Disney Plans Niche Resort in Hawaii

October 3, 2007 7:24 p.m.

Walt Disney Co. is kicking off a new theme-park strategy of building niche resorts and attractions with a stand-alone resort in Hawaii.

The Burbank, Calif., company said it had purchased 21 acres of oceanfront property on the island of Oahu, where it will build its first solo resort featuring both hotel rooms and vacation club villas.

Disney's theme-park operation has been hatching plans to expand its reach by building smaller attractions and resorts around the world, rather than just more big parks. As well as stand-alone hotels in cities and beach resorts, that plan is expected to include Disney-branded retail and dining districts and smaller, more specialized parks that could focus on popular themes such as pirates or princesses.

Disney said its new Hawaiian project would be an immersive, Disney-branded resort, but it declined to give more details on the theme, saying its designers, or "imagineers," are still completing plans. The company noted, however, that it has tapped the Hawaiian theme for several projects over the years, from the 1937 Mickey Mouse animated short "Hawaiian Holiday" to the 2002 animated film "Lilo & Stitch." The Walt Disney World resort in Florida also includes the Polynesian Resort.

The Hawaiian resort will have more than 800 units, with construction expected to start next year for a 2011 opening. The cost of the land is around $144 million, which will be paid over the course of the project, Disney said.

Hawaii is a relatively safe first stop for Disney: It is an established travel market that isn't too far from home. However, Disney plans to reach well beyond the U.S., with Asia expected to be a big focus.

The challenge is giving guests a taste of Disney, without cannibalizing its existing theme parks. Disney also has burned its fingers before when it has branched outside its parks: An indoor, interactive theme-park project called Disney Quest drew sparse crowds in Chicago and was closed in 2001.

But other recent attempts to expand in the travel business have had more success, including its vacation villas and cruise ships. Earlier this year, Disney announced it was adding two new ships to its cruise business.