# Sunterra Aqusition Announced



## sca6 (Mar 12, 2007)

Press release of 3/12/07 announcing the Sunterra/ Diamond News!   http://www.sunterra.com/acquisition/press_release.aspx


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## riverdees05 (Mar 12, 2007)

We own two weeks at Lake Tahoe, will this be a good thing or not?  Have not been impressed with Sunterra.  We do not own points and went their presentation once and did not buy-in.


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## timeos2 (Mar 12, 2007)

*We just don't know yet*

If all you do is use your resort and/or trade in the RCI/II or other weeks systems and the resort is not currently managed by Sunterra (RPM) then you most likely won't see much difference.  If you were in one of the Sunterra Club systems and/or your resort is managed by Sunterra/RPM then things are up in the air. You must realize that when a company spends this kind of money to acquire a system they plan to provide service and make money. But not every acquisition works out, not every company has what it takes to run a successful resort system and many don't seem to appreciate the value of communications with owners. Sunterra has not been the best in many of those areas so the new owners could be better - but they also could be worse. Until it happens and we see what they offer and how they treat the owners it is just so much speculation. We don't have any choice in the sale so I'd like to go in with a positive attitude and expect a responsive new organization that will improve our choices and be reasonable in cost.  At the same time I will be ready to take action as best I can if they are another Westgate type.  Only time will tell.


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## PeelBoy (Mar 12, 2007)

How about confirmed exchanges through II?  I have booked 4 weeks already via II, so hopefully the confirmations will not be affected.


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## timeos2 (Mar 12, 2007)

*Sunterra Letter to Owners*

See the letter.

I really like the part where the potential new owner "spearheaded" the Marriott work on the property they sold them. Visions of grandeur?

Also the faq where it states the Europe group will NOT be divested.


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## pedro47 (Mar 12, 2007)

Timeos2, please keep an eye on this development.


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## Hoc (Mar 12, 2007)

timeos2 said:


> Sunterra has not been the best in many of those areas so the new owners could be better - but they also could be worse.



A lot of Polo Towers owners complain heavily about Diamond Resorts' management of that property.  Apparently, the entity has acted in its own self-interest to the extreme prejudice of the owners.  Things like shutting down the owners' lounge and renting it out as a business center, not giving good maintenance value for the dollars collected (and letting the units deteriorate), announcing outrageous maintenance fee hikes, and the like.

No personal experience one way or another.  But it's talk like this over the past few years that has kept me from buying a Polo Towers unit, despite the fact that they seem to go for rock-bottom prices on ebay.


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## Kauai Kid (Mar 13, 2007)

We own two weeks at the Embassy Poipu, no that's dead, the Point at Poipu, no that's dying, perhaps we own two weeks at the Diamond Poipu.

Since those of us who purchased weeks are the theoretical owners why don't we have any say over the management of the units?  It's our money that purchased the units not Sunterra's or Diamond's.  Our name is on the deed, doesn't that mean anything anymore? 

Now another big unknown in the equation.

Sterling


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## timeos2 (Mar 13, 2007)

*It's too common*



Kauai Kid said:


> We own two weeks at the Embassy Poipu, no that's dead, the Point at Poipu, no that's dying, perhaps we own two weeks at the Diamond Poipu.
> 
> Since those of us who purchased weeks are the theoretical owners why don't we have any say over the management of the units?  It's our money that purchased the units not Sunterra's or Diamond's.  Our name is on the deed, doesn't that mean anything anymore?
> 
> ...



You should - you should be electing owner representatives, a majority of the Board, and they should be looking at who the management should be. But often times the developer doesn't want to let go, wants to continue to manage and basically be the only voice that counts. It is wrong on every level but all too common. Get your fellow owners to work to gain control. It is your resort, not Sunterras or Diamonds, and the individual owners should have control. It won't be easy to accomplish.


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## Carolinian (Mar 14, 2007)

Kauai Kid said:


> We own two weeks at the Embassy Poipu, no that's dead, the Point at Poipu, no that's dying, perhaps we own two weeks at the Diamond Poipu.
> 
> Since those of us who purchased weeks are the theoretical owners why don't we have any say over the management of the units?  It's our money that purchased the units not Sunterra's or Diamond's.  Our name is on the deed, doesn't that mean anything anymore?
> 
> ...



One danger with a points type organization is that they control enough votes from the weeks that are in points to have effective control of the HOA.  Hopefully that is not the case at your resort, and owners can organize and get control.

On the NC Outer Banks, resorts have had varied experience with developers.  With the Equivest/Peppertree resorts (Outer Banks Beach Club, Outer Banks Beach Club II), the developer quite properly turned over control of the HOA's to the owners when the resorts sold out, and initially worked out a management contract with the HOA's.  Some disputes there which came to a head after Cendant acquired Peppertree/Equivest, and the HOA's terminated their management contracts and both selected SPM Resorts as their new management company.  That has led to lawsuits between the HOA's and Peppertree/Equivest.

Another developer, First Flight Builders (Hatteras High, Dunes South, Ocean Villas, Ocean Villas II), tried to keep control of the HOA's.  Members organized and kicked them out of all of their resorts.  Dunes South had a court battle that went all the way to the state appellate courts.  Ocean Villa II filed an action in court but settled before trial. The others did not have to go to court.

Barrier Island Station (BIS-Duck, BIS-Kitty Hawk, and Ocean Pines) still rigidly keeps control of the HOA's at its resorts, even though two of them are long sold out.


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## T_R_Oglodyte (Mar 14, 2007)

Carolinian said:


> One danger with a points type organization is that they control enough votes from the weeks that are in points to have effective control of the HOA.  Hopefully that is not the case at your resort, and owners can organize and get control. …



Too late for that.  There are two big impediments.  

First is the language in the condominium documents (long before points started).  Replacing the management company requires that half of the owners vote in favor of replacing the current management company.  That's not half of a quorum - that's half of the total number of owners.  The program document summary approved by the State of Hawai'1 for sales in the 1990's specifically mentioned that it would be virtually impossible for owners to replace the management company.

Second, Spence and I are convinced that the main reason the Sunterra Trusts exist is to ensure that Sunterra can continue to control the Boards of Directors after the resort inventory is completely sold.  Inventory that is in the trust is no longer voted by the purchasers; it's voted by the trustee of the trust.  The trustee is not a Sunterra entity - IIRC, it's the trust department of one of the big Honolulu banks - but it's pretty unlikely the trustee would ever cast a vote against Sunterra except in extreme cases.


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