Disney’s Florida empire is set to expand over the coming decade. (Photo by Matt Stroshane)
Walt Disney World Resort via Getty Images
A little more than two months ago, Disney and Florida Governor Ron DeSantis appeared to bury a very big hatchet with the nullification of a lawsuit over how the company can grow its theme park empire in the Sunshine State. The two-year feud had escalated with DeSantis’ hostile takeover of the former Reedy Creek economic development district from Disney’s control following the company’s opposition to DeSantis’ controversial “Don’t Say Gay” law, which has been recently watered down.
On Wednesday, the DeSantis-appointed board overseeing the rebranded Central Florida Central Florida Tourism Oversight District agreed to allow Disney to move forward with its long-held plans to invest up to $17 billion in its sprawling Orlando resort. The potential plans include expanding Disney’s footprint with a fifth major theme park as well as potentially adding two smaller parks (such as waterparks) and hotels.
“It’s business as usual again for Disney in Florida,” says Robert Niles, creator of Theme Park Insider. “With DeSantis abandoning his Presidential campaign-driven feud with Disney, the company can go ahead with its post-lockdown expansion plans.”
Disney’s parks and experiences division generated $32.5 billion in revenue for fiscal year 2023, accounting for more than a third of the company’s total annual revenue. This was a 16% increase from the previous year and a record high for the segment.
On the company’s latest earnings call in May, Disney executives exuded bullish optimism while discussing the planned capital investment alongside the rosy financials.
“[Disney’s theme parks division] is a 25‐plus margin business and has been for an extended period of time, has terrifically high guest satisfaction scores, which create layers of advantage, which suggest we should be able to sustain high margins and high returns on investment,” Disney’s CFO Hugh Johnson told investors. “With the business with that profile, you invest in it.”
“Disney has committed to spend $60 billion on its parks worldwide over the next decade,” says Niles. “We now know how much of that is coming to Florida.” The $17 billion earmarked for Orlando includes new attractions on expanded sites at Magic Kingdom and Disney’s Animal Kingdom, as well as a new hotel, he notes. “Beyond that, Disney has not revealed any plans. Just because Disney has the authority to build a fifth park doesn’t guarantee that it will.”
The last time Disney added a major theme park to its Orlando resort was in 1998, when the 580-acre Animal Kingdom park opened at a reported cost of nearly $1 billion.
Wednesday’s agreement allows Disney to get on with its expansion plans while also letting DeSantis normalize relations with the state’s biggest employer. During their heated back-and-forths, Disney CEO Bob Iger had called DeSantis “anti-business” and “anti-Florida” and the company pulled the plug on a $1-billion company campus that would have brought 2,000 jobs to Lake Nona, Florida.
Not everyone is happy with Disney’s foray into hardball politics. At the company’s most recent shareholder meeting in April, some chafed at the company’s political donations toward appeasing DeSantis. “In recent years, Disney contributed over $100,000 to an administration that took aim at Disney’s employees, mocked the company’s values at a national level, and then punished Disney by diminishing its tax breaks and degree of self-governance,” said Laura Nixon, a representative from the Educational Foundation of America, a longtime holder of Disney stock.
Taking the opposite stance, Scott Shepard, general counsel at the conservative think tank National Center for Public Policy Research decried “making Disney synonymous with force-feeding radical gender ideology to small school children and then hiding it from the parents would send Disney’s core audience flooding away.” The company’s financial reports suggest Disney’s core fanbase has not gone anywhere.
With DeSantis no longer a presidential hopeful, experts say Disney is right to just move on. “Theme parks are a capital-driven business,” says Niles. “Tech is always advancing. If you want to be the market leader, and charge market-leading prices, you have to be expanding and advancing at all times. That costs money.”
