Since Orlando became the end-all, be-all of theme park destinations, there’s emerged a clear divide among visitors.

There are those staying on-site — immersing themselves in that Disney or Universal “bubble,” along with more tangible perks like free transportation and extra hours at the parks.

Then there are others who choose off-site options which sacrifice those benefits for a lower room rate.

Universal Orlando’s newly-announced Endless Summer Resort will break that traditional separation when its first phase opens in 2019. Located on what used to the Wet n’ Wild water park, the property is surrounded by International Drive competitors which usually beat the on-site hotels on price. With Universal advertising rates as low as $73 per night (for a seven-night stay) in what will eventually be a 2,800-room resort, that advantage may be erased.

“The other hoteliers in the market are definitely going to have to up their game,” said Paul Sexton, vice president of Orlando hotel services firm HREC Investment Advisors. “They cannot any longer afford to just get by on an OK-quality hotel and to do their marketing in a way that attracts the lower-priced buyers.”

Having a major park make an aggressive play for budget-minded travelers may evoke memories of what happened to the motels along U.S. Route 192.

Once the go-to area for Walt Disney World guests looking to save some money, 192’s decline in the 1990s came just as Disney began opening more moderate and value resorts. For off-site guests, the Lake Buena Vista resorts east of Disney property became the better option, and the 192 motels were left to decay. With the post-9/11 downturn in tourism and the Great Recession, some hotels on U.S. 192 became long-term housing for low-income theme park workers or cash-strapped families to stay afloat.

Sexton said the deterioration on U.S. 192 can’t be blamed on Disney, at least not entirely, as the motel-style lodging that sprouted up after the Magic Kingdom opened in 1971 became “obsolete” over the next two decades. The depressed economy also affected Disney when some blocks of Walt Disney World rooms were temporarily closed during the post-9/11 tourism slump.

Conditions in the market now, especially on I-Drive, couldn’t be more different. In fact, Sexton said the real issue isn’t new resorts pulling visitors away from those established hotels, it’s demand outpacing supply. While the number of visitors to Orlando has risen about 3 percent annually between 2010 and 2017, growth in the number of hotel rooms hasn’t kept pace until recently.

The increased demand isn’t concentrated among theme park visitors. I-Drive hotels also attract convention guests as well as international visitors requiring longer hotel stays and devoting time to other I-Drive attractions like the Orlando Eye or the Orlando Premium Outlets.

With diverse demand that shows no signs of slowing down and active improvement projects in the area, I-Drive is largely protected from a 192-style decline, according to Ady Milman, professor at the University of Central Florida’s Rosen College of Hospitality Management. He expects that before demand for Universal’s Endless Summer Resort impacts surrounding hotels, Universal and its hotel partner Loews will cede their advantage on pricing.

“They may offer it initially at low pricing to introduce it to the market, but depending on its success, the room rates are going to go higher,” Milman said.

It may be Disney World that faces the toughest challenge from this new resort. Universal’s on-site resorts already offer lower pricing at comparable hotel categories than those operated by Disney. Endless Summer will be in Universal’s new “Value” category (not to be confused with the “Prime Value” label for its Cabana Bay Beach Resort and soon-to-open Aventura Hotel) and at the $73 per night promotional rate, will beat the lowest list prices for Disney’s trio of All-Star resorts set at $110 per night.

Don’t expect the Mouse to respond, however.

Milman said Walt Disney World has enough alluring features to keep guests on-site. Sexton seconded that opinion, saying the two parks attract slightly different demographics with Disney skewing younger and Universal appealing more to teenagers and young adults.

The competition benefits everyone, Sexton said. The more Disney and Universal seem to build, the more tourists stream into Orlando every year — including into those existing I-Drive hotels.

“They are not dividing up a same-sized pie,” Sexton said. “As they add attractions and amusements, the pie continues to get larger.”

Universal’s Endless Summer Resort is under construction at the corner of International Drive and Universal Boulevard, with the first phase scheduled to open in the summer of 2019.

About The Author

John has covered sports, politics, government and health care for a variety of news outlets, including the Illinois Radio Network and Rivet News Radio, as well as freelance work for the Florida Radio Network and contributing to the Unofficial Universal Orlando Podcast. He is a graduate of Columbia College Chicago. You can find him in the theme parks every chance he gets.

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