The Potential Value and Purchase Price of Walt Disney World's Theme Parks: An Analysis

Walt Disney World (WDW) is a giant revenue generator for The Walt Disney Company, playing a critical role in the company's strategic goals. Despite its immense value, the resorts and Disney Springs are integral parts of WDW and are highly unlikely to be sold at any cost. However, if we focus on the theme parks alone, their monetary worth can be estimated. This article delves into the potential purchase price of WDW's theme parks, excluding the resorts and Disney Springs.

Valuation of WDW's Theme Parks

Estimating the value of the four main theme parks, Magic Kingdom, Epcot, Disney's Hollywood Studios, and Disney's Animal Kingdom, excluding the water parks and other facilities, can be a daunting task. Nonetheless, based on market analysis and industry standards, the cumulated value of these parks is roughly $20 billion. Adding the value of the water parks, hotels, and infrastructure, the total evaluation could be around $30 billion.

Tax Assessed Value of WDW Properties

The total assessed value of all properties within the Reedy Creek Improvement Area, which includes Walt Disney World's properties and some other facilities, was $8.281 billion in 2015. By 2016, this value had increased to $9.527 billion. This area encompasses the Walt Disney World resorts, a former WDW resort now managed by the Department of Defense, and a few mobile home communities. However, it does not include employee residences or the planned city of Celebration, Florida.

Physical Cost of Construction

Considering the cost of construction, the initial investment to build the resort was much less than $90 billion. Taking into account the enormous profit the company would seek from selling WDW, the eventual sale price could be twice as high.

Disney's assets are valued at approximately $90 billion, but this figure includes a vast array of properties and assets such as film, TV, and theme parks. It is critical to note that a significant portion of this value is tied to the WDW theme parks, making it difficult to separate.

Character Meet-Ups and Future Extensions

A crucial factor in the continued success of WDW is the character meet-ups, which are a primary draw for young visitors. Characters like Mickey Mouse, Elsa, and others are integral to the park's appeal. To maintain relevance, the parks need to include both existing and future characters. If Disney were willing to sell a controlling interest, it might resemble the arrangement with the Oriental Land Company, where Disney still profits from the park while making it easier to manage character presence.

Alternative Scenarios for Purchase

If the aim were to obtain a controlling interest in WDW's theme parks, the purchase price would likely be around $X, similar to the deal with the Oriental Land Company. If, however, the objective were to buy the entire Disney company for $161 billion and only require WDW, the buyer could potentially sell off assets not needed, thus reducing the overall purchase price.

Overall, the purchase price of the four main theme parks would be substantial, making a standalone transaction feasible but requiring careful strategic planning to ensure long-term success and profitability.