The project to build a new Disneyland theme park in Shanghai has moved a step closer to reality, with Disney signing a partnership agreement with a company owned by the Chinese government.
Disney will share the cost of building Shanghai Disneyland with Shanghai Shen Di Group Co., with the US company expected to take a 43% share in the resulting joint venture. The government-controlled entity will own the rest, although the project cannot move forward until an agreement is reached over a number of smaller joint ventures that will operate the resort's planned theme park and hotels.
In an e-mail statement, Disney said of the deal: "We can confirm the statement from the Shanghai government that we have taken another step forward in the approval process. We are still awaiting final approval from the central government on the incorporation of the related joint venture companies and the completion of the necessary regulatory processes."
Disney received clearance to pursue the project in November 2009, but it has taken a year of protacted negotiations to secure a deal on funding. In all, the company has been in talks with the Chinese government over the Shanghai Disneyland project for over a decade.
A report in July suggested that construction of the new resort could begin as early as November, but work is now unlikely to get underway for several months. Last year, the company said that the park could open by 2014, although the mayor of Shanghai has since suggested that an opening date in 2015 or 2016 is more realistic.
Shanghai Disneyland will initially occupy 286 acres of land in the Pudong area, making it 24 acres smaller than the region's other Disney resort, Hong Kong Disneyland. The Shanghai resort had initially been expected to be nearly 3 times larger - sparking concern over how the Hong Kong park would be able to compete. However, Disney is likely to follow its standard practice of gradual expansion at Shanghai.
The Disney project has attracted its share of controversy, with attention being focused on the Chinese governments plans to relocate residents living on the proposed site. An article in the Washington Post highlighted the plight of one family who are set to lose their home when Disney move into the area.
Shanghai Disneyland will be Disney's fourth resort outside of the US, after Disneyland Paris, Tokyo Disneyland and Hong Kong Disneyland.