

[Scar]

April 3, 2011 - The Wall Street Journal


Walt Disney Co. on Friday will break ground on a new theme park and resort in Shanghai, according to people familiar with the matter, after years of red tape and negotiations with the Chinese government.

The groundbreaking ceremony follows Disney's recent receipt of final approval from the Chinese central government to move ahead with its long-gestating plans for the 963-acre park and resort. That is about 1/26th the size of the 40-square-mile Walt Disney World in Orlando, Fla.

Early Saturday morning, or late Friday in the U.S., invitations were issued by Disney, together with an arm of the Shanghai government and a local business partner of Disney's, inviting recipients to "a special event in Shanghai" on April 8. Disney Chief Executive Officer Robert Iger is expected to attend the groundbreaking ceremony. Shanghai Disneyland will be the Burbank, Calif.-based Disney's sixth major theme park in the world, and its first in mainland China.

Shanghai's mayor has estimated the cost of the first phase of the theme park will be 24.4 billion yuan, or $3.73 billion. The total cost of the resort isn't clear, but it is likely to be one of the largest foreign investments ever made in mainland China. The resort will be majority-owned by media and entertainment companies that are in turn owned by the Shanghai Municipal Government. Disney's stake in the endeavor hasn't been disclosed, though the company is expected to hold a minority interest.

In addition to Disney, the parties issuing the invitation were the Administrative Commission of Shanghai International Tourism and Resorts Zone and Shanghai Shendi Group Co. Ltd. The latter is Disney's government-owned joint venture partner, a company formed by various government-owned businesses that has investors including a subsidiary of broadcaster Shanghai Media Group and another responsible for construction.

[Victor Kelly]

Just be aware comrade Mickey is watching you. I won't tell you what will happen if you do something wrong.

[2Epcot]

Shanghai Disney Resort breaks ground in China


(CNN) -- The Walt Disney Company broke ground Friday on the Shanghai Disney Resort, after getting approval from the Chinese central government in Beijing.

"Today marks a significant milestone in the history of The Walt Disney Company," said Robert A. Iger, president and CEO of The Walt Disney Company. "Our Shanghai resort will be a world-class family vacation destination that combines classic Disney characters and storytelling with the uniqueness and beauty of China. Working with our Chinese partners, the Shanghai Disney Resort will be both authentically Disney and distinctly Chinese."

Friday's groundbreaking ceremony featured traditional Chinese drum music, a Mandarin soloist and a 50-voice children's choir from Shanghai. Mickey Mouse was also in attendance, dressed in a traditional Chinese costume.

"We're incredibly excited to build a Disney resort in Shanghai, one of the world's most vibrant cities," said Thomas O. Staggs, Chairman of Walt Disney Parks and Resorts. "We are hard at work designing Shanghai Disneyland, which when complete will be a special place where guests of all ages will discover a world of imagination, creativity, adventure and thrills."

The resort will "include a Magic Kingdom-style theme park with characteristics tailored to the Shanghai region and other amenities consistent with Disney's destination resorts worldwide," Disney said.

The new resort is scheduled to open in about five years. When it opens, Disney says the park will also have two themed hotels, a large retail, dining and entertainment venue, as well as recreational facilities, a lake and plenty of parking.

In total, building the resort is expected to cost more than four billion dollars, which will be split between the Walt Disney Company and its China partners.

Disney already has a Disneyland resort in Hong Kong, China, as well as in Tokyo, Japan, but Shanghai's would mark the first Disney resort in mainland China.

Disney has offices in Beijing, Shanghai and Guangzhou.

I'm really looking forward to this. I actually leave for Shanghai on Wednesday with my wife who is there on business. She is originally from the Shanghai area, so we will be visiting her family as well. We will spend 3 weeks there so it will be interesting to see how the locals are feeling about the new park.

[ShanPooh]

Just be aware comrade Mickey is watching you. I won't tell you what will happen if you do something wrong.

Having been to mainland China, I can tell you the answer is "not much".
Didn't the Red Scare die with McCarthy?

[Ramblingman]

I guess when the world comes under one ruling power, it won't be a government, it'll be the Disney board.