Walt Disney Co. Chief Executive Robert A. Iger was joined by Shanghai’s Communist Party chief and the city’s mayor Friday to officially commence construction of a long-awaited theme park that will give the Burbank company a critical beachhead in mainland China.
In a carefully staged groundbreaking ceremony interspersed with singing and dancing, Iger said the new park would feature a blend of East and West and underscored the importance of the $3.7-billion project for Disney.
“This is a defining moment in our company’s history,” Iger told the audience from an indoor stage set up across from the site of the planned resort, which he said would be “both authentically Disney and distinctly Chinese.”
Iger, the Disney chief since 2005, revealed few details about what attractions the Shanghai location would include except that designers had chosen to replace the traditional Main Street entrance with 11 acres of green space that would lead to the largest Storybook Castle of any of the company’s six theme parks.
The resort will be co-managed with Disney’s joint venture partner, Shanghai Shendi Group, a conglomerate of government-owned companies that hold a 57% stake in the project set to open in 2014.
Financing for both Shanghai Shendi and Disney will consist of 70% equity and 30% debt, Disney said.
The kickoff comes after more than a decade of bureaucratic wrangling complicated by everything from Disney’s inability to launch a dedicated television channel in China to what to do with ancestral graves belonging to villagers evicted from a 963-acre site.
Shanghai officials said the resort would be a boon for the local economy, describing it as China’s largest foreign invested venture in the service sector.
“This project will improve Shanghai’s international profile as a world famous tourist destination,” said Mayor Han Zheng. “Shanghai Disney Resort will be a role model.”
For Disney, the park represents a highly sought entree into one of the most promising consumer markets in the world to sell merchandise and market movie and TV brands despite tight government restrictions.
Iger noted in a news conference later in the day that the Shanghai park was located within a three-hour car or train ride of 330 million people, many of whom belong to a fast-growing middle class.
“We believe this resort will quickly become a special place,” Iger said.
Its construction comes as the sometimes maligned Hong Kong Disney park is undergoing significant expansion to offset criticism that the site was too small and didn’t feature enough attractions.
Despite the close proximity of the two parks in the same country, Iger said China was a big enough market for the two destinations.
Friday’s ceremony gave many reporters their first glimpse of the planned site -- about 1.5 square miles of upturned soil in a still rural part of eastern Shanghai.
Earth diggers affixed with giant red bows were parked in formation. Villagers lined the local roads, some waving at the convoy of vehicles going to the event.
Minutes after Shanghai Party Chief Yu Zhengsheng announced the official groundbreaking, two children sang “When You Wish Upon a Star” in Chinese. Costumed Disney characters such as Mickey Mouse, Goofy and even Princess Jasmine then danced onto the stage.
“Let the dream begin,” an announcer said.