Looks like the Hong Kong Disneyland Resort will remain a one-gate property. The Hong Kong government announced today that Disney's option to buy adjoining property to expand the resort will not be renewed.
Hong Kong Disneyland opened in 2005 on 320 acres of reclaimed land on Lantau Island, with several hundred adjacent acres reserved under option for future expansion. From the government's press release today:
Under the Option Deed signed in 2000, HKITP, i.e. the joint venture company between the Government and the Walt Disney Company (TWDC) for the development and operation of HKDL, was granted the option to purchase the Site for HKDL's possible expansion. The Option will expire after September 24, 2020, if it is not extended upon agreement by the Government and TWDC. Consequent to the Government's decision, the right of HKITP to purchase the Site will not be extended.
Hong Kong Disneyland has announced an aggressive expansion program to add attractions within the park, including new rides themed to Frozen and Marvel's Avengers.
"HKITP's strategic direction is to focus on the ongoing multi-year expansion plan featuring a series of new attractions that will continue to position HKDL as a premier tourism destination in the region, and help capture business opportunities upon the gradual recovery of tourism," a spokesperson for Hong Kong's Commerce and Economic Development Bureau said in the government's press release.
"The Government considers it prudent for HKITP to focus on the development and expansion of the existing resort in the coming few years, rather than geographic expansion into the Site," the source said.
Without the extra land for expansion, Hong Kong Disneyland will not be able to expand with a second gate, although there remains space on the resort's existing property to add another hotel.
At this point, Hong Kong Disneyland and Shanghai Disneyland are Disney's only single-gate resorts. Hong Kong Disneyland attracted about 5.7 million visitors last year, a 15 percent drop from 2018, according to the TEA/AECOM Theme Index attendance report. Shanghai Disneyland drew 11.2 million visitors last year, down five percent from the park's second full year of operation.
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So... does this mean Universal can buy up the land now?
This is not surprising at all to me, Disney really screwed the pooch in Hong Kong and it was only a matter of time before the government was pressured into sticking it back to them in some way. Considering the sky high cost of real estate in Hong Kong, and the affordable housing crisis, it will go to social services or housing development.
Probably for the best. The Imagineering series highlights the complete mess of Disney Studios Paris and how they regret doing a park just to keep the land rights so best to avoid a mistake like that again.
This is just politics between HK government and TWDC. HKDLR was surprisingly profitable pre pandemic if one takes out the management fees and royalties than TWDC receives for HKDLR.
However having lived and worked in HK, the land will probably not go towards resolving the affordable housing crisis in HK simply because its just too remote to make it attractive to qualified public housing applicants. Its more about accessible affordable housing in HK that is the real issue. This is because there is inventory of affordable housing in HK available, but its just too remote and inconvenient for it to be attractive to those who really need it.
This expansion land will probably sit vacant till TWDC and HK government reach a deal that is more palatable for the latter.
They probably would have wasted it on yet another studios park anyway.
HK govt most likely will use the land for quarantine centres and temporary housing because there is height restriction for buildings. I really don't think HK govt will build anything permanent on the site.
In five or ten years time, if WDC is ready to buy the land and build the second gate, these temporary structures can be relocated. Of course WDC will have to pay a greater land premium than the HK$2.8 billion stipulated in the original agreement.
It makes more sense to demolish HK Ocean Park for housing. Also, Sunny Bay is supposed to develop some housing, both sites are much more accessible than the 2nd gate land.
From professional feasibilty viewpoint :
1st
The park still does not have enough BASIC atraction choices. For just one venue. More then 30% internal growth should be finalized, before moving OUT of actual confinements)
It's lunacy to talk about a 2nd venue.
2nd
HK government is involved in both Ocean Park development, and HKDL.
Of course they do NOT want to get the one business grow bigger then the other.
Their government viewpoint is global HK tourist business (= incoming tourism for HK), NOT individual company profits.
3rd
Ocean park is older, and offers better cost/profit rates.
BLUNT business fact.
>>>>>>>>
HK government decisionmaking, approaved.
(This is totally loose from Chinese geo-political decisionmaking)
Very understandable. Plus, if you think about it, Disneyland survived 45 years as a one park resort. That was a lackluster upon opening in 1955. Hong Kong also has that awesome Mystic Manor ride which helps.
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It’s understandable. The low attendance never warranted a 2nd gate. Unfortunately, with only one park, HKDR will have difficulty drawing more guests to the resort. It’s not a death sentence, but it’s pretty close to it.