ORLANDO, Fla. – Disney is canceling its plans to build a $1 billion campus in the Lake Nona area of Orlando, along with plans to relocate thousands of jobs to Florida.
Walt Disney World president Jeff Vahle sent a letter Thursday confirming the news.
Vahle cited “a change in company leadership and evolving economic and business conditions.”
However, Vahle also sought to reassure community leaders and cast members that Disney still was committed to Central Florida, reiterating plans to invest $17 billion in Walt Disney World over the next 10 years and pointing out that Disney is the region’s largest taxpayer.
Just last month, Disney laid off several thousand employees — a second round of cuts that were part of the company’s plan to eliminate 7,000 jobs in 2023 as part of a reconfiguration project to save on costs. It has yet to be confirmed whether the Lake Nona project cancelation was related to that plan.
Disney first confirmed the plans for the Lake Nona campus in 2021. The campus would have housed workers in digital technology, finance and product development, including imagineering workers.
Originally, cast members were supposed to move to Florida by the end of last year, but Disney delayed the project to 2026 to give workers more time to relocate.
Vahle’s letter does not make mention of Disney’s current feud with Florida Gov. Ron DeSantis and Republican lawmakers, who pushed a raft of policy changes regarding Disney in the last year or so after Disney’s former CEO, Robert Chapek, criticized the state’s Parental Rights in Education law, known by critics as “Don’t Say Gay.”
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The state remade the special taxing district, the Reedy Creek Improvement District, that governs Walt Disney World with a board that was handpicked by DeSantis to bring the district more under state control.
After it was revealed that Disney entered into an agreement with the former Reedy Creek board to strip the new board of much of its oversight power, lawmakers submitted bills to void that deal, made Disney’s monorail subject to inspection by Florida Department of Transportation, and tried to put Disney’s theme park rides under inspection by the Florida Department of Agriculture.
DeSantis has hinted at using the new board, called the Central Florida Tourism Oversight District, to levy tolls on roads, develop Disney land, and even joked about putting a state prison on or near the property.
Disney is suing DeSantis and the new governing board in federal court for a number of constitutional violations. Meanwhile, the CFTOD is suing Disney in state court.
Chapek was ousted late last year and replaced with former CEO Robert Iger, who had said he would be happy to talk to the governor and come to a compromise on the feud between the company and the state.
However, Iger has had harsh words for DeSantis as well, calling the actions “anti-Florida” and “anti-business.”
During a quarterly earnings call earlier this month, Iger also lashed out at Florida lawmakers for “retaliating” against Disney for its criticism, argued that laws regarding special districts should be applied to all businesses, not just Disney, and again, that Disney is a large taxpayer for the state despite tax breaks lawmakers have given Disney in the past.
“Does the state want us to invest more, employ more people, and pay taxes, or not?” Iger said.
DeSantis’ office, meanwhile, had this to say about Disney’s decision:
Disney announced the possibility of a Lake Nona campus nearly two years ago. Nothing ever came of the project, and the state was unsure whether it would come to fruition.
Given the company’s financial straits, falling market cap and declining stock price, it is unsurprising that they would restructure their business operations and cancel unsuccessful ventures.DeSantis Press Secretary Jeremy Redfern
However, it’s not true that nothing ever came of the project. City of Orlando records show plans to move forward with the Lake Nona project passed the Orlando development review committee on March 9. Documents include a site plan map of buildings and parking garages. The document is called the “Lake Nona Parcel 20A Office Complex.” The project was passed unanimously, according to the meeting minutes.
Disney has been in the midst of a reorganization, trimming about 7,000 jobs and targeting about $5.5 billion in cost savings across the company.
Still, Disney continues to post strong earnings thanks to its theme park division. The quarter two financial report on May 10 showed Disney earned $1.27 billion, up from $470 million a year ago, and revenue rose 13%, meeting the Wall Street forecast.
Disney’s stock price has hovered above the $90 a share mark since May 10. It rose to $94 a share Thursday before news of the Lake Nona project broke, and ended for the day at $93.75 a share.
Disney’s biggest struggle financially has been growing pains with its streaming services, something Iger has been trying to get a handle on. Disney said streaming losses were due to Disney+ Hotstar, which is the company’s streaming brand in India and some Southeast Asian countries.
[WATCH: Orange County Mayor Jerry Demings on Disney decision]
Reactions from local leaders and lawmakers to Disney’s decision largely characterize it as a consequence, with some — such as Rep. Anna Eskamani, D-District 42 — directly blaming DeSantis.
It is unfortunate that Disney will not be moving forward with construction of the Lake Nona campus. However, these are the consequences when there isn’t an inclusive and collaborative work environment between the state of Florida and the business community. We will continue to work closely with our valued partners at Disney.Orange County Mayor Jerry Demings
Governor Ron DeSantis is a job killing moron who cares more about his own political ambitions and culture wars than Florida and our future. According to him, ‘woke makes you go broke’ but this is another example of how it’s actually the complete opposite. DeSantis is not who you want for President — ever.Rep. Anna Eskamani, D-District 42
I am disappointed about this decision. At a time when our residents face high living costs and other financial challenges, the Disney project would have brought many high paying jobs to our community.Orange County Comptroller Phil Diamond
Florida just lost 2,000 jobs and millions in additional revenue because of Ron DeSantis’ unhinged personal vendetta against Disney. DeSantis has single-handedly and decidedly made Florida an anti-business state, not only with his continued attacks on companies that dare challenge his fascist policies, but also by forcing draconian laws that will decimate the workforce of the backbone industries of our state’s economy. Unfortunately, today’s news isn’t a shock for those of us who have been living through his reign of terror, and Floridians are already paying a high price.Florida Democratic Party Chair Nikki Fried
The spin on the Disney news is BS. Part of the reason Chapek got fired is woke California employees didn’t want to move to Florida and turned on him. Spending $1 billion on office buildings to move employees that don’t want to be here was always a stupid business decision.— Rep. Randy Fine (@VoteRandyFine) May 18, 2023
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