Anaheim Touts $6 Billion of Disneyland-Related Investment

Courtesy of Disney
Anaheim development

Four new luxury hotels are planned, along with a larger convention center and updated infrastructure tied to the planned 'Star Wars' land.

As Los Angeles continues its march toward all-out war between the city’s real estate developers and a growing movement that is pushing to curb citywide development, neighboring Anaheim is thumbing its nose at its sexier sibling to the north by touting its developer-friendly ways and $6 billion in recent investment, much of which is derived from Disney’s upcoming Stars Wars-themed land.

The $6 billion covers multiple projects, including four new luxury hotels, one a 466-room JW Marriott near the Disneyland Resort, which is expected to begin construction in 2017 and bring nearly 2,380 rooms to market. The city also is expanding its convention center by 200,000 square feet and is adding a parking structure, transit hub and pedestrian bridge to accommodate the Star Wars attraction, which is expected to add several million more visitors to the 25 million who already come to Anaheim’s theme parks annually.

Despite this massive annual influx of visitors, Anaheim long has been plagued by a shortage of luxury hotel accommodations. The city has just two four-diamond hotels — Disney’s Grand Californian Hotel & Spa and the Disneyland Hotel — which ranks it near the bottom for major visitor destinations.

“What is good for the resort is very beneficial for our neighborhoods,” John Woodhead, director of community and economic development for the city of Anaheim, told The Hollywood Reporter. “We are trying to enhance the hospitality industry by encouraging the development of a market for luxury hotels that we have been trying to attract for a long time.”

Disney recently closed several existing attractions to make room for its Star Wars-themed land, which is being built on 14 acres to the north of Frontierland and is being billed as a “never-before-seen planet inhabited by humanoids, droids and many others.” Disney also is building a Star Wars-themed attraction at Walt Disney World Resort in Florida.

No firm timetable has been set for the opening of either, but Disney recently teased some of the Anaheim attractions, which will allow visitors to fly in a Millennium Falcon and engage in battles between the First Order and the Resistance. Disney CEO Bob Iger told attendees at the company's D23 Expo in August 2015 that this will be Disney’s "largest single-themed land expansion ever."

Sensing the spill-over power from the Magic Kingdom, several top commercial developers are getting in on the action. Not far from the site of the Star Wars construction, Chinese developer LT Global acquired a 14.8-acre parcel of land adjacent to Angel Stadium in what is known as the Platinum Triangle. LT Global is planning a mix of new residential, commercial — including dining and entertainment — and office space and at least one hotel. The renderings of the project bear a striking resemblance to AEG’s L.A. Live in downtown Los Angeles.

Adding to all of this is L.A.-based CIM Group, which acquired the Stadium Gateway building across from Angel Stadium and is exploring building another 300,000-square-foot office tower next door. The company previously developed apartments in downtown Anaheim, which it sold last year.

Los Angeles is in the midst of its own building boom with half a dozen cranes scratching the downtown skyline and large-scale projects underway from Hollywood to South L.A. But a large shadow has been cast by the Coalition to Preserve L.A., part of the Neighborhood Integrity Initiative, which has pledged to bring a ballot initiative to voters in March, which, if passed, would drastically curtail development in the city. Last week, the group submitted over 100,000 signatures to get the measure on the ballot and, according to the campaign’s manager Jill Stewart, is moving full steam ahead.

“The city has no plan, and the City Council are caught in a frenzy of development and they are not qualified to be doing what they are doing,” Stewart told THR. “I would say we are one of the most out-of-control and childish cities when it comes to our leadership in dealing with this.”

The group wants a new general plan for the city, a two-year “timeout” from spot zoning, which is the granting of zoning exceptions for individual projects, and a law prohibiting developers from writing their own environmental impact reports.

With a population of just of 340,000, it is unclear how much Anaheim can capitalize on the uncertainty within L.A.’s development community. But the prospect of a brewing battle in Los Angeles provides Anaheim — and other neighboring cities — with the opportunity to attract more development dollars.

“L.A. has introduced uncertainty into the marketplace and that is something that developers hate to see,” said Woodhead. “Just the specter of that has a very negative impact on development. Naturally, we will have people look to us and see some of the things we have to offer here.”

Opening day at Disneyland in 1955

For now, the city will continue to build around the Walt Disney Company, which may be headquartered in Burbank but profoundly shaped the history of Anaheim when Disneyland first opened its gates in 1955. The park long has remained the city’s largest employer and contributes billions to Southern California's economy, as well as hundreds of millions in tax revenue. Other Fortune 500 companies such as Raytheon, AT&T and Hewlett Packard also maintain corporate offices in Anaheim, which also is home to the largest industrial district in Orange County.

Anaheim native Nathan Masters, a writer specializing in Los Angeles history who hosts the KCET Series Lost L.A., said his hometown’s relationship with L.A. always has been complicated. Those complications date back to 1889 when Orange County seceded from Los Angeles County and more recently flared up when Anaheim officials took legal action when the name of the local major league baseball team, The Anaheim Angels, was changed to the Los Angeles Angels of Anaheim. “L.A. was always the regional capital, but in more recent times there has been a tension in Anaheim where people are trying to stake out their own independent identity,” said Masters.