Walt Disney (DIS), the company known for its theme parks, movies, and Mickey Mouse, will begin to build homes with price tags as high as $8 million. According to The Wall Street Journal, the vacation homes will be erected at Florida's Walt Disney World. The newspaper added that "The proposed 980-acre Golden Oak development, most recently two golf courses within the 40 square miles of Disney's Orlando theme parks, is expected to eventually encompass 450 homes and a 445-room Four Seasons hotel."
Analysts are likely to ask, "why bother?" Disney made $3.3 billion last year on revenue of $36.1 billion. Its revenue strength is media properties like ESPN and the huge theme parks it has in Asia, the U.S. and Europe. It would appear that Disney has decided to take a risk that Florida real estate will recover and that the rich will be drawn, somehow, to the Disney name.
It's definitely a risky venture. For decades, the Disney brand has been tied to middle class tastes, drawing families to its theme parks and movies like Toy Story 3. Plus, real estate development has suffered over the last three years, and the Florida market, hurt by a property balloon and high unemployment in the state, may not come back for years.
Otherwise, it is a great idea.
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