What a mess – Disney’s new hotel plans have unraveled and left a hole in their high rent shopping district. It all started last year when Disney and the city couldn’t come to terms on the then already-under-construction Eastern Gateway parking structure and bridge over Harbor Blvd. Disney eventually abandoned those plans and moved the parking project to the west side of the resort, which is now under construction. In short, they had a city relations problem.
A similar problem has now occurred with a proposed new hotel, which was originally supposed to be built on what is Downtown Disney parking. When the Eastern Gateway project failed, that hotel project was shifted to the far western end of Downtown Disney – on top of what was shops, restaurants, and the theater located between the Monorail beam and the Disneyland Hotel.
Disney kicked several successful businesses (Rainforest, AMC Theaters, Starbucks, ESPN Zone, and others) out of their spaces early in the summer, with construction expected to begin in July. Early news about the delay seemed to place blame on old Richfield gas tanks left under the construction site. And that may very well be the case, but the real problems were very similar to what killed the Eastern Gateway project. The city of Anaheim and Disney had a breakdown in communication which has resulted in Disney suspending the hotel project indefinitely.
The city had offered tax rebate incentives to developers who would build 4 Diamond/Star hotels that met certain conditions. Our friends at the Anabella Hotel took advantage of the offer and are building a brand new luxury hotel on that spot (next to the Convention Center) right now. Disney also wanted in on the action, but in the last week, it has become clear that something was wrong. Disney submitted revised plans to the city which indicated a move of the hotel and some design changes. It was at this point that the city notified Disney out of the blue that they no longer felt that Disney qualified for the incentives equaling $267 Million over 20 years.
Disney was scheduled to attend a meeting with the city next week, but canceled, sending a letter to the city expressing their disappointment that the city would make such a sudden decision after a year of discussions and agreement about the project. Disney has also notified all construction crews to stop work on the project.
All of which leaves Disney in a terrible position. They have valuable real estate at the far west end of Downtown Disney which is essentially abandoned. Disney will make adjustments and do some set decoration to make the area less depressing. Food trucks have contracts through Labor Day weekend which could easily be extended or even expanded if the hotel is further delayed or canceled completely.
I’m conflicted about this news. A new hotel would certainly be beneficial for the tax base of the city and put lots of folks to work, which are really good things. But this design, shoehorned into Downtown Disney, never struck me as a perfect fit. However, I’d still like to see Disney explore a 4th hotel. . . somewhere else.
The west side of Downtown Disney has been dressed up with food trucks and colorful umbrellas and lighting.
An alternate walking path was under construction, which would give Paradise Pier Hotel and Disneyland Hotel guests a way to walk to Downtown Disney once the hotel project breaks ground.
And here’s the other side of those walls (behind the old AMC)
The walkway has already been built.
There’s still a lot that could happen. The city could assure Disney that they’ll get the tax incentives, Disney could decide to build the project anyway since a 4-star hotel with high occupancy would make a lot of money, or Disney could decide to completely abandon the new hotel and redevelop that end of Downtown Disney. Disney has some choices to make, and there’s a lot of pressure to make a timely decision.
How would you like to see Disney address the dual issues of the paused hotel and Downtown Disney ghost town?
Food for thought – If Disney does cancel the hotel, what will they do with all those gutted buildings between the monorail beam and the Disneyland Hotel. Let’s hear your best ideas.
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