# Hyatt Northstar sold to Welk Resorts



## tahoeJoe

Press Release

I don't think this is a good thing for Hyatt owners. First the NYC property never opens, Coconut Plantation has been stalled for years, Hyatt has not built any new resorts for years, and now Northstar Lodge is gone. Also, my sources tell me Hyatt Maui hasn't broke ground. Can anyone confirm?


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## dougp26364

I definately wouldn't consider this good news for Hyatt owners. It makes one wonder about rumors of stonger systems buying out Hyatt all together. I know Marriott salesmen have sometimes hinted about a big buyout and DRI salesmen are always hinting that there's another major buyout just around the corner. Something like this lends a little legitimacy to that possiblity. Right now, very few developers are building but it seems as if the stronger companies are buying up and merging with the weaker companies. I would never have thought of Hyatt as weaker, just smaller.


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## Beefnot

Maybe Hyatt has begun shedding its timeshare operations. In pieces.


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## bdh

Beefnot said:


> Maybe Hyatt has begun shedding its timeshare operations. In pieces.



The majority of Hyatt properties are not wholly owned/developed by Hyatt.  An outside entity partners with Hyatt - the entity brings the majority of the cash and Hyatt brings the "name" and management operation.

So when a Hyatt Northstar or Siesta Key is sold, its the owner/developer that has the tangible asset to sell.  In the case of Siesta Key, the new owner wasn't a TS/fractional company so the Hyatt management operation was retained - obviously at Northstar, since Welk is TS/fractional company they are not going to retain Hyatt management.


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## JanT

Forgive me for not being really astute about this subject.  So, does this take Northstar off the very small list of properties available for internal exchange for Hyatt owners?  And what if Hyatt does sell all of it's properties?  Where does that leave Hyatt owners in terms of the properties they own?  I.E., do they become part of the new companies programs?


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## dougp26364

JanT said:


> Forgive me for not being really astute about this subject.  So, does this take Northstar off the very small list of properties available for internal exchange for Hyatt owners?  And what if Hyatt does sell all of it's properties?  Where does that leave Hyatt owners in terms of the properties they own?  I.E., do they become part of the new companies programs?



I think this probably varies a little from company to company but, in general terms, those that bought the property as one company retain their rights with the original company. Sometimes they have the right to "convert" their ownership to the new management company, sometimes not.

Examples would be all the recent DRI aquisitions of companies such as ILX and Monarch Vacation Club. Those owners can retain their original purchase rights or they can convert their ownership into a points based reservations system with DRI called THE Club.

HGVC has aquired management contracts with other resort properties. Those properties are considered affiliates and the owners have the option of converting to HGVC points or keeping their ownership as it was before Hilton. 

Hilton has recently purchased the unsold inventory at Westgates Planet Hollywood Towers and has renamed the project Elera. However, owners who bought with Westgate do not, as of yet at least, have the option to convert their weeks to HGVC weeks. The project remains seperated into Westgate owners and HGVC owners. I believe HGVC manages the entire property.

There is a property in Branson called Stormy Point Village. It was started by Fiesta but was apparently sold to Summerwinds along the way. I believe that Summerwinds manages the property and continues to develop the property but the Fiesta owners are still with Fiesta.

So it varies from situation to situation and it's something to pay attention too. I believe that the logical thing with this transaction is that Hyatt owners who bought into this property will still be Hyatt owners. I would also assume that other Hyatt owners will have access to the Hyatt inventory. This is an assumption and could be so far off base that it's not worth the time it took to type it out, so take it with a grain of salt. I'm just basing the assumption on what I've seen in the past.


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## Kal

The real key to the high-end properties such as Northstar is participation in the HRC by owners of the units. First off a unit has to be sold. If it's not sold, it's not available to HRC members. Now when a unit is sold, the owner has options where they can use the unit themselves, rent it themselves or turn (all or part of) it over to the HRC in exchange for stays at other HRC properties, Hyatt Hotels or Interval.

Thus, the only way an HRC member can "exchange" into the unit is if it is available to the HRC and succeed in competition from other HRC members for occupancy.

Realistically, not many of those units have been sold and, if the unit is sold, the new owner would likely occupy (or rent) the unit themselves. Since ownership provides more than a single week, they might make some low-season time available to the HRC. Net result, a tedious probability of getting into those units.

Hyatt is simply a management function and the owners can terminate Hyatt i.a.w. terms of their ownership contract. Obviously those owners decided to make a change to Welk.

One major benefit of being an owner in the Hyatt system is that Hyatt brings to the table a number of resorts where they have contractual involvement as a management function. Members of the HRC are owners at a specific resort and have no voice in the conduct of Hyatt's business or it's relationship to other resorts.


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## Kal

dougp26364 said:


> ...I believe that the logical thing with this transaction is that Hyatt owners who bought into this property will still be Hyatt owners. I would also assume that other Hyatt owners will have access to the Hyatt inventory...


 
Just a few thoughts to add.

Don't think of the owners as "*Hyatt owners*", but rather people who own a unit in a resort where the resort has retained the services of Hyatt to manage their property.  Hyatt rarely if ever has real money on the table.  The project is funded and owned by developers who use the Hyatt management and marketing skills to operate and sell the units.  The developer has a long term contract with Hyatt to provide those services.  It's not unusual for the developer to sell the resort to others, but the Hyatt services usually survive the sale.  In this case, the developer and owners made a decision to terminate those services (probably with a financial penalty) in favor of the buyer who had their own in house management sales and services skills.


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## T_R_Oglodyte

JanT said:


> Forgive me for not being really astute about this subject.  So, does this take Northstar off the very small list of properties available for internal exchange for Hyatt owners?  And what if Hyatt does sell all of it's properties?  Where does that leave Hyatt owners in terms of the properties they own?  I.E., do they become part of the new companies programs?





dougp26364 said:


> I think this probably varies a little from company to company but, in general terms, those that bought the property as one company retain their rights with the original company. Sometimes they have the right to "convert" their ownership to the new management company, sometimes not.
> 
> Examples would be all the recent DRI aquisitions of companies such as ILX and Monarch Vacation Club. Those owners can retain their original purchase rights or they can convert their ownership into a points based reservations system with DRI called THE Club...



I agree with what Doug said.  In most cases (at least in the US) the people who bought under the old regime have the rights and ownerships associated with that program.  The ownerships could be deeds, trust interests, or a RTU in a club.  Whatever those rights and ownerships are, the previous still have those rights; they don't change or disappear just because the developer sells out or is bought.  So those interests will usually continue intact under the new ownership.  

The easiest and most common way to do this is the way DRI does it.  They just simply retain the previous operation as an intact unit (generally with a name change; in DRI's case the call it a "Collection").  Then they begin trying to sell owners upgrades to join the DRI Club. As people from that collection join the DRI Club, the associated inventory starts to become available to all Club members.

I think the worst situation is where one developer starts sales at a project, but then sells the unsold interests and the *resort *management contract to a third party, but retains management of the timeshare interests it sold at the project.  Then that small slice of original sold timeshare interests at the resort becomes kind of an orphan at the resort.


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## bdh

JanT said:


> Forgive me for not being really astute about this subject.  So, does this take Northstar off the very small list of properties available for internal exchange for Hyatt owners?  And what if Hyatt does sell all of it's properties?  Where does that leave Hyatt owners in terms of the properties they own?  I.E., do they become part of the new companies programs?




Based on the thought process that Welk would not retain Hyatt as the management company, the sale of Northstar to Welk would remove Northstar from the list of internal exchanges available to HRC owners. When an individual buys an HRC property, they own a specific deeded week at that property - so the current Northstar HRC owners retain their deeded week - but when the management company changes, any future exchanges would be through the new management company. 

Due to the various property types in the HRC system (deeded vs RTU) and who "owns" each property (Hyatt, developer or HOA), there are various scenarios on the disposition of each property. The RTU's automatically revert back to the developer at the end of the term - so unless the developer at High Sierra, Windward Pointe, Del Mar, Highlands Inn experiences money trouble or a potential huge profit from selling (doubtful that either one of these would occur), there's no sale at these. With a large portion of the deeded properties being "mature" (essentially sold out with little active developer sales/ownership), the respective HOA's own/run the property - so unless the majority of individual owners at a specific property vote to sell the property or terminate Hyatt's management contract, there's no sale or change in operation or HRC exchange options. Some HRC properties are owned and developed by Hyatt - I believe Wild Oak is (not sure which other ones are), due to WO being an active sales site with more buildings supposedly to be built in the near future, you would not expect the sale of this property. The majority of the Colorado HRC properties were/are developed by East-West, again, unless the developer experiences money trouble or a potential huge profit from selling (again doubtful), there's no sale at these. 

The thought that Hyatt is "dismantling" the system is a little premature. While the sale of Northstar to Welk will remove a property from the HRC exchange options, the reality is that very little is lost to the remaining HRC owners - with only a handful of Northstar units sold and in the HRC system, its not like there were/are plentiful exchanges into Northstar.


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## bdh

T_R_Oglodyte said:


> In most cases (at least in the US) the people who bought under the old regime have the rights and ownerships associated with that program.  The ownerships could be deeds, trust interests, or a RTU in a club.  Whatever those rights and ownerships are, the previous still have those rights; they don't change or disappear just because the developer sells out or is bought.  So those interests will usually continue intact under the new ownership.



Based on the HRC program format, what an individual owns when they buy a week is that specific deeded week/unit - the option to exchange into other HRC or II properties is a "benefit" in lieu of a "right".  So when the Hyatt management operation is removed/terminated from a specific property, the owners retain their deeded week ownership right at that property but would lose the HRC and II exchange benefit.


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## dougp26364

bdh said:


> Based on the HRC program format, what an individual owns when they buy a week is that specific deeded week/unit - the option to exchange into other HRC or II properties is a "benefit" in lieu of a "right".  So when the Hyatt management operation is removed/terminated from a specific property, the owners retain their deeded week ownership right at that property but would lose the HRC and II exchange benefit.



That is not necessarily the case and there are examples out there to prove it.

The one that immeadiately comes to mind is Gatlinburg Town Square, which was begun by one developer, had the management rights assumed by Sunterra and is presently managed by Summer Bay. The HOA was recently attempting to evict Summer Bay as their management company so there is the potential for a 4th management company to take over this resort.

Through it all, there have remained a variety of contracts for usage rights. DRI has maintained the rights of weeks that were converted/sold under the Sunterra management when it was in charge of the resort. As a DRI owner, I still have direct access to the resort through the unit weeks that remain in their inventory, even though DRI (formerly Sunterra) no longer manages the resort.

A more recent example is Westgates Planet Hollywood Towers. Westgate sold the remainder of the inventory and management contract to Hilton. The units sold previously by Westgate remain in Westgates inventory and are not accessable to Hilton owners. Likewise the unsold inventory that is now controlled by Hilton is not available directly to Westgate owners. To further complicate this scenario, Westgate units continue to exchange through I.I. and Hilton units will exchange through RCI.

Just because there is a management change does not mean previous owners lose the rights under the system they originally purchased into and, that inventory typically remains available for internal exchange purposes to all other owners in that system.


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## T_R_Oglodyte

bdh said:


> Based on the HRC program format, what an individual owns when they buy a week is that specific deeded week/unit - the option to exchange into other HRC or II properties is a "benefit" in lieu of a "right".  So when the Hyatt management operation is removed/terminated from a specific property, the owners retain their deeded week ownership right at that property but would lose the HRC and II exchange benefit.



If the benefit to exchange into HRC was sold as part of the original timeshare purchase, that component can't be terminated just because Hyatt no longer owns/operates the resort. 

As far as exchange options go, there are several cases, none of which prevent the owner from exchanging.  

Case 1: If the ownership continues to be part of HRC and membership in an exchange company is part of the HRC program, then the exchange relationships will continue without change.

Case 2: If the ownership becomes severed from HRC and the owners exchange membership has been through HRC, then the owner can join any exchange company that will accept deposits from the resort.  The only difference would be that any exchange memberships would now be individual membership instead of membership through HRC.

Case 3: If exchange company membership hasn't been part of HRC, then the owners memberships will already be individual memberships and will continue unchanged.


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## ondeadlin

There is so little availability at Northstar that it really wouldn't matter much to me as a Hyatt owner if the property went away.


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## heathpack

For some reason this doesn't faze me.  Northstar had little appeal for us.  Maui is appealing but I expect Hyatt to make it "unaffordable" (as far as points requirements go) for gold week owners.  Ditto for Manhattan.  

Maybe keeping my expectations low is the key to being content with Hyatt.  That and feeling like I've already squeezed enough value out on my week that Id feel ok even if I had to give it away for nothing (not that I actually would )

H


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## ondeadlin

What I like most about Hyatt is that since buying my Diamond week resale at the bottom of the market in 2009, it now regularly sells for more than I paid for it and never less.

I have no complaints about the current system either.  My main strategy is either to get a prime ski week through Hyatt for 2000 to 2200 points, or to trade for a prime ski week through II, and use the leftover points to secure a long weekend in a ski studio at Hyatt.  Both strategies work for me.

Assuming the system continues to function this way, I'll have no complaints and will probably even pick up a second week at some point.


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## GregGH

http://www.hyatthurts.org

http://www.gregpalast.com/billionai...t-pinch-penny-pritzker-pockets-commerce-post/


?????


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## bdh

dougp26364 said:


> That is not necessarily the case and there are examples out there to prove it.





T_R_Oglodyte said:


> If the benefit to exchange into HRC was sold as part of the original timeshare purchase, that component can't be terminated just because Hyatt no longer owns/operates the resort.




I'm thinking the Hyatt attorneys took care of "closing the door" on this topic.

Don't have a contract to quote verbiage, but the basic gist of it is: the HRC purchase contracts are worded that what a person is buying is a specific deeded week/unit and that is THE only guarantee.  Goes on to state that internal or external exchanges are possible by converting the deeded week to points, but that benefit is not a guarantee and does not go on indefinitely.  IE: if the property an individual purchased at is no longer part of the HRC system, they no longer have access to HRC exchanges.  Whatever exchange company the ex HRC property chooses to affiliate with, it will become the default exchange company for the ex HRC owners.

As noted by ondeadlin and heathpack, Northstar exiting the HRC system is not that much of a loss as there just weren't that many exchanges into Northstar.  There is much more availability for skiing at the Aspen, Breck and Beaver Creek HRC properties than there would have every been at NS.  I'd expect there is more discontent within the Northstar owner's camp that they will no longer have access to the HRC system - but to confirm that, you'll need to find a Northstar owner (the proverbial needle in a haystack).


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## Kal

Could it be that Hyatt was in a negative cash flow situation at NS. Hyatt receives a sales/marketing commission with every unit they sell. If sales are in the tank Hyatt is supporting a marketing/sales staff at a loss.

Hyatt manages the resort thru a contract with HRC. The property is staffed with all the necessary humans albeit at a minimal level. If few units have been sold, occupancy is low but HRC must support the cost of that staff and services.

Eventually, Hyatt probably looked at the bottom line and determined something has to give and put added pressure on the developer. BOINK!


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## tahoeJoe

heathpack said:


> keeping expectations low is the key to being content.....
> 
> H



Maybe that should be Hyatt's new marketing slogan. :hysterical:


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## dougp26364

bdh said:


> I'm thinking the Hyatt attorneys took care of "closing the door" on this topic.
> 
> Don't have a contract to quote verbiage, but the basic gist of it is: the HRC purchase contracts are worded that what a person is buying is a specific deeded week/unit and that is THE only guarantee.  Goes on to state that internal or external exchanges are possible by converting the deeded week to points, but that benefit is not a guarantee and does not go on indefinitely.  IE: if the property an individual purchased at is no longer part of the HRC system, they no longer have access to HRC exchanges.  Whatever exchange company the ex HRC property chooses to affiliate with, it will become the default exchange company for the ex HRC owners.
> 
> As noted by ondeadlin and heathpack, Northstar exiting the HRC system is not that much of a loss as there just weren't that many exchanges into Northstar.  There is much more availability for skiing at the Aspen, Breck and Beaver Creek HRC properties than there would have every been at NS.  I'd expect there is more discontent within the Northstar owner's camp that they will no longer have access to the HRC system - but to confirm that, you'll need to find a Northstar owner (the proverbial needle in a haystack).



As I think of other examples I come up with one that could indicate you are correct.

A few years back Marriott divested itself of a couple of it's timeshares in Hilton Head and I believe one or two of it's buildings at it's Vail property because they were not meeting Marriott standards. If memory serves me correctly, those owners who were once Marriott owners found themselves no longer Marriott owners and lost their Marriott preference with I.I. There was also a big discussion at Marriott's Beachplace Towers as the HOA wasn't in favor of some of the demand Marriott was making but owners apparently strongly expressed they still wanted to keep the Marriott name on their resort, thus the HOA compromised with Marriott in order to maintain Marriott "Standards."

Of course this may not be the same situation that Hyatt owners finde themselves in if they were sold into a points based reservations system or some sort of trust which uses points to establishe amount of ownership. If they were sold Hyatt as the program then they will likely retain Hyatt internal exchange rights and those few units would still be available to other Hyatt owners based on Hyatt's existing exchange rules. 

Not being a Hyatt owner I'm purely speculating, but it is possible that those who were once Hyatt owners will no longer be Hyatt owners.


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## MaryH

I think Hyatt would need to make that position that you bought the week not any exchange capabilities in view of the Del Mar situation.  They would not want to continue it if they ever lost the management contract.

So which properties belongs to which category? 

RTU
Highlands Inn
High Sierra
Windward Pointe
Del Mar

Developer / affiliate ?
Miami Blue

HOA?
Sunset Harbour
Beach House

Hyatt?


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## Kal

Other deeded properties include:

Coconut Plantation
Grand Aspen
Main Street Station
Mountain Lodge
Pinion Point
Wild Oak Ranch


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## MaryH

So does HOA owns the deeded resorts or ?


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## Kal

For the "deeded resorts", the unit purchased comes with a deed to that specific unit/week. During the period of time starting at initial construction any unsold units are owned by the developer. Units purchased are owned by individuals. If an owned unit is foreclosed, that unit becomes the property of the resort which is managed by the HOA. The HOA contracts with HRC to perform day-to-day management duties, but all decisions are approved by the HOA.

In short, the HOA only owns foreclosed units until those are sold to individual owners. The HOA is the combined group of all unit owners.


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## MaryH

Kal but who owns the underlying properties of RTU such as Windward points, Carmel, etc. or co-marketed units such as Miami Blue?  Hyatt or the developer which may not be Hyatt from what I heard since someone else developed Sunset Harbour and same for Beach House I think.

When I did the owner update to find out what is happening in Maui and NYC, I also asked about Northstar.  I was told that Hyatt only sold the unsold units to Welks (not sure what is done for any partially sold unit(s)) they others still stay in HRC.  But not sure of the terms of the management contract so HOA of existing units might change it and/or the contract may run out.

Hyatt wants to move more into fractionals and whole condos so more residence clubs along the line of Siesta Keys.


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## Kal

For RTU units, the developer retains ownership of the property.  The developer is almost always a third party other than Hyatt.  

For deeded resorts, each unit is owned by the purchaser.  Any unsold units are owned by the developer.  When the resort is sold out, the Board of Directors (selected by owners HOA) are responsible for operation of the resort.  The owners employ Hyatt to manage the resort.


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## MaryH

So anyone knows who developed Siesta Keys? 

Active sales as far as I know are
Windward Point
Wild Oak
Highlands Inn
Pinon Point
Siesta key

So are all the other resorts sold out?

By the way, Wild Oak is contemplating buidling some more building.  Who decides that, Developer or Hyatt Sales?


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## lizap

I think this is likely what happened.




Kal said:


> Could it be that Hyatt was in a negative cash flow situation at NS. Hyatt receives a sales/marketing commission with every unit they sell. If sales are in the tank Hyatt is supporting a marketing/sales staff at a loss.
> 
> Hyatt manages the resort thru a contract with HRC. The property is staffed with all the necessary humans albeit at a minimal level. If few units have been sold, occupancy is low but HRC must support the cost of that staff and services.
> 
> Eventually, Hyatt probably looked at the bottom line and determined something has to give and put added pressure on the developer. BOINK!


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## mjm1

We are Welk Resort owners, so were pleasantly surprised to  hear they were buying a portion of the Hyatt Northstar property.  We were in South Shore over July 4th (wonderful fireworks show by the way), and decided to visit the Hyatt property to see what it is like.  The woman at the desk was very nice and accommodating.  She acknowledged the transaction and took some time to show us a 3BR unit (fortunately it was very slow at the desk). 

The unit was extremely nice. The transaction isn't finalized, so Welk owners can't make reservations yet, but some have taken advantage of an owner's discount rental rate to stay there. I am curious to see how Welk allocates points to this resort.

Once the transaction is finalized, Welk will own a portion of the units, as well as land for future development. A foundation for a second building was laid earlier where a parking lot currently sits. Hyatt owners will retain many of the units in the current building.

Overall, we were very impressed.


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## ypenubolu

mjm1 said:


> We are Welk Resort owners, so were pleasantly surprised to  hear they were buying a portion of the Hyatt Northstar property.  We were in South Shore over July 4th (wonderful fireworks show by the way), and decided to visit the Hyatt property to see what it is like.  The woman at the desk was very nice and accommodating.  She acknowledged the transaction and took some time to show us a 3BR unit (fortunately it was very slow at the desk).
> 
> The unit was extremely nice. The transaction isn't finalized, so Welk owners can't make reservations yet, but some have taken advantage of an owner's discount rental rate to stay there. I am curious to see how Welk allocates points to this resort.
> 
> Once the transaction is finalized, Welk will own a portion of the units, as well as land for future development. A foundation for a second building was laid earlier where a parking lot currently sits. Hyatt owners will retain many of the units in the current building.
> 
> Overall, we were very impressed.



Here is what you need for Welk points to reserve  - 

Peak weeks - 21-43, 46-15
3 bedroom - 480000
2 bedroom - 420000
Studio - 120000

Off Peak weeks - 16-20 , 44-45
3 bedroom - 270000
2 bedroom - 210000
Studio - 90000


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## BayGirl22

*Are their still Hyatt-owned units available to Hyatt members?*

Trying to find recent info on the sale.  Northstar is still listed on the Hyatt Residence Club site as a property, and the property comes up as both Hyatt and Welk in various searches.  Were the already-sold units retained by Hyatt so still theoretically available as an internal exchange?  

I understand there aren't many in circulation so availability is low, but has anyone been able to trade into them at all?  We're close to Tahoe and would love to trade in, even if for a weekend or summer week.  The presence in Tahoe, among other factors, is making me start to consider Hyatt over Starwood to buy resale.  Trying to figure out if Northstar is even still in the mix.


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## ivywag

*Northstar*

Hyatt retained all of the units that they had sold and they are available for Hyatt internal exchange.  There is a 2 bedroom on the HRC website right now available for June. Northstar is a Friday-Friday occupancy resort. They do come up occasionally or you could wait list for the Welk units through Interval. They're all in the same building. Hope this helps!


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## BayGirl22

ivywag said:


> Hyatt retained all of the units that they had sold and they are available for Hyatt internal exchange.  There is a 2 bedroom on the HRC website right now available for June. Northstar is a Friday-Friday occupancy resort. They do come up occasionally or you could wait list for the Welk units through Interval. They're all in the same building. Hope this helps!



Thanks, yes that is helpful.  Its good to know we could potentially get a weekend there at least.  It looks like a beautiful property.  


(And I can't believe that was my first post here on TUG.  I've been reading and learning since 2007 when we signed at Princeville on our honeymoon then rescinded.  Guess I never needed to ask to find what I needed.)


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