Disney to Build Luxury Vacation Homes
June 23, 2010 - Florida
By Juliet Chung from The Wall Street Journal Asia
Walt Disney Co. plans to unveil Wednesday its first foray into residential real estate in more than a decade with a pricey vacation-home development in Florida's Walt Disney World.
It's a risky move. Disney will offer homes priced between $1.5 million and $8 million in a state where the foreclosure rate remains among the nation's highest.
In Orlando, where brokers say home values have dropped between 50% and 60% from the peak, Disney's pricing would put its homes near the top of the market.
According to Realtor.com, the average price of new listings in greater Orlando this year is just over $243,000.
But Disney believes the market for luxury homes is rebounding. Despite adding wine-tasting events and VIP park tours in recent years, "The affluent market is an area where we haven't offered a lot of product," says Matt Kelly, vice president of Disney resort real-estate development.
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.
The hotel will sit in the center of the development, to the south and east of one of the original golf courses, which will be updated.
Plans also call for a clubhouse, parks and pedestrian walkways, with wetlands and other conservation area comprising about half the project's acreage.
Golden Oak will test whether Walt Disney World is compelling enough for the well-heeled to buy a home there instead of in other family-friendly resort towns
But the test will be a limited one: Fewer than 30 lots will be available for sale this year, with the first homes expected to be finished in 2011.
The timing and scale of a second phase that may offer fully-built homes remains undecided. Disney declined to reveal its investment in the project.
Disney estimates Golden Oak could take eight to 10 years to complete.
Buyers interested in the first lots must deposit $25,000 to be placed on a sales reservation-list.
This article has been republished from Wall Street Journal
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