Marriott Vacation Club in 2020

Just curious as to what the contributors here expect in terms of an expanded MVCI in the next 5 or so years? I would imagine after a few of the large build-outs are done, we would see expansion overseas (Asia / Australia). Do you think Marriott is done in Orlando and Hilton Head? Like most, I would love to see entirely new locations as part of our program.

good morning

DC is almost 4 years old... not a single new project build... some RC stuff added to Trust. I expect more of same... Recycle Trust thru aggressive ROFR and sell the dream of go anywhere, whenever you want. Recycle off season weeks as Trust and sell the opportunity to go to Utah In Feb...

only new construction is 3rd tower at GC...no new construction at Lakeshore yet...

puckmanfl said:

good morning

DC is almost 4 years old... not a single new project build... some RC stuff added to Trust. I expect more of same... Recycle Trust thru aggressive ROFR and sell the dream of go anywhere, whenever you want. Recycle off season weeks as Trust and sell the opportunity to go to Utah In Feb...

only new construction is 3rd tower at GC...no new construction at Lakeshore yet...

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I disagree. It doesn't seem there is enough money to be made just recycling. They need to build new stuff with big inventory. Plus new stuff sells so it's always nice, for the sales people, to point to at least one new project.

I would speculate the next major phase of DClub will include the addition of very high end private homes that are available only through the Explorer Collection, and at very high point prices.

An example might be a 3BR/4BR homes in St. John, Turks and Caicos, Maldives, Grand Cayman, Big Island, etc. I choose tropical spots because I'm not much of a skier --and will count on Puck to respond with the premium ski destinations. Jackson Hole?

This would be something similar to what people are/were paying $250,000 up-front to purchase usage rights in a (traditional) Destination Club like the now defunct High Country Club, or whatever it was called. Wyndham has something similar called the Presidential Reserve I think, and it would be a good marketing ploy. Marriott could sell someone 35,000 Trust Points that would be good for two weeks at one of these places -- and they compete with the traditional Destination Clubs, with the credibility of the Marriott/Ritz brand. Plus you only need one or two of each property in the Trust to re-sell the dream over and over again.

I don't expect to see further construction of the traditional timeshares that were built between 1985-2000, and that expansion will be from converting existing buildings/condominiums/hotels, like HGVC is doing at Hokulani, Park City, and Myrtle Beach. Marriott is behind HGVC (and Wyndham) in identifying and acquiring these convertible properties.

Finally, I think they will acquire Interval International because it opens up a robust supply of properties for a rental business, and they could even create hybrid programs with Starwood and Hyatt if all parties decide it is in their interest to collaborate. Not clear if Starwood and Hyatt view themselves as long term players in the timeshare space, and Marriott is the logical consolidator.

We will see, interesting years to come for VAC.

Best,

Greg

Very interesting stuff from all so far. Besides agreeing with the listed acquisitions of Starwood and hyatt, I see marriott expanding even further on adding urban locations. In order to help sell the dream, the renovation of partial existing hotels will help to drive future point expansion as I would imagine there would be quite the demand for rooms in NYC, Chicago, SF, ect... The Hilton NYC properties seem quite popular and wyndham currently is expanding in Chicago and NY as well. Point costs for all of these properties are quite high, so this certainly represents a future point producer for Marriott as the cost of a partial conversion is definitely less than a brand new build.

good morning....

almost 4 years in... (what are they waiting for)only major addition to the Trust is RC Vail... they have added some RC access but nothing else. I believe they can recycle almost the entire weeks product within the next 10 years. The traditional weeks based owner will be getting on in years, heirs will not want to deal with the MF's and more prime units will be available to Trust thru ROFR...its actually brilliant. a complete resell of the original product

The prime customer now is the 1-3K point purchaser...setting up high end vacation homes doesn't really look attractive to the 3K purchaser

I can see the possible acquisition of Hyatt, but not Starwood.

sb2313 said:

Very interesting stuff from all so far. Besides agreeing with the listed acquisitions of Starwood and hyatt, I see marriott expanding even further on adding urban locations. In order to help sell the dream, the renovation of partial existing hotels will help to drive future point expansion as I would imagine there would be quite the demand for rooms in NYC, Chicago, SF, ect... The Hilton NYC properties seem quite popular and wyndham currently is expanding in Chicago and NY as well. Point costs for all of these properties are quite high, so this certainly represents a future point producer for Marriott as the cost of a partial conversion is definitely less than a brand new build.

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Another thing VAC could do is, as Marriott International builds new Ritz Carlton properties, as discussed in this thread/article, if VAC were to embed a few dedicated rooms into each property for Explorer Collection. The different corporations/ownership could complicate things, but everything is negotiable.

If Marriott truly partners in the building 30+ Ritz properties in the coming years (in some of the best urban/tropical/ski spots on the planet), that would be a brilliant way to expand the VAC network. I think VAC wants to expand beyond the 1-3K Trust Point purchaser who is focused on the legacy properties, and VAC also wants to cater to the very well-heeled luxury consumer who wants access and splash.

Interesting stuff.

Best,

Greg

Maintenance Fees versus Rental Rates

Does the group think maintenance fees are inflating at a slower rate than Hotel Rentals ?

I'm interested to see if the DC Exchange Company eventually morphs into an II-type player, with the other major timeshare companies signing on. Have no idea if it'll happen but the legal logistics have been written into the governing docs since Day One.

I agree with Puck's outlook.

I estimate there are still 2-3 years remaining for absorption of separation costs from Marriott International and MVCI still does not have its own dedicated HR/IT capabilities which its trying to build now.

More of the same for the foreseeable future.

The stock valuation has been on a tear but I expect that to also slow down in the coming 1-2 years as they incur greater operating costs from managing their own independent businesses.

Sprinkling new Explorer opportunities and cross-marketing partnership agreements is what the "Asset Light" business model was envisioned to be and I see no significant deviation fro this trend in the near term. In the meantime, rent, rent, and rent your way to bigger profits.

When the stock starts to flounder for 2-3 consecutive quarters, then something new may be announced. Until then, its steady as she goes.

FT

I am more interested in what the future holds for weeks owners. Will we still be able to exchange the way we are now?

Interesting discussion. I can see them continuing to acquire weeks via ROFR to expand the current footprint and converting some hotel space to timeshare availability. I am waiting for someone to buy II the way Wyn bought RCI, but I don't know that would be a good thing for MVCI to do. I can see them being interested in Hyatt properties. Hyatt already sold part of their property in Northstar to the Welk Resort Group. I would love to see Marriott pick up some of their others, including Carmel.

Crafty527 said:

I am more interested in what the future holds for weeks owners. Will we still be able to exchange the way we are now?

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I suspect Yes because there was never any guarantee of availability to begin with for deeded week owners. Only by sharing our collective experiences, successes, and failures can we learn to improve our odds.

FT

Playing off some of the previously posted ideas, I like the idea of them acquiring some or all of the Hyatt timeshare residences, which may be doable as it's a smaller, compact, but very high quality system. Then continuing to expand RC residences near and far.

Make those available, whether tiered in access as currently or not, through MVCI and/or the premier group as applicable. Keeping the premier properties separate may be a way for them to upsale more points to current and new MVCI points owners for more access to these, if expanded with appealing new properties.

To serve a wider group of lower number of Marriott points and weeks-only owners, acquisition of II or widening of a parallel MVCI exchange program that opens it to some non-Marriott properties under which free or reduced price exchanges/points redemptions are made could be considered.

The annual fee for this trading could be somewhat higher than now if the benefits of wider exchanging into external properties under a Marriott run program were enhanced. It could be run like a traditional exchange program with transaction fees for non-Marriott owners in the exchange, and like the Marriott points/II weeks exchange as an annual fee with no individual trading transactions for Marriott MVCI owners. This way, they could expand the trading inventory to more outside properties and still apply a Marriott owner trading preference for internally owned properties.

I also agree with Puck and FT on this. I see MVCI keeping things asset light. 2020 is only six years out, so not a long time. Consider that MVCI still has additional planned units at the following resorts; Canyon Villas (39), Frenchman's Cove (66), Fairway Villas (90), Grand Chateau (477 about half under construction now), Harbour Lake (588), Ko'Olina (190), Lakeshore Reserve (245), Shadow Ridge (484), Willow Ridge (282). I would expect Frenchman's Cove and Ko'Olina to be the last to be completed, with perhaps Lakeshore the next that they resume construction at next (outside of MGC where it is in progress now)

That is still a lot of unbuilt inventory at resorts already in progress. It doesn't include any undeveloped land they had been trying to sell. I just don't see them building any new resorts in the foreseeable future. I do think they will add some more Explorer Collection options. Perhaps like Greg mentioned.

They will continue reacquiring weeks through ROFR and buyback offers, but they can't feed their sales machine with ROFR and buyback alone. They do need inventory to fill that need. They can't even do that with Explorer Collection options since the trust doesn't own those.

Where will they be in 2025/30? Perhaps they may have announced a new resort by then. I don't see any acquisitions in the near future. Not II, if that happened would the other guys, Starwood and Hyatt, go over to RCI with II left with little in the way of prime resorts?

GregT said:

If Marriott truly partners in the building 30+ Ritz properties in the coming years (in some of the best urban/tropical/ski spots on the planet), that would be a brilliant way to expand the VAC network. I think VAC wants to expand beyond the 1-3K Trust Point purchaser who is focused on the legacy properties, and VAC also wants to cater to the very well-heeled luxury consumer who wants access and splash.

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I'm sure they would like to cater to the well heeled luxury consumer and may try in a limited way to do that. However based on their previous ventures into high end and fractional timeshare as well as a less expensive brand I think they probably realize that to do any thing on a large scale they have to have a product in the price range similar to the traditional MVC program. There just aren't enough high end (ritz Carlton) and above buyers out there. The old product (price range) was their sweet spot. Just my opinion.

Fairwinds said:

I'm sure they would like to cater to the well heeled luxury consumer and may try in a limited way to do that. However based on their previous ventures into high end and fractional timeshare as well as a less expensive brand I think they probably realize that to do any thing on a large scale they have to have a product in the price range similar to the traditional MVC program. There just aren't enough high end (ritz Carlton) and above buyers out there. The old product (price range) was their sweet spot. Just my opinion.

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I would think they learned their lesson from the luxury segment. It is not an easy sell. I think are would be very leery of getting back in to luxury ownership sale. I don't see them expanding back in to luxury in any way unless it is through Explorer partnerships where someone else is holding the bag if things come crashing down again.

dioxide45 said:

I would think they learned their lesson from the luxury segment. It is not an easy sell. I think are would be very leery of getting back in to luxury ownership sale. I don't see them expanding back in to luxury in any way unless it is through Explorer partnerships where someone else is holding the bag if things come crashing down again.

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I agree my quote got mixed with my response (I don't know what I'm doing

Fairwinds said:

I agree my quote got mixed with my response (I don't know what I'm doing

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I see it now, the first paragraph was a quote of Greg from earlier...

dansimms said:

Just curious as to what the contributors here expect in terms of an expanded MVCI in the next 5 or so years? I would imagine after a few of the large build-outs are done, we would see expansion overseas (Asia / Australia). Do you think Marriott is done in Orlando and Hilton Head? Like most, I would love to see entirely new locations as part of our program.

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Great conversation dans imams. I'd like to see new destinations too. Where would you like to see? For me Asia and Australia are too far away. I thought I read Jackson Hole but can't find the post now (Great Idea) I'd also like to see Santa Fe. OCONUS I'd like Belize or Costa Rico and I really like Canada (Whistler?)

I would like to see some added destinations in the Caribbean. Perhaps also in Europe, but I would really like more domestic USA locations. Perhaps more along the gulf coast and SoCal. Virginia Beach would also be a great place to add. Manor Club isn't on the beach. Florida Keys would be fantastic. I am not big on urban locations.

Fairwinds said:

I agree my quote got mixed with my response (I don't know what I'm doing

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I hope you don't mind I fixed the quotes.

FYI for next time, after you click the "quote" button just make sure that the [bracketed info] remains at the beginning and end of what you want to quote.

dioxide45 said:

Florida Keys would be fantastic. I am not big on urban locations.

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Agree on the Florida Keys. Also agree on most urban locations, but I think New York City would be the absolute best place they could add a resort, assuming it is composed of suites or villas. And it needs to be in the middle of downtown, near the theater district, such as at the Marquis or a similar attractive location. Same concept as Boston. Chicago could also be attractive. Beyond New York and possibly Chicago, I agree with you. And just having access to hotel rooms is not attractive--you can get those now with either cash or reward points.

New England location

Something convenient to a Vermont Ski Mountain would be great too.....The Mad River Glen / Sugarbush section of the state is particularly beautiful or near Stowe. This is centered among NYC, Albany, Hartford, Montreal and Boston....where I presume there are many MVCI Owners that could use another 'drive to' location.