Anaheim Wonders at Cost of Disney Fantasy : Entertainment: Resort plan would consume millions in public funds at a time when city can least afford it.
Only hours after imagining the city’s future with Disney’s serene WESTCOT Center and its glittering Spacestation Earth as a centerpiece, city officials were jolted back to the cold reality of 1991: Anaheim would be forced to pledge millions in public funds it does not now have.
At minimum, the preliminary master plan for the $3-billion development calls upon the city to acquire more than 50 acres for the project’s three parking garages, capable of storing 28,000 cars, in an area where real estate has been selling for more than $1 million per acre.
Local officials and real estate analysts say those land costs will probably climb much higher. Disney’s announcement has already sparked a frenzy of interest in Disneyland-area properties by owners of restaurants, hotels and other businesses eager to exploit a growing tourist attraction, they say.
“The city just does not have that kind of money right now,” Anaheim Councilman Bob D. Simpson said after attending a public unveiling of plans for the 470-acre Disneyland Resort proposal. “I just don’t know how we could pay for it.”
Anaheim’s worries about the cost could become a moot point, some say, because Disney will not decide until the year’s end whether to build its second Southern California attraction in Anaheim or Long Beach, where Disney has proposed a 414-acre ocean-theme resort dubbed Port Disney.
However, Anaheim officials believe that their city holds a slight edge in the competition, largely because there are fewer governmental obstacles in Orange County. In Long Beach, Disney would need approval from the local city government and various state, federal and coastal agencies.
But in Anaheim, the potential of increased financial demands could not come at a worse time. The city is struggling with a projected $20-million budget deficit spread over the next two years, declining sales tax revenue and the demands of other multimillion-dollar projects it is already managing.
In addition to the property, Disney Development Co. Vice President Kerry Hunnewell said the entertainment company will seek public financing for its costly transportation plan. That phase of the project calls for new ramps off the Santa Ana Freeway that would carry traffic directly into multistory parking garages.
The city might also be tapped to help in the proposed reconfiguration of streets, especially the elaborate plans for a proposed new main entrance to the Disney attractions from Harbor Boulevard. The entry plans include lush median landscaping, pedestrian walkways and a suspension bridge linking the parking garages on the east side of Harbor with the refurbished entrance.
In all, the project promises to add three new hotels along what is now West Street, which planners want to rename Disneyland Drive as the resort’s main thoroughfare. Plans also call for renovating the Disneyland Hotel and a face-lift for Disneyland, which would include two new “lands”--one a permanent birthday party for Mickey Mouse and another linked with the popular Indiana Jones adventure films--plus an updated Tomorrowland.
The new addition--WESTCOT Center--was inspired by Florida’s EPCOT Center, a 260-acre complex that Disney calls a “permanent international showplace” which is framed by a giant dome that looks like a white golf ball. EPCOT stands for Experimental Prototype Community of Tomorrow. It houses displays focusing on discovery and scientific achievements, with pavilions representing 11 nations.
In the new Anaheim park, Disney officials basically propose to bring a version of the phenomenally successful Florida attraction to the West Coast, which explains their creating the name WESTCOT.
Neither Disney nor city officials could estimate Thursday the scope of the project’s public funding needs. Officials also declined to speculate whether Anaheim would try to seek revenue bonds or tax increases as possible funding options.
“It’s basically an unknown,” Councilman Tom Daly said. “I don’t know enough about what Disney’s needs are and what the city staff will recommend to accommodate those needs. But based on what I’ve heard and seen, let’s just say it will be a considerable challenge.”
On top of Anaheim’s fiscal woes and Disney’s expected demands, city staff and council members are already managing: the construction of a $110-million sports arena, scheduled to be completed in 1993; the study of a citywide people-mover project that would be expected to cost $200 million to build; and the planning of a Convention Center expansion, projected to cost $10 million to $14 million.
Although the arena is supported with private money, Simpson said, the city had to acquire the arena land for about $17 million. The councilman said money for the people-mover and convention center expansion have yet to be worked out.
Hunnewell said the land for two parking garages is just east of Disney’s present main entrance, off Harbor, and stretches to Katella Avenue. A third parking garage is planned for the northwest side of the park, off Ball Road. He said Disney already controls most of the 30 to 40 acres needed there.
“What we’re proposing is a project that would provide incremental fiscal benefits to all levels of government,” Hunnewell said. “What we’re proposing in the way of transportation improvements would not only benefit Disney but the city of Anaheim as well.”
Still, the costs promise to be staggering, with real estate speculation already running at full throttle.
One hotel owner, who asked not to be identified, said that shortly after Disney’s plans were made public Wednesday, he received a $5-million offer for his 60-room motel that sits within a plot of land that is proposed for one of Disney’s eastern parking garages. Without Disney, analysts said, the property would not be worth a fraction of the offer.
Still, the owner said: “I told him no. I knew all he wanted to do was turn around and flip it” to a new buyer for even more money.
The owner said he has not decided what will be done with the motel.
Chuck Noble, an area real estate analyst, said larger blocks of land in the area will probably attract the most activity.
One, Noble said, that should certainly draw the buzz of hotel developers is the 58-acre strawberry field near the corner of Harbor Boulevard and Katella Avenue.
Longtime owner Hiroshi Fujishige and his family have repeatedly resisted overtures by Disney and other potential buyers to sell the land, yet Noble predicted that pressure could be turned up a notch as the tourist industry scrambles for prime locations near the proposed new park.
Some members of the Fujishige family attended Thursday’s private announcement ceremony at Disneyland, and Disney executives have outlined their property as being under consideration for future Disney expansion.
“There’s no pressure,” the strawberry farmer said Thursday, “at least not yet. I’ll just sit low for quite a while.”
Fujishige, 68, said he had been invited to the private briefing for government and civic leaders but elected not to attend because he is not in the market to sell.
“There was no sense for me to go,” he said.
The farmer had earlier rejected as too low a $32-million deal the company reportedly offered for a long-term lease on his property.
Dan Kruse, an Anaheim-based analyst who tends to the needs of those seeking property for various industries, said he received two calls from clients Thursday morning--both looking for new Anaheim addresses for their hotel and restaurant supply companies.
“They want to be located closer to Disneyland, where the hotels and restaurants are going to be,” Kruse said. “Land values are automatically going to go up. People want to capitalize on the added tourist trade going on in the area. They must have read the paper this morning.”
On Thursday night, Disney began its attempt to sell the expansion to city residents with the first of what are to be a series of private community meetings.
Elaborate brochures highlighting the new park’s attractions have already been circulated in neighborhoods near the present Disneyland.
Hunnewell said the community meetings will be held at the Disneyland Hotel and will attempt to draw residents from various neighborhoods throughout the city.
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