THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Monday, October 3, 1994 TAG: 9410030054
SECTION: LOCAL PAGE: B1 EDITION: FINAL
SOURCE: BY MARTHA SLUD, ASSOCIATED PRESS
DATELINE: RICHMOND LENGTH: Long : 102 lines
When the Walt Disney Co. announced plans last November to put an American history theme park near a Civil War battlefield in Virginia, Disney executive Scott Stahley said he was glad it was all finally out in the open.
For months, Stahley used an alias to scout the Washington area for a place to build Disney's third American amusement park. He told a team of real estate brokers that he came from Phoenix - not Orlando, Fla., where he worked for Disney - and even studied the sports pages so he could discuss the Phoenix Suns convincingly.
On Wednesday, Disney announced it was dropping its 3,000-acre site near Haymarket 35 miles southwest of Washington that Stahley's stealthy labors had secured. And if Disney is to keep the park in northern Virginia, as company officials insisted last week, acquiring real estate likely will be a lot different this time around.
The company retreated from its original Disney's America plan after nearly a year of attacks and lawsuits from environmentalists and historians. Critics argued that the park would be too close to the site of the two battles of Manassas and would destroy the region's rural character.
What Stahley knew last year was that if word got out that Disney was trying to buy enough land to build a major theme park, land prices could skyrocket.
Harrison Price, an attractions consultant from San Pedro, Calif., said many other companies launch highly public searches for new land to encourage communities to court them with incentives. He helped Disney find its 27,000-acre site for Walt Disney World in Orlando.
For Disney, he said, the attitude has always been that ``you don't go out to buy land with your entire strategy on your sleeve.''
But now that its project is out in the open, the company could take a page out of the book of automakers General Motors Corp. and Mercedes-Benz and other companies whose expansion announcements have spawned major bidding wars from places looking to attract them.
Just hours after the Haymarket project was dropped, officials from throughout Virginia and in surrounding states scrambled to make their pitches. Disney's America President Dana Nottingham denies that the company has already picked another site and he will not discuss any of the offers. He will say only that ``we continue to be extremely interested in the Capital region here in Northern Virginia.''
University of North Carolina at Charlotte economist John Connaughton said that now that everyone knows about Disney's America, he expects Disney will negotiate the best incentives package it can to make up for the anticipated higher price of a new tract of land.
``I think the community will have to be a partner in assembling the tract of land, and will absorb the increased price,'' Connaughton said. ``If that doesn't work, (Disney) may have to get into a bidding war.''
When companies play one community off another in their search for relocation sites, the results for the winning site can be mixed.
One famous winner was Spring Hill, Tenn., a town of 1,000 people in 1985 when GM selected it as the site of its $3.5 billion Saturn plant. Tennessee, which won out over 38 other states, provided Saturn with a $52 million incentives package. Spring Hill has grown to about 3,500 people.
Bill Boozer, a spokesman for he Tennessee Department of Economic and Community Development, said Spring Hill was chosen because it had the best combination of land, utilities, services and climate factors.
``Tennessee's approach was built on the basis of the belief that General Motors was going to select a site as a business decision.'' he said. ``A lot of states put up billboards between (former GM chairman) Roger Smith's house and GM headquarters. We didn't do that.''
Tennessee rejected the big-money approach in courting GM, but Alabama took a different route. It offered the German automaker Mercedes-Benz a $253 million package of capital investments and tax breaks, quickly generating objection that the state paid too much.
Mercedes-Benz scrutinized 170 sites in 30 states before choosing Vance, Ala., last year for a $300 million plant that will employ 1,500 people. Economists predict the plant will create another 13,500 jobs in the next 20 years.
``It's gone from euphoria to fright,'' Wayne Flynt, an Auburn University professor specializing in Alabama history and culture, said last year of the way a state where ``Buy American'' fervor runs high fawned over a foreign company.
Searching for a site publicly also is a two-edged sword for companies, Price said.
``The disadvantage is everyone knows what is going on and that could induce higher costs,'' Price said. ``The advantage is that you might find a piece of land that you wouldn't otherwise.''
But some companies - including another theme park company that considered Prince William County - say going public helps avoid potential problems. Critics of the Disney project in Virginia were angered at the outset that they didn't know anything about the company's plans.
Lego Systems Inc., the Danish maker of children's construction toys, chose Carlsbad, Calif., over Prince William County for its first U.S. theme park just after Disney announced its plans for Haymarket. Lego said it got input from citizens and legislators in each jurisdiction it seriously considered. It considered more than 600 communities during a two-year search for a site for the $100 million theme park.
``Everyone knew what we were doing,'' Lego spokesman David Lafrennie said. ``We're a very open company.''
KEYWORDS: DISNEY'S AMERICA by CNB