Custom House owners: what is the deal with the high fees this year?

I haven't gotten a written statement and explanation of the fees yet. I am wondering why the fees have gone in two years from $1,276 to $1,550. I bought our weeks to stay there when Rick retires next year, and

Were the units in horrible condition because $300+ in replacements seems very high after a special assessment last year. When will these crazy increases end?

It seems to me, that there is something very wrong with the math on the Custom House maintenance fees, as the Homeowners Association Board has turned the Custom House into a "VFW Hall-equivalent," and they are renting the place out to huge groups of people (100, 200 people) for receptions, parties, events, or in the case of next weekend, a Holiday Craft Show. The General Manager of the Custom House - who stands to look good with the revenue that these rentals generate (including Custom House bar revenues) - alleges that the Homeowners Association Board voted in favor of the "VFW Hall-equivalent" rentals to offset Maintenance Fees. We've been there to witness the chaos, wear and tear that these receptions, parties and events cause to the Custom House, and in my opinion, (1) there is no way that this policy makes economic sense for anyone, as the wear and tear on the building far exceeds the revenues, and (2) the privacy and intimacy of the Custom House - - one of the Custom House's most redeeming characteristics - - was lost to the masses and assess that the HOA now has parading through the place, and there's just about no place that is off limits, these events occupy the first and second floors of the rotunda, the Observation Deck, etc. The bathrooms cannot support groups the size of what this HOA Board is now entertaining, and in my opinion, this has led to the demise of the Custom House. While the Custom House has always had an "open to the public" component, that segment of the population was manageable and did not create the havoc that these receptions, parties, or events do.

So, in the context of maintenance fees, while first and foremost (1) I entirely disagree with the Board's decision to turn the Custom House into a "reception/party/event machine," (2) I am certain that the revenues generated do not come close to recovering the expenses that the wear and tear place on the building, and (3) I'd consider this revenue stream hardly worth the alleged revenue source, in the context of the Custom House.

I am certain of one thing, Marriott never sold ownership in the Custom House as anything other than a small, 84-unit, quaint, urban property experience, and not an Amusement Park.

rickandcindy23 said:

I haven't gotten a written statement and explanation of the fees yet. I am wondering why the fees have gone in two years from $1,276 to $1,550. I bought our weeks to stay there when Rick retires next year, and

Were the units in horrible condition because $300+ in replacements seems very high after a special assessment last year. When will these crazy increases end?

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The fees are extra high presumably due to the extensive outside renovations that are being required by the City of Boston (who actually owns the building).

The entire building is due to be surrounded by scaffolding in 2015 so they can waterproof the outside of the building. I imagine this was last done 100 years ago when the tower was originally built on top of the original 1849 dome.

It's a huge, expensive project, and hopefully they'll be no further increases out of the ordinary.

Can't tell you if the 2016 fees will go back to those in 2013, but hoping they will be lower than the 2015 fees.

Added: Read Post #6 for a more accurate reason for the 2015 increase in fees.




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At most of the MVCI* resorts the common areas have always been owned by MVCI - the only thing sold, effectively removing it from their control and profitability, was interests in the units themselves. As well, the governing docs spell out quite clearly that the common areas can be used by MVCI for pretty much any purpose they deem suitable as long as the owners' rights aren't infringed (which they're not, if it's stipulated that they don't own the common areas) and, any profits from that use is MVCI's and not the owners. It's possible that MVCI gave a portion of any profits to the HOA's but I don't think it's a requirement, at least it's not at either of my resorts. I also don't think that the resort GM's have any say as to which activities MVCI can hold in the common areas, although their input may be requested because they know the local area and may be better qualified to advise on the local transportation, weather, food and beverage regulations, etc.

On the flip side, upkeep and refurb expenses for the common areas are supposed to be covered by MVCI, not charged to the owners. At my two resorts there's been no indication that expenses for the most recent common area upgrades (bar/grilles and at Barony, the total refurb of the gardenside area pool) weren't paid by MVCI.

Are things that different at Custom House, that the owners have control over and are poised to profit from common area activities, so must share in the expenses for common areas?

*Note MVCI is now MVW, of course, but I don't think the spin-off had any effect on the language in the docs related to common area control and usage.

TheTimeTraveler said:

The fees are extra high presumably due to the extensive outside renovations that are being required by the City of Boston (who actually owns the building).

The entire building is due to be surrounded by scaffolding in 2015 so they can waterproof the outside of the building. I imagine this was last done 100 years ago when the tower was originally built on top of the original 1849 dome.

It's a huge, expensive project, and hopefully they'll be no further increases out of the ordinary.

Can't tell you if the 2016 fees will go back to those in 2013, but hoping they will be lower than the 2015 fees.




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But wasn't there a one-time special assessment in the 2014 MF's that was designated specifically for that purpose? That's how it was explained to owners last year so it shouldn't be an ongoing expense this year and beyond.

SueDonJ said:

But wasn't there a one-time special assessment in the 2014 MF's that was designated specifically for that purpose? That's how it was explained to owners last year so it shouldn't be an ongoing expense this year and beyond.

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Digging deeper; The 2015 increase actually has nothing to do with the facade as that was fully paid for in 2014 (and that physical work begins next year).

The actual reason for the larger fee is the increase in the cost of steam, electricity, credit card fees and reserves in anticipation of the 2015 internet upgrade and major renovations scheduled for calendar year 2016.




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SueDonJ said:

At most of the MVCI* resorts the common areas have always been owned by MVCI - the only thing sold, effectively removing it from their control and profitability, was interests in the units themselves. As well, the governing docs spell out quite clearly that the common areas can be used by MVCI for pretty much any purpose they deem suitable as long as the owners' rights aren't infringed...

On the flip side, upkeep and refurb expenses for the common areas are supposed to be covered by MVCI, not charged to the owners. At my two resorts there's been no indication that expenses for the most recent common area upgrades (bar/grilles and at Barony, the total refurb of the gardenside area pool) weren't paid by MVCI.

Are things that different at Custom House, that the owners have control over and are poised to profit from common area activities, so must share in the expenses for common areas?

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I don't understand this comment and I don't think it is correct. At all of the resorts where I own or have owned in the past, our maintenance fee and reserve budgets had large amounts for common area expenses--grounds and landscaping, pools, pavement, roofs, exterior building maintenance, etc. These are all common areas. MVCI may have reserved the right to lease out or otherwise use the common ares at some of the resorts, but even that was not the case at Sabal Palms. At Sabal, the Association in the early years was responsible for the little store (which lost money), and then got annual income when the store was leased out to an independent operator instead of being operated by the Association.

Also, almost every special assessment I have heard of was for common area needs, not for refurbishments within the units.

BocaBoy said:

I don't understand this comment and I don't think it is correct. At all of the resorts where I own or have owned in the past, our maintenance fee and reserve budgets had large amounts for common area expenses--grounds and landscaping, pools, pavement, roofs, exterior building maintenance, etc. These are all common areas. MVCI may have reserved the right to lease out or otherwise use the common ares at some of the resorts, but even that was not the case at Sabal Palms. At Sabal, the Association in the early years was responsible for the little store (which lost money), and then got annual income when the store was leased out to an independent operator instead of being operated by the Association.

Also, almost every special assessment I have heard of was for common area needs, not for refurbishments within the units.

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When the rotunda and Presidential Seal had to be repainted, those costs came of of the HOA coffers. They are clearly a Common Area.

Operationally, the Custom House may be unlike any other MVCI resorts, in that in order to access your villa, you must walk past the Front Desk and pass through the very common areas where these parties, receptions, events, craft fairs, etc. are being sanctioned, and attended by hundreds of people. If my memory is right, there is 1 public mens and ladies room on the ground floor, 1 each on the second floor, and 1 each on the Observation Deck floor (these are the staff bathrooms, as well). No where near an adequate number for the size of the groups that the Custom House is hosting.

In my opinion, the HOA Board is out of their mind for allowing these events to take place at the Custom House. Previous to this change in policy, "parties" could be held by Custom House Owners, through a contractual agreement with the property manager.

The last time we witnessed one of these parties at the Custom House, it reminded me of the Tower of Terror at Disney.

Gone, are the days of owners, exchangers, or renters having a cocktail in the tranquil Counting Room.

Open to the Public, ARTOPIA at Marriott Custom House

http://www.meetup.com/BostonArt/events/218577503/

EducatedConsumer said:

http://www.meetup.com/BostonArt/events/218577503/

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I wonder what the allowed occupancy levels are for these areas based on the certificate of occupancy? I expect that maximum occupancy levels are dictated in some part by available restroom facilities. Or restroom facilities are dictated by expected maximum occupancy. I wonder if perhaps they are exceeding these limits during these gatherings and one could make some calls to report the abuses if they are truly exceeding occupancy?

The 2015 budget has an expense reduction from outside income amounting to $139K...not an insignificant amount, which equates to about $35/ownership week. The HOA Board did approve the usage of "common areas" for income producing activities. In my view this is no different than other resorts having similar approaches to allowing outside activities to bring in revenue. e.g. luaus at KoOlina.

In 2014 there was a special reserve assessment to do façade restoration in 2015, which included a $70K contingency budget, to be returned to owners if not needed.

All of the CH Board activities are transparent, discussed openly and communicated to owners.

It is pretty obvious that whoever posted the original questions is not a CH owner or not an informed owner.

I wonder if, because the property is leased from the city, there's an arrangement between Marriott and the city that some space needs to be available for functions by groups looking for function space in the city? I don't know, am just guessing, but I can't think of any other lodging facility in the city that doesn't make its common areas available for functions.

Granted timeshares are different from hotels in that the hotels don't have owners who have to co-exist with outsiders who attend functions.

Obviously I was wrong about every single cost for common areas at the timeshares being solely MVW's responsibility, and I'm sorry for that. But I do know that at the Hilton Head resorts and at least a few others the bar/grilles, for example, are financed by MVW and all the profits go to them. At Hilton Head they're not available to only owners/guests at the resorts, either - which I know because we've visited and been welcomed to sit and eat/drink at a few of the MVW Hilton Head resorts where we don't own. It might not be as obvious as we saw during stays at Waiohai and Crystal Shores, where they had big signs at the beach entrances to the resorts advertising the restaurants, but it happens. (I understand Waiohai's onsite restaurant has since been closed and the space converted to owner units, but I believe Stilts is still in place at Crystal Shores.)

That's the point I was trying to make, that it would surprise me very much to learn that there are any Marriott timeshares where MVW doesn't have rights to use the common areas, including making them available for public use, and make a profit doing so.

I do agree with dioxide that it wouldn't hurt to make sure that the local ordinances related to public functions are being upheld. The GM or board members should be able to answer those questions but if they're unwilling, there's nothing wrong with escalating the discussion to MVW execs. It's a valid discussion for owners.