# Marriott Vacations Worldwide 2Q 2019 Earnings Conference Call  & Integration Update



## JIMinNC (Aug 1, 2019)

I listened to the Marriott Vacations Worldwide 2Q 2019 investor conference call this morning. The audio kept sputtering so I don't have exact wording, but Steve Weisz did say they were continuing to work to develop an integration of their multiple brands to give their owners and guests more resort choices and alternatives, or something to that effect. He said they would have more information and discuss the plans in more detail at an October 4 Investor Day presentation.

Once they post the transcript on the MVW website, I'll post the exact quotes. There were also some other things they mentioned about technology integration and Interval app updates, but the audio issues made it hard to pick up the details. I'll add those also when the transcript is posted.

*EDIT: See post #12 for exact quote and other information from the call.*


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## DannyTS (Aug 1, 2019)

JIMinNC said:


> I listened to the Marriott Vacations Worldwide 2Q 2019 investor conference call this morning. The audio kept sputtering so I don't have exact wording, but Steve Weisz did say they were continuing to work to develop an integration of their multiple brands to give their owners and guests more resort choices and alternatives, or something to that effect. He said they would have more information and discuss the plans in more detail at an October 4 Investor Day presentation.
> 
> Once they post the transcript on the MVW website, I'll post the exact quotes. There were also some other things they mentioned about technology integration and Interval app updates, but the audio issues made it hard to pick up the details. I'll add those also when the transcript is posted.


thanks for the info!

The fact that they are prepared in just 2 months to discuss details publicly probably means we are getting really close to the announcement date. Q2 or even Q1 of 2020 would be my guess.


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## JIMinNC (Aug 1, 2019)

DannyTS said:


> thanks for the info!
> 
> The fact that they are prepared in just 2 months to discuss details publicly probably means we are getting really close to the announcement date. Q2 or even Q1 of 2020 would be my guess.



I would caution not to get your hopes up on the level of details that may be discussed on October 4. Generally investor presentations are very high level. As I said, the audio was breaking up, but when I can get the exact quote, I'll post it, as the full quote may offer more insight into what they are going to discuss.


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## CPNY (Aug 1, 2019)

JIMinNC said:


> I would caution not to get your hopes up on the level of details that may be discussed on October 4. Generally investor presentations are very high level. As I said, the audio was breaking up, but when I can get the exact quote, I'll post it, as the full quote may offer more insight into what they are going to discuss.


Excjt
Exciting news! I wonder if the new technology integration and interval app has anything to do with the whole overall integration. Could be eluding to some of the possible speculations on a combo program. Anyway, who knows, but still exciting. Lots of good news today, this along with universals new theme park announcement!!

https://attractionsmagazine.com/universal-new-park-epic-universe/


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## TravelTime (Aug 1, 2019)

What does the timing seem like?


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## DannyTS (Aug 1, 2019)

The audio is on their website already by the way

http://ir.marriottvacationsworldwide.com/events-presentations


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## CPNY (Aug 1, 2019)

TravelTime said:


> What does the timing seem like?


Hopefully after my mandatory vistana resales are recorded and transferred lol. (If recording date has any affect on enrollment in any integrated program) lol.


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## kds4 (Aug 1, 2019)

JIMinNC said:


> I listened to the Marriott Vacations Worldwide 2Q 2019 investor conference call this morning. The audio kept sputtering so I don't have exact wording, but Steve Weisz did say they were continuing to work to develop an integration of their multiple brands to give their owners and guests more resort choices and alternatives, or something to that effect. He said they would have more information and discuss the plans in more detail at an October 4 Investor Day presentation.
> 
> Once they post the transcript on the MVW website, I'll post the exact quotes. There were also some other things they mentioned about technology integration and Interval app updates, but the audio issues made it hard to pick up the details. I'll add those also when the transcript is posted.



Sounds good. During our recent owner update, we were told that 2 different emails would be sent out to owners in October announcing new benefits that some owners will have already qualified for, and what other owners will need to do to qualify to access the new benefits. So far, that jives.


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## TravelTime (Aug 1, 2019)

CPNY said:


> Hopefully after my mandatory vistana resales are recorded and transferred lol. (If recording date has any affect on enrollment in any integrated program) lol.



That is what I am hoping for too. I already had a Hyatt close and record. I suspect anyone owning a Westin/Vistana will end up getting a good proposition from MVC. I have 2 more closing and recording this month but they are not mandatory. I bought to use with the hope that MVC allows me to enroll all my weeks. I bought one MVC week and I am hoping there will be a way to enroll that week. If not, it is EOY and we will use it since it is at our happy place.


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## kds4 (Aug 1, 2019)

CPNY said:


> Excjt
> Exciting news! I wonder if the new technology integration and interval app has anything to do with the whole overall integration. Could be eluding to some of the possible speculations on a combo program. Anyway, who knows, but still exciting. Lots of good news today, this along with universals new theme park announcement!!
> 
> https://attractionsmagazine.com/universal-new-park-epic-universe/



So, they are taking over the Lockheed-Martin Complex. That is what is currently located in the highlighted area of the map Universal provided.


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## CPNY (Aug 1, 2019)

kds4 said:


> So, they are taking over the Lockheed-Martin Complex. That is what is currently located in the highlighted area of the map Universal provided.


I believe they already owned that site and was letting LM store missile testing materials there. I skimmed the article but there is a lot of great background information on the expansion. It seems they sold off the 2,000 acres they bought in the 90s and re purchased it. Orlando informer is a great blog with great information. Going to their December universal meetup event. 

https://orlandoinformer.com/blog/universal-announces-third-theme-park/


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## JIMinNC (Aug 1, 2019)

Here is the exact quote from Steve Weisz from this morning's call:

*"We also continued our work on enhancing our product offerings across our multiple Marriott brands. As we shared with you previously, we continue to evaluate the various options, and our current plan is to add new enhancements in stages, each building on the strong foundation that we offer customers today. Over time, our goal is to develop an integrated product that leverages all of our Marriott family of brands, providing owners and potential owners an even greater array of vacation destinations and experiences from which to choose. We remain extremely optimistic about its potential, and we’ll have more to say about this in our Investor Day on October 4.”
*
He clearly says that enhancements will come in stages, with the ultimate goal of an integrated product.

There was also some discussion about asset sales. This was from CFO John Geller:

*"We are undertaking a comprehensive review of our vacation ownership assets to determine the best strategic direction for the business. While work to quantify the impact continues, we do expect to generate incremental cash flows over the next few years.
*
Later Steve Weisz added:

*"We're going through an assessment of the various assets we acquired when we bought the ILG business. There will probably be some things we'll agree that probably are not strategic for us in the long term, in terms of selling off individual parcels or things of that nature..."
*
There was also a question from one of the analysts about their development spending to acquire new inventory. John Geller said they look to budget for replacement of the inventory they sell "off the shelf". I think they consider ROFR part of their development spending, so that may explain some of the unpredictability of ROFR, in that they look at their inventory, and if inventory is low, they may be more aggressive with ROFR than if they feel they have excess. The analyst also tried to get a feel for whether 2020 development spending would increase from 2019, and Geller said that right now, he can't say that development spend will be higher next year.

On a couple of other items:

*- Contract sales were up 6% over 2Q 2018. Both legacy MVW and ILG grew about 6%. They had expected MVW to grow at 10%, but they came in under that. Weisz said one factor was all of the changes they have made to their sales and marketing organization over the last 6-9 months. He said their sales leadership is predominantly from the MVC side of the business, and those managers spent a disproportionate amount of time in the VSE properties trying to drive some of the changes there, so they sort of "took their eye off the ball" on the MVC side.

- 2Q tour flows were 45% first time buyers, but only about a third of contract sales are first timers. He said there are slightly more first time buyers on the ILG side and slightly less on the MVC side.

- 62% of contract sales in the quarter were financed

- Interval International has announced a new agreement with Planet Fitness to leverage Interval technology to allow more than 8 million Planet Fitness Black Card members access to hotel, cruise, and condominium rental vacations at preferential rates.

- They have added more features to the Interval mobile app, including the ability to deposit a week.*


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## CPNY (Aug 1, 2019)

TravelTime said:


> That is what I am hoping for too. I already had a Hyatt close and record. I suspect anyone owning a Westin/Vistana will end up getting a good proposition from MVC. I have 2 more closing and recording this month but they are not mandatory. I bought to use with the hope that MVC allows me to enroll all my weeks. I bought one MVC week and I am hoping there will be a way to enroll that week. If not, it is EOY and we will use it since it is at our happy place.



Awesome, mine should be recorded and transferred within the month I’m hoping. Time will tell. I can’t wait to see what the integration is. If it’s something to be conducted through an interval app for example who knows what kind of or if any enrollment there will be. But if it’s anything like what that DC members speak of regarding resale weeks when DC was rolled out 10 years ago, it would be nice for the resales to be completed before any new announcement.


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## JIMinNC (Aug 1, 2019)

CPNY said:


> Awesome, mine should be recorded and transferred within the month I’m hoping. Time will tell. I can’t wait to see what the integration is. If it’s something to be conducted through an interval app for example who knows what kind of or if any enrollment there will be. But if it’s anything like what that DC members speak of regarding resale weeks when DC was rolled out 10 years ago, it would be nice for the resales to be completed before any new announcement.



If you read Steve Weisz's exact quote from the call, they are going to do this in stages. He prefaced his mention of developing an "integrated product" with "over time", so to me, that sounds like their ultimate solution will not be coming soon. Other "enhancements" will come sooner, in stages, but it doesn't sound like a truly integrated product is on the immediate horizon.


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## CPNY (Aug 1, 2019)

JIMinNC said:


> If you read Steve Weisz's exact quote from the call, they are going to do this in stages. He prefaced his mention of developing an "integrated product" with "over time", so to me, that sounds like their ultimate solution will not be coming soon. Other "enhancements" will come sooner, in stages, but it doesn't sound like a truly integrated product is on the immediate horizon.


Makes complete sense to me. I’m thinking we will see technology enhancements and maybe some joint priority in interval first. It’s quick and easy. I haven’t listened to the call. But one thing that is for certain is the sales reps are lying through their teeth. Remember the guy who “saw a word document” !? Lol


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## Steve Fatula (Aug 1, 2019)

CPNY said:


> Makes complete sense to me. I’m thinking we will see technology enhancements and maybe some joint priority in interval first. It’s quick and easy. I haven’t listened to the call. But one thing that is for certain is the sales reps are lying through their teeth. Remember the guy who “saw a word document” !? Lol



Yeah, rep at Mountainside said 2 days ago Steve was here and told them later this year they'll be pushing vistana owners to buy 3500 points to enroll in the dc program.


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## CalGalTraveler (Aug 1, 2019)

Steve Fatula said:


> Yeah, rep at Mountainside said 2 days ago Steve was here and told them later this year they'll be pushing vistana owners to buy 3500 points to enroll in the dc program.



If they make us buy more DC points to enroll, that will be dead in the water. Will simply stick with StarOptions, pick up another mandatory trader and use what we have. IMO I am more excited about trading Westins than MVC and can get that via SOs today. Such a move would extend the life of the SO inventory pool significantly because VSN owners would do nothing.


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## Steve Fatula (Aug 1, 2019)

CalGalTraveler said:


> If they make us buy more DC points to enroll, that will be dead in the water. Will simply stick with StarOptions, pick up another mandatory trader and use what we have. IMO I am more excited about trading Westins than MVC and can get that via SOs today. Such a move would extend the life of the SO inventory pool significantly because VSN owners would do nothing.



You'd be surprised what not Tuggers might do in this fictitious scenario. Remember, this was in response to sales reps lying, I seriously doubt this is a going to happen as claimed any time soon. I merely added thus as another lie, the conference call seems to go against this. Keeping what you have is I am sure no issue anyway. That's the way it was and is for legacy Marriott owners Many of them have bought points to enroll weeks and many have not.


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## JIMinNC (Aug 1, 2019)

A thought just occurred to me...when we are discussing "integrated product", as owners, we tend to think of it in terms of the booking and exchange mechanisms that we would use to book across MVC, Westin, Sheraton, etc. But when Steve Weisz is speaking to analysts about "product", he may be referring more to the product that is actually sold at the sales centers, since that is their real revenue source

Right now legacy MVC and legacy ILG sales centers are selling two totally different products. So, when he tells analysts _*"...our goal is to develop an integrated product that leverages all of our Marriott family of brands..." *_he may be actually referring to evolving to a single product that can be sold at both legacy MVC and legacy ILG sales centers. When you think about it from their perspective, as long as they have to maintain two different sales programs, they have to have two different training programs, two sets of legal docs, two sets of marketing materials, multiple web sites, etc. So it would seem that the goal, at least for new sales, would be one single product to sell. Obviously, they have the challenge of integrating the multiple variations of previously-sold weeks/Flex plans/DC Trust to exchange with whatever new product they develop, but it would seem to me that their ultimate goal would have to be selling one product at all sales locations - a single product that encompasses whatever unsold inventory they have and any new properties that are developed in the future.


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## TravelTime (Aug 1, 2019)

CalGalTraveler said:


> If they make us buy more DC points to enroll, that will be dead in the water. Will simply stick with StarOptions, pick up another mandatory trader and use what we have. IMO I am more excited about trading Westins than MVC and can get that via SOs today. Such a move would extend the life of the SO inventory pool significantly because VSN owners would do nothing.



Keep in mind they may end the existence of mandatory traders so people can't buy them resale anymore. Also they can change any of these programs any time. We can resist the future direction or be flexible and hope the new program is has some perks to legacy owners.


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## Steve Fatula (Aug 1, 2019)

JIMinNC said:


> A thought just occurred to me...when we are discussing "integrated product", as owners, we tend to think of it in terms of the booking and exchange mechanisms that we would use to book across MVC, Westin, Sheraton, etc. But when Steve Weisz is speaking to analysts about "product", he may be referring more to the product that is actually sold at the sales centers, since that is their real revenue source
> 
> Right now legacy MVC and legacy ILG sales centers are selling two totally different products. So, when he tells analysts _*"...our goal is to develop an integrated product that leverages all of our Marriott family of brands..." *_he may be actually referring to evolving to a single product that can be sold at both legacy MVC and legacy ILG sales centers. When you think about it from their perspective, as long as they have to maintain two different sales programs, they have to have two different training programs, two sets of legal docs, two sets of marketing materials, multiple web sites, etc. So it would seem that the goal, at least for new sales, would be one single product to sell. Obviously, they have the challenge of integrating the multiple variations of previously-sold weeks/Flex plans/DC Trust to exchange with whatever new product they develop, but it would seem to me that their ultimate goal would have to be selling one product at all sales locations - a single product that encompasses whatever unsold inventory they have and any new properties that are developed in the future.



Why can't they just sell DC points moving forward and no weeks or anything else? Why is a new product needed at all? I have to believe DC points is the product. The issue to be tackled is legacy owners.


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## pchung6 (Aug 1, 2019)

TravelTime said:


> Keep in mind they may end the existence of mandatory traders so people can't buy them resale anymore. Also they can change any of these programs any time. We can resist the future direction or be flexible and hope the new program is has some perks to legacy owners.



If they could end the mandatory, they would have already done that. They just can't. Can I just change something on your house deed because it will benefit me?


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## JIMinNC (Aug 1, 2019)

Steve Fatula said:


> Why can't they just sell DC points moving forward and no weeks or anything else? Why is a new product needed at all? I have to believe DC points is the product. The issue to be tackled is legacy owners.



Absolutely. They could define DC Points to be the "integrated product", or they could rebrand it but use the same infrastructure. I didn't mean to imply that they would have to create something totally new, just that they have to define what the new product is. To do that, they will have to figure out how to integrate all of the previously-sold weeks/trusts to play well together; but when Weisz says "product" I suspect his ultimate goal is to sell the same product everywhere - regardless of whether that product is the DC, the DC rebranded as something else, or something totally new. Personally, I think they should rebrand it, even if they use the basic structure of the DC. They are bringing together two large owner groups, so to just fold one into the legacy product of the other may not be the smartest marketing move. I think that's why Marriott International rebranded Marriott Rewards as Bonvoy - they could have clearly just called the new program Marriott Rewards since it had great brand identification, but by creating a new brand, both MR and SPG members came into the new program as equals. I think MVW should do the same.


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## Steve Fatula (Aug 1, 2019)

Yeah, renaming would be wise, I agree. I would virtually bet it will be the dc points program with possibly a few changes / enhancements. Points can then be sold by everyone. Which is why I sort of think there is some truth to paying to enroll for ILG. If you don't pay, you keep what you have, just like our legacy weeks.


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## TravelTime (Aug 1, 2019)

pchung6 said:


> If they could end the mandatory, they would have already done that. They just can't. Can I just change something on your house deed because it will benefit me?



Why can't they end it?


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## pchung6 (Aug 1, 2019)

TravelTime said:


> Why can't they end it?



Why they haven't done it?


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## pchung6 (Aug 1, 2019)

Steve Fatula said:


> Yeah, renaming would be wise, I agree. I would virtually bet it will be the dc points program with possibly a few changes / enhancements. Points can then be sold by everyone. Which is why I sort of think there is some truth to paying to enroll for ILG. If you don't pay, you keep what you have, just like our legacy weeks.



Here we go again. Like I said before many times, VSN already has very well established point system. You ask them to pay again to enroll to DC? Not many will do, MVC will end up with unsold VSN weeks only since most VSN owners will just stick with their VSN points. There is nothing wrong with existing VSN system if it is not better than DC system.


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## CPNY (Aug 1, 2019)

TravelTime said:


> Why can't they end it?


Because I said so  *disclaimer: this was a joke, don’t want to be warned or banned for this post.


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## CPNY (Aug 1, 2019)

pchung6 said:


> Here we go again. Like I said before many times, VSN already has very well established point system. You ask them to pay again to enroll to DC? Not many will do, MVC will end up with unsold VSN weeks only since most VSN owners will just stick with their VSN points. There is nothing wrong with existing VSN system if it is not better than DC system.


Pay no attention to these types of speculation. Everyone is loyal to their ownership and what they bought into. For example. We love VSN because we’ve had the benefits of weeks with points. MVC finally got into the points game ten years ago. I said a while ago in responding to a “it’s going to be DC all the way” speculation. They could build a completely separate program “product” in which everyone has to buy in. But was attacked for apparent hate speech lol.


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## CalGalTraveler (Aug 1, 2019)

TravelTime said:


> Why can't they end it?



Because mandatory (i.e. ability to offer resale buyers ability to trade in staroptions automatically) is not a program that can be changed at the whim of the the developer. It is a provision baked into the CC&Rs for several key properties (WKORV, WKORVN, HSV, SSV (Bella, Key West), WSJ (certain bldgs). But not the newer ones where they did not grandfather this in e.g. WLR, Nanea are "voluntary"

What @pchung6 is saying is that ILG would have gotten rid of it long ago if they could have. Would involve huge legal fight affecting property owner rights. Only way to get out is to ROFR sales and convince owners to trade their unit in for other programs. ROFR will take a very very long time unless they aggressively buy out the units which would likely require more investment that they have available to spend after this expensive acquisition.

What this means is unless MVC gives owners of prime Westin's the option to enroll in DC /Overlay AND grandfather SO mandatory rights at no/low cost, the best inventory in the Westin mandatory properties will remain in SO inventory pool for a long time; DC will never be able to reserve these units.


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## SueDonJ (Aug 1, 2019)

pchung6 said:


> If they could end the mandatory, they would have already done that. They just can't. Can I just change something on your house deed because it will benefit me?





pchung6 said:


> Here we go again. Like I said before many times, VSN already has very well established point system. *You ask them to pay again to enroll to DC?* Not many will do, MVC will end up with unsold VSN weeks only since most VSN owners will just stick with their VSN points. There is nothing wrong with existing VSN system if it is not better than DC system.



The questions about whether or not MVW *would* change or eliminate the VSN points option are interesting but if it can't be done, there's no sense in even talking about it. The answer to whether it *can* be done is in how the option is integrated into the governing docs of the overall timeshare company under which it was established, the resort(s) at which it's an option, and, the individual deeds and affiliated agreements.

For example, with Marriott Weeks the option to exchange a direct-purchase or DC-enrolled Week for Bonvoy (formerly Marriott Rewards) Points is stipulated in an addendum to the purchase/enrollment agreement. The deed for a direct-purchase Week, or the Enrollment Agreement for an external-resale Week, guarantee only that the Week is eligible for the stated amount of Points but also that the option itself is subject to everything stipulated in the addendum, which states that the option is subject to change up to and including a cessation of the affiliation. It's understood that the option can go away at any time.

If the VSN option was automatic at purchase with the terms specifically stated in a deed's Week without any terms subject to any underlying affiliation agreements, then that would be a very difficult legal hurdle for MVW if they want to change things. But if it's an add-on to the original purchase that's subject to t&c's of an affiliation agreement, that's a lot of leeway for MVW. Obviously I have no idea how Vistana works but the idea that VSN might be an add-on comes from the question I bolded in your quoted post. Do/did Vistana owners pay extra for that option at purchase?


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## CalGalTraveler (Aug 1, 2019)

SueDonJ said:


> Do/did Vistana owners pay extra for that option at purchase?



The answer is "No." Points are automatically included upon purchase of every VSN property sold by the developer. It is not an option.

If the property is deemed "mandatory" those points are automatically given to resale buyers; Staroption rights come with the property.

If the property is deemed "voluntary" then the resale buyer must re-enroll the property with the developer for points. Only developer purchased units have access to the SO system.


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## pchung6 (Aug 1, 2019)

SueDonJ said:


> If the VSN option was automatic at purchase with the terms specifically stated in a deed's Week without any terms subject to any underlying affiliation agreements, then that would be a very difficult legal hurdle for MVW if they want to change things. But if it's an add-on to the original purchase that's subject to t&c's of an affiliation agreement, that's a lot of leeway for MVW. Obviously I have no idea how Vistana works but the idea that VSN might be an add-on comes from the question I bolded in your quoted post. Do/did Vistana owners pay extra for that option at purchase?



Vistana has been trying so hard in last 2-3 years asking owners to upgrade to Flex by giving back the original purchase amount. Do you think WKORV OF or WKV owners will budge?


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## SueDonJ (Aug 1, 2019)

CalGalTraveler said:


> The answer is "No." Points are automatically included upon purchase of every VSN property sold by the developer. It is not an option.
> 
> If the property is deemed "mandatory" those points are automatically given to resale buyers; Staroption rights come with the property.
> 
> If the property is deemed "voluntary" then the resale buyer must re-enroll the property with the developer for points. Only developer purchased units have access to the SO system.



Thanks. I'm trying to flesh out a thought process, comparing what I know of Marriott to how Vistana works either similarly or vastly different. 

Do I understand correctly that "re-enrolling" to change a voluntary Week to a mandatory, is what Vistana owners are talking about when they mention paying exorbitant fees to Vistana, somewhat making up for the difference between's the Week's cost on the external-resale market compared to direct-purchase?


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## CPNY (Aug 1, 2019)

SueDonJ said:


> If the VSN option was automatic at purchase with the terms specifically stated in a deed's Week without any terms subject to any underlying affiliation agreements, then that would be a very difficult legal hurdle for MVW if they want to change things. But if it's an add-on to the original purchase that's subject to t&c's of an affiliation agreement, that's a lot of leeway for MVW. Obviously I have no idea how Vistana works but the idea that VSN might be an add-on comes from the question I bolded in your quoted post. Do/did Vistana owners pay extra for that option at purchase?



Think of it this way. 

Mandatory VSN Week is like an enrolled MVC week in the DC program, except when you sell it the enrolled status in the DC would transfer with resale. In other words, you have no choice but to be enrolled in the affiliates program. If they did away with VSN then those mandatory weeks will automatically have to be enrolled into the DC program. 

Voluntary weeks would be like purchasing a MVC week resale with no enrollment and the only way to retro or enroll in any program you must pull the trigger on another developer sale. The new flex plans count. New money in can re enroll your voluntary. 

The contracting of mandatory deeds states it must be enrolled. If MVC did away with VSN all together the clear winners would be mandatory weeks owners, as they would be automatically enrolled with no additional costs. I think they would only do this if they knew there was a handful of man deeds out there. They are working hard to sell these people into flex programs and MANY who don’t understand what they actually own are trading in and buying into it.


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## CalGalTraveler (Aug 1, 2019)

SueDonJ said:


> Thanks. I'm trying to flesh out a thought process, comparing what I know of Marriott to how Vistana works either similarly or vastly different.
> 
> Do I understand correctly that "re-enrolling" to change a voluntary Week to a mandatory, is what Vistana owners are talking about when they mention paying exorbitant fees to Vistana, somewhat making up for the difference between's the Week's cost on the external-resale market compared to direct-purchase?



No problem! You have helped me to understand MVC/DC.

"Mandatory" and "Voluntary" are by the resort not the week and are fixed in the legal description of the properties/CC&Rs.

Re-enrolling makes a voluntary resale week eligible to trade in Staroptions again. It is still a voluntary resort per the property docs because when the re-enrolled owner sells their unit, the resale buyer does not have rights to the SO program and must re-enroll again if they want to trade.


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## CPNY (Aug 1, 2019)

SueDonJ said:


> Thanks. I'm trying to flesh out a thought process, comparing what I know of Marriott to how Vistana works either similarly or vastly different.
> 
> Do I understand correctly that "re-enrolling" to change a voluntary Week to a mandatory, is what Vistana owners are talking about when they mention paying exorbitant fees to Vistana, somewhat making up for the difference between's the Week's cost on the external-resale market compared to direct-purchase?


You can’t turn a voluntary deed into a mandatory one. But you can “enroll” or retro as VSN refers to it as, with a new purchase. All this does is bring the voluntary resale back into the VSN where you can now use the star options to book other resorts at 8 months. Once you retro or re enroll that voluntary  deed with a new purchase, then turn around and sell it, it falls back out of the network for the new owner buying it. Now, there are many who still buy voluntary deeds in places like Sheraton Desert Oasis because it pulls in excellent trading power in II. So you can still get Westin properties in Hawaii with priority network interval exchange without having the benefits of star options. Hope that makes sense.


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## DannyTS (Aug 1, 2019)

JIMinNC said:


> Here is the exact quote from Steve Weisz from this morning's call:
> 
> *"We also continued our work on enhancing our product offerings across our multiple Marriott brands. As we shared with you previously, we continue to evaluate the various options, and our current plan is to add new enhancements in stages, each building on the strong foundation that we offer customers today. Over time, our goal is to develop an integrated product that leverages all of our Marriott family of brands, providing owners and potential owners an even greater array of vacation destinations and experiences from which to choose. We remain extremely optimistic about its potential, and we’ll have more to say about this in our Investor Day on October 4.”
> *


I find this good news bad news. It is good news because it confirms what we always speculated, that an integrated product is going to happen. It is bad news because it appears that the integration will be a long process. It also questions whether they actually had most of this figured out before the acquisition or they just went ahead in the dark and now they are struggling with the details. The markets did not like the message today. The stock closed 5% down and it was down more than 7% at one point. I did not listen to the call but i reviewed the press release. On surface I do not see any major problem except that the MVC sales only grew by 6%, same as ILG. It seems that temporarily they did not accomplished much in terms of sales, the MVC sales executives were telling ILG sales people what to do. This did not have a positive effect on ILG growth it had a negative impact on the MVC growth. It appears to me that instead of letting Vistana sales do its job, come with a better (integrated) product, then push through all channels the improved product, they just pounded on a probably confused sales team which, despite the additional efforts, did not do any better than it would have done otherwise.


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## VacationForever (Aug 1, 2019)

pchung6 said:


> Here we go again. Like I said before many times, VSN already has very well established point system. You ask them to pay again to enroll to DC? Not many will do, MVC will end up with unsold VSN weeks only since most VSN owners will just stick with their VSN points. There is nothing wrong with existing VSN system if it is not better than DC system.


Hah!  Here we go again, ditto!  VSN is better than DC system!?  It depends on who you ask.  I own at both and they each have their merits.  From resort locations perspective, I much prefer MVC.  From ease of use and "fairness", VSN wins as there is no skimming.  I would prefer the 2 systems be kept separate and to access across the systems, the owners need to pay a large sum for it.  Reality?  We have to wait for it.


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## DannyTS (Aug 1, 2019)

the only good news, it seems that those that still want to buy Vistana or Marriott resale before the integration may still have a little bit of time.


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## Steve Fatula (Aug 1, 2019)

An integrated program will come, like it or not. I expect Westin and SO mandatory rights will continue, DC was always an option for Marriott owners. Nothing was really taken from weeks owners, I would expect the same. Call the program whatever you want, it will be an overlay for the same reasons MVCI DC points were. They will integrate them, obviously. The details are unknown of course. This is not a question of whose system is better, etc. They could indeed build a new product, but that's another level of complexity. I think they will enhance what they have, new perks too. There will be some draw into joining overlay X. I personally believe it will be a renamed DC not because I am a Marriott owner, not because I think it's superior, etc. Merely because it's their system. But it won't be what we have today. Just pure speculation. But the conf call was pretty clear to me. Integration coming.


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## kds4 (Aug 1, 2019)

CPNY said:


> Think of it this way.
> 
> Mandatory VSN Week is like an enrolled MVC week in the DC program, except when you sell it the enrolled status in the DC would transfer with resale. In other words, you have no choice but to be enrolled in the affiliates program. *If they did away with VSN then those mandatory weeks will automatically have to be enrolled into the DC program. *
> 
> ...



I'm not as positive as you are (although I don't own a VSN property) that contractually that would be true. While the terms of the 'contract' between VSN and its' owners may require enrollment in VSN's network of 'mandatory weeks' (so long as there is a VSN network); if there is a way for MVC to terminate the VSN network (within the terms of the governing documents) and MVC chose to exercise that option, there would likely be no 'automatically required transfer' to the DC program (which is a different network, albeit under the same MVC corporate umbrella) unless the mandatory VSN language prospectively included 'future unidentified additional affiliate programs not yet associated with VSN' or other indeterminate future language. I think it unlikely the VSN language would have been that 'forward looking', but since I don't have any VSN documentation to refer to could be wrong. I don't see a reason to eliminate it if it runs well as a stand alone network, assuming an integrated overlay for both systems can be devised.


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## davidvel (Aug 1, 2019)

I'm unfamiliar with the quality of these other systems and their resorts. For those in the DC that have familiarity with the other systems that Marriott acquired: If those systems were put into the DC, would you consider this overall to be a plus or a minus?


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## kds4 (Aug 1, 2019)

davidvel said:


> I'm unfamiliar with the quality of these other systems and their resorts. For those in the DC that have familiarity with the other systems that Marriott acquired: If those systems were put into the DC, would you consider this overall to be a plus or a minus?



That's largely a subjective question IMHO. How many more resort locations does it add compared to how many additional owners in the 'pool' to compete with for inventory access. What are the locations of the non-Marriott system properties relative to MVC locations and how do they compare in 'quality' (however you choose to measure that)? I'm sure there are other compare/contrast type of questions someone could come up with. No matter the answer MVC ultimately comes up with, there will be those who like it and those who don't.


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## CPNY (Aug 1, 2019)

.


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## CPNY (Aug 1, 2019)

kds4 said:


> I'm not as positive as you are (although I don't own a VSN property) that contractually that would be true. While the terms of the 'contract' between VSN and its' owners may require enrollment in VSN's network of 'mandatory weeks' (so long as there is a VSN network); if there is a way for MVC to terminate the VSN network (within the terms of the governing documents) and MVC chose to exercise that option, there would likely be no 'automatically required transfer' to the DC program (which is a different network, albeit under the same MVC corporate umbrella) unless the mandatory VSN language prospectively included 'future unidentified additional affiliate programs not yet associated with VSN' or other indeterminate future language. I think it unlikely the VSN language would have been that 'forward looking', but since I don't have any VSN documentation to refer to could be wrong. I don't see a reason to eliminate it if it runs well as a stand alone network, assuming an integrated overlay for both systems can be devised.



There is verbiage in the contract that states the current management company’s program and any successor, affiliate, etc etc. so yes the wording is there. As long as the resort is being managed by vistana or its successors then that phase must be a
Enrolled in any program being run by the management company


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## pchung6 (Aug 1, 2019)

kds4 said:


> I'm not as positive as you are (although I don't own a VSN property) that contractually that would be true. .



So did you rescind your MVC DC purchase as many had suggested?


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## kds4 (Aug 1, 2019)

CPNY said:


> There is verbiage in the contract that states the current management company’s program and any successor, affiliate, etc etc. so yes the wording is there. As long as the resort is being managed by vistana or its successors then that phase must be a
> Enrolled in any program being run by the management company



I see. Then you may be correct.


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## kds4 (Aug 1, 2019)

pchung6 said:


> So did you rescind your MVC DC purchase as many had suggested?



No. We're comfortable with our purchase. Thanks.


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## grgs (Aug 1, 2019)

Here's a set of recording docs pertaining to Westin Kierland:

https://recorder.maricopa.gov/recdocdata/GetRecDataDetail.aspx?rec=20020790610

I think section 6 (beginning on p. 13) relates to the mandatory issue.  But this is out of my area of expertise. I suppose, too, something else might have been filed later on to change these terms.  FWIW, does anyone else want to take a look?  I'm sure we've looked at this doc on the Starwood board at sometime, but it's been a while.


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## CalGalTraveler (Aug 1, 2019)

For mandatory resorts, enrollment in a "Club Resort" program is tightly intertwined in the legal documents and includes legal definitions of Club Points etc. Here is an excerpt from appendix H of automatic enrollment in the "Network" for the VUI owner (which includes resale) from SVV Bella docs filed in Florida County Recorders office.  I am not a lawyer.


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## DannyTS (Aug 1, 2019)

Say I had a choice to
-use my Vistana week, -trade it in VSN with no skim
-trade it in DC with a 10%skim
Which one would MVC want me to do?


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## CalGalTraveler (Aug 1, 2019)

Here are some more definitions from the SVV Bella County filed docs that highlight a provision of a "Club Operator" and it's assigns to operate a Network


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## CPNY (Aug 1, 2019)

kds4 said:


> I see. Then you may be correct.


It also goes on to state about being ousted. It’s difficult to cut off the resort. They would have to sell the whole resort to another company all together.


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## CPNY (Aug 1, 2019)

CalGalTraveler said:


> Here are some more definitions from the SVV Bella County filed docs that highlight a provision of a "Club Operator" and it's assigns to operate a Network
> 
> View attachment 13169


Right. Those are just definitions. My Bella hasn’t closed yet. I can try and pull up key west.


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## pchung6 (Aug 1, 2019)

kds4 said:


> No. We're comfortable with our purchase. Thanks.



I'm glad you are enjoying your developer purchase. Must be a good expensive toy with possible Westin access for free or with possibility you might have to pay again to join. 

However, you could have the "Guarantee" Westin access with just an SVV purchase resale for $1000.


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## controller1 (Aug 1, 2019)

pchung6 said:


> Vistana has been trying so hard in last 2-3 years asking owners to upgrade to Flex by giving back the original purchase amount. Do you think WKORV OF or WKV owners will budge?



I doubt it for the OF properties since there have been several statements about WKORV OF and WKORVN OF will not be a part of Flex.


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## kds4 (Aug 1, 2019)

pchung6 said:


> I'm glad you are enjoying your developer purchase. Must be a good expensive toy with possible Westin access for free or with possibility you might have to pay again to join.
> 
> However, you could have the "Guarantee" Westin access with just an SVV purchase resale for $1000.



We are happy with our MVC ownership (just as many are with their VSN). Other than wanting to visit Harborside once, we haven't identified any VSN properties we are interested in trying. Our recent purchase decision was strictly based on our plans within the MVC system (and had nothing to do with the acquisition of VSN). In the future we may identify other VSN properties we would like to visit, but that is not something that is presently 'on our radar'.


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## sjsharkie (Aug 1, 2019)

CalGalTraveler said:


> For mandatory resorts, enrollment in a "Club Resort" program is tightly intertwined in the legal documents and includes legal definitions of Club Points etc. Here is an excerpt from appendix H of automatic enrollment in the "Network" for the VUI owner (which includes resale) from SVV Bella docs filed in Florida County Recorders office.  I am not a lawyer.


This has been discussed before on another thread.  It also says the club operator can change the program and its rules at any time.  There also is a clause somewhere in there that states that the club can change its rules and force re-recording by the resort as necessary.

I know I differ from other people, but to me it is clear that the mandatory designation can be changed (though it would open up MVCI to potential legal exposure/costs and also cause owner blowback that might damage their brand/future sales).

IMHO, I don't see anything new here from the investor call that would lead me to believe they are any closer in the short-term to combining the programs.

-ryan


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## CPNY (Aug 1, 2019)

sjsharkie said:


> This has been discussed before on another thread.  It also says the club operator can change the program and its rules at any time.  There also is a clause somewhere in there that states that the club can change its rules and force re-recording by the resort as necessary.
> 
> I know I differ from other people, but to me it is clear that the mandatory designation can be changed (though it would open up MVCI to potential legal exposure/costs and also cause owner blowback that might damage their brand/future sales).
> 
> ...


I’m sure there is a get out clause in there somewhere. I really don’t think MVC would exercise it though. I’d love to know how many mandatory deed owners there are but the more there are the less likely they are to cut the program. I think they are trying their hardest to get those weeks back.  If an uninformed SVV key west owner who doesn’t know much except they own a timeshare in Orlando and knows they can book other resorts at 8 months walks into an owners update and is sold on, “you own an old product, we don’t even sell those anymore, everything is flex now, you can go to any Sheraton or Westin at 12 months. Why wait until 8!?” And “hey we will even take that junky deed you own back and put 20K toward the purchase price, go ahead look online, you’ll never get that much money for it”.  I can see why unsuspecting people might bite and give their deed back. Those who know what mandatory really means would laugh at that.


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## CalGalTraveler (Aug 1, 2019)

It will be up to the lawyers to argue but one thing is for sure - there would be significant blow-back if they forced a change or took draconian measures to limit. This would result in legal disputes and extreme customer dissatisfaction.

One data point from the call is very relevant. They said that only _one third of contract sales are from new buyers_. This means two things:

1) *The new buyer market is limited.* (either saturated, scared by exit company commercials and Internet horror stories, or it's a model that doesn't fit today's buyers who may prefer AirBnB with no commitment.)

2) *In order to meet their projections they must convince existing customers to buy more. *(2/3 of contracts) I don't think they can make their numbers if they rely on a percentage of 60% of MVC who have enrolled and ask them for more money. *If they cannot monetize and move the VSN side of the house because VSN owners don't trust MVC and are dissatisfied so refuse to buy more, it will be a failed acquisition.  
*


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## CPNY (Aug 1, 2019)

CalGalTraveler said:


> It will be up to the lawyers to argue but one thing is for sure - there would be significant blow-back if they forced a change or took draconian measures which would result in legal disputes and extreme customer dissatisfaction.
> 
> One data point from the call is very relevant. They said that only _one third of contract sales are from new buyers_. This means two things:
> 
> ...


That makes a lot of sense. And yes we know owners make a huge portion of their sales. It’s why my major point in this whole speculation about what ifs, is, it makes sense to have multiple types of programs. They have to appeal to a new generation. One that doesn’t see timeshare ownership as an advantage. People are traveling differently. I think having more options is a good thing.


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## DannyTS (Aug 1, 2019)

CPNY said:


> I’m sure there is a get out clause in there somewhere. I really don’t think MVC would exercise it though. I’d love to know how many mandatory deed owners there are but the more there are the less likely they are to cut the program. I think they are trying their hardest to get those weeks back.  If an uninformed SVV key west owner who doesn’t know much except they own a timeshare in Orlando and knows they can book other resorts at 8 months walks into an owners update and is sold on, “you own an old product, we don’t even sell those anymore, everything is flex now, you can go to any Sheraton or Westin at 12 months. Why wait until 8!?” And “hey we will even take that junky deed you own back and put 20K toward the purchase price, go ahead look online, you’ll never get that much money for it”.  I can see why unsuspecting people might bite and give their deed back. Those who know what mandatory really means would laugh at that.



I think we are overanalyzing the possibility of the mandatory resorts to be kicked out of the club. Sit at the pool at any Vistana resort, most people do not even know resale exists! Mandatory vs voluntary is for the initiated, it does not really matter for a multi billion dollars company in the grand scheme. I also do not think Vistana even wanted to buy back those deeds, this is how much they cared about the mandatory status. Every time I discussed a retro with them they advised me to KEEP SVV Bella because I already had SO. They wanted instead my Lagunamar weeks, voluntary of course. 

I did read everything i could about mandatory before I bought one. I thought at the time that it would be a legal and PR nightmare for the developer to try to change it, it is not worth it. I think some make a confusion. From everything I read, they can change the rules of the club (like number of points, seasons etc) not belonging to the club in the case of the mandatory resorts.


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## controller1 (Aug 1, 2019)

DannyTS said:


> I think we are overanalyzing the possibility of the mandatory resorts to be kicked out of the club. Sit at the pool at any Vistana resort, most people do not even know resale exists! Mandatory vs voluntary is for the initiated, it does not really matter for a multi billion dollars company in the grand scheme. I also do not think Vistana even wanted to buy back those deeds, this is how much they cared about the mandatory status. Every time I discussed a retro with them they advised me to KEEP SVV Bella because I already had SO.



I agree with you.  Every time I've been in a sales presentation with the emphasis on Westin Flex, each and every salesperson has told me to not ever trade in my mandatory weeks at WKORVN.


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## CPNY (Aug 1, 2019)

DannyTS said:


> I think we are overanalyzing the possibility of the mandatory resorts to be kicked out of the club. Sit at the pool at any Vistana resort, most people do not even know resale exists! Mandatory vs voluntary is for the initiated, it does not really matter for a multi billion dollars company in the grand scheme. I also do not think Vistana even wanted to buy back those deeds, this is how much they cared about the mandatory status. Every time I discussed a retro with them they advised me to KEEP SVV Bella because I already had SO. They wanted instead my Lagunamar weeks, voluntary of course.
> 
> I did read everything i could about mandatory before I bought one. I thought at the time that it would be a legal and PR nightmare for the developer to try to change it, it is not worth it. I think some make a confusion. From everything I read, they can change the rules of the club (like number of points, seasons etc) not belonging to the club in the case of the mandatory resorts.


You are right. They want the Lagunamar inventory it seems, maybe to build out Aventuras or get inventory into DC integration. Either way, Mexico is a big footprint for them. I’ve yet to go to lagunamar. I hear it’s nice? I should try it out at some point. They offered me 20K for me SVV KW lockout but maybe that was just to get me to buy more? Something I’d never do developer these days. Unless universal came out with one and they built Hogwarts as a resort and my room was the gryffindor common room!


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## dougp26364 (Aug 1, 2019)

It’s funny. When Marriott was going to introduce their points program initially, there was a great deal of excited anticipation. With this merger, there’s more paranoia and fear.

We have no facts, just speculation, words from salesmen and what little info we can get from these earnings calls, which is vague at best.

Here are the historical facts. When Marriott introduced their points program, it was an optional enhancement to what owners already had, not a replacement of what they owned. Existing owners could either buy in by purchasing points or they could pay an enrollment fee. Past that nothing really changed.

Now as for the sales staff, they wanted owners to buy in. Why? That’s where they make their paycheck. So of course they focused on reasons to buy points instead of only enroll up your weeks. They used fear and, to some extent, intimidation. A lot of owners bought because of those tactics. Not TUG members necessarily but the ignorant masses that don’t educate themselves on the facts. DON’T TRUST WHAT YOU GEAR FROM THE SALES FLOOR AND DON’T LET THEM PANIC YOU. I’d have thought TUG members would realize that by now.

History says they offered two options, enroll or buy in. Sales floors will focus on the buy in option and tell owners they’ll be limited if there’s an enrollment option. That will undoubtedly be a lie. We were told our enrolled weeks would NEVER be able to get into the new resorts that would be trust only. We’d need to “supercharge” our enrolled points with purchased trust points. That was only partially true and was, for the most part, so insignificant that I’ll call it an outright lie. 

Stop the hand wringing and worrying. We’ll get the real info soon enough and can start digesting and dissecting it at that time. The only reliable tidbits right now are that we’re moving closer, but it’s still a ways out as they work on the logistics of merging to dissimilar programs. Marriott isn’t going to leave anyone out so long as they feel they can make money from them. I’m almost positive there going to be licking there lips at the opportunity to sell SVN owners on all the new locations and opportunities that await them by joining the new program. I’m relatively certain they’ll offer a buy in option as a test drive and hope to sell the skeptics down the road when they see all the new location options offered (not everyone will be happy with just the SVN options). At least that’s how I’d look at it if I was Marriott. Some will buy now because the sales teams will make them believe it’s cheaper and better to buy new points and get their weeks enrolled free. Some will buy more because of the expanded options. Others, like we were, will elect to enroll their existing weeks while they explore the new possibilities to see if the program works for them. But I hardly doubt all this “sky is falling” talk will ever come to fruition.


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## DannyTS (Aug 1, 2019)

CPNY said:


> I’ve yet to go to lagunamar. I hear it’s nice? I should try it out at some point.


we love it


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## CPNY (Aug 1, 2019)

L


DannyTS said:


> we love it
> 
> View attachment 13170


looks amazing!


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## SteelerGal (Aug 1, 2019)

I agree w/ above.  MVC already has a case study regarding a failed program: HRC. All HRC properties convert to points after xx months if you do not reserve your home week  You can book at that point less than a week at any available resort. So why would I buy into a HPP points program starting at 16k?  Sales will tell you that you will have even more flexibility.  However the System is already flexible for majority of the HRC owners.  Because of the lack of  Sales into HPP(Points), I don’t see MVC going down that path.


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## pchung6 (Aug 1, 2019)

dougp26364 said:


> It’s funny. When Marriott was going to introduce their points program initially, there was a great deal of excited anticipation. With this merger, there’s more paranoia and fear.



It is because when Marriott introduced DC program, there was no points only weeks. Now with Vistana, there is already a very good system within Vistana. Westin is just better than Marriott at the same location, any Westin. I stay at both a lot for work, i know it is. Unless Vistana owners really want something like Aruba instead of St Johns, there is really no need to enroll to Marriott. I hope both programs stay separated forever, it is just my hope.


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## JIMinNC (Aug 1, 2019)

DannyTS said:


> I find this good news bad news. It is good news because it confirms what we always speculated, that an integrated product is going to happen. It is bad news because it appears that the integration will be a long process. It also questions whether they actually had most of this figured out before the acquisition or they just went ahead in the dark and now they are struggling with the details. The markets did not like the message today. The stock closed 5% down and it was down more than 7% at one point. I did not listen to the call but i reviewed the press release. On surface I do not see any major problem except that the MVC sales only grew by 6%, same as ILG. It seems that temporarily they did not accomplished much in terms of sales, the MVC sales executives were telling ILG sales people what to do. This did not have a positive effect on ILG growth it had a negative impact on the MVC growth. It appears to me that instead of letting Vistana sales do its job, come with a better (integrated) product, then push through all channels the improved product, they just pounded on a probably confused sales team which, despite the additional efforts, did not do any better than it would have done otherwise.



If you listen to the full call, you get a little different impression. It was legacy MVC that grew less in 2Q than 1Q, while legacy ILG did much better in 2Q vs 1Q. It was the lower legacy MVC sales that caused them to fail to meet sales expectations for 2Q, and that's a big factor in what has caused their stock to drop. Basically what they said was that ILG sales did not have as high a closing percentage/VPG (volume per guest) as MVC did. ILG also got a lot of their sales leads/tours from high cost OPC (Off-Property Contact) channels, whereas MVC was more active in mining the Loyalty program and soliciting tours from resort guests and guests at nearby hotels. In an attempt to improve the ILG closing/VPG, they have been discontinuing the higher cost/less effective tour generation methods and trying to bring MVC sales techniques to the legacy ILG locations. They said in 1Q 2019, the ILG locations actually had a 2% sales _*decline*_ year-over-year compared to 2018, while MVC are 10%; but in 2Q 2019, the changes they made at ILG bore fruit, and sales increased 6%. Here is a quote:

*"We've made a lot of changes in our sales and marketing organization over the last 6-9 months, and it takes some time to manifest these changes into higher efficiencies. We know these are best practices and we are comfortable we'll see improvement over time. You saw some of that evidenced in what happened in the VSE business over the second quarter, where we saw very substantial improvements in what was a 2% down year first quarter-over-quarter, to 6% up in second quarter. It takes some time to put these things in place. I will also say to you that part of that is driven by our sales leadership, which predominantly remains from the MVC business, they spent a disproportionate amount of time in the VSE properties trying to drive some of these changes. So in some respect, I think you'll see some of the slight dip from 10% growth we had for MVC in the first quarter to the 6% growth in the second quarter in the MVC business, that was partly because they were spending more time there and we took or eye off the ball a little on the MVC side."*


----------



## CPNY (Aug 1, 2019)

pchung6 said:


> It is because when Marriott introduced DC program, there was no points only weeks. Now with Vistana, there is already a very good system within Vistana. Westin is just better than Marriott at the same location, any Westin. I stay at both a lot for work, i know it is. Unless Vistana owners really want something like Aruba instead of St Johns, there is really no need to enroll to Marriott. I hope both programs stay separated forever, it is just my hope.


I’d def do Aruba and check it out. But I do love the Bahamas


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## CPNY (Aug 1, 2019)

JIMinNC said:


> If you listen to the full call, you get a little different impression. It was legacy MVC that grew less in 2Q than 1Q, while legacy ILG did much better in 2Q vs 1Q. It was the lower legacy MVC sales that caused them to fail to meet sales expectations for 2Q, and that's a big factor in what has caused their stock to drop. Basically what they said was that ILG sales did not have as high a closing percentage/VPG (volume per guest) as MVC did. ILG also got a lot of their sales leads/tours from high cost OPC (Off-Property Contact) channels, whereas MVC was more active in mining the Loyalty program and soliciting tours from resort guests and guests at nearby hotels. In an attempt to improve the ILG closing/VPG, they have been discontinuing the higher cost/less effective tour generation methods and trying to bring MVC sales techniques to the legacy ILG locations. They said in 1Q 2019, the ILG locations actually had a 2% sales _*decline*_ year-over-year compared to 2018, while MVC are 10%; but in 2Q 2019, the changes they made at ILG bore fruit, and sales increased 6%. Here is a quote:
> 
> *"We've made a lot of changes in our sales and marketing organization over the last 6-9 months, and it takes some time to manifest these changes into higher efficiencies. We know these are best practices and we are comfortable we'll see improvement over time. You saw some of that evidenced in what happened in the VSE business over the second quarter, where we saw very substantial improvements in what was a 2% down year first quarter-over-quarter, to 6% up in second quarter. It takes some time to put these things in place. I will also say to you that part of that is driven by our sales leadership, which predominantly remains from the MVC business, they spent a disproportionate amount of time in the VSE properties trying to drive some of these changes. So in some respect, I think you'll see some of the slight dip from 10% growth we had for MVC in the first quarter to the 6% growth in the second quarter in the MVC business, that was partly because they were spending more time there and we took or eye off the ball a little on the MVC side."*


Do they list out sales figures from each property? I wonder why they get most of their new contracts. I def see a lot of social media marketing of travel deals to sit in on a sales presentation. Must more than any other brand. MVC seems to corner the market there.


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## JIMinNC (Aug 1, 2019)

CPNY said:


> Do they list out sales figures from each property? I wonder why they get most of their new contracts. I def see a lot of social media marketing of travel deals to sit in on a sales presentation. Must more than any other brand. MVC seems to corner the market there.



No. They do not break out sales by each location in their public disclosures.


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## CPNY (Aug 1, 2019)

JIMinNC said:


> No. They do not break out sales by each location in their public disclosures.


That would be interesting to see. I’d guess Orlando would be a big sales destination since mostly families head there. But who knows.


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## DannyTS (Aug 1, 2019)

CPNY said:


> That would be interesting to see. I’d guess Orlando would be a big sales destination since mostly families head there. But who knows.


I agree, there is a reason why so many resorts in Orlando, and not just MVC, virtually all timeshares. My guess is that Orlando does very well with first time buyers.


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## CPNY (Aug 1, 2019)

DannyTS said:


> I agree, there is a reason why so many resorts in Orlando, and not just MVC, virtually all timeshares. My guess is that Orlando does very well with first time buyers.


Until they come here and learn to rescind!! I know many have said MVC has too many in Orlando and could possibly sell one or two off. That would be interesting. But to your point, there is a huge TS presence in Orlando! I’d suspect for a reason.


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## DannyTS (Aug 1, 2019)

CPNY said:


> I know many have said MVC has too many in Orlando and could possibly sell one or two off.



I do not understand what game some are playing.


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## CPNY (Aug 1, 2019)

DannyTS said:


> I do not understand what game some are playing.


I think so much has been speculated. It seems a program whatever it looks like is a long time away which is what I always thought to be true. I’ve always speculated some sort of joint priority in the form of an exchange in interval maybe? Who knows, don’t care. But I’d hate for them to get rid of SVV if ever, that’s how I have my options lol. Truthfully I really just want to book harborside resort or a ski week. Unless I send friends or family to  Westin.


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## DannyTS (Aug 1, 2019)

let's also not forget, 2 new parks are going to open: Galaxy's edge and Epic Universe (Disney and Universal), they will probably add 20 million visitors annually. I am not sure the developers think like the timeshare owners.


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## DannyTS (Aug 1, 2019)

CPNY said:


> I think so much has been speculated. It seems a program whatever it looks like is a long time away which is what I always thought to be true. I’ve always speculated some sort of joint priority in the form of an exchange in interval maybe? Who knows, don’t care. But I’d hate for them to get rid of SVV if ever, that’s how I have my options lol. Truthfully I really just want to book harborside resort or a ski week. Unless I send friends or family to  Westin.


They are milking too much these resorts, selling isn't happening. Isn't the MVW headquarter in Orlando? I would not worry about that at all.


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## JIMinNC (Aug 1, 2019)

pchung6 said:


> I'm glad you are enjoying your developer purchase. Must be a good expensive toy with possible Westin access for free or with possibility you might have to pay again to join.
> 
> However, you could have the "Guarantee" Westin access with just an SVV purchase resale for $1000.



I know it's sort of heresy for a TUGger to buy something from a developer, but you may not know that in the MVC DC Points program, there are certain developer purchases that can compare reasonably favorably in price to resale points purchases. They key is, you have to specifically want *Points* and not have your needs met by a resale week. Since MVC has never had the equivalent of a Vistana Mandatory week, someone wanting to play in the MVC points system has no choice but to pay MVC some significant $$$, even for true resale points.

For example, an external, third-party resale purchase of DC Points probably averages about $3.50 to $4/point to pass ROFR. Some have gotten deals past ROFR for less than that, but some of those may be eBay sellers with "creative" ROFR submittals. But if you assume, an average $3.50 - $4/point price, plus the additional $3/point MVC activation fee, then a reasonable estimate of total resale points cost is $6.50 to $7.00 per point.

MVC has bundled deals that include an enrolled resale week purchased direct from MVC Resales (acting as the broker), coupled with a bundle of DC Points (generally at least equal to the point value of the resale week) at the developer price. Another option is buying a resale week from MVC in an international location like Aruba, St Kitts, or Spain. Those international weeks come enrolled with DC Points, but are truly developer-priced. They also from time to time offer the ability for someone with already-owned external resale weeks to enroll those weeks in the points program if you buy a bundle of Trust points to add to your ownership. All of those options can often result in a total price per point that is not much different than the full $6.50 to $7/point cost of resale points. An informed TUGger can buy from MVC and get something that is comparable in price to resale *points*.


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## CPNY (Aug 1, 2019)

DannyTS said:


> They are milking too much these resorts, selling isn't happening. Isn't the MVW headquarter in Orlando? I would not worry about that at all.


I think it is in Orlando. Is the timeshare capitol of the world lol


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## CPNY (Aug 1, 2019)

JIMinNC said:


> I know it's sort of heresy for a TUGger to buy something from a developer, but you may not know that in the MVC DC Points program, there are certain developer purchases that can compare reasonably favorably in price to resale points purchases. They key is, you have to specifically want *Points* and not have your needs met by a resale week. Since MVC has never had the equivalent of a Vistana Mandatory week, someone wanting to play in the MVC points system has no choice but to pay MVC some significant $$$, even for true resale points.
> 
> For example, an external, third-party resale purchase of DC Points probably averages about $3.50 to $4/point to pass ROFR. Some have gotten deals past ROFR for less than that, but some of those may be eBay sellers with "creative" ROFR submittals. But if you assume, an average $3.50 - $4/point price, plus the additional $3/point MVC activation fee, then a reasonable estimate of total resale points cost is $6.50 to $7.00 per point.
> 
> MVC has bundled deals that include an enrolled resale week purchased direct from MVC Resales (acting as the broker), coupled with a bundle of DC Points (generally at least equal to the point value of the resale week) at the developer price. Another option is buying a resale week from MVC in an international location like Aruba, St Kitts, or Spain. Those international weeks come enrolled with DC Points, but are truly developer-priced. They also from time to time offer the ability for someone with already-owned external resale weeks to enroll those weeks in the points program if you buy a bundle of Trust points to add to your ownership. All of those options can often result in a total price per point that is not much different than the full $6.50 to $7/point cost of resale points. An informed TUGger can buy from MVC and get something that is comparable in price to resale.


It seems buying resale week at say Aruba or somewhere you really want to go, then enroll it with a developer purchase when they offer those deals seems like the most economical way to go? How many points is a 1 bedroom Aruba week worth? Is there a chart to reference?


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## JIMinNC (Aug 1, 2019)

CPNY said:


> It seems buying resale week at say Aruba or somewhere you really want to go, then enroll it with a developer purchase when they offer those deals seems like the most economical way to go? How many points is a 1 bedroom Aruba week worth? Is there a chart to reference?



If you wanted to go to one of the international locations that MVC can't put into the trust and thus still sells as weeks, then it might just be cheaper to buy one of those weeks direct from MVC since when you do that, it comes enrolled anyway. You basically pay a developer-level price in the $25K to $40K+ range, but that might be cheaper than buying an external resale and then still having to buy at least 3000 points ($33K+) to enroll the week. And there's no guarantee when or if they will offer such a promotion and if the points buy is still the same as it has been in the past.

Aruba 1BR/2BR point values:

*Aruba Ocean Club*
1BR OV Gold   2050
2BR OV Gold   3075
1BR OF Gold   2575
2BR OF Gold   3975
1BR OV Platinum  2900
2BR OV Platinum  4075
1BR OF Platinum  3750
2BR OF Platinum  5225

The other resort, Aruba Surf Club only has 2BR and 3BR units but they are comparable to the above for the 2BR units. Surf Club also has fixed weeks for weeks 7, 51, 52 that are much higher points. Here is a master points list maintained by TUGger Steven Ting: https://historical.vacationpointexchange.com/


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## dioxide45 (Aug 1, 2019)

JIMinNC said:


> A thought just occurred to me...when we are discussing "integrated product", as owners, we tend to think of it in terms of the booking and exchange mechanisms that we would use to book across MVC, Westin, Sheraton, etc. But when Steve Weisz is speaking to analysts about "product", he may be referring more to the product that is actually sold at the sales centers, since that is their real revenue source
> 
> Right now legacy MVC and legacy ILG sales centers are selling two totally different products. So, when he tells analysts _*"...our goal is to develop an integrated product that leverages all of our Marriott family of brands..." *_he may be actually referring to evolving to a single product that can be sold at both legacy MVC and legacy ILG sales centers. When you think about it from their perspective, as long as they have to maintain two different sales programs, they have to have two different training programs, two sets of legal docs, two sets of marketing materials, multiple web sites, etc. So it would seem that the goal, at least for new sales, would be one single product to sell. Obviously, they have the challenge of integrating the multiple variations of previously-sold weeks/Flex plans/DC Trust to exchange with whatever new product they develop, but it would seem to me that their ultimate goal would have to be selling one product at all sales locations - a single product that encompasses whatever unsold inventory they have and any new properties that are developed in the future.


In order to sell a new combined product, they either have to start adding Vistana weeks to the MVC DC Trust or create a new trust where they throw in Vistana and Marriott weeks. Odd that they would go either of these routes as they still pile a ton of Nanea inventory in to the Westin Flex trust. It will be interesting to see how they manage to sell a single combined product.



DannyTS said:


> I find this good news bad news. It is good news because it confirms what we always speculated, that an integrated product is going to happen. It is bad news because it appears that the integration will be a long process. It also questions whether they actually had most of this figured out before the acquisition or they just went ahead in the dark and now they are struggling with the details. The markets did not like the message today. The stock closed 5% down and it was down more than 7% at one point. I did not listen to the call but i reviewed the press release. On surface I do not see any major problem except that the MVC sales only grew by 6%, same as ILG. It seems that temporarily they did not accomplished much in terms of sales, the MVC sales executives were telling ILG sales people what to do. This did not have a positive effect on ILG growth it had a negative impact on the MVC growth. It appears to me that instead of letting Vistana sales do its job, come with a better (integrated) product, then push through all channels the improved product, they just pounded on a probably confused sales team which, despite the additional efforts, did not do any better than it would have done otherwise.


I wonder if the interest rate drop by the fed and perhaps their overall outlook on the global market also impacted the stock? A slowing economy usually hits the tourism industry first and also impacts luxury products.



TravelTime said:


> Keep in mind they may end the existence of mandatory traders so people can't buy them resale anymore. Also they can change any of these programs any time. We can resist the future direction or be flexible and hope the new program is has some perks to legacy owners.





sjsharkie said:


> This has been discussed before on another thread.  It also says the club operator can change the program and its rules at any time.  There also is a clause somewhere in there that states that the club can change its rules and force re-recording by the resort as necessary.
> 
> I know I differ from other people, but to me it is clear that the mandatory designation can be changed (though it would open up MVCI to potential legal exposure/costs and also cause owner blowback that might damage their brand/future sales).
> 
> ...


While the club operator can change the club terms, any change they make impacts everyone in the club. Mandatory and voluntary are not defined in the club program terms. They are a product of the resort. Change the terms to negatively impact the 5% of owners that have mandatory resale weeks and you also negatively impact the 95% of the owners that bought direct from the developer. They can't simply say "no more mandatory". It isn't that easy.


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## CPNY (Aug 1, 2019)

JIMinNC said:


> If you wanted to go to one of the international locations that MVC can't put into the trust and thus still sells as weeks, then it might just be cheaper to buy one of those weeks direct from MVC since when you do that, it comes enrolled anyway. You basically pay a developer-level price in the $25K to $40K+ range, but that might be cheaper than buying an external resale and then still having to buy at least 3000 points ($33K+) to enroll the week. And there's no guarantee when or if they will offer such a promotion and if the points buy is still the same as it has been in the past.
> 
> Aruba 1BR/2BR point values:
> 
> ...


So you get preferential reservations at your home resort or book others in DC? Makes a lot of sense to do that if you plan on going to Aruba. When booking home resort do you have to exchange in II for a different week than you own? I’ve thought about Aruba but it could also be worth it to pick up a high trade value resale week in vistana. I never exchange my star option weeks and wouldn’t mind a lower maint fee week to trade with and start visiting other resorts.


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## CPNY (Aug 1, 2019)

JIMinNC said:


> If you wanted to go to one of the international locations that MVC can't put into the trust and thus still sells as weeks, then it might just be cheaper to buy one of those weeks direct from MVC since when you do that, it comes enrolled anyway. You basically pay a developer-level price in the $25K to $40K+ range, but that might be cheaper than buying an external resale and then still having to buy at least 3000 points ($33K+) to enroll the week. And there's no guarantee when or if they will offer such a promotion and if the points buy is still the same as it has been in the past.
> 
> Aruba 1BR/2BR point values:
> 
> ...


Awesome this is helpful. Buying Aruba from developer might be a good option. Although my mother was just in Aruba and went on a presentation. They were offering her a week for 18K or a little less. I think it was a one bedroom. I’ll have to book a week and visit a presentation and see what they offer me


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## sjsharkie (Aug 1, 2019)

dioxide45 said:


> While the club operator can change the club terms, any change they make impacts everyone in the club. Mandatory and voluntary are not defined in the club program terms. They are a product of the resort. Change the terms to negatively impact the 5% of owners that have mandatory resale weeks and you also negatively impact the 95% of the owners that bought direct from the developer. They can't simply say "no more mandatory". It isn't that easy.


No argument here.  My only point was that just because it was recorded in the CC&Rs of all of the mandatory resorts, does not make it forever so.

I agree that the impact and blowback to resale and direct mandatory owners alike make this unlikely from a company like Marriott.

-ryan


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## CPNY (Aug 1, 2019)

sjsharkie said:


> No argument here.  My only point was that just because it was recorded in the CC&Rs of all of the mandatory resorts, does not make it forever so.
> 
> I agree that the impact and blowback to resale and direct mandatory owners alike make this unlikely from a company like Marriott.
> 
> -ryan


There is almost def an “out” on the part of the management  company. They could always leave the resort out of any new program. If they created a 3rd program and left certain resorts out like SVV then the only way for mandatory SVV owners to have access would be to buy in. They could keep the VSN the same and leave resorts like SVV there in which case mandatory owners wouldn’t have access to a new program or product. They may add resorts like Westin Kaanapali, St John, harborside and Kierland in which case those owners would have access to any program those resorts are part of the network. If something like that happened then I’d be upset I sold my HRA lol. Luckily I have two more in the family lol. I just don’t think they would make a 3rd program and leave one resort out of. I think they would just bite the bullet and add them all. Of course that’s all hypothetical on what they could do in regards to what’s written In the CC&R’s


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## JIMinNC (Aug 1, 2019)

dioxide45 said:


> In order to sell a new combined product, they either have to start adding Vistana weeks to the MVC DC Trust or create a new trust where they throw in Vistana and Marriott weeks. Odd that they would go either of these routes as they still pile a ton of Nanea inventory in to the Westin Flex trust. It will be interesting to see how they manage to sell a single combined product.



Given that it sounds like a true integrated product may still be quite a ways away, perhaps they put the Nanea inventory in Westin Flex to make that product more attractive. They can't just put legacy VSE sales on hold until the new "whatever" is created, so maybe it make sense to consolidate as much inventory as possible into the Westin and Sheraton flex trusts to sell as much as they can until their new thing comes. They'll have to accommodate all current trusts in whatever integrated exchange system they devise - whether it's the DC or something new - so at least try to make what they are selling now more attractive. If it's late 2020 or 2021 before a truly integrated product is launched, they have to still sell what they have in the interim. 



> I wonder if the interest rate drop by the fed and perhaps their overall outlook on the global market also impacted the stock? A slowing economy usually hits the tourism industry first and also impacts luxury products.



Yesterday, when the market dropped 300+ points after the Fed cut and Powell's press conference, VAC stock traded narrowly in the $102-$103 range all day. Today after the earnings announcement, while the overall market was recovering over 300 points up, VAC stock fell over 6% in the first hour or so of trading. Since it was moving opposite to most stocks, I would say that was mainly a reaction to the disappointing earnings. The stock recovered about half of the 6% decline by noon, but then, when the White House announced the new China tariffs and the market fell over 600 points, VAC went down with everything else and closed at $96.69, down $5.54 (5.4%) on the day.


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## pchung6 (Aug 1, 2019)

JIMinNC said:


> Yesterday, when the market dropped 300+ points after the Fed cut and Powell's press conference, VAC stock traded narrowly in the $102-$103 range all day. Today after the earnings announcement, while the overall market was recovering over 300 points up, VAC stock fell over 6% in the first hour or so of trading. Since it was moving opposite to most stocks, I would say that was mainly a reaction to the disappointing earnings. The stock recovered about half of the 6% decline by noon, but then, when the White House announced the new China tariffs and the market fell over 600 points, VAC went down with everything else and closed at $96.69, down $5.54 (5.4%) on the day.



I just unloaded my VAC shares a while ago. I never like VAC ILG integration. Will load some HGV or WYND soon, probably HGV first.


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## JIMinNC (Aug 1, 2019)

CPNY said:


> So you get preferential reservations at your home resort or book others in DC? Makes a lot of sense to do that if you plan on going to Aruba. When booking home resort do you have to exchange in II for a different week than you own? I’ve thought about Aruba but it could also be worth it to pick up a high trade value resale week in vistana. I never exchange my star option weeks and wouldn’t mind a lower maint fee week to trade with and start visiting other resorts.



When booking your home resort with an MVC legacy week, you can book any week in your season through MVC. So if you own Platinum, any Platinum week can be booked. If you want to go during Gold season, though, you'll need to convert to DC points or deposit in II and trade.



CPNY said:


> Awesome this is helpful. Buying Aruba from developer might be a good option. Although my mother was just in Aruba and went on a presentation. They were offering her a week for 18K or a little less. I think it was a one bedroom. I’ll have to book a week and visit a presentation and see what they offer me



Yeah, I might be wrong on my developer pricing. I know some of the 2BR units are north of $35K, but maybe a Gold 1BR is less than $20K. The key is, if you buy an Aruba week from MVC, it comes already enrolled, so you don't have to buy a Trust point package to enroll it.


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## JIMinNC (Aug 2, 2019)

pchung6 said:


> I just unloaded my VAC shares a while ago. Will load some HGV or WYND soon, probably HGV first.



Yeah, HGV had a BAD earnings call today. Sales dropped off the cliff because they've got a shortage of high-value weeks to sell in Hawaii and a few other places and won't have the new stuff online until 2020. They took down their full year guidance to flat to down 3% on sales. Stock tanked 14% to $28. Said fundamentals were good, just nothing good to sell in a few key places.


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## pchung6 (Aug 2, 2019)

JIMinNC said:


> Yeah, HGV had a BAD earnings call today. Sales dropped off the cliff because they've got a shortage of high-value weeks to sell in Hawaii and a few other places and won't have the new stuff online until 2020. They took down their full year guidance to flat to down 3% on sales. Stock tanked 14% to $28. Said fundamentals were good, just nothing good to sell in a few key places.



I know. Isn't it good time to buy HGV? I'm still waiting and observing. Last year, I bought GE @ $7 when everyone said it will go bankrupt, then sold at $10. I like to get in when everyone is scared.


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## Steve Fatula (Aug 2, 2019)

CPNY said:


> It seems buying resale week at say Aruba or somewhere you really want to go, then enroll it with a developer purchase when they offer those deals seems like the most economical way to go? How many points is a 1 bedroom Aruba week worth? Is there a chart to reference?



You can do the same in Europe where you can get a better bang for the buck than Aruba. I bought a week there 2? Years ago from Marriott on purpose. It came enrolled and that's what I wanted, the points. Might never go there. I like the points system a lot along with the ownership level perks which I take advantage of all the time. You do not get those with resale, very easily at least. This was way less expensive than a resale week and a purchase to enroll it. Weeks don't work for us any more being retired, don't like multiples of 7 for the most part! But points + weeks allow us to still use those weeks, we just extend them. My semi cheap Spain week was 2750 points value, which then allowed me 60 day discounts of 30% on points cost for stays. Again, being retired, very flexible.


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## Dean (Aug 2, 2019)

CalGalTraveler said:


> If they make us buy more DC points to enroll, that will be dead in the water. Will simply stick with StarOptions, pick up another mandatory trader and use what we have. IMO I am more excited about trading Westins than MVC and can get that via SOs today. Such a move would extend the life of the SO inventory pool significantly because VSN owners would do nothing.


I think that's true for most here but timeshares aren't sold very often to those as knowledgeable as this group.  They're able to sell routinely to members and non members before the merger including trust points to enroll or increase their level, the same will likely be true going forward no matter what the program.  If not, we're all in trouble owning.  



pchung6 said:


> If they could end the mandatory, they would have already done that. They just can't. Can I just change something on your house deed because it will benefit me?


They likely won't but I'm sure they could if they chose.  All POS I've ever seen have far less protections than would a deed or standard contract.  Even for your deed there's a risk as I was just talking to my aunt who had part of her property annexed by the airport by her.  



CalGalTraveler said:


> It will be up to the lawyers to argue but one thing is for sure - there would be significant blow-back if they forced a change or took draconian measures to limit. This would result in legal disputes and extreme customer dissatisfaction.
> 
> One data point from the call is very relevant. They said that only _one third of contract sales are from new buyers_. This means two things:
> 
> ...


If Wyndham and Bluegreen and Diamond can sell options worth pennies on the dollar, I'm sure MVC can sell as well.  I'd say 1/3 is very high as members tend to be better educated than non members.  Plus I'd expect the % to shift toward members with the expanded market to maybe close to 50/50, maybe more for a few years with the new horizon for many of the members.  



CPNY said:


> I think it is in Orlando. Is the timeshare capitol of the world lol


Same for hotels, most in the US when you look at the area as a whole, LV has modestly more than just Orlando IIRC.


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## DannyTS (Aug 2, 2019)

JIMinNC said:


> I know it's sort of heresy for a TUGger to buy something from a developer, but you may not know that in the MVC DC Points program, there are certain developer purchases that can compare reasonably favorably in price to resale points purchases. They key is, you have to specifically want *Points* and not have your needs met by a resale week. Since MVC has never had the equivalent of a Vistana Mandatory week, someone wanting to play in the MVC points system has no choice but to pay MVC some significant $$$, even for true resale points.
> 
> For example, an external, third-party resale purchase of DC Points probably averages about $3.50 to $4/point to pass ROFR. Some have gotten deals past ROFR for less than that, but some of those may be eBay sellers with "creative" ROFR submittals. But if you assume, an average $3.50 - $4/point price, plus the additional $3/point MVC activation fee, then a reasonable estimate of total resale points cost is $6.50 to $7.00 per point.
> 
> MVC has bundled deals that include an enrolled resale week purchased direct from MVC Resales (acting as the broker), coupled with a bundle of DC Points (generally at least equal to the point value of the resale week) at the developer price. Another option is buying a resale week from MVC in an international location like Aruba, St Kitts, or Spain. Those international weeks come enrolled with DC Points, but are truly developer-priced. They also from time to time offer the ability for someone with already-owned external resale weeks to enroll those weeks in the points program if you buy a bundle of Trust points to add to your ownership. All of those options can often result in a total price per point that is not much different than the full $6.50 to $7/point cost of resale points. An informed TUGger can buy from MVC and get something that is comparable in price to resale *points*.


I believe that those that like points but are not comfortable with Vistana mandatory should look at HGVC resale before buying DC points. HGVC treats resale owners fairly and they also have some great resorts.


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## JIMinNC (Aug 2, 2019)

Dean said:


> I'd say 1/3 is very high as members tend to be better educated than non members.  Plus I'd expect the % to shift toward members with the expanded market to maybe close to 50/50, maybe more for a few years with the new horizon for many of the members.



I’m not sure what you mean by this, but the sales have always been skewed towards existing owners. Existing owners have experience with the product, most are satisfied (90+%), and since they stay at the properties they represent a steady source of prospects. The number I had always heard them quote was 40% to 45% first time buyers and 55-60% existing owners, so the quote from this call that only 1/3 of sales were to first timers represents an even heavier skew towards existing owners.

The fact they said that 45% of tours were first timers but only 1/3 of sales implies a much lower close rate for first timers (versus 55% of tours and 67% of sales for established owners). That’s not all that surprising though, since first timers don’t have the built-in advantages I noted above. 

I agree that the impact of an eventual integrated program might at least temporarily shift the mix even more towards existing owners, but that wouldn’t move it towards 50-50, but would instead cause it to shift more towards 70-30 or 75-25 in favor of existing owners. 

One thing that just occurred to me is I wonder if the reason the 2Q sales mix was 2/3 existing owners versus the typical 55-60% may have been partly due to the post-2010 enrollment promo that ran for the entire quarter. That could have enticed more owners than normal to buy.


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## JIMinNC (Aug 2, 2019)

DannyTS said:


> I believe that those that like points but are not comfortable with Vistana mandatory should look at HGVC resale before buying DC points. HGVC treats resale owners fairly and they also have some great resorts.



If the only factor were the design of the points program, then I would agree. In fact, I would probably rate both HGVC and Vistana Mandatory above the DC for basic usability, fairness, and design. But a prospective buyer should also consider locations, and MVC has a much better mix of location options than HGVC - more Maui, Kauai, more Caribbean, more availability in FL outside of Orlando, more Hilton Head, etc. The Vistana locations come closer to MVC in variety but still lack Hilton Head, Aruba, Oahu, beachfront south shore Kauai, etc. All MVC really lacks is Mexico. 

So it’s not just a factor of program design but where you want to go.


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## DannyTS (Aug 2, 2019)

JIMinNC said:


> If the only factor were the design of the points program, then I would agree. In fact, I would probably rate both HGVC and Vistana Mandatory above the DC for basic usability, fairness, and design. But a prospective buyer should also consider locations, and MVC has a much better mix of location options than HGVC - more Maui, Kauai, more Caribbean, more availability in FL outside of Orlando, more Hilton Head, etc. The Vistana locations come closer to MVC in variety but still lack Hilton Head, Aruba, Oahu, beachfront south shore Kauai, etc. All MVC really lacks is Mexico.
> 
> So it’s not just a factor of program design but where you want to go.


Ok, but I think that a Vistana or an MVC trader plus HGVC would cover a lot. Not perfect but way more cost effective both upfront cost and MF with little to no loss when the time comes to sell. Not to mention you would have access to both RCI and II.
If you travel a lot to Maui you can also buy resale Vistana or Marriott plus HGVC.


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## davidvel (Aug 2, 2019)

Dean said:


> I think that's true for most here but timeshares aren't sold very often to those as knowledgeable as this group.  They're able to sell routinely to members and non members before the merger including trust points to enroll or increase their level, the same will likely be true going forward no matter what the program.  If not, we're all in trouble owning.
> 
> They likely won't but I'm sure they could if they chose.  All POS I've ever seen have far less protections than would a deed or standard contract.  Even for your deed there's a risk as I was just talking to my aunt who had part of her property annexed by the airport by her.
> 
> ...


You lost me at: Marriott is going to get the government to exercise eminent domain to get rid of mandatory.


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## JIMinNC (Aug 2, 2019)

DannyTS said:


> Ok, but I think that a Vistana or an MVC trader plus HGVC would cover a lot. Not perfect but way more cost effective both upfront cost and MF with little to no loss when the time comes to sell. Not to mention you would have access to both RCI and II.
> If you travel a lot to Maui you can also buy resale Vistana or Marriott plus HGVC.



No question that deeded weeks and II or RCI trading can provide that additional location access more cost effectively, but that’s not the same as a points system. We don’t use RCI or II any more because we don’t like the trading process, but for someone who doesn’t mind the hassles and limitations, trading can be a lot cheaper than playing in points. Trading isn’t for everyone though.


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## DannyTS (Aug 2, 2019)

JIMinNC said:


> No question that deeded weeks and II or RCI trading can provide that additional location access more cost effectively, but that’s not the same as a points system. We don’t use RCI or II any more because we don’t like the trading process, but for someone who doesn’t mind the hassles and limitations, trading can be a lot cheaper than playing in points. Trading isn’t for everyone though.


Points aren't perfect either. Certain dates/resorts can be difficult to book. Even on the HGVC side, I had to "walk" a reservation in order to book Italy for a summer week. But all I was saying, one should look at these options before spending 30 or 40k just to have a access to DC.  If spending that kind of money to get into DC makes sense in their situation that is OK but at least they also looked at alternatives.


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## bazzap (Aug 2, 2019)

JIMinNC said:


> If the only factor were the design of the points program, then I would agree. In fact, I would probably rate both HGVC and Vistana Mandatory above the DC for basic usability, fairness, and design. But a prospective buyer should also consider locations, and MVC has a much better mix of location options than HGVC - more Maui, Kauai, more Caribbean, more availability in FL outside of Orlando, more Hilton Head, etc. The Vistana locations come closer to MVC in variety but still lack Hilton Head, Aruba, Oahu, beachfront south shore Kauai, etc. All MVC really lacks is Mexico.
> 
> So it’s not just a factor of program design but where you want to go.


And Vistana has no resorts at all in Europe or Asia either - is that right?


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## CPNY (Aug 2, 2019)

JIMinNC said:


> If the only factor were the design of the points program, then I would agree. In fact, I would probably rate both HGVC and Vistana Mandatory above the DC for basic usability, fairness, and design. But a prospective buyer should also consider locations, and MVC has a much better mix of location options than HGVC - more Maui, Kauai, more Caribbean, more availability in FL outside of Orlando, more Hilton Head, etc. The Vistana locations come closer to MVC in variety but still lack Hilton Head, Aruba, Oahu, beachfront south shore Kauai, etc. All MVC really lacks is Mexico.
> 
> So it’s not just a factor of program design but where you want to go.


You touch upon the burning question of “where should I buy”. Location location location imo. Buy where you want to go. With that being said, I absolutely love the vistana mandatory program for usability, fairness and design. MVC has many more options in location and that is a HUGE plus! The biggest drawback to HGVC is imo locations, just not enough where I’d want to go. I think it was you who said buy an international resale week through MVC and get the points benefit. I assume when you elect to convert the week to points, you can still book at 12 months? That’s a huge benefit that even vistana doesn’t have. It seems to me that the true winner in all of this is the international weeks purchased through developer that you can go to your home resort or elect to use points if you can book any MVC at 12 months. If say harborside was enrolled in some joint program, I’d highly consider buying back in for that perk. The maint fee to own there is absurd.


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## CPNY (Aug 2, 2019)

bazzap said:


> And Vistana has no resorts at all in Europe or Asia either - is that right?


Correct. Tbh Asia to me isn’t that beneficial. I’ve done 5 star resorts traveling through SE Asia and have paid less than what maint fee would have been. But correct there is no Europe presence. Another situation for me personally that makes no difference as I prefer to use airbnb in Europe.


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## JIMinNC (Aug 2, 2019)

DannyTS said:


> Points aren't perfect either. Certain dates/resorts can be difficult to book. Even on the HGVC side, I had to "walk" a reservation in order to book Italy for a summer week. But all I was saying, one should look at these options before spending 30 or 40k just to have a access to DC.  If spending that kind of money to get into DC makes sense in their situation that is OK but at least they also looked at alternatives.



Couldn't agree more. Everything has its advantages/disadvantages, it's all about finding the option that fits your purposes the best.

I should probably ask this on the HGVC board, but we're going to try to walk an HGVC Italy reservation of our own when the reservation window for or dates in fall 2020 opens this December. When you walked yours, did you start on the first day that would give you your desired check-in day, or did you start a few days early to get the string going?


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## CalGalTraveler (Aug 2, 2019)

JIMinNC said:


> If the only factor were the design of the points program, then I would agree. In fact, I would probably rate both HGVC and Vistana Mandatory above the DC for basic usability, fairness, and design. But a prospective buyer should also consider locations, and MVC has a much better mix of location options than HGVC - more Maui, Kauai, more Caribbean, more availability in FL outside of Orlando, more Hilton Head, etc. The Vistana locations come closer to MVC in variety but still lack Hilton Head, Aruba, Oahu, beachfront south shore Kauai, etc. All MVC really lacks is Mexico.
> 
> So it’s not just a factor of program design but where you want to go.



Love this affirmation of what has been our TS strategy thus far: *Vistana Mandatory PLUS HGVC *makes a terrific combo:

*1) Complementary Location Breadth* (Vistana - Caribbean, Maui, Kauai, Colorado, Mexico + HGVC - Oahu, BI, Mexico, NYC (5 properties), Florida Gulf and Atlantic Coasts, Barbados (Crane), Japan, Chicago, Charleston, Portugal, Italy, Scotland + RCI trades for points/short stays on certain properties + II)
*
2) Points:* Access to entire system inventory because every property is automatically enrolled (x Vistana Voluntary resale), book short stays with any property in the system during 9/8 mo points inventory that hasn't been reserved during owner's home week.
*
3) Deeded ownership *- you know what you own, no/low chance of devaluing the points, no potential to play games by switching valuable inventory out of the trust due to low transparency as to what the trust owns. MVC weeks enrollment also mitigates this issue.


*What this strategy lacks vs. MVC:*

1) Inability to rent points. This is a valuable feature of DC and enrolled weeks.
2) Aruba, Spain, France, London, SF, Tahoe, Costa Rica and Phuket but can trade into MVC via II. By week only. Not instant trade.


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## JIMinNC (Aug 2, 2019)

CalGalTraveler said:


> Love this affirmation of what has been our TS strategy thus far: *Vistana Mandatory PLUS HGVC *make a great combo:
> 
> *1) Complementary Location Breadth* (Vistana - Caribbean, Maui, Kauai, Colorado, Mexico + HGVC - Oahu, BI, Mexico, NYC (5 properties), Florida Golf and Atlantic Coasts, Barbados (Crane), Japan, Chicago, Charleston, Portugal, Italy, Scotland + RCI trades for points/short stays on certain properties + II)
> *
> ...



That combination actually does come very close to offering a similar collection of resorts as MVC, plus a simpler, more resale-friendly points system. There are still some nuanced advantages to MVC over the VSE-Mandatory+HGVC option that could be important to some:

People who prefer the Maui Ocean Club location in south Kaanapali
People who want a true beach-front option on Kauai
People who want more options in Hilton Head
People who want easier to book locations in Florida outside of Orlando (the HGVC affiliates can be really difficult)
People who want multiple Caribbean island locations (Aruba, St Thomas, St Kitts)
Maybe others
But having said that, HGVC plus VSE Mandatory comes pretty close.

But I could also make a case that HGVC plus MVC is also a complete, complementary pairing, albeit at a higher cost due to the high cost of the MVC points system:

MVC gives you multiple options on Kauai, plus Kaanapali Maui, non-Waikiki Oahu; HGVC gives you Waikiki, multiple Big Island options
MVC offers easier to book options in SW/SE Florida; HGVC offers many options in NYC
MVC offers more Caribbean options; HGVC offers more options in Las Vegas
MVC offers Spain and France; HGVC offers Italy and Scotland
MVC offers Arizona and Palm Desert; HGVC offers Charleston and Los Cabos
Both offer Park City and Colorado, but MVC also offers Lake Tahoe
All in, there are multiple ways to make the systems work. We were originally attracted to MVC due to Hilton Head, Maui, and Kauai, so that became our core holding. We added HGVC to complement that. As a result, Westin/Sheraton offer less incremental value for us, but if any future exchange program with MVC can be accessed in a cost effective manner, we would certainly love to visit many of those places, if for no other reason than a change of pace and a new venue.


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## CalGalTraveler (Aug 2, 2019)

@JIMinNC That's a great assessment.

I would also add that HGVC provides access to RCI in addition to II which expands options. Although RCI has a number of junk properties, HGVC can trade for:

* 1 bdrm Disney Orlando (limited via OGS)
* Cabo and PV trades at high end resorts with no mandatory AI
* Welk (Tahoe, Escondido, Cabo etc.). Welk recently moved to RCI.
* Disneyland via Worldmark Anaheim, Peacock Suites (Shell), Dolfin Cove
* Tradewinds Cruises (cost-effective trades into Fiji, French Poly, Caribbean)
* Worldmark/Wyndham system (lower quality but some locations adjacent to National Parks.)

HGVC also offers Portugal (Algarve), Legoland/Socal Beaches via Carlsbad properties, and properties in Japan (Mt Fuji), Okinawa (2022). Given HGVC's substantial Asian customer base, I would expect more properties in the Pacific Rim including SF.

re: Multiple Caribbean Islands you need to pick your favorites: HGVC + Vistana offers (Barbados, St. John, Bahamas) or plus MVC (St. Thomas, St. Kitts, Aruba)

Ski weeks in CO and Park City are limited in HGVC so augmenting with either MVC or Vistana enables more booking options.


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## JIMinNC (Aug 2, 2019)

CalGalTraveler said:


> @JIMinNC That's a great assessment.
> 
> I would also add that HGVC provides access to RCI in addition to II which expands options. Although RCI has a number of junk properties, HGVC can trade for 1 bdrm Disney Orlando (limited via OGS), Cabo and PV trades at high end resorts with no mandatory AI, Disneyland via Worldmark Anaheim, Peacock Suites (Shell), Tradewinds Cruises (cost-effective trades into Fiji, French Poly, Caribbean), plus the Worldmark/Wyndham system (lower quality but some locations adjacent to National Parks.)
> 
> ...



True, a combo of either MVC & HGVC or VSE & HGVC does offer access to both II and RCI, but I never really tend think about that option since we've pretty much made the decision to avoid traditional trading. If we could just go online and book decent stuff like we can with points, I would love the additional options offered by RCI and II; but we hate the uncertainty and waiting involved with the ongoing searches usually required to get decent stuff.

But you bring up a good point, I don't think I've ever used the HGVC portal to shop RCI. Maybe I ought to play with it a bit. We've been trying to use all of our left-over RCI TPUs from our pre-MVC/HGVC ownership for several years now. Finally used them all except for 12 leftovers that expire tin November. Can't do much with 12 TPUs, so once those expire, we'll close our old RCI account and just have the HGVC RCI account.


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## CalGalTraveler (Aug 2, 2019)

JIMinNC said:


> But you bring up a good point, I don't think I've ever used the HGVC portal to shop RCI. Maybe I ought to play with it a bit. We've been trying to use all of our left-over RCI TPUs from our pre-MVC/HGVC ownership for several years now. Finally used them all except for 12 leftovers that expire tin November. Can't do much with 12 TPUs, so once those expire, we'll close our old RCI account and just have the HGVC RCI account.



Yes, RCI has properties that are designated as RCI points for shorter stays via the HGVC portal. These points properties are not available via OGS so you need to go into the RCI system and search your favorite resorts frequently. You then book immediately. I have seen Crane Barbados in points for short stays (mainly shoulder season), but also NYC (HGVC and Manhattan Club) via points. A downside is that many of the properties in RCI including HGVC are now charging resort fees which can add to your cost vs. internal trading.

I also forgot to mention that HGVC has Washington DC (bHC) to see the museums and national monuments. Not sure if MVC has this. But MVC has Boston. Great combos, and it depends where one wants to go the most.


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## Dean (Aug 2, 2019)

JIMinNC said:


> I’m not sure what you mean by this, but the sales have always been skewed towards existing owners. Existing owners have experience with the product, most are satisfied (90+%), and since they stay at the properties they represent a steady source of prospects. The number I had always heard them quote was 40% to 45% first time buyers and 55-60% existing owners, so the quote from this call that only 1/3 of sales were to first timers represents an even heavier skew towards existing owners.
> 
> The fact they said that 45% of tours were first timers but only 1/3 of sales implies a much lower close rate for first timers (versus 55% of tours and 67% of sales for established owners). That’s not all that surprising though, since first timers don’t have the built-in advantages I noted above.
> 
> ...


Basically saying that it may be that the % of sales to current members may be higher going forward at least for a while, because there will be a larger # and this will be something new to them.  Once whatever system has been in place for a while, that will likely settle down.



davidvel said:


> You lost me at: Marriott is going to get the government to exercise eminent domain to get rid of mandatory.


I was merely pointing out that a POS does not give the protection of a deed and that even a deed is not absolute protection.


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## JIMinNC (Aug 2, 2019)

CalGalTraveler said:


> HGVC has access via the portal to RCI weeks (via OGS) but also properties that are designated as RCI points for shorter stays. These points properties are not available via OGS so you need to go into the RCI system and search your favorite resorts. I have seen Crane Barbados in points for short stays (mainly shoulder season), but also NYC (HGVC and Manhattan Club) via points. The only downside is that many of the properties including HGVC are now charging resort fees which can add to your cost vs. internal trading.
> 
> I also forgot to mention that HGVC has Washington DC (bHC) to see the museums and national monuments. Not sure if MVC has this.



MVC has the Pulse Mayflower in DC


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## bazzap (Aug 2, 2019)

CPNY said:


> Correct. Tbh Asia to me isn’t that beneficial. I’ve done 5 star resorts traveling through SE Asia and have paid less than what maint fee would have been. But correct there is no Europe presence. Another situation for me personally that makes no difference as I prefer to use airbnb in Europe.


Well I guess whatever suits.
I just wouldn’t view airbnb as a comparable type of vacation - equally valid as an option but totally different.
And in SE Asia, especially Thailand, I am always looking for other options to extend our MVC stays so I would really like to know of some 5* resorts where you can pay less than the ~$1200 per week MF of Phuket Beach Club
(you can probably get it cheaper, but it is nearly double that on expedia with comparable places at least similarly priced)
https://www.expedia.com/Marriotts-P...315&top_cur=USD&rfrr=HSR&pwa_ts=1564762758231


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## CPNY (Aug 2, 2019)

bazzap said:


> Well I guess whatever suits.
> I just wouldn’t view airbnb as a comparable type of vacation - equally valid as an option but totally different.
> And in SE Asia, especially Thailand, I am always looking for other options to extend our MVC stays so I would really like to know of some 5* resorts where you can pay less than the ~$1200 per week MF of Phuket Beach Club
> (you can probably get it cheaper, but it is nearly double that on expedia with comparable places at least similarly priced)
> https://www.expedia.com/Marriotts-Phuket-Beach-Club.h860838.Hotel-Information?chkin=12/6/2019&chkout=12/13/2019&regionId=6270218&destination=Mai+Khao,+Phuket+(province),+Thailand&swpToggleOn=true&selected=860838&rm1=a4&x_pwa=1&sort=recommended&top_dp=315&top_cur=USD&rfrr=HSR&pwa_ts=1564762758231


I don’t travel during school breaks. But height of dry season in feb I’m seeing resorts around 1,100. (1,074) for Marriott resort and spa Patong beach club on hotels . Com 


Saw another, cape Dara in pattaya. Plus, deals can be had. I lucked out with a brand new hotel and paid 600 for the whole week, the resort sells for 5,000 for the week. Granted, they had just opened two months earlier but still. Deals can be had lol. That was the best little boutique resort. Na nirand romantic boutique hotel in Chiang mai. It was amazing. Have you ventured to chiang mai after the beach? Or go before.


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## bazzap (Aug 2, 2019)

CPNY said:


> I don’t travel during school breaks. But height of dry season in feb I’m seeing resorts around 1,100. (1,074) for Marriott resort and spa Patong beach club on hotels . Com
> 
> 
> Saw another, cape Dara in pattaya. Plus, deals can be had. I lucked out with a brand new hotel and paid 600 for the whole week, the resort sells for 5,000 for the week. Granted, they had just opened two months earlier but still. Deals can be had lol. That was the best little boutique resort. Na nirand romantic boutique hotel in Chiang mai. It was amazing. Have you ventured to chiang mai after the beach? Or go before.


OK thanks.
I understand those prices for more typical hotel rooms, the suites accommodating up to 4 with lounge, kitchen... seem to be a lot more expensive.
I wouldn’t choose to return to Patong or Pattaya, but In Chiang Mai taking a look at Na Nirand it looks a really good option I will check it out further.


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## m61376 (Aug 5, 2019)

Interesting reading everyone's thoughts here.
I think the biggest hurdle going forward will be attracting millennials, who tend to prefer variety and are more globally focused. AirBNB is hugely successful, and offers something particularly well suited to European vacations- location versus resort amenities. I think inclusion of rental properties in desirable city locations, which has been started albeit on a limited and costly basis in MVC]s Exploration program or similar (not sure) is the key for attracting Millenials and GenXers. Timeshares offer great resort destination vacations, but for now AirBNB is filling a huge void. However, if a combined program could offer similarly accessible properties in major global cities. priced competitively and with the security of the Marriott or Westin brand, that would be a huge plus.

For example, we recently went to London, 3 generations and 7 people. Finding a centrally located hotel room for 3 kids and 2 adults was nearly impossible (there was one Marriott that was $$), and, curiously, the concept of guaranteed connecting rooms generally escaped most properties. I booked an AirBNB, although with angst, going overseas with family and going to an "unknown." Interestingly, the smart host had a couple of flats in the same building; we booked a 3BR that was perfect and ideally located. These are the type of properties which, IMHO, would generate sales to new buyers looking for more global experiences. 

While there are some international properties, for the most part they are resorts not centrally located within the major cities. Frankly, when traveling to London, etc., it's a sightseeing vacation, so I want a nice, clean place to stay, but the most important thing to me, anyway, is the location. If I was a resort trip the traditional timeshare locations are great, but for those seeking diversity in travel, I personally think they need to offer more AirBNB type properties, with central locations, space for families, kitchen and laundry facilities, but without resort amenities. 20 or 30 years ago it was unusual for parents to travel overseas with young children, while today it is much more commonplace, and European hotels, for the most part, haven't changed their capacity limitations. There's a bog niche needing to be fulfilled, which at least partially accounts for the quick growth of AirBNB. The big advantage they'd have over individual AirBNB properties is name recognition, since there's that natural insecurity when booking an AirBNB.


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## DannyTS (Aug 5, 2019)

the stock is down again today, currently at $85.31, down from about $104 before the earnings call. Ouch! HGV is actually in the same boat so it is not just MVW.


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## CPNY (Aug 5, 2019)

m61376 said:


> Interesting reading everyone's thoughts here.
> I think the biggest hurdle going forward will be attracting millennials, who tend to prefer variety and are more globally focused. AirBNB is hugely successful, and offers something particularly well suited to European vacations- location versus resort amenities. I think inclusion of rental properties in desirable city locations, which has been started albeit on a limited and costly basis in MVC]s Exploration program or similar (not sure) is the key for attracting Millenials and GenXers. Timeshares offer great resort destination vacations, but for now AirBNB is filling a huge void. However, if a combined program could offer similarly accessible properties in major global cities. priced competitively and with the security of the Marriott or Westin brand, that would be a huge plus.
> 
> For example, we recently went to London, 3 generations and 7 people. Finding a centrally located hotel room for 3 kids and 2 adults was nearly impossible (there was one Marriott that was $$), and, curiously, the concept of guaranteed connecting rooms generally escaped most properties. I booked an AirBNB, although with angst, going overseas with family and going to an "unknown." Interestingly, the smart host had a couple of flats in the same building; we booked a 3BR that was perfect and ideally located. These are the type of properties which, IMHO, would generate sales to new buyers looking for more global experiences.
> ...



I’ve been speaking to that point for a while. I’m in complete agreement with you. First, as someone who’s pre-millennial (not by much) I made my first TS purchase at a resort I loved at 23.  This was well before the internet on your phone. There were vacation home rental specialists but nothing anywhere near the scope of an airbnb. As I travel now, almost all of my travels are with airbnb or vacation home rentals, unless I’m going to a beach destination. The millennial doesn’t want a TS or “run of the mill” resort. The instagram crowd wants gram-able destinations. I’m glad to see Marriott get into the vacation home rental game, it would be good to see vacation ownership play a role however I feel it would be more expensive that booking directly through the owner. If MVC really wants a third product it would be points being able to be used with an airbnb style of booking. Maybe airbnb should begin a vacation club ownership. Although that would be a huge gamble being that it doesn’t own any of the accommodations. 

I’m glad to hear your airbnb experience wasn’t that bad. It’s my preferred choice when traveling to many cities or ski destinations.


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## JIMinNC (Aug 5, 2019)

CPNY said:


> I’ve been speaking to that point for a while. I’m in complete agreement with you. First, as someone who’s pre-millennial (not by much) I made my first TS purchase at a resort I loved at 23.  This was well before the internet on your phone. There were vacation home rental specialists but nothing anywhere near the scope of an airbnb. As I travel now, almost all of my travels are with airbnb or vacation home rentals, unless I’m going to a beach destination. The millennial doesn’t want a TS or “run of the mill” resort. The instagram crowd wants gram-able destinations. I’m glad to see Marriott get into the vacation home rental game, it would be good to see vacation ownership play a role however I feel it would be more expensive that booking directly through the owner. If MVC really wants a third product it would be points being able to be used with an airbnb style of booking. Maybe airbnb should begin a vacation club ownership. Although that would be a huge gamble being that it doesn’t own any of the accommodations.
> 
> I’m glad to hear your airbnb experience wasn’t that bad. It’s my preferred choice when traveling to many cities or ski destinations.



What would be the ideal product would be a partnership between AirBnB and Marriott Vacations Worldwide or Hilton Grand Vacations. AirBnB already has created that market, so not sure MVW or HGV should try to re-invent the wheel, but if one of them could partner with AirBnB to have a selection of higher-quality AirBnB locations which could carry the "Marriott Approved", "Westin Approved", or "Hilton Approved" label. To get that label, they would need to meet MVW or HGV standards. That's an AirBnB product I might be willing to try. Until then, I'll stick to hotels unless I'm in a place where Marriott International, Hilton Hotels, Hyatt, or one of the others doesn't have a presence.

The only thing I think they should do is be careful to avoid AirBnB locations that are in predominantly residential areas. Investors buying up houses and condos for short term rentals is creating problems in many neighborhoods and creating blowback. Oahu just effectively banned AirBnB in all but approved resort areas. I would actually prefer locations that are near the tourist destinations, not in someone's neighborhood where I have to go a long way in an unfamiliar locale. That's one advantage of hotels - they are typically located closer to where tourists want to go. I'm not after the lowest cost and would prefer to pay more for the primo location.


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## JIMinNC (Aug 5, 2019)

DannyTS said:


> the stock is down again today, currently at $85.31, down from about $104 before the earnings call. Ouch! HGV is actually in the same boat so it is not just MVW.



Now down below $84, but some of that is collateral damage from the market reaction to the big escalation of the trade war last week and over the weekend.


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## DannyTS (Aug 5, 2019)

JIMinNC said:


> Now down below $84, but some of that is collateral damage from the market reaction to the big escalation of the trade war last week and over the weekend.


I agree, some of it is collateral damage but not more than 3-5% I guess. I am not sure why a company like MVW would be punishedby the markets for the trade war, their earnings are not related, at least I do not see it.  Additionally, the company has a decent level of debt and the rate cut should have been a positive.


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## CalGalTraveler (Aug 5, 2019)

Simple. these are discretionary/luxury purchases. First to go south if there is a perceived downturn ahead.  The markets are jittery.


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## JIMinNC (Aug 5, 2019)

DannyTS said:


> I agree, some of it is collateral damage but not more than 3-5% I guess. I am not sure why a company like MVW would be punishedby the markets for the trade war, their earnings are not related, at least I do not see it.  Additionally, the company has a decent level of debt and the rate cut should have been a positive.



When the market falls 750 points as it is right now, all boats sink. If the trade war really accelerates, it theoretically could trigger a recession, so that would be bad for a discretionary company like VAC.


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## DannyTS (Aug 5, 2019)

JIMinNC said:


> When the market falls 750 points as it is right now, all boats sink. If the trade war really accelerates, it theoretically could trigger a recession, so that would be bad for a discretionary company like VAC.


I agree with that but I also looked at Marriott International and it is down only 3% since August 1st vs VAC  that is down 20%. So it seems that the VAC decrease has a lot to do with the earnings call IMO. Of course the market correction does not help.


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## JIMinNC (Aug 5, 2019)

DannyTS said:


> I agree with that but I also looked at Marriott International and it is down only 3% since August 1st vs VAC  that is down 20%. So it seems that the VAC decrease has a lot to do with the earnings call IMO. Of course the market correction does not help.



Absolutely. Most of the drop is the earnings miss, but the damage is being exacerbated by the overall market drop the last few trading days.


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## CalGalTraveler (Aug 5, 2019)

In addition to the markets, it has been almost a year and so far no significant results/programs from the expensive ILG acquisition. The markets only have so much patience and it would have been expected that some of this would have been designed prior to the acquisition.  I find it informative that the CEO is only now learning details of the ILG programs and seems surprised by some of it.


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## DannyTS (Aug 5, 2019)

CalGalTraveler said:


> I find it informative that the CEO is only now learning details of the ILG programs and seems surprised by some of it.



This was indeed very shocking to me, I  thought they had most of the pieces of the puzzle in place before the acquisition. All they had to do was to read TUG. 
@TUGBrian can't we offer a free membership to Mr Weiss? lol


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## JIMinNC (Aug 5, 2019)

CalGalTraveler said:


> In addition to the markets, it has been almost a year and so far no significant results/programs from the expensive ILG acquisition. The markets only have so much patience and it would have been expected that some of this would have been designed prior to the acquisition.  I find it informative that the CEO is only now learning details of the ILG programs and seems surprised by some of it.



I've read the transcript or listened to every analyst conference call since the merger, and I don't recall even one analyst ever asking a question or who seemed to even care about new products/exchange systems. Their singular focus has been on how MVW is progressing towards realizing their $100 million in projected cost savings and secondarily how they are doing in improving ILG's lower VPG and closing rates. According to the calls, they are contending they are ahead of schedule on the cost savings and they didn't set specific goals/expectations on improving ILG sales performance, so nothing to measure against. It's the sales performance that hurt their 2Q, so that's what is tanking the stock. Companies that miss their own sales forecasts get punished.


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## TUGBrian (Aug 5, 2019)

we would happily offer a free TUG membership to any marriott executive who wished to participate here =)


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## CalGalTraveler (Aug 5, 2019)

JIMinNC said:


> I've read the transcript or listened to every analyst conference call since the merger, and I don't recall even one analyst ever asking a question or who seemed to even care about new products/exchange systems. Their singular focus has been on how MVW is progressing towards realizing their $100 million in projected cost savings and secondarily how they are doing in improving ILG's lower VPG and closing rates. According to the calls, they are contending they are ahead of schedule on the cost savings and they didn't set specific goals/expectations on improving ILG sales performance, so nothing to measure against. It's the sales performance that hurt their 2Q, so that's what is tanking the stock. Companies that miss their own sales forecasts get punished.



Same thing. They are asking, "How will you increase sales performance?" Product/programs are how they will improve closing rates and ultimately the top line.


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## bazzap (Aug 5, 2019)

CalGalTraveler said:


> In addition to the markets, it has been almost a year and so far no significant results/programs from the expensive ILG acquisition. The markets only have so much patience and it would have been expected that some of this would have been designed prior to the acquisition.  I find it informative that the CEO is only now learning details of the ILG programs and seems surprised by some of it.


As it has taken 2 years+ for the arguably simpler Marriott International acquisition of Starwood hotels to get “sorted”, I really did not expect real visible progress with the MVC integration of ILG in the first year.
https://www.prnewswire.com/news-rel...-unparalleled-guest-experience-300333101.html


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## JIMinNC (Aug 5, 2019)

CalGalTraveler said:


> Same thing. They are asking, "How will you increase sales performance?" Product/programs are how they will improve closing rates and ultimately the top line.



I agree, but the analysts don't seem to care.


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## CalGalTraveler (Aug 5, 2019)

JIMinNC said:


> I agree, but the analysts don't seem to care.



Actually the analysts care deeply about the top line. They don't care how they achieve it as long as they MVC makes their numbers.


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## m61376 (Aug 5, 2019)

JIMinNC said:


> What would be the ideal product would be a partnership between AirBnB and Marriott Vacations Worldwide or Hilton Grand Vacations. AirBnB already has created that market, so not sure MVW or HGV should try to re-invent the wheel, but if one of them could partner with AirBnB to have a selection of higher-quality AirBnB locations which could carry the "Marriott Approved", "Westin Approved", or "Hilton Approved" label. To get that label, they would need to meet MVW or HGV standards. That's an AirBnB product I might be willing to try. Until then, I'll stick to hotels unless I'm in a place where Marriott International, Hilton Hotels, Hyatt, or one of the others doesn't have a presence.
> 
> The only thing I think they should do is be careful to avoid AirBnB locations that are in predominantly residential areas. Investors buying up houses and condos for short term rentals is creating problems in many neighborhoods and creating blowback. Oahu just effectively banned AirBnB in all but approved resort areas. I would actually prefer locations that are near the tourist destinations, not in someone's neighborhood where I have to go a long way in an unfamiliar locale. That's one advantage of hotels - they are typically located closer to where tourists want to go. I'm not after the lowest cost and would prefer to pay more for the primo location.



The problem with a hotel brand putting an approved label on an AirBNB is that they're privately owned and thus no real quality control.AirBNB is merely the online rental agent of sorts. What would be ideal from my consumer perspective is Marriott owning clusters of apartments in well located buildings in major destination cities, where resorts aren't needed and family accommodations make for more comfortable travel. I'm with you- I resorted to an AirBNB because, with one expensive exception, I couldn't find a centrally located hotel that would accommodate three young children with parents, nor be guaranteed a connecting room. We were lucky- the place we stayed at, while not cheap, was terrific, but there was a lot of angst before we arrived because if tit did not meet expectations I could have argues with AirBNB for a refund, but at the end of the fay my family needed a place to stay. 
Clearly many European destinations have not kept o[ with the times wrt hotel accommodations, and are ill equipped for family travel.


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## JIMinNC (Aug 5, 2019)

m61376 said:


> The problem with a hotel brand putting an approved label on an AirBNB is that they're privately owned and thus no real quality control.



Virtually all hotels are privately owned also - by REITs or other investors - Marriott, Hilton, etc just manage and handle bookings through their reservation systems. As long as the hotel company was willing to exercise the same quality control with the independent properties as they do with their hotel owners to keep the sign out front, they could control the quality against their brand standards. The biggest challenge would obviously be how to do that with hundreds or thousands of independent properties versus a single hotel that has a hundred rooms or more at a single location.


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## CPNY (Aug 5, 2019)

JIMinNC said:


> What would be the ideal product would be a partnership between AirBnB and Marriott Vacations Worldwide or Hilton Grand Vacations. AirBnB already has created that market, so not sure MVW or HGV should try to re-invent the wheel, but if one of them could partner with AirBnB to have a selection of higher-quality AirBnB locations which could carry the "Marriott Approved", "Westin Approved", or "Hilton Approved" label. To get that label, they would need to meet MVW or HGV standards. That's an AirBnB product I might be willing to try. Until then, I'll stick to hotels unless I'm in a place where Marriott International, Hilton Hotels, Hyatt, or one of the others doesn't have a presence.
> 
> The only thing I think they should do is be careful to avoid AirBnB locations that are in predominantly residential areas. Investors buying up houses and condos for short term rentals is creating problems in many neighborhoods and creating blowback. Oahu just effectively banned AirBnB in all but approved resort areas. I would actually prefer locations that are near the tourist destinations, not in someone's neighborhood where I have to go a long way in an unfamiliar locale. That's one advantage of hotels - they are typically located closer to where tourists want to go. I'm not after the lowest cost and would prefer to pay more for the primo location.


It seems that Marriott hotels is getting in on the action with the new villa options. They are testing the waters. I think MVC can do the same. I stayed at a Wyndham vacation place and it was an airbnb style condo in Breckinridge. Again it was booked through Wyndham. Not sure how that was set up, I booked paying cash so it could have just been a portal for villa owners to resent much like airbnb. Fact is, most millennial and younger are staying at Airbnb’s and vacation rentals. The fact is, vacation rentals have been around well before airbnb. The options are much better. As far as location I think it depends on who you speak to. Most not all, People in their 30’s and younger would rather stay in residential areas in cities sometimes. You get a true feel of the city as a local. I suspect many who are on team timeshare feel more comfortable staying in tourist areas. So desired location is dependent on who’s booking. Oahu most likely banned airbnb in those areas because of hotel and resort lobbyists. The hotel industry has been fighting extremely hard in nyc to ban airbnb all together because it cuts into their business. When you have companies like Marriott being sued for not listing bologna fees in their nightly room rates, it’s no wonder why people like airbnb. Plus the app is easy to use. I like both resort and airbnb. In a city I’d rather a flat than a run of the mill hotel room.


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## controller1 (Aug 5, 2019)

JIMinNC said:


> Virtually all hotels are privately owned also - by REITs or other investors - Marriott, Hilton, etc just manage and handle bookings through their reservation systems. As long as the hotel company was willing to exercise the same quality control with the independent properties as they do with their hotel owners to keep the sign out front, they could control the quality against their brand standards. The biggest challenge would obviously be how to do that with hundreds or thousands of independent properties versus a single hotel that has a hundred rooms or more at a single location.



However, a bigger problem with the new Marriott condo/house rental business is what company's standard does the property owner adhere to?  I ask because if you look at the houses on the Marriott site you can also find the exact same house on several other sites such as VRBO and AirBnB. BTW, the Marriott site is higher priced than the other sites.


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## JIMinNC (Aug 5, 2019)

controller1 said:


> However, a bigger problem with the new Marriott condo/house rental business is what company's standard does the property owner adhere to?  I ask because if you look at the houses on the Marriott site you can also find the exact same house on several other sites such as VRBO and AirBnB. BTW, the Marriott site is higher priced than the other sites.



I would suspect (hope?) that to be listed on the Marriott site, the owner had to agree to abide by certain quality standards or other rules which VRBO and AirBnB probably don't have. If they cease to maintain that standard, Marriott will drop them, while AirBnB or VRBO probably wouldn't. I'm also not sure what guarantees VRBO or AirBnB provide, but I would hope that Marriott would stand behind their brand if there was a problem. For those reasons, I would expect Marriott to charge a higher price, but if those extra guarantees don't really exist, then I don't think that concept will work for them.


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