Paradise Pier Construction and Retheming

[1FoolishMortal]

Their openings were supposedly delayed a year. Nobody said anything about the start of construction. They can take as long as they want with that.

[tcsnwhite]

I think the Pier stuff is a go. They are too far into things, not to mention they wanted to get all that area done by World of Color's opening (and you can't have all that construction going on when trying to debut a huge show like that). I think the Pier is definitely going to hit its '10 deadline.

[Majikku]

Their openings were supposedly delayed a year. Nobody said anything about the start of construction. They can take as long as they want with that.

Perhaps your right,but paying construction workers etc costs money,seems foolish to start projects and take your sweet time. Seems more expensive that way,no?

[MagicWDI]

Their openings were supposedly delayed a year. Nobody said anything about the start of construction. They can take as long as they want with that.

The object is to cut down on spending during times when review will fall well short of expections, so reorganizations, pink slips and holds on projects for a little while seem to be the smart thing to do to prevent any further damage that you can't come out of.

Also we must remember how Disney was going to pay for these massive projects. Most of the time you depend on revenue, especially during good times. Well, times aren't so good right now and it wouldn't be smart to borrow money when your revenue is shrinking. The DLR, and thus Disney Parks & Resorts, is lucky they got help from the parent company, but it won't cover all the bills.

During times like these we don't want the word "loss" to appear anywhere in the fiscal reports. We are already seeing "short" and that is causing people to lose jobs. Seeing the word "loss" could result in departments getting merged, spun off, or closed.

So in response to the construction, they will most likely hold off. Taking their time costs more as well as the contractor will charge more for being out there. Disney doesn't do these projects alone.

[Ben]

I thought Disney already reserved funding from one or two years ago when they had a large profit. I remember reading somewhere that they did well one year (close of 2007?), and were taking a set amount for park developement, most of it going to DCA. I don't think it was all of the alleged $1.2 million, but a good chunk like $500K-$600K for parks. It was sometime just before the $1.2 mil approval. Anyone remember that?

[MagicWDI]

I think the Pier stuff is a go. They are too far into things, not to mention they wanted to get all that area done by World of Color's opening (and you can't have all that construction going on when trying to debut a huge show like that). I think the Pier is definitely going to hit its '10 deadline.

Oh yes, not to mention at this point it would cost ya to stop the projects once they are started.

[Majikku]

Oh yes, not to mention at this point it would cost ya to stop the projects once they are started.

Thats why when alot of people kept saying there is no rush to start these projects, it was foolish, because if they would have jumped right in and started the entry and other aspects of this remodel earlier, we probably wouldnt have delays right now. But see now they waited and the economy went sour,and we are stuck.

[MagicWDI]

I thought Disney already reserved funding from one or two years ago when they had a large profit. I remember reading somewhere that they did well one year (close of 2007?), and were taking a set amount for park developement, most of it going to DCA. I don't think it was all of the alleged $1.2 million, but a good chunk like $500K-$600K for parks. It was sometime just before the $1.2 mil approval. Anyone remember that?

You can set aside budgets, but it would be foolish for any company to just spend cash of that magnitude all at once when they don't need to. All of these projects are divided into segments and each segment is getting its own budget. This is not one overall projects but many smaller ones. That is the only way to do a massive overhaul of this scale. The reason is so one projects doesn't effect the other.

If anyone told you they already spent the money they don't know what they are talking about. I've never heard of pre-ordering projects. There is usually a bill for the overall cost (which is determined later) and it is paid for afterward, which is usually paid for by loans.

The only thing you can get ahead on is paying for material, but the reviews, design, development, contractors, workers, equipment, construction, etc is all paid for once they get the figures in.

[MagicWDI]

Thats why when alot of people kept saying there is no rush to start these projects, it was foolish, because if they would have jumped right in and started the entry and other aspects of this remodel earlier, we probably wouldnt have delays right now. But see now they waited and the economy went sour,and we are stuck.

Well it's probably better they didn't start then as they would have been in a deeper hole than they are now, seeing as some of these changes are very hard to market. You can only market the attractions and entertainment, but the new entry and remodel to the Pier won't bring in more people in the short turn, as these specific projects are to change the image of the park.

So how do you sell a project that will cost a lot of money if it won't bring in more money to pay for it?

This is why these image changing projects were attached, like an earmark, to the overall expansion projects.

Lucky for the company they are convinced that in order for DCA to be a success they need to change the image of the park and the characteristics of the brand, so these projects are going to be done one way or another.

[Ben]

If anyone told you they already spent the money they don't know what they are talking about. I've never heard of pre-ordering projects. There is usually a bill for the overall cost (which is determined later) and it is paid for afterward, which is usually paid for by loans.

No, I didn't think they spent it. I just thought it was reserved. I totally understand Disney reviewing, changing and deferring plans for their capital investment. I thought that when they originally announced the whole plan that it was still suceptible to change if economic or stock performance went bad. Sounds like Disney has a good plan... to hold onto money during these tough times. Makes sense to me.

However, I also believe that what can happen is the longer delay in implementing projects risks the more opportunity that it may loose steam, interest and support to proceed at a later time, especially if in a different economic climate. I don't mean it as a pesimistic view like "the projects aren't going to happen", but I know, realistically, that opinions and motivation (and who is behind the motivation), about these projects can change. I'm sure Disney didn't think delaying projects and merging operations would be something they would have to do, but their opinon and actions have changed in light of what's going on in our economic world. (I'm in the camp that the "One-Disney" rhetoric was not part of carrying out an already pre-planned item on a "to-do list... rather it's responsive to immediate fiscal need in today's economy).