Walt Disney World has introduced that it’s earmarking practically 80 acres of land for a brand new inexpensive housing improvement in Central Florida. This put up will share particulars in regards to the plan, plus our commentary about Orlando’s housing disaster, skyrocketing shelter inflation, and (a few of) what’s inflicting this. (Updated November 16, 2022.)
“We are invested in working together with our community to solve complex issues,” mentioned Jeff Vahle, president of Walt Disney World Resort. “The lack of affordable housing is affecting many people across our country, including right here in Central Florida. With this initiative, we’re lending a hand to make a real and meaningful impact in our community by tapping into the best of our company’s strengths. This is the right opportunity and the right time to take action.”
The improvement, which is anticipated to incorporate greater than 1,300 models, will probably be constructed by a third-party inexpensive housing developer and will probably be situated on Walt Disney World’s land in southwest Orange County, Florida. It will provide Central Florida residents a wide range of dwelling selections which are inexpensive and attainable, in an amazing a part of Horizon West close to the brand new and increasing Flamingo Crossings Town Center retail and eating advanced. The improvement will probably be out there for qualifying candidates within the area, together with Disney Cast Members.
November 16, 2022 Update: Walt Disney World has supplied its first replace on this housing improvement undertaking since saying it again within the spring. We now know the precise location for this initiative, which is in an amazing spot west of State Road 429, only a few miles away from Magic Kingdom, close to faculties and buying, together with Flamingo Crossings Town Center. (We realize it’s an amazing spot as a result of we lived a stone’s throw from right here up till this yr!)
The Michaels Organization will construct, personal and function the property. According to Walt Disney World, it is a distinguished and visionary developer identified for creating high-quality houses in communities in lots of states, together with Florida. (I’ve seen a lot of housing builders in Central Florida, however by no means this one. Perhaps I’ve simply missed it?) The improvement is anticipated to be privately financed and restricted to candidates inside a sure revenue vary.
“For more than 50 years, Walt Disney World has cared for and invested in our community, and we’re committed to being a part of this solution which will bring more attainable housing to Central Florida,” mentioned Jeff Vahle, president of Walt Disney World Resort. “We will continue to find ways to use our resources to make a difference in the community we call home, and we’re excited to take this step with a nationally recognized developer.”
After a radical search, Disney acknowledged that it selected The Michaels Organization on account of its long-standing monitor file in constructing and managing attainable housing communities. Negotiations between Walt Disney World and The Michaels Organization on a definitive settlement for the initiative are presently underway. The improvement will probably be open for qualifying candidates, together with however not restricted to Cast Members.
“We are excited to work with an iconic brand like Disney to deliver attainable housing for the Central Florida community,” mentioned Michaels CEO John J. O’Donnell. “Our goal is to create a repeatable model that we hope will inspire other companies and municipalities to create high quality, attainable housing in their own communities.”
This initiative will assist provide a viable answer to one of many nation’s biggest challenges and will assist and construct upon Orange County’s Housing for All motion plan to handle housing affordability for native residents, an motion plan caused by the fervour and management of Mayor Jerry Demings.
Here’s a video Disney beforehand launched together with the unique announcement:
According to Walt Disney World, this initiative has been within the works for some time as the corporate has been targeted on discovering options to this problem for fairly a while.
Attainable housing is certainly one of some ways Disney engages with native leaders to assist the neighborhood discover lasting options to this subject, from donations, to provides to its Disney VoluntEARS program and extra. Earlier this yr, Walt Disney World and Disneyland donated $300K to native meals banks to assist individuals in the neighborhood dealing with meals insecurity. That donation was a part of the $5.5 million that Walt Disney World has contributed to vital neighborhood causes in the course of the fiftieth Anniversary celebration, together with organizations addressing the necessity for inexpensive housing.
It’s additionally not the primary time the Walt Disney Company has assisted native communities with underserved housing wants. Several years in the past, Disneyland Resort led an effort to revitalize the Orange County Housing Trust that gives “last mile” funding for inexpensive housing tasks in Anaheim.
This made the Buena Esperanza undertaking — a transformed studio condominium neighborhood for veterans and homeless people with psychological sickness — a actuality. In addition to offering them a spot to stay, the neighborhood presents job placement and psychological well being and wellness assist to residents.
As a results of Disney’s funding a second undertaking, Finamore Place, in Anaheim is beneath development with an anticipated completion date of early summer time 2022. It will present over 100 further housing models. Disneyland Resort will proceed to indicate assist for these and different such worthy endeavors.
The Walt Disney Company additionally spent years investing in native nonprofits on the entrance strains of vital causes in the neighborhood like inexpensive housing. Through a whole bunch of thousands and thousands of {dollars} in donations, the Disney VoluntEARS program, contributions to native meals banks and extra. Just just a few months in the past, Walt Disney World donated $3 million to a few of these exact same organizations.
In phrases of commentary, this doesn’t come as an enormous shock to us. Shelter inflation is skyrocketing, with rising rents outpacing even the red-hot housing market. You’ve undoubtedly seen or learn the headlines, however in case not, right here’s an article from earlier this yr about astronomical rental charges. That’s from this January, and it’s solely gotten worse since.
In Central Florida, this story has dominated the information, with quite a few analysts displaying the native market far outpacing the nationwide common. Rent.com’s newest knowledge reveals Orlando’s common condominium elevated 38% year-over-year, far above the 20% nationwide charge and 5% typical yr enhance. Again, that’s as of January–and can also be just one yr. Since this time in 2020, rents are up much more considerably.
As this weblog is wont to do, we’ve gone off-topic a number of instances in the previous few years and commented on the influence of individuals “fleeing to Florida” on Walt Disney World. This pattern has additionally garnered a variety of nationwide consideration not too long ago, however the phenomenon is definitely nothing new.
Back when Annual Pass costs elevated in February 2020 and the June earlier than that (in different phrases, pre-pandemic), we talked about the continued inhabitants explosion in Central Florida. At that point, a number of cities within the Orlando metro space had been among the many quickest rising within the United States. Many of those new Florida residents are (and had been) individuals leaving the Northeast and Midwest.
Our commentary on the time was this: “If new home prices and construction around Walt Disney World are any indication, these transplants are also on the more affluent end of the spectrum. (Behind Magic Kingdom, there’s been a proliferation of subdivisions with no end in sight—most of these have homes starting at over $300,000 and ranging up to $800,000.)”
Those worth factors now appear quaint (add one other couple hundred thousand {dollars} on), however the sentiment nonetheless rings true. And this was lengthy earlier than “Zoom Towns” had entered our collective vernacular. If you’ve seen any of these ‘fleeing to Florida’ tales within the information, you’re undoubtedly conscious that this pattern has solely accelerated within the final two years. In truth, lots of you could be contemporary Florida transplants from the Midwest or Northeast. In neighborhoods round Horizon West, you’ll spot extra Cowboys, Yankees, and Patriots satisfaction than for any Florida franchise (sure, even the Buccaneers!).
This has disrupted the native market in a a number of methods. First is the plain one–there’s a sudden surge of individuals and constructing can’t preserve tempo with the inflow. (To the credit score of D.R. Horton, Toll Brothers, and so on., they’re making an attempt their darnedest!)
Second, many of those individuals work remotely and are usually not a part of the native labor market. I don’t have any knowledge to corroborate this, however my sturdy suspicion is that the median revenue of those Florida transplants who work remotely for out-of-state firms is considerably greater than the typical native hospitality trade employee.
In different phrases, there may be not sufficient housing provide and out of the blue there’s a pointy enhance in median wages–however not essentially amongst those that really, bodily work in Central Florida. Even with their very own wage will increase, the frontline employees at Walt Disney World, Universal, SeaWorld, and wherever else merely compete with white collar professionals who work-from-home.
This additionally most likely parallels a narrative you’ve seen on nationwide information. Here’s a chunk on the “Great Reshuffling” from CBS Sunday Morning final May that focuses on how the Boise housing market had been upended, largely by relocating Californians who noticed that Idaho market as cheap relative to what they’d been paying. (It has solely gotten worse since then.) Same concept in Central Florida, however with Northeasterners as a substitute of Californians.
From my perspective, Walt Disney World’s motivations are pretty apparent. This housing is required for its personal Cast Members, who would be the major “beneficiaries” of the event. (I’d assume firm staff will probably be given precedence, and it finally ends up principally only a improvement for displaced Cast Members.)
Moreover, if Central Florida’s unhealthy housing market continues on its present course, the corporate could have (much more) hassle hiring Cast Members. I’m not going to revisit the labor scarcity right here, however it’s definitely related and the motivating issue behind this transfer. Disney is definitely a charitable firm, however that is extra about fulfilling Walt Disney World’s personal wants.
Universal is dealing with the same subject, and that’ll solely be exacerbated as soon as Epic Universe prepares to start out staffing frontline roles. (I’m really curious how they’re going to perform the hiring wanted for that many guest-facing roles in a wholly new theme park. Here’s hoping they’ve a plan.) Suffice to say, it ought to be no shock that the most important gamers within the Central Florida theme park and hospitality industries are foraying into housing and making an attempt to handle this subject.
This is to not solid aspersions or criticize Walt Disney World. The firm may merely flip a blind eye to this and lean much more closely on the College Program, not eager to affiliate itself or its staff with inexpensive housing.
While I feel there are extra underlying points that should be addressed, that is nonetheless an admirable transfer, and one that isn’t with out danger for Walt Disney World. The media loves to attach Disney to any disagreeable headline to draw eyeballs, and precisely that would occur right here if/when there are issues with this inexpensive housing improvement down the street. (It doesn’t take a lot an energetic creativeness to check future headlines with the phrases “Disney” and “slumlord,” no matter actuality.)
My solely commentary past that’s: construct, child, construct.
This is an effective first step, however a ton extra development and discount of purple tape is critical. While approach late to the occasion, hopefully the Federal Reserve rising rates of interest will lower into investor exercise and reverse the present, unsustainable pattern of shelter price will increase. That, in flip, ought to cut back costs–or not less than gradual worth development. (My worry is that a number of the aforementioned dwelling builders will as a substitute gradual the tempo of development given the added market uncertainty. Or that greater rates of interest will make new dwelling purchases much more unattainable.)
In addition to that, there should be adjustments to zoning, a rest of extreme land use restrictions, and higher incentives for constructing or redeveloping industrial actual property that’s now unneeded due to WFH–and maybe disincentives for funding and hypothesis. Of course, all of that’s effectively past the scope of this put up (and I ought to add the caveat right here that this commentary is a reductionist have a look at the causes and penalties of rising rental costs). For now, Walt Disney World deserves kudos (as does Universal, which is doing one thing comparable) for the initiative. It alone received’t resolve the availability/demand imbalance within the Central Florida shelter markets, however it’s a strong begin.
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YOUR THOUGHTS
What do you consider Walt Disney World’s announcement that it’ll earmark ~80 acres of our land for a brand new inexpensive housing improvement in Central Florida? Is this a superb transfer or unhealthy transfer? A strong begin, or nonetheless not practically sufficient? Do you agree or disagree with our commentary? Any questions we may help you reply? Hearing your suggestions–even if you disagree with us–is each attention-grabbing to us and useful to different readers, so please share your ideas under within the feedback!