Comcast (NASDAQ:CMCSA) isn't the only Central Florida theme-park operator expanding these days. Disney (NYSE:DIS) announced on Thursday that it will be adding a 15-story tower to its Disney's Coronado Springs Resort, adding 500 rooms that will include suites and concierge-level services.
The expansion will be transformative for the entire resort, as a series of bridges across its signature lake will connect guests to floating gardens and an island oasis by the time it's complete in 2019. A popular addition to the new tower will be rooftop dining, offering sweeping vistas of Disney World's massive resort. It's going to be a huge draw at night when the fireworks at nearby theme parks kick in.
One can always argue that 500 more rooms is a drop in the bucket for Disney. The resort already has more than 30,000 rooms across its 27 themed resorts; it merely increases its capacity by less than 2%. However, with rival Comcast adding new hotels at a feverish pace and its attendance gains far outpacing Disney World in recent years, every drop in that bucket is incremental. The Coronado Springs expansion will mean 500 more families staying on property, and the new landscaping and entertainment features will make it more magnetic as a destination.
2019 don't be late
Universal Orlando took a big step in taking on Disney when it built its first three on-site hotels between 1999 and 2001, tacking on 2,400 accommodations for overnight guests. Now under Comcast ownership, ramping up its resort offerings has become a key component of competing against Disney as it woos a captive audience.
The addition of Cabana Bay Beach Resort in 2014, Sapphire Falls last summer, and Aventura next year will bring its room count up to 6,200. It's probably not a mere coincidence that the announcement late last year of the 16-story Aventura Hotel featuring a rooftop bar and grill component to the 600 rooms it will be adding to Comcast's resort follows Disney's similar chess move three months later. Along with the nearby Legoland Florida gearing up to open its second hotel later this year, Central Florida's attractions are taking "if you build it, they will come" to the next level.
Space has been the big limitation for Comcast. Unlike Disney, with more than 40 square miles of land to play with in Central Florida, Aventura is being shoehorned into a six-acre parcel. However, Comcast's decision to snap up large tracts of land near its resort last year means that Disney's biggest rival will have more than enough turf to keep dreaming out loud.
This week the attention rightfully belongs to Disney. The new tower at Coronado Springs and the announcement of refashioning the marketplace at Disney's Caribbean Beach Resort into a livelier waterfront dining and shopping destination will be big draws for both potential overnight guests as well as folks staying elsewhere looking for something to do.
There's also been a lot of online chatter surrounding recent Disney permitting requests, suggesting that the theme-park giant will build a cable car system connecting the two resorts with Disney's Hollywood Studios and EPCOT. Disney has not commented on the chatter, but between Star Wars Land at Disney's Hollywood Studios and the new hotel tower at Coronado Springs both coming online in 2019, it wouldn't be a shock if Disney does something to make it easier to move guests in and out of those properties.
The battle is real, and shareholders putting up with the near-term capital expenditures to build out these destinations should be rewarded in the long run as more guests have more reasons to spend more money.