How Disney World Drives Up the Value of Nearby Real Estate
When you’re visiting Disney World, it can be easy to feel like you’re on an exclusive island filled with Mickey and Minnie. But, whether you’re staying at an off-site hotel or looking to dine at a restaurant that won’t charge you an arm and a leg for a hamburger, you just might find yourself traveling around the outskirts of the resort area.
Disney World Entrance
From White Castle to Portillos to shopping, there’s more beyond the parks that can be worth checking out. But, did you know that it’s EXPENSIVE for a restaurant (or anything else) to come to the Disney World area? Let’s take a look at just how much retail owners are shelling out to secure a highly-valued spot next to one of the most popular travel destinations in the U.S.
Real Estate Values are Higher Around Disney World
Housing data from Orange and Osceola counties (where Disney World is located) certainly affirms that Disney World drives up real estate values simply by existing. To take a look at the numbers, retail space around Disney has a lower vacancy rate than the Orlando average but has a higher rental rate per square foot than the Orlando average.
White Castle
In fact, according to Orlando Business Journal, retail in West Orange County (including the area around the Disney-owned Flamingo Crossings shopping center) has an average vacancy rate of 2.6% compared to 6.3% for the overall Orlando market. So, while you won’t find as many stores and restaurants around Disney as you might find in Downtown Orlando, the ones that are there are paying a hefty price.
Flamingo Crossings Town Center Concept Art ©The Walt Disney Co. | Obtained via BizJournals
These metrics demonstrate that there is HIGH demand for retail space near Disney World as businesses hope to capitalize on the large number of visitors in the area with convenient proximity to the resorts.
©The Walt Disney Co. | Obtained via BizJournals
An example of this can be seen with a recent purchase by Starbucks. The company recently paid roughly TWICE as much as what their retail locations normally sell for in Central Florida for a retail space on Palm Parkway (which is roughly 2.5 miles from Disney Springs), according to Orlando Business Journal.
This location makes the store the closest free-standing Starbucks location to Disney outside of the parks and Disney Springs, and the sale was made FAST. The property went to market in May and was sold within a week signaling that Disney has only continued to drive up demand for surrounding retail space, as the traffic it brings is great for business.
Starbucks in Disney Springs
But, the idea that Disney World is driving up property values in the area isn’t new at all. You may have heard the story of Walt Disney buying up property in Florida in secret. That’s because Walt wanted to make sure that the price of the land he purchased wouldn’t be driven up simply because people heard that he was buying it up. And, he was right for doing so! Walt purchased the first acre of land for roughly $80 and after the secret project was out, he purchased the last acre of land for about $80,000 — that’s quite the increase in property value!
This proves that, even in the mid-1900s, the Disney name was a given for driving up real estate costs.
©D23
AND, it’s not just commercial property that is more expensive. According to Neighborhood Scout, Lake Buena Vista and Bay Lake (where Disney World is located) median real estate price is $427,236, which is more expensive than 79.4% of the neighborhoods in Florida and 74.8% of the neighborhoods in the U.S. As for rentals, the average rental cost in this neighborhood is higher than 84.8% of the neighborhoods in Florida.
©Disney
Whew, that’s pricey! In fact, some experts in urban development credit Disney with the affordable housing crisis in the area. According to ClickOrlando, Richard Foglesong wrote in his book, Married to the Mouse, “It [Disney World] brought with it low-wage jobs and affordable housing challenges that we have here in Central Florida.” Foglesong added that the crisis happened in the 1970s with the opening of Disney World and hasn’t really changed in 50 years.
Click here to learn more about the Flamingo Crossings shopping center!
Why Are Retail Prices Higher Around Disney World?
So why has this happened? For one, it’s demand. Disney attracts millions of guests every year and those guests are not always going to stay on property to eat and shop. That means that businesses in the Disney World area expect a higher level of demand simply because of their proximity to the parks.
©Disney
Especially in the modern-day, Disney World is EXPENSIVE. It’s very much the norm for guests to avoid the “Disney premium” by shopping and dining off-site. And, a commercial business wants to be the option that these guests turn to by occupying a prime, nearby location.
Portillo’s
As for housing, Disney employs around 77,000 people, according to Orlando Sentinel, and they all need a place to live. So, in turn, those 77,000 people drive demand for housing around Disney World and that constant driver of demand keeps housing real estate costs HIGH.
Want to see some secrets Disney couldn’t keep? Click here!
And, They Could Get Even More Expensive
Beyond the current prices, housing and retail real estate could get even MORE expensive in the Disney World area soon. In 2021, Disney bought 60 acres of land in nearby Lake Nona as the first step in building a new campus that will serve to relocate thousands of Disney employees from California to this area of Florida.
Obtained Via the Orlando Business Journal
According to Orlando Business Journal, this will significantly disrupt the Lake Nona market as “This move will send even more buyers from California to Central Florida willing to pay far more than a home’s list price, driving up prices in an already-hot housing market.”
©The Walt Disney Company
Lake Nona is already the most expensive part of Orange County, but the push in high-income housing demand could have a ripple effect that drives real estate up in the surrounding areas of the county. And, as housing gets more expensive, the area may also become more desirable for commercial businesses looking to capitalize on the relocating population.
To see more about the Lake Nona campus, click here!
So, you don’t have to dig too deep to see the MASSIVE impact that Disney World has on real estate prices in Orlando. And, as demand for the parks continues to grow and The Walt Disney Company expands, we will likely see prices rise even more. Of course, we keep track of it all here at DFB, so be sure to stay tuned for the latest!
How Expensive Will Disney World Be in 10 Years? Click HERE to Find Out!
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