Sales of the Villas at Disney's Grand Floridian Resort & Spa helped propel Disney's Parks & Resorts division to a 12% increase in profits during the 4th quarter of Fiscal Year 2013. But Disney is struggling to maintain is sales pace in Fiscal Year 2014.
Disney chairman and CEO Bob Iger singled-out Disney Vacation Club as one of the business units responsible for growth in the Pakrs & Resorts division for the period ending September 30, 2013. But the subsequent weeks have not been kind to Disney's timeshare sales unit.
After the initial surge of anticipatory buyers, sales at the Grand Floridian declined much quicker than executives anticipated. Over the last four calendar months, Grand Floridian numbers have dropped from 223,000 points sold in July 2013 to just 75,000 points in October 2013.
DVCNews.com tracking of deeds filed with the Orange County Comptroller's office shows the Villas at Disney's Grand Floridian Resort moved just 17 points more than Disney's Animal Kingdom Villas in the month of October. Disney Vacation Club has been selling Animal Kingdom points since February 2007 while the Grand Floridian has been available for less than six months.
Full October sales numbers will be posted later this week.
According to a Disney Vacation Club source, the decrease in Grand Floridian sales has executives very worried. Late last week, conference calls were held with members of the sales staff in an attempt to identify reasons behind the weak performance. Despite luxurious accommodations and spacious rooms, feedback from potential buyers suggests that they are most troubled by the high acquisition cost of the points and the number of points required for each night in the Grand Floridian villas. The resultant "points shock" has left interested parties considering other vacation club properties, investigating the resale market or foregoing DVC altogether.
Points for the Villas at Disney's Grand Floridian Resort are currently priced at $150 each, plus closing costs. The nightly point requirements for a room at the Grand Floridian runs up to 35% higher than a comparable villa & view at DVC's other nearby property: Bay Lake Tower at Disney's Comtemporary Resort.
So far Disney Vacation Club has resisted offering any incentives or discounts on the purchase of Grand Floridian points. Perhaps that philosophy will change as Disney looks for ways to move its inventory.
Meanwhile, work has already begun to bring Disney Vacation Club villas to Disney's Polynesian Resort. Given the high regard in which many Walt Disney World afficionados hold the Polynesian, it is likely Disney envisions even higher prices and higher point requirements for the final timeshare property on its Magic Kingdom monorail loop. Grand Floridian sales struggles will undoubtedly prompt Disney to take another look at its Polynesian projections.
The Polynesian villas are scheduled to open sometime in 2015.
