Groundbreaking ceremony for Disneyland Shanghai

12 April 2011 23 h 47 min 29 comments

After 10 years of tough discussions with the Chinese and Shanghai governments, the first Disney park in mainland China is at last coming out of the ground. The resort is scheduled to open in 2015 or 2016.

This deal marks one of the largest foreign investments ever made in China : over $4 billion. The initial investment in the project is evaluated at $3.7 billion to build the theme park and an additional $700 million is forecast to build the other aspects. The investment will be split between Disney and the Shanghai Shendi Group (a company owned by the Shanghai government). The Walt Disney will hold 43% of the shares of the owner companies and the Shanghai Shendi Group will hold the remaining 57%. Financing will be proportional to ownership. In addition, a joint venture management company will be formed, with Disney having a 70% stake and Shanghai Shendi Group having a 30% stake. The management company will be responsible for creating, developing and operating the resort.

Opening in about 5 years

The resort, which is scheduled to open in about five years, will be composed of the Magic Kingdom-style theme park Shanghai Disneyland, which will feature attractions tailored specifically for Chinese citizens; two themed hotels; a large retail, dining and entertainment venue; recreational facilities; a lake; and associated parking and transportation hubs. For its opening, the resort will cover 963 acres, with additional room to expand.

Disney president and CEO Bob Iger was attending the start of the building in Shanghai. ”Today marks a significant milestone in the history of the Walt Disney Co.,” Iger said. “Our Shanghai resort will be a world-class family vacation destination that combines classic Disney characters and storytelling with the uniqueness and beauty of China. It will be authentically Disney and distinctly Chinese.”

At the Friday’s groundbreaking ceremony, Iger and the Head of Disney Park division, Staggs, were joined by Shanghai Party Secretary Yu Zhengsheng and Shanghai Mayor Han Zheng to officially break ground on the project.

The Disney’s ownership of the park at 43% is exactly the same as Hong Kong Disneyland. Since it opened in 2005, Hong Kong Disneyland has experienced lower-than-expected attendance with 42 percent of its guests last year coming from mainland China, according to HK Disneyland.

According to some rumors, The Walt Disney Company and the Chinese government have already started a new round of discussions regarding the launch of a chinese version of Disney Channel.

SOURCES: Disney Company, Shanghai Daily, THR (8-10 april 2011)

IN THE PRESS:

. Disney Breaks Ground on Shanghai Resort (THR, 8/04/2011)

Disney set to break ground on Shanghai theme park (Los Angeles Time, 6/04/2011)

. Bailian Group contracts with Shanghai Disneyland (Global Times, 14/04/2011)

. China Approves Disney Theme Park in Shanghai (NY Times, 4/11/2009)

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