# ROFR for Starwood may increase



## Scott & Laura

Hello;

After following Starwoods margin calls for a few years, things seem to be turning positive for SVO.

I follow this recent news here.

http://seekingalpha.com/article/532...ses-q1-2012-results-earnings-call-transcript?

Vasant Prabhu stated; for 1st Quarter 2012
Our Vacation Ownership business remains stable with interval sales and revenues up. The cash profile of the business continues to improve as we see more cash sales and more prepayment of loans. Default rates continue to drop with Q1 defaults at 4.2%, levels not seen since early 2007. We remain on track to deliver over $100 million in cash from this business in 2012. Since 2009, our Vacation Ownership business will have delivered $800 million in cash to Starwood. 

We finished the quarter with over $800 million in cash, almost $700 million in excess of working capital needs. Our net debt, not including Vacation Ownership receivables, was $1.38 billion, $150 million lower than we ended 2011. As our debt declines and our EBITDA climbs, we have been upgraded by all 3 rating agencies to investment grade.

*Frits van Paasschen said;*

Our continuing philosophy with Vacation Ownership is we'll look at ways that are high IRR, high return opportunities to sustain the sales volume for the business, but not focus on growing the absolute size. We like being able to control and manage our Vacation Ownership business and having it be part of our portfolio at the size as it is. And, as Vasant mentioned over the course of some of his remarks, at the end of this year, we will have gotten to $800 million in positive cash out of our Vacation Ownership business. And the trends of the business right now are very healthy. So while, clearly, others have pursued a different strategy, we feel very good about where we stand right now. And if there's an asset-light model for growing our Vacation Ownership business, clearly in the philosophy of higher return ways of adding inventory, that's something we would look at. But again, we need to make sure that we have product that we can control, that fits with our brands and that works with the owner base that we've developed over time.


I personally believe this means Starwood will be active in ROFR.

Reagds

Scott


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## Ken555

All they need is to take 1% of that cash and build a great web site to support owners, lower costs (increase profit long term) and give another tool for them to use in showing the flexibility of their product during sales meetings.


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## ocdb8r

Thanks for the post.  Very interesting.  What part of this makes you think more ROFR than previously?  They only have it at Mission Hills (where I think it's unlikely given all the Desert Willow Villas inventory), Princeville (plenty of inventory and a slow seller) and the Kaanapali resorts (where they have exercised consistently).

I think these statements are solely to address questions as to their strategy vis-a-vis Marriott's spin-off and move to asset-light, making SVO stick out a bit given HGVC was already asset-light(er).


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## gregb

Purchasing units at resale (either by ROFR, or in the open market) for resorts with active sales is one way Starwood can continue to generate income from SVO.  They put this acquired inventory into their resort sales channel and benefit from their enormous markup.  This strategy lets them control their inventory.  If sales slacken, they just stop purchasing resale units.  

This has less risk than building a new resort because they can control their inventory, rather than having a whole resort to sell.  Plus they get the marketing tool of telling the customers the resort is almost sold out.  

As long as the resales prices are 1/2 to 1/3 or even less than the retail prices, Starwood makes out like a bandit.

So I agree, this seems to suggest that Starwood will remain active in the ROFR and maybe even resales market.  Got to give all of those sales people something to sell.

Greg


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## grgs

I agree with Greg's analysis.  Specifically, these statements could be construed in support of Starwood taking advantage of ROFR:

_"high return opportunities to sustain the sales volume for the business, but not focus on growing the absolute size"_​
_"We like being able to control and manage our Vacation Ownership business and having it be part of our portfolio at the size as it is." _​
_"if there's an asset-light model for growing our Vacation Ownership business, clearly in the philosophy of higher return ways of adding inventory, that's something we would look at"_​
Whether that means we'll notice a pick up in the number of ROFR units, we'll just have to wait and see.

Glorian


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## Fredm

ocdb8r said:


> What part of this makes you think more ROFR than previously?  They only have it at Mission Hills (where I think it's unlikely given all the Desert Willow Villas inventory), Princeville (plenty of inventory and a slow seller) and the Kaanapali resorts (where they have exercised consistently).



Starwood has been aggressively exercising ROFR at WMH (Platinum Season) and Princeville.  They have been doing so for at least the past 6 months.


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## clsmit

Since they are not building anything new they need to ROFR to keep a variety of inventory available. WLR is still selling and I'm guessing they still have weeks at SVV, in addition to WDW and Princeville. So they need other prime locations for sales. SBP has a good flow of potential buyers, so ROFR there would make sense (not the highest dollar sales, but it's better than nothing). WKORV/N has a huge margin on their ROFR so what Fred is seeing also makes sense. WMH also has a high end customer base ripe for selling to. ROFR is the only option unless/until they acquire more properties in desirable locations.


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## ocdb8r

Fredm said:


> Starwood has been aggressively exercising ROFR at WMH (Platinum Season) and Princeville.  They have been doing so for at least the past 6 months.



Hmmm, I must have missed that.  I haven't noticed many posts on here for those resorts and based on the deeds recorded for those resorts over the last 6 months, it didn't look like they were picking up anything other than the occassional defaulted units.


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## Fredm

ocdb8r said:


> Hmmm, I must have missed that.  I haven't noticed many posts on here for those resorts and based on the deeds recorded for those resorts over the last 6 months, it didn't look like they were picking up anything other than the occassional defaulted units.



I have, from time to time, posted specific ROFR experiences at these resorts. 
To add to these, WMH annual Platinum was exercised at $5,500 on Monday.
Several weeks ago a WMH Platinum was exercised at $5,000.
WMH ROFR activity actually goes back further than 6 months. 
Starwood started exercising in earnest when it ran short of Platinum inventory at WDW over a year ago. 

We also had a rash of WPORV sales exercised. In fact, it burned through our inventory at the time. The good news was that I had to go fishing for an eoy to sell to a buyer, and found a TUG owner who was interested in selling. That eoy passed ROFR at $8,500. Prior sales below $8,000 were exercised.

We are opening escrow today at $6,000 for a WMH Platinum. I will let you know how it goes.

Seven of our last ten sales at these resorts were exercised by Starwood.


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## Westin5Star

My first EOY WPORV was ROFR when I went to sell it for around $5k.  I was not happy as Starwood messed up the paperwork 3 times and it took about 6 months to finalize.

Fred on the other hand helped me with my other week.  I received a much better price that was not ROFR.  The transaction was fast and smooth.  Thank you Fred!

I am now in the market for a Marriott Aruba Surf OF Gold and I am hoping to find it for around $10k and that it is not ROFR by Marriott.  Based on two other recent sales that I am aware of, I should be fine if I stay over $10k.


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## jerseygirl

Westin5Star - you may find this thread interesting:

http://tugbbs.com/forums/showthread.php?t=173371


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## Westin5Star

Thanks for the information Jersey.


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## Syed

Starwood exercised on two of my Island Villa annual sales at WKORVN. Both were for $12,000


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## tomandrobin

Westin5Star said:


> Thanks for the information Jersey.




I was looking for a 3-bedroom gold season for Marriott Surf Club. I had found several units for $12k 

We loved our stay there that much to buy a week at the resort. In the end, we decided not to purchase a week and just make a trade with a Marriott owner when we want to go back.


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## Westin5Star

tomandrobin said:


> I was looking for a 3-bedroom gold season for Marriott Surf Club. I had found several units for $12k
> 
> We loved our stay there that much to buy a week at the resort. In the end, we decided not to purchase a week and just make a trade with a Marriott owner when we want to go back.



Thanks.  I know of two recent sales for 2BR OF gold for $10,500 each at the Surf.  I have an II request in right now for next June but I am also looking to buy.  Maybe I will just have to go to Aruba twice next year.  I sure wish Starwood would surprise us all and build a TS there.


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## tomandrobin

Westin5Star said:


> Thanks.  I know of two recent sales for 2BR OF gold for $10,500 each at the Surf.  I have an II request in right now for next June but I am also looking to buy.  Maybe I will just have to go to Aruba twice next year.  I sure wish Starwood would surprise us all and build a TS there.



Ditto.....I was pumped for Westin Aruba and was really let down when Starwood cancelled its development. Hence why I own Cancun now.


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## Docklander

tomandrobin said:


> Ditto.....I was pumped for Westin Aruba and was really let down when Starwood cancelled its development. Hence why I own Cancun now.



Did you see the plans? Those ocean front 3-bed units looked amazing! Maybe they'll build them one day.


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## Pmuppet

Ken555 said:


> All they need is to take 1% of that cash and build a great web site to support owners, lower costs (increase profit long term) and give another tool for them to use in showing the flexibility of their product during sales meetings.



Agreed 100%.  It is a joke the websites TS customers (starwod, II, RCI) have to use to trade.  I am by no means "a techie," and if i can illustrate dozens of system improvements, you know it is bad.

Not sure how a business which specializes in online trading can have such a horrible online product.


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## Pmuppet

gregb said:


> So I agree, this seems to suggest that Starwood will remain active in the ROFR and maybe even resales market.  Got to give all of those sales people something to sell.
> 
> Greg




So, tuggers unite, spread the word that buying TS from builders is a bad decision, but buying resale can be a good investment.

Basically cut off the resale gravytrain for starwood, so the only way they can make money is building new resorts and selling these properties.  

Cause while i wont ever buy from a developer, there is real value from buying from a developer to get into a newly exclusive property.

Doesnt mean it is a good business decision, but likely the only way to buy into a newly built resort if you have to.


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## Fredm

Fredm said:


> I have, from time to time, posted specific ROFR experiences at these resorts.
> To add to these, WMH annual Platinum was exercised at $5,500 on Monday.
> Several weeks ago a WMH Platinum was exercised at $5,000.
> WMH ROFR activity actually goes back further than 6 months.
> Starwood started exercising in earnest when it ran short of Platinum inventory at WDW over a year ago.
> 
> We also had a rash of WPORV sales exercised. In fact, it burned through our inventory at the time. The good news was that I had to go fishing for an eoy to sell to a buyer, and found a TUG owner who was interested in selling. That eoy passed ROFR at $8,500. Prior sales below $8,000 were exercised.
> 
> *We are opening escrow today at $6,000 for a WMH Platinum. I will let you know how it goes.*
> 
> Seven of our last ten sales at these resorts were exercised by Starwood.



Starwood exercised ROFR at $6,000 on WMH Platinum.


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## grgs

Fredm said:


> Starwood exercised ROFR at $6,000 on WMH Platinum.



Thanks for the update--I appreciate you letting us know what's going on with Starwood and ROFR.

Glorian


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## Mauiwmn

*Starwood did not exercise ROFR on WKORV OFC*

Starwood seems to be all over the place with what they are exercising ROFR on these days. My purchase passed  this week for an OFC at WKORV for $32,000.

I thought they'd snap this one up for sure.  Was extremely surprised that they passed.

They must be having better luck selling the less expensive IV & OV units.

We worked with Syed again on this purchase & he was a pleasure to deal with.
Syed advised me today that Starwood had exercised on the last 8 contacts he had submitted.

Maybe I was lucky and they ran out of money.


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## Downhill1

Which resorts does Starwood have ROFR "rights" at?  Thx


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## Mauiwmn

All I believe.


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## Fredm

Downhill1 said:


> Which resorts does Starwood have ROFR "rights" at?  Thx



WKORV, WKORV-N, WPORV, WMH, WDW.


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## fluke

SDO has no ROFR.  I am sure there are a few others but I am not sure.  Someone with more knowledge will probably chime in.

Fredm responded at the same time with better info


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## fluke

Fredm said:


> WKORV, WKORV-N, WPORV, WMH, WDW.



Doesn't the Bay Villas section at WSJ also have ROFR?


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## Mauiwmn

Fred,

Thanks for the correct info.  I am surprised they don't have ROFR at WKV.  I was confusing the buybacks for upgrades there.

Kathleen


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## DavidnRobin

fluke said:


> Doesn't the Bay Villas section at WSJ also have ROFR?



I do not think they do - VGV phase does not.


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## DavidnRobin

KSharpe said:


> Fred,
> 
> Thanks for the correct info.  I am surprised they don't have ROFR at WKV.  I was confusing the buybacks for upgrades there.
> 
> Kathleen



No ROFR for WKV.


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## Fredm

fluke said:


> Doesn't the Bay Villas section at WSJ also have ROFR?



As David said, VGV does not. But, I cannot say with certainty that Bay Villas does not.  
Likewise with Riverfront. I don't know. I have not read the governing documents for either of them. 

Maybe an owner who has read the documents can chime in.

With these two possible exceptions, my prior post is accurate.


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## Negma

I just heard that they exercised ROFR on WKORV-N ocean view 2br lock-off every year for 15K.


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## m61376

Westin5Star said:


> Thanks.  I know of two recent sales for 2BR OF gold for $10,500 each at the Surf.  I have an II request in right now for next June but I am also looking to buy.  Maybe I will just have to go to Aruba twice next year.  I sure wish Starwood would surprise us all and build a TS there.



Unless laws change it is highly unlikely, since Aruba now has a moratorium on future timeshare developments. Of course, that could change tomorrow.

Unbelievable prices, btw. Just a few years ago the rock-bottom best prices on those units (the 2BR OF and the 3BR OV were about the same price) was 18K. Then when the economy really tanked about 16k was a lowball price, and now 2-3 years later you're getting new lows. Sign of the times, I guess, but given the rental rates for these units from Marriott, these resale prices are very appealing.


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## Downhill1

*ROFR Exercised*

Earlier this week, Starwood exercised their ROFR on a WMH 2BR Annual Platinum at a price of $4,000 plus around $525 in closing costs.


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## Fredm

Downhill1 said:


> Earlier this week, Starwood exercised their ROFR on a WMH 2BR Annual Platinum at a price of $4,000 plus around $525 in closing costs.



No surprise there. 

My saga continues. Starwood exercised a WMH Platinum this week at $6,500.


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## LisaRex

Fredm said:


> My saga continues. Starwood exercised a WMH Platinum this week at $6,500.



I hope you get a commission from them for all your trouble!


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## Fredm

And............ ROFR today on WKORV OFD at $30,000.


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## DavidnRobin

Fredm said:


> And............ ROFR today on WKORV OFD at $30,000.



Thanks for this info.
Looks like prices for OFD are on the increase - good news for me (on paper...) - better for those that reportedly paid ~$25K


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## Fredm

DavidnRobin said:


> Thanks for this info.
> Looks like prices for OFD are on the increase - good news for me (on paper...) - better for those that reportedly paid ~$25K



Yep!

Given Starwood's stated intention to not build new resorts, churning deeds is the primary source of sales inventory going forward. 

Hard to say where the cut-off price point will be for ROFR generally (my upper limit guess is 35-40% of the retail sale price). Currently it appears to be closer to 25-30%.
But, OF units may be an exception, as the gross margin can still be considerable above 40%.

For now Starwood seems able to get the inventory it needs at the lower percentages.


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## jerseygirl

Fredm said:


> ...Given Starwood's stated intention to not build new resorts, churning deeds is the primary source of sales inventory going forward ....



But is there enough turnover to make this a viable, primary source of revenue? (See my conspiracy post on the "early deposits" thread.  Marriott had a "single channel" conversion to dump their bad weeks ... Starwood messed up this opportunity by creating "two channels).  Makes it much trickier!  ).


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## Fredm

jerseygirl said:


> But is there enough turnover to make this a viable, primary source of revenue? (See my conspiracy post on the "early deposits" thread.  Marriott had a "single channel" conversion to dump their bad weeks ... Starwood messed up this opportunity by creating "two channels).  Makes it much trickier!  ).



It's enough for now. Starwood is not intent on growing top line timeshare sales revenue. They have so stated. But, it does account for why they are being very aggressive with ROFR. They are not just sniping the very low resales. But,are in fact pushing prices up. They DO need the inventory to maintain its flat top line revenue target. It also supports my rather ambitious thinking of how much Starwood may be willing to pay to exercise ROFR at some point in the future. 40% of the retail sale price approximates what it costs to build, without having to risk the capital associated with building. 
(ROFR enables them to modulate its inventory investment closely with sales productivity. Or, shut it down if necessary).
Of course, this can change if the economic climate improves dramatically. But, they are more likely to take an asset-lite approach if it does. This means partnerships with other systems, or, expanding ops management of small/independent systems. Starwood has indicated a lukewarm interest in this approach, but only if it is compatible with their standards.


RE: your conspiracy theory, I think you are reaching too far.
Here is what I think:
Precisely because Starwood is no longer building, and is almost sold out of everything it has built, it must seed I.I. with inventory from somewhere.  Unlike the Marriott legacy system, Starwood controls the flow to I.I. for everything. 
The I.I. affiliation agreement possibly contains a minimum inventory mix for each resort that cannot be met with standing unsold inventory. So, Starwood is using its predictive model to cut inventory loose. I would think doing so early enables them to manage SVN with more predictability.


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## Fredm

Fredm said:


> No surprise there.
> 
> My saga continues. Starwood exercised a WMH Platinum this week at $6,500.



Starwood exercised WMH Platinum today at $7,000.


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## Fredm

Fredm said:


> And............ ROFR today on WKORV OFD at $30,000.



ROFR today on WKORV OFD at $31,000.


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## jarta

Fred,   ...   Stop it!  You are causing too much seller's remorse.  lol!   Salty


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## sharktzu

Hey Fred, I'm not saying I want to sell my two WKORV Ocean View EOY weeks, but if I did, what would a fair market price be for them? Sorry to bug you, but I'm just curious. Thanks!


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## Fredm

sharktzu said:


> Hey Fred, I'm not saying I want to sell my two WKORV Ocean View EOY weeks, but if I did, what would a fair market price be for them? Sorry to bug you, but I'm just curious. Thanks!



Sent you a PM


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## Fredm

Fredm said:


> Starwood exercised WMH Platinum today at $7,000.



OK, I'm getting punch drunk.  Another WMH Platinum exercised at $7,500.


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## gtm2011

Fred,
Do you know if Starwood has ROFR at all of the newer resorts like WDW, WRF or WLM?
Thanks.


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## Fredm

gtm2011 said:


> Fred,
> Do you know if Starwood has ROFR at all of the newer resorts like WDW, WRF or WLM?
> Thanks.



Read my posts 25 and 31 in this thread.


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## Denise L

Wow!  I guess an OFC is not in my future.  Good for those of us who paid retail though.


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## Fredm

*Correction*



Fredm said:


> WKORV, WKORV-N, WPORV, WMH, WDW.



I just received a confirmation from Starwood. 
*WDW does NOT have an ROFR. *

Per their verifications department, the 3 Hawaii resorts and WMH are the only 4 resorts with ROFR, currently.


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## jerseygirl

Well, that's odd.      Your thoughts Fred?


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## Fredm

jerseygirl said:


> Well, that's odd.      Your thoughts Fred?



I don't know what to say. I had to ask a second time to be sure of what I was being told.

Since I was the one who posted that WDW did have an ROFR, I wanted to post the correction.
It also answered the previously unknown status of Bay Villas and Riverfront.
No ROFR.

ETA: I just received confirmation in writing from Starwood's verifications department.
WKORV, WKORV/N, WPORV, and WMH, are the only resorts with ROFR.


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## jerseygirl

Well, if this was their sales revenue plan, so much for that!  Perhaps we need to help them come up with an eBay buyer name.  Anyone?  Nodge?


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## Fredm

Fredm said:


> OK, I'm getting punch drunk.  Another WMH Platinum exercised at $7,500.



WMH Platinum exercised at $8,000


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## maph

WMH 2 bedroom platinum, eBay purchase, exercised at $1707.  No surprise I guess given Fred's numbers.


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## Fredm

Fredm said:


> WMH Platinum exercised at $8,000



Finally! WMH Platinum PASSED at $8,500.


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## Fredm

WKORVN annual IV exercised today at $14,000.

WPORV eoy even exercised today at $8,000.


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## ada903

Wow a year ago WPORV annual 2 BDR was going for $1,000 or less on eBay.



Fredm said:


> WKORVN annual IV exercised today at $14,000.
> 
> WPORV eoy even exercised today at $8,000.


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## mlpmd56

*Wkorv*

I started another thread on this but I am repeating here.  WKORV EOY even first use 2014 1 bedroom ocean view ROFR exercised at $4500.  This was last week.  This is only slightly less than I paid in 2008.  Don't know if that helps people.  I do love the resort.  The reason I sold is their ridiculous increasing maintenance fees.  They do seem to be recycling and reselling more now.  Another way for them to gouge.  Very annoying.  Marcy


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## Fredm

WKORVN eoy odd IV exercised at $9,000, with seller paying 2012 portion of 2013use fees.


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## ada903

View category?



Fredm said:


> WKORVN eoy odd exercised at $9,000, with seller paying 2012 portion of 2013use fees.


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## Fredm

ada903 said:


> View category?



Oops! Island View.


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## PamMo

Wow!!!! I've heard several reports that Hawaii hotel occupancy rates/revenues are significantly up from previous years - particularly on Maui and Oahu. Maybe Starwood is getting ready with inventory for a busy whale/sell season?


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## ada903

Wow.  Thanks. 



Fredm said:


> Oops! Island View.


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## Fredm

ada903 said:


> Wow.  Thanks.



With the seller paying 2012 fees, the effective review price was ~7800.

Given that Starwood exercised a POR eoy at 8k, I am not shocked by it.

Earlier in this thread I offered an opinion about where Starwood's threshhold might be. So far, they remain at the lower end of my estimates, but pushing upward.


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## Syed

Starwood recently waived the following

WKORVN Island villa annual $16,000
WKORV Deluxe oceanfront $35,000

WPORV Even year $7500


WKORV Deluxe Oceanfront $25,000 was exercised


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## capjak

*WKORV-North*

Starwood excercised my WKORV-North at 11,500 2014 first use (island view, annual)


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## Fredm

WKORV OFD exercised at $32,000 today.


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## KACTravels

Fredm said:


> WKORV OFD exercised at $32,000 today.



Wow!  Thanks for keeping us informed on the ROFR activity.


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## feckman

KACTravels said:


> Wow!  Thanks for keeping us informed on the ROFR activity.



Yes, thank you, Fred!  I have a 2BR WKORV OV annual currently pending at $17K. I'm not terribly optimistic at this point.  How long do they generally take to exercise/waive?


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## Fredm

feckman said:


> Yes, thank you, Fred!  I have a 2BR WKORV OV annual currently pending at $17K. I'm not terribly optimistic at this point.  How long do they generally take to exercise/waive?



Starwood has 10 business days after date submitted. This usually translates to 15 calendar days.
They have been turning things around in 9-10 calendar days recently, but workload can change at any time.

My most recent experience with annual OV:
16,900 failed. 17,500 passed. Another 17,500 failed. 

Good luck!


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## Fredm

WPORV annual failed at $9,500. Another failed at $10,000.


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## feckman

Fredm said:


> Starwood has 10 business days after date submitted. This usually translates to 15 calendar days.
> They have been turning things around in 9-10 calendar days recently, but workload can change at any time.
> 
> My most recent experience with annual OV:
> 16,900 failed. 17,500 passed. Another 17,500 failed.
> 
> Good luck!



Thanks much!  I almost hope it does fail -- we've heard from a few people that OV units in the North property generally have better views than those in South. This left us feeling that we should've made an offer there.

I don't want to hijack the thread, but does this sound about right?


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## PamMo

Feckman, we own OV at WKORV and OF at WKORVN. I think some of the best OV villas at South have better views than some OF villas at North. South villas are larger, have full kitchens with ovens, dining table for 6 (vs 4 at North), and lower MF's. They do not have the second balcony on the LO studio, though. The villas I would not want to own are IV at South.


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## Syed

The following two were exercised recently.
2 Bed Lock off OF odd at WKORVN for $14,100
2 Bed Lock off Deluxe OF annual at WKORV for $33,300

2 Bed Lock off Ocean View annual at WKORVN for $20,275 was waived
2 Bed Lock off Center OF week 51 annual at WKORV for $35,000 was waived


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## feckman

PamMo said:


> Feckman, we own OV at WKORV and OF at WKORVN. I think some of the best OV villas at South have better views than some OF villas at North. South villas are larger, have full kitchens with ovens, dining table for 6 (vs 4 at North), and lower MF's. They do not have the second balcony on the LO studio, though. The villas I would not want to own are IV at South.



Very good info, thanks!  I'm sure we'll be good either way, but I didn't realize that the North property doesn't have a full kitchen or seating for 6.  That's actually pretty important for us.


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## LisaRex

feckman said:


> Thanks much!  I almost hope it does fail -- we've heard from a few people that OV units in the North property generally have better views than those in South. This left us feeling that we should've made an offer there.



I wouldn't want to be placed in a Bldg 4 ocean view unit because it's set farther back and looks out over a parking lot.  Generally speaking, north has more reliably good rooms.  If I was to buy OV, I'd target the north side. 

http://www.hawaiirevealed.com/free-...ali-area/westin-kaanapali-ocean-resort-villas


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## vacationtime1

feckman said:


> Very good info, thanks!  I'm sure we'll be good either way, but* I didn't realize that the North property doesn't have a full kitchen or seating for 6*.  That's actually pretty important for us.




The non-studio units at North have full kitchens.  The only problem with the kitchen is that it has a convection oven that is not intuitive to use.  That's all.  

The dining tables at North seat only 4.


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## LisaRex

vacationtime1 said:


> The non-studio units at North have full kitchens.  The only problem with the kitchen is that it has a convection oven that is not intuitive to use.  That's all.
> 
> The dining tables at North seat only 4.



...and the South side OVs only have lanais on the 1 bdrm side and a juliette balcony on the studio.  The North has a lanai on both sides.  

The south tables seat 6 and the living rooms are appreciably larger.


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## Syed

Following is a detailed description of the villa units in the Westin Kaanapali Ocean Resort Villas. The amenities in both phases can be used by all guests.
THERE ARE FOUR FLOOR PLAN TYPES:
A description of each of the four floor plans, which includes the view types available and annual maintenance and property tax information, follows.
The island view units face the road and the West Maui mountains.

1.DELUXE two bedroom lock off – 1,550 square feet:
One bedroom premium is 1,038 sq. ft. and the studio premium is 512 sq. ft.
All are corner units
There are lanais off the living room, master bedroom and studio
Buildings 2 and 3 have Ocean Front types, Buildings 2, 3 and 4 have Ocean View types and Building 4 has the Island View type unit
The deluxe ocean front units have the living room and the master bedroom facing the ocean and have a 180 degree view of the ocean with the studio portion is on the side of the building.
Annual Maintenance Fees and Property Taxes are $2,881.32

2. PREMIUM (Center) 2 bedroom lock off - 1400 square feet:
One bedroom premium is 900 sq. ft. and the studio premium is 500 sq. ft.
They are the center ocean front units located in Buildings 2 and 3 only
One unit on each floor
All three rooms face the ocean directly, with a 180 degree ocean view, and have a lanai off each room
Annual Maintenance Fees and Property Taxes are $2,091.04

3. Two bedroom lock off - 1400 square feet:
One bedroom premium is 900 sq. ft. and the studio premium is 500 sq. ft.
Lanais off the living room and master bedroom, juliette balcony only off the Studio
Buildings 2, 3 and 4 have the ocean view type and Building 4 has the island view type Annual Maintenance Fees and Property Taxes are $2,091.04

4. One bedroom premium - larger than 900 square feet:
This type of unit is available only in the ocean view category
Lanais off the living room and bedroom
Located in buildings 2, 3 and 4
Annual Maintenance Fees and Property Taxes are $1,764.25
Floor plan types 1, 2 and 3:
One bedroom portion of the lock off
The dining room table in the living room seats 6. 
There is a 4-burner cook top, an oven and a convection/microwave oven, full size refrigerator, dishwasher and washer/dryer
There is a king bed in the bedroom and queen size sofa bed in the living room
Studio premium
Has a small dining table for two
There is a 2-burner cook top and convection/microwave, full size refrigerator, dishwasher and washer/dryer
There is a king bed and a queen size sofa bed
Floor Plan Type 4:
One bedroom premium ocean view
Dining table in the living room seats
There is a 4-burner cook top, an oven and a convection/microwave oven, full size refrigerator, dishwasher and washer/dryer

Now for a description of the Westin Kaanapali Ocean Resort Villas North, which are in buildings 5, 6, 7 and 8

The buildings are angled providing some ocean views from the island villa units
The ocean front units don't all have direct oceanfront views
All units in Building 8 and some in Building 5 are considered ocean front
Ocean View units are in Building 7 and Island Villa units are in 5, 6 and 7
There is only one floor plan available in Oceanfront, Ocean View and Island Villa types.
Some of the Island Villa units have a view of the ocean and the pools. Some have pool and koi pond views and some have only a koi pond view
The Island Villa units don't face the road

Following is a description of each of the floor plans and annual maintenance and property tax information.

2 Bedroom lock off type - 1230 square feet:
One bedroom premium is 750 sq. ft. and the studio premium is 480 sq. ft. There are lanais off both sides of the lock off

One bedroom portion of the lock off description:
The dining table in the living room seats 4.
There is a 4-burner cook top, no oven but a convection/microwave oven, full size refrigerator, dishwasher and washer/dryer.
There is a king bed in the bedroom and queen size sofa bed in the living room
The Studio premium description:
Has a small dining table for two
There is a 2-burner cook top and convection/microwave, full size refrigerator, dishwasher and washer/dryer
There is a King bed and a queen size sofa bed
The Annual Maintenance Fees and Property Taxes are $2,344.44

NOTE:
If this is your first purchase of a Starwood timeshare, add $130.21 SVN Club fee.
If it is your second purchase of a Starwood timeshare, add $34.37 annual SVN Club fee. If it is your third purchase the SVN Club fee is zero.

Bi-annual fees are 1/2 the annual fee plus a $20 bookkeeping fee and add the applicable SVN Club fee.


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## YYJMSP

Syed said:


> The island view units face the road and the West Maui mountains.
> 
> 1.DELUXE two bedroom lock off – 1,550 square feet:
> One bedroom premium is 1,038 sq. ft. and the studio premium is 512 sq. ft.
> All are corner units
> There are lanais off the living room, master bedroom and studio
> Buildings 2 and 3 have Ocean Front types, Buildings 2, 3 and 4 have Ocean View types and Building 4 has the Island View type unit



The Island View Deluxe units in the one corner of building 4 (the 1BR side being units 4x21) actually face directly over the pool and towards the ocean.

They were marketed as "pool view" by some sales persons...


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## LisaRex

YYJMSP said:


> They were marketed as "pool view" by some sales persons...



I wonder how misled the people who bought "pool view" and were assigned a parking lot view felt.  Because the actual deeded view of both is "Island View."


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## YYJMSP

LisaRex said:


> I wonder how misled the people who bought "pool view" and were assigned a parking lot view felt.  Because the actual deeded view of both is "Island View."



I hate to say it, but we were one of those, that particular unit being our first purchase a long time ago, when were young and naïve.

We eventually realized our oops about 3yrs later  when we found TUG and started paying more attention...

We've been lucky that we've actually ended up with that unit on the 6th floor every time we've made a home Resort booking, and I think we've gotten better views than some of the OV units


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## DavidnRobin

Syed said:


> 1.DELUXE two bedroom lock off – 1,550 square feet:
> 
> 2. PREMIUM (Center) 2 bedroom lock off - 1400 square feet:
> 
> 3. Two bedroom lock off - 1400 square feet:
> 
> 4. One bedroom premium - larger than 900 square feet:



Hi Syed (how's it going?) -

The square footage that you stated for WKORV is only the interior area and does not include the lanai (balcony) area.
From pages 264-271 of the Owners' Manual - the Net Living area (net interior plus net lanai area) is as follows:

Villa Type:	~Area (sqft)
1Bd Prem:            995 sqft
2Bd LO Prem:	1475 sqft
2Bd LO Prem (OF):	1700 sqft
2Bd LO Dlx:	1810 sqft
(Note: The OF premium has  a lanai off of the studio, and why it is larger than the standard Premium.  Also, the view from the Dlx is >180 degrees since you can also see from the side of the lanai of the 1Bd side - for example: can also see the pool area and the mountains - so more like 270 degrees, and even greater if the view from the windows on the side are included)


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## Syed

David, Thank you for the information on the lanai square footage. I will go back and include it in the Unit descriptions


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## Syed

Starwood exercised the following:

WKORV
One bedroom Premium Ocean View Odd year with 2015 usage for $5100
Two bedroom L/O Ocean View annual with 2014 usage for $16,500
WKORVN
Two bedroom L/O Oceanfront annual with 2014 usage for $23,500

And Waived:
Two bedroom L/O Ocean view annual with 2014 usage at WKORV for $18,800


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## PamMo

Thank you, Syed. Does "2014 usage" mean the Seller paid next year's MF's and rolled it into the sales price, or simply that Buyer's usage begins in 2014? I know many contracts are including MF's and closing costs to try to tamp down ROFR by Starwood.


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## DavidnRobin

Syed said:


> David, Thank you for the information on the lanai square footage. I will go back and include it in the Unit descriptions



For example: Here is a listing of WKORV villa sizes (Net Interior, Lanai, and Total sqft) along with Valuation/Common Interest from Owners Manual for B2, Floors 5-6.  As you can see, not all villa types are equal in size. (sorry... a bit fuzzy)


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## Syed

PamMo said:


> Thank you, Syed. Does "2014 usage" mean the Seller paid next year's MF's and rolled it into the sales price, or simply that Buyer's usage begins in 2014? I know many contracts are including MF's and closing costs to try to tamp down ROFR by Starwood.



The 2014 usage means buyer usage and annual fees to start in 2014 and is not included in the total price. However, the $800 in closing is included in the price. Starwood seems to be a little more aggressive, in their buy back,  than they were a few weeks ago.


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## Syed

For example: Here is a listing of WKORV villa sizes (Net Interior, Lanai, and Total sqft) along with Valuation/Common Interest from Owners Manual for B2, Floors 5-6. As you can see, not all villa types are equal in size. (sorry... a bit fuzzy)

David, I really appreciate this information. I had someone ask me about lanai square footage today and was glad to have it available.


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## Syed

Another 2 bed OF at WKORVN was exercised for $23,300.


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## DavidnRobin

Syed said:


> David, I really appreciate this information. I had someone ask me about lanai square footage today and was glad to have it available.



Not a problem - I had this from the time I calculated MF$/sqft.  The lanais for the 2Bd Dlx adds a lot of sqft - the studio side is about 9x10, and the 1 Bd side is 8x25.  We spend a lot of time on ours, and what i love about the OFD.  This info is in the OM - I think I have it in 3 parts (PDF) - thought I got it from you originally (?) - I could send you if you want (large files) - if you don't have it.   I should still have your work email.


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## Syed

David, Sorry for the delayed response. Thanks for the offer. I found it. Mahalo


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## Fredm

WKORV OFD waived at $33,500.


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## Fredm

WKORV eoy odd IV exercised today at $6,800. Buyers first use 2015.

WKOR-N eoy even IV exercised at $7,500. Buyer pays 2013 fees.


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## feckman

The WKORV 2BR OV unit we had a $17K offer on was exercised.


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## PamMo

feckman said:


> The WKORV 2BR OV unit we had a $17K offer on was exercised.



Sorry to hear it didn't get past ROFR, feckman. Are you going to try for another?


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## feckman

PamMo said:


> Sorry to hear it didn't get past ROFR, feckman. Are you going to try for another?



Thanks, I appreciate it!  I think we'll try one more time.  The whole ROFR process rubs me the wrong way, but I think we'll give it another try at a slightly higher level and see what happens.  If that fails, we'll likely fall back on something else.

I understand that ROFR can be beneficial to existing owners, but I don't like how it artificially inflates market value...or how it exploits both owners and unwitting retail buyers by allowing Starwood to cherry-pick intervals and resell them at huge profits.

The more I learn about how Starwood runs their resorts, the less inclined I am to purchase any of their properties.  Although it sounds like most developers/management companies have their share of warts.  That's what sent us to WKORV from KBC when we stayed there in January.  We liked the KBC property and loved the location, but the timeshare presentation and all the slimy Diamond propaganda made me feel like I needed a shower.


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## DavidnRobin

Sorry about the ROFR, but as you said - as an Owner am glad there is a ROFR for multiple reasons.   I do not feel exploited - and it is apparently the market value.  Especially beneficial when posted here on TUG.  Good luck on the next - the ROFR was much lower just a short time ago.  I know people who can't give away their DRI points (if they are the same thing...).


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## feckman

I hear you, but ROFR is definitely not market value -- it's artificial. If Starwood decided to stop exercising tomorrow, where would values likely go?  And what does that mean for the "real" market value of any given interval?  Not the most secure position to be in as an owner, especially those who purchased retail. 

I'm admittedly very new to the timeshare game and have a LOT to learn, but you don't have to be a weather man to know which way the wind blows.  

Regardless, WKORV is a spectacular property and I do hope that we're able to purchase a unit.  That said, Maui is what we're really in love with, so we'll set a ceiling for WKORV and have a fallback plan if it doesn't pan out.  We'd certainly NEVER buy points from Diamond -- most intervals at KBC are deeded weeks, so we'll go for that.  After making it out of the timeshare presentation at KBC, you couldn't pay us to take DRI points!


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## jarta

feckman said:


> Thanks, I appreciate it!  I think we'll try one more time.  The whole ROFR process rubs me the wrong way, but I think we'll give it another try at a slightly higher level and see what happens.  If that fails, we'll likely fall back on something else.
> 
> I understand that ROFR can be beneficial to existing owners, but I don't like how it artificially inflates market value...or how it exploits both owners and unwitting retail buyers by allowing Starwood to cherry-pick intervals and resell them at huge profits.
> 
> The more I learn about how Starwood runs their resorts, the less inclined I am to purchase any of their properties.  Although it sounds like most developers/management companies have their share of warts.  That's what sent us to WKORV from KBC when we stayed there in January.  We liked the KBC property and loved the location, but the timeshare presentation and all the slimy Diamond propaganda made me feel like I needed a shower.



How is the exercise of ROFR artificially inflating market value for Starwood's Maui resorts if there is a market where Starwood can resell the properties it ROFRs at huge profits?  I don't understand how you consider that market value is determined.

If Starwood is doing such a horrible job of managing its Maui properties, why are people willing to pay the high MFs and additional multiple thousands of dollars to acquire the Starwood Maui properties on the open market while the DRI property resales on the open market are for much less money?  It seems like that doesn't make sense at all.  Maybe the Starwood Maui (WKORVN) properties and system are just considered superior to the DRI (Ka'anipali Beach Club) property and system by the timeshare market.   Salty

http://www.ebay.com/csc/Timeshares-..._nkw=kaanapali+beach+club&LH_Complete=1&rt=nc


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## Ken555

feckman said:


> I hear you, but ROFR is definitely not market value -- it's artificial. If Starwood decided to stop exercising tomorrow, where would values likely go?  And what does that mean for the "real" market value of any given interval?



I'm sympathetic to your position, since you just lost a unit at a nice price. But, think about it from the owner's perspective and you might reach a different conclusion. I don't own WKORV but if I did I'd want the ROFR since it helps stabilize prices for a very expensive timeshare. Not many years ago these units were in the $30k's range and when prices fell there was seemingly no floor. Now that SVO is buying the prices have stabilized and even increased. That only hurts buyers not owners. And, since ROFR is part of the process for these properties it is the real market value...for obvious reasons. Prices change over time, regardless if there is ROFR or not.


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## DavidnRobin

feckman said:


> I hear you, but ROFR is definitely not market value -- it's artificial. If Starwood decided to stop exercising tomorrow, where would values likely go?



But SVO does, because they can and it is profitable.  SVO may be driving the market price, and therefore it becomes the market price.  Afterall, people are making the bids at a price that SVO considers worth the ROFR.   It's not like SVO is bidding up the price.  This means people will need to bid/offer higher if they want WKORV/N until it is no longer profitable for SVO.  This will drive up the price until it doesn't - based on supply/demand - which drives any market.  SVO gets to play/influence both sides with minimal effort or risk (sweet deal for them).


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## feckman

jarta said:


> How is the exercise of ROFR artificially inflating market value for Starwood's Maui resorts if there is a market where Starwood can resell the properties it ROFRs at huge profits?  I don't understand how you consider that market value is determined.



Sorry, I thought given that we're on TUG the "market" I'm talking about would be understood as the "resale market."  That's how I consider market value.  To wit:

http://www.ebay.com/sch/i.html?_odk...m570.l1313&_nkw=Westin+Kaanapali&_sacat=15897

Obviously not one of these are likely to pass ROFR, and Starwood will have picked up countless additional inventory on the backs of existing owners who may not know any better.



Ken555 said:


> But, think about it from the owner's perspective and you might reach a different conclusion. I don't own WKORV but if I did I'd want the ROFR since it helps stabilize prices for a very expensive timeshare.



I don't think I would reach a different conclusion.  I understand that in this case, at this time, Starwood's aggressiveness at exercising ROFR can be seen as "protecting" owners, but I don't think that's their motivation.  Rather, they're simply padding inventory so they can fleece buyers on the retail market.  I'd rather know the "real" value of something I own and make my decisions on that basis.

In addition, I bristle at the thought of relying on the whims of a single corporate buyer to prop up the (resale) market value of something I own.  The market value is the value determined on the open market, not what Starwood is willing to pay (or not pay) for any given interval at any given moment.  The whole thing strikes me as a house of cards built on the back of a single buyer with an unfair advantage (ROFR) and ulterior motives (the ability to re-sell at retail for massive profit).  If/when that buyer decides to leave the (resale) market, prices may very well plummet.  I'm certainly not suggesting that this is likely to happen, I'm just saying that it could.



DavidnRobin said:


> SVO gets to play/influence both sides with minimal effort or risk (sweet deal for them).



EXACTLY my point.  The process exploits both buyers and sellers for the sole benefit of Starwood.  Just look at the eBay values for WKORV/N properties.  This is obviously closer to true (resale) market value, although even these values may be inflated by buyers willing to bid more in the dim hopes of passing Starwood's known ROFR.  I'm sure SVO didn't do anything to pay those eBay owners a penny more than they had to.

All that said, I feel lucky to be able to consider and discuss all of this with the good and knowledgeable people here on TUG before buying anything at all.  I am confident that this will help my family come with a solid strategy, viable alternatives and a reasonable price ceiling for owning a timeshare on Maui.  I feel really bad for retail buyers who don't have the same opportunity and pay tens of thousands of dollars more than they could/should have.  Even if our next offer passes ROFR, we will have done so by weighing the benefits of the property against some approximation of the "true" (resale) market value -- eyes wide open.  This is a HUGE advantage and a luxury I am sincerely appreciative of. 

--Jim.


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## PamMo

feckman, I definitely understand your feelings. It is SO disappointing! You had the opportunity and a signed contract to buy the exact unit you want, for a very good price - and then lost it when Starwood took it through ROFR. I bet you were already thinking about your first vacation there, weren't you? I know the feeling. It happened to me on an OF unit at WKORVN. If it's what you want, don't give up. Villas always come up for sale, and Starwood will not exercise ROFR on all of them. Good luck to you!

Added: Jim, you were posting when I was. Starwood has not always actively exercised ROFR. At the bottom of the recession, prices were half what they are now, and deals were going through with few exceptions. They are exercising it now because Hawaii tourism is booming again, and people are wanting to buy there. Prices have gone up at the Westin and Marriott timeshares on Maui as demand has increased. Other timeshares are cheaper to get into, but they do not have the same quality or provide the same level of guest experience as WKORV/WKORVN and new Marriott towers.


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## feckman

PamMo said:


> feckman, I definitely understand your feelings. It is SO disappointing! You had the opportunity and a signed contract to buy the exact unit you want, for a very good price - and then lost it when Starwood took it through ROFR. I bet you were already thinking about your first vacation there, weren't you? I know the feeling. It happened to me on an OF unit at WKORVN. If it's what you want, don't give up. Villas always come up for sale, and Starwood will not exercise ROFR on all of them. Good luck to you!



Thanks, PamMo!  I'm not so much disappointed as annoyed by the way the process is rigged in Starwood's favor.  I've never been able to pay no attention to the man behind the curtain.  

I know we'll wind up with something we'll be happy with on Maui, so I'm not really worried about that.  It's just a matter of figuring out what that will look like and what we're willing to pay given all the competing factors.  It's complicated!  



PamMo said:


> Added: Jim, you were posting when I was. Starwood has not always actively exercised ROFR. At the bottom of the recession, prices were half what they are now, and deals were going through with few exceptions. They are exercising it now because Hawaii tourism is booming again, and people are wanting to buy there. Prices have gone up at the Westin and Marriott timeshares on Maui as demand has increased. Other timeshares are cheaper to get into, but they do not have the same quality or provide the same level of guest experience as WKORV/WKORVN and new Marriott towers.



Understood, and I agree.  The guest experience will certainly be different at different resorts.  The questions then become how much different, how valuable are those differences and at what cost?  Obviously, these valuations happen on a family-by-family basis.  For us, the valuable things are pretty parochial.  Things like access to a washer and dryer, the ability to cook in the unit, a comfortable bed.  In the end, our family tends to be very active, spending little time in the unit or at the resort anyway.  I'm sure that'll change as the years pass, though!  

Thanks again for all the input and discussion!


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## jarta

feckman   ...   





> Obviously not one of these are likely to pass ROFR, and Starwood will have picked up countless additional inventory on the backs of existing owners who may not know any better.   ...  The market value is the value determined on the open market, not what Starwood is willing to pay (or not pay) for any given interval at any given moment.



eBay sales (even assuming they are taken to deed) are not examples of market value, IMO.  Market value is defined as:

"The most probable price that the specified property interest should sell for in a competitive market after a reasonable exposure time, as of a specified date, in cash, or in terms equivalent to cash, under all conditions requisite to a fair sale, with the buyer and seller each acting prudently, knowledgeably, for self-interest, and assuming neither is under duress."

http://www.appraisalinstitute.org/ppc/downloads/2011_guidenote_11.pdf

eBay auctions are missing a few elements - like sellers without duress, reasonable periods of exposure time, prudent sellers acting for self-interest and binding contracts to sell.

Just as there is nothing wrong with you buying a nice timeshare from a distressed owner for $1 (or whatever it might sell for on eBay), there is nothing wrong with Starwood reselling ROFRed weeks for a huge profit.  Both you and Starwood should be able to take advantage of supply and demand in the market.

eBay is a great place to pick up a timeshare week from a seller under duress who offers it for a week or a post card company who was paid to take the week from an owner under duress or a seller who inherited a timeshare and has no interest, much less a self-interest, in recouping any money from a sale after exposure for a reasonable period of time.  

I know eBay has the absolute lowest timeshare prices available.  I have bought timeshare weeks on eBay myself.  But I never kidded myself about paying market value when I paid the absolute lowest price for a timeshare from a desperate seller.   Salty


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## feckman

jarta said:


> Both you and Starwood should be able to take advantage of supply and demand in the market.



Ah, but there's the fundamental flaw in your argument, at least as it pertains to the RESALE market: Starwood is not taking advantage of supply and demand in the market, they are taking advantage of their unilateral access to ROFR.

There's no way to know whether any given eBay sale involves a seller under duress, but they can certainly include "reasonable" exposure time and binding contracts to sell.  Textbook definitions and semantics aside, I think eBay is much closer to a "real" (resale) market value than Starwood setting an arbitrary value below which exercising ROFR is sufficiently profitable for them.

Given that fact, the "protection" that owners feel from ROFR is not much more than smoke and mirrors, IMO.

Again, ROFR may be the reality for many properties, but I think that healthy discussions about the "benefits" of ROFR (and those who actually reap the rewards) are important for those of is in the resale market to have and consider.  And if my family does end up with a WKORV unit, I at least will feel better having thought about all this without unrealistic expectations about what my interval is *actually* worth.  (see: 2008 Housing Crisis)


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## DavidnRobin

Oh well - I tried... guess I am misguided/misinformed.

Good luck in your search - if you buy WKORV - I would strongly suggest OF (IMO, IMO, IMO etc) - of course, the ROFR have caused these to increase as well.  Otherwise, exchange via SVN or II into WKORV/N unless you need hard to get weeks (relatively few for weeks1-50).


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## SMHarman

jarta said:


> <snip>
> Just as there is nothing wrong with you buying a nice timeshare from a distressed owner for $1 (or whatever it might sell for on eBay), there is nothing wrong with Starwood reselling ROFRed weeks for a huge profit.  Both you and Starwood should be able to take advantage of supply and demand in the market.<snip>   Salty



On the flip side, Starwood has assessed what it believes MV is and that could be calculated as ROFR price + cost to carry (MF-rental income) + sales commission / incentive costs + profit margin = current list price for retail at the resort.


----------



## feckman

DavidnRobin said:


> Oh well - I tried... guess I am misguided/misinformed.



I appreciate it!  I understand that many here are owners and I'm not looking to pee in anyone's pool, but my perspective as a non-owner with critical distance and no vested interest (yet) is that, while a developer exercising ROFR may protect owners in practice, it's neither resale market value nor is it a reliable protection for the owner.  I may *appreciate* it if we become WKORV owners, but unless I'm missing something it's not going to change my fundamental opinion on the practice.



DavidnRobin said:


> Good luck in your search - if you buy WKORV - I would strongly suggest OF (IMO, IMO, IMO etc) - of course, the ROFR have caused these to increase as well.  Otherwise, exchange via SVN or II into WKORV/N unless you need hard to get weeks (relatively few for weeks1-50).



Thanks for that advice as well.  We considered OF, but it's quite a heavy financial lift for what is effectively an indulgence.  Also, some of the more recent threads on the difficulty of booking OF (and the potential for even more difficulty in the future with StarOptions banking, etc.) have scared us away from shooting the lock off the wallet and just going for OF.


----------



## SMHarman

feckman said:


> Ah, but there's the fundamental flaw in your argument, at least as it pertains to the RESALE market: Starwood is not taking advantage of supply and demand in the market, they are taking advantage of their unilateral access to ROFR.
> 
> There's no way to know whether any given eBay sale involves a seller under duress, but they can certainly include "reasonable" exposure time and binding contracts to sell.  Textbook definitions and semantics aside, I think eBay is much closer to a "real" (resale) market value than Starwood setting an arbitrary value below which exercising ROFR is sufficiently profitable for them.
> 
> Given that fact, the "protection" that owners feel from ROFR is not much more than smoke and mirrors, IMO.
> 
> Again, ROFR may be the reality for many properties, but I think that healthy discussions about the "benefits" of ROFR (and those who actually reap the rewards) are important for those of is in the resale market to have and consider.  And if my family does end up with a WKORV unit, I at least will feel better having thought about all this without unrealistic expectations about what my interval is *actually* worth.  (see: 2008 Housing Crisis)



But *Woods ROFR is not a right to reposess so it can resell.  It is a right to replace the buyer you found in an open market transaction with themselves, no other aspects of the contract change, you as a seller still get a check for the same $ just from *wood, not from the person who you thought you were getting it from.

The ROFR does not even provide a floor price for the seller.  If the ebay buyer managed to squeak through a sale at $1 then *wood would ROFR and pay the seller $1.

From a seller perspective not much changes the frustration is on the buyer side where you keep being bought out of contracts the time and effort and probably tied up cash in escrow while that goes on.


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## Ken555

feckman said:


> while a developer exercising ROFR may protect owners in practice, it's neither resale market value nor is it a reliable protection for the owner.  I may *appreciate* it if we become WKORV owners, but unless I'm missing something it's not going to change my fundamental opinion on the practice.



There has been countless threads on this topic over the years on TUG. Opinions vary, but many seem to believe that when a resort has a ROFR there is at least some ability to predict, at times, what a deed would sell for on the open market. Many have benefited by receiving higher prices for their timeshares than would otherwise be the case, and many others wish their own resort had it.

Based on the historical prices of WKORV, I think you'll discover that it was once a very expensive resort (resale). Only in the last five years has it lost significant value on the resale market, yet Starwood seems to have no difficulty selling at retail...even today. So, if you want to own WKORV now I think you know what the prices should be. When I bought my WKV platinum week I worked with a broker, and I'd suggest the same to you for your purchase. I've only bought inexpensive weeks on eBay and I tend to doubt I'd spend ~$15-20k+ on an eBay sale (I'd also want title insurance for such a large purchase, as well).


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## feckman

Ken555 said:


> When I bought my WKV platinum week I worked with a broker, and I'd suggest the same to you for your purchase. I've only bought inexpensive weeks on eBay and I tend to doubt I'd spend ~$15-20k+ on an eBay sale (I'd also want title insurance for such a large purchase, as well).



Agreed.  We're working with a broker on this purchase as well as one at Grand Timber Lodge in Breckenridge and a Marriott Custom House in Boston.  He's been good to deal with so far.


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## Ken555

feckman said:


> Agreed.  We're working with a broker on this purchase as well as one at Grand Timber Lodge in Breckenridge and a Marriott Custom House in Boston.  He's been good to deal with so far.



Unless you go during school holidays, II has been great for me at obtaining weeks at Grand Timber Lodge. We had a 3-bed in Dec, tho early skiing, and I've successfully visited several times over the last five or so years.


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## Fredm

feckman said:


> ROFR is definitely not market value -- it's artificial. *If Starwood decided to stop exercising tomorrow, where would values likely go?  And what does that mean for the "real" market value of any given interval? * Not the most secure position to be in as an owner, especially those who purchased retail.



We can all agree that Starwood is the beneficiary of their reserved preemption right.

You are right about ROFR not being market value. 
Whether it affects price at all (one way or the other) is a discussion that will never be resolved here. IMO, it has little to do with it.

I transact a fair number of timeshares subject to a ROFR, and have been doing so for quite some time.
FWIW, the dynamic that *by far *influences resale demand (hence price) is the developer's marketing investment. 
The *primary source *of secondary market buyers are families that attended a developer timeshare presentation, liked it, but did not buy from the developer. I suspect you are among them. 
Firming resale prices are a result of more prospects produced by more timeshare tours. 

The absence of ROFR unto itself will not soften prices. In fact, resale prices at WKORV were strongest when there was no ROFR being exercised. Prior to 2008 Starwood was marketing the tail off the resort, and resale prices were relatively high because their presentations created resale buyers (sorry for the repetition).

We tend to view the past few years as how it has always been, or how it will always be. The low point was 2007-2010. Lots of financially strapped sellers, and low developer marketing investment. 

It is not the presence or absence of ROFR you should be concerned about.
Worry about market value  if Starwood decides to not sell it with vigor any more. Then, the remaining demand will be largely from existing owners (the second highest source of natural demand).
In that case, it is predictable that supply will exceed demand. It always has.


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## feckman

Fredm said:


> We tend to view the past few years as how it has always been, or how it will always be. The low point was 2007-2010. Lots of financially strapped sellers, and low developer marketing investment.
> 
> It is not the presence or absence of ROFR you should be concerned about.
> Worry about market value  if Starwood decides to not sell it with vigor any more. Then, the remaining demand will be largely from existing owners (the second highest source of natural demand).
> In that case, it is predictable that supply will exceed demand. It always has.



Very fair points and I appreciate your perspective.  And you're exactly right -- we attended a timeshare presentation (at the Ka'anapali Beach Club) which is where our timeshare journey started.  TUG has since fueled the fire and provided us with a welcome (and ongoing) education.


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## gdonnersc1

Fredm says:



> It is not the presence or absence of ROFR you should be concerned about.
> Worry about market value  if Starwood decides to not sell it with vigor any more. Then, the remaining demand will be largely from existing owners (the second highest source of natural demand).
> In that case, it is predictable that supply will exceed demand. It always has.



You can see the same thing in housing developments.  When the developer turns over the community, sells their final properties and stops spending money on marketing, demand inevitably softens, prices go down and inventories go up.  Good for buyers and bad for sellers.  But there could be another dynamic--if Starwood did not have the incentive to maximize profits on the sales side, it might not do as good a job managing a community which would lower the quality of the experience for everyone.  Has anyone seen this happen in real life at a timeshare community when the developer was the manager as well and stops marketing?

In any case, I believe that owners benefit from the ROFR process as it adds buyers and keeps the developer interested.


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## Fredm

WKORV IV Deluxe eoy even exercised at $8,500. Buyer pays 2013 fees.


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## PamMo

Thanks again for adding to the ROFR database, Fred. It's interesting Starwood exercised at that price for an eoy 2BR deluxe IV - generally regarded as the least desirable units at WKORV. Starwood's recent activity seems to indicate some growing strength in sales.

I'm curious? Have you and Syed seen a big jump in interest/sales of Hawaiian timeshares this year? There's been a lot of buzz in the TUG boards about buying there.

The Maui News had a couple of interesting articles about increased condo sales and tourism (see below).


_*Maui sales of condos strongest in 5 years*
March 16, 2013
Condominium sales on Maui hit a five-year high for February, reflecting a generally brightening real estate market, according to a report by the Realtors Association of Maui. A total of 100 condos were sold last month, compared to 62 in January and 83 the same month last year, the report out this week showed. This year's February sales are the best for the month in the last five years, topping the 98 sales in 2011. The median price, with half the prices higher and half lower, rose 27 percent year over year in February to $364,950 and was 25 percent higher than January's $292,000. That price was still lower than the five-year high of $692,500 in 2009.

*Revenue per room reaches new high for Maui*
March 13, 2013
Maui hit a new high for the month of January with an average daily room rate of $289.98, which was in keeping with a record-setting month statewide, Hospitality Advisors and Smith Travel Research reported. The daily room rate was up 6.3 percent from the previous January, part of a strong start of the year buoyed by a 1.2 percentage point growth in occupancy to 78.7 percent for Maui. Maui also benefitted from a 6.5 percent increase in visitor arrivals, which included travelers from the U.S. West, up 9 per-cent; U.S. East, up 2.7 percent; Japan, up 27 percent; and Canada, up 12 percent. The Valley Isle's revenue per available room, or RevPAR, jumped 8 percent from last January to $228.21.​_


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## Fredm

PamMo said:


> I'm curious? Have you and Syed seen a big jump in interest/sales of Hawaiian timeshares this year? There's been a lot of buzz in the TUG boards about buying there.



Increase in # of sales. Sale prices have also increased. 

Importantly, the trend appears to be up. The trend begets itself. 
When prices are going down, buyers wait for them to sink further creating yet more softness in the market.
Now, buyers are more willing to pull the trigger for fear that prices will be higher if they do not.
Too early to tell if this attitude will be sustained. Too much depends on general confidence in the economy. But, it does appear that the downturn is over. At least the huge overhang of unsold inventory has shrunk, and the really low priced stuff has been absorbed.

An example: I just posted an ROFR of an IV deluxe eoy at $8,500.  I now have buyers looking to purchase at 9k, but don't have the inventory to sell them.  A couple of years ago I could not sell them at 4k.


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## jarta

Fredm said:


> Increase in # of sales. Sale prices have also increased.
> 
> Importantly, the trend appears to be up. The trend begets itself.
> When prices are going down, buyers wait for them to sink further creating yet more softness in the market.
> Now, buyers are more willing to pull the trigger for fear that prices will be higher if they do not.
> Too early to tell if this attitude will be sustained. Too much depends on general confidence in the economy. But, it does appear that the downturn is over. At least the huge overhang of unsold inventory has shrunk, and the really low priced stuff has been absorbed.
> 
> An example: I just posted an ROFR of an IV deluxe eoy at $8,500.  I now have buyers looking to purchase at 9k, but don't have the inventory to sell them.  A couple of years ago I could not sell them at 4k.



You are correct.  If the economy continues to improve (more vacationing) and the unsold inventory continues to shrink (no timeshares being built) and if demand for a week in Maui remains the same (despite high, but possibly dropping, MFs and horribly high expense to travel to HI), demand eventually will overtake supply and resale prices will be even higher than today.

And, if (when?) the Maui resale weeks become too expensive for most resale buyers, the resale price of II trader resorts likely will go up, too, as their supply falls.  But, by the time that happens, I predict the Maui weeks deposited in II will dry up even further and be deposited, much more often than now, as 2-br units.

Fred did it ever occur to you that publishing/advertising the ROFR prices here, by itself, would fan the flames of self-sustaining price increases?  You sly old fox!  lol!    Salty


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## Fredm

jarta said:


> Fred did it ever occur to you that publishing/advertising the ROFR prices here, by itself, would fan the flames of self-sustaining price increases?  You sly old fox!  lol!    Salty



lol!   I wish I had the power to move the market!

Actually, my ROFR posts are intended to provide some insight to what buyers can expect, so as to not lead to their frustration and disappointment.
My contribution to this community.

Sellers must still compete with other owners who are motivated to sell at lower prices. Most buyers gravitate to the lowest priced listing by a credible seller. Such is the reality of the resale marketplace.


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## PamMo

Fredm said:


> lol!   I wish I had the power to move the market!
> 
> Actually, my ROFR posts are intended to provide some insight to what buyers can expect, so as to not lead to their frustration and disappointment.
> My contribution to this community.



And we thank you for your contributions to the collective knowledge in this forum!

Posting ROFR updates can be helpful to buyers and sellers. Starwood seems to be picking off all the low hanging fruit anyway, whether the sales price is posted or not. Knowing what price point is being bought through ROFR helps a buyer to make an offer which might stick.


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## SMHarman

PamMo said:


> And we thank you for your contributions to the collective knowledge in this forum!
> 
> Posting ROFR updates can be helpful to buyers and sellers. Starwood seems to be picking off all the low hanging fruit anyway, whether the sales price is posted or not. Knowing what price point is being bought through ROFR helps a buyer to make an offer which might stick.


Why wouldn't they.
They buy at 20, and can sell at 60, thats 40k gross profit.  
Say it takes them a couple of years to sell it well thats 6k of MF (and there is a lot of fuzzy math lazy rounding going on here) remember some of that goes back to starwood for running the booking systems and the hotel services, but they now have that room to put into Starwood inventory at 700/night for the 2 bed (IV so more for the ones they are buying back).  Thats $4200 a year or a profit on carry over MF of $1200.
A chunk of the $60/40k is going on salesperson commission but there is very little negative about this math.
I guess over time they have realized that the island view is hard to sell so let those pass ROFR but the OV and OF sell themselves after a few days of sitting on the Lanai in one of those.


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## Fredm

WKORV OFD exercised at $34,000.


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## larryallen

How long are they taking to exercise, or not, at WKORV?


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## Fredm

Starwood has 10 business days after date submitted. Usually translates to 15 calendar days.


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## DeniseM

Hi Fred - How do you hold them to the letter of the law?  Do you send them Docs "return receipt" to document the date, or what's the procedure?


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## Fredm

DeniseM said:


> Hi Fred - How do you hold them to the letter of the law?  Do you send them Docs "return receipt" to document the date, or what's the procedure?



Hi Denise.

The quickest/easiest thing to do is transmit the documents electronically.
The email date serves as the delivery date (keeping in mind that receipt is ET). If after 5pm ET, delivery is not until the next business day. The  clock starts the first business day *after *the delivery date.
Starwood has always honored the email date for our submissions.

Email them to: 00SVO-LoanServicingTeam@Starwoodvo.com

The submission must be complete with correct seller names/signatures. All documents must have the ICN on them.
If anything is incorrect/incomplete the documents will not be accepted. It may take SVO some days to even get to it. If not complete it will then be bounced back, resubmitted, and the clock starts over.

eta: several years ago (before Starwood became active w/ROFR) our closing agents submitted via US Mail, return receipt. 
If using the mail, it is a good idea to get a return receipt, or express mail delivery confirmation.


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## alohakevin

PamMo said:


> The Maui News had a couple of interesting articles about increased condo sales and tourism (see below).
> 
> 
> _*Maui sales of condos strongest in 5 years*
> March 16, 2013
> Condominium sales on Maui hit a five-year high for February, reflecting a generally brightening real estate market, according to a report by the Realtors Association of Maui. A total of 100 condos were sold last month, compared to 62 in January and 83 the same month last year, the report out this week showed. This year's February sales are the best for the month in the last five years, topping the 98 sales in 2011. The median price, with half the prices higher and half lower, rose 27 percent year over year in February to $364,950 and was 25 percent higher than January's $292,000. That price was still lower than the five-year high of $692,500 in 2009.
> 
> *Revenue per room reaches new high for Maui*
> March 13, 2013
> Maui hit a new high for the month of January with an average daily room rate of $289.98, which was in keeping with a record-setting month statewide, Hospitality Advisors and Smith Travel Research reported. The daily room rate was up 6.3 percent from the previous January, part of a strong start of the year buoyed by a 1.2 percentage point growth in occupancy to 78.7 percent for Maui. Maui also benefitted from a 6.5 percent increase in visitor arrivals, which included travelers from the U.S. West, up 9 per-cent; U.S. East, up 2.7 percent; Japan, up 27 percent; and Canada, up 12 percent. The Valley Isle's revenue per available room, or RevPAR, jumped 8 percent from last January to $228.21.​_



Not to change the subject I hope the mayor and council read this. Havent heard much about tax rate this year.


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## jarta

> Not to change the subject I hope the mayor and council read this. Havent heard much about tax rate this year.



That's because the people who usually complain about the Maui County assessment or tax rate are busy reserving rooms on Maui.  Or, taking Starwood's ROFR.

When the daily room rate jumps 6.3% in a year and the occupancy rate still goes up for hotels, TS ownership on Maui, despite the tax, looks like a bargain.   Salty


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## tillamookrn

*WMH pending*

My WMH EOY 2 bedroom lock-off, Gold Plus season, passed ROFR. 
Took 2 weeks to hear back from SVO. I picked this up off EBay for $1! (Seller paid closing fees)
Plan on splitting the unit for a 1 week premium for my personal use, and use the other to trade in II.


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## Syed

WKORV and WKORVN Starwood Exercise update
 WKORV 
Deluxe Oceanfront $41,000 waived
2 bed OV annual $22,000 was waived and one for $21,000 exercised
1 bed OV annual for $9500 exercised.

WKORVN 
Ocean Front annual for $29,800 waived
Ocean view annual for $24,000 waived
Island villa annual for $12,500 exercised
Island Villa even year for $10,200 exercised


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## Mauiwmn

*Recent ROFR*

Per Syed these are recent ROFR numbers at WKORV-N:

North OF-$28,500 exercised
North OF-$29,000 waived

South OFD-$38,800 exercised
South OFD-$41,000 waived

South OFC-$41,000 pending Starwood response

Starwood became even more aggressive with ROFR in mid February.


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## LobsterHunter

I know most of the ROFR's on this thread relate to WKORV & WKORVN, but we just passed ROFR on WMH.  The unit was an annual platinum 2br for $3,500 & the 2013 use was included (seller wanted to be reimbursed for 2013 use).  I was a little concerned $3,500 might not pass ROFR, so we just made the purchase price $5,100 & did not reimburse seller for 2013 use, it passed.  Now in the process of retro-ing unit, so having the 2013 use was a big bonus for us.  A letter to the Riverside tax collector should set our taxes based on $3,500 instead of the $5,100 as well.


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## Kildahl

Any known ROFRs being exercised at WPORV?


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## Downhill1

Kildahl said:


> Any known ROFRs being exercised at WPORV?



Starwood has ROFR at WPORV.


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## sb2313

It does have ROFR at princeville, not too many reports since westin5stars post early in this thread.


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## DavidnRobin

No ROFR have been reported for WPORV - I do not think SVO uses their ROFR for resorts that are in active sales.  They have been selling cheaply on the resale market - maybe around $5-6K?


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## Downhill1

DavidnRobin said:


> This is incorrect - WPORV does have a ROFR.



My bad - apologies


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## Bob808

Why doesn't 't Starwood cherry pick villas off the Internet?


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## jarta

Bob808 said:


> Why doesn't 't Starwood cherry pick villas off the Internet?



Because Starwood has a ROFR and will get notice of the terms of the sale.   It has no need to chase around tracking Internet sales (or any other type of sale).   Salty


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## tillamookrn

DavidnRobin said:


> No ROFR have been reported for WPORV - I do not think SVO uses their ROFR for resorts that are in active sales.  They have been selling cheaply on the resale market - maybe around $5-6K?



ROFR exercised on my WPORV 2 bedroom ocean view unit @ $1883. 
EBay bankruptcy auction...I knew it was a long shot, but my fingers were crossed.


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## DeniseM

Maybe this will make it easier - WPORV has no ocean view deeds - they are all island view - every unit at the resort.


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## Bob808

Like the STICKY above we can ask owners to please post Exercised ROFR.


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## Bob808

tomandrobin said:


> Ditto.....I was pumped for Westin Aruba and was really let down when Starwood cancelled its development. Hence why I own Cancun now.



SVN customer service called me last week for a satisfaction survey.  I shared with her I would be very excited about Aruba.


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## rebrewer

*WPORV  RoFR*

Doesn't anyone have a copy of the exact wording for Right of First Refusal for Princeville?  SVO just exercised on a purchase outside the 10 days I was told was their contractual option.  Is it 10 days, or 10 business days?

Thanks,

Bob


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## Mauiwmn

It's 10 business days.


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## rebrewer

Mauiwmn said:


> It's 10 business days.



Thanks.  Do you have a copy of the actual wording?


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## pathways25

RIGHT OF FIRST REFUSAL TO PURCHASE.

If you receive an offer to buy (the "Offer to Buy") your Vacation Ownership Interest and if you want to accept it, you must first notify the Developer before accepting the offer and must provide a complete copy of the Offer to Buy.  The Developer will then have the right and an option to buy your Vacation Ownership Interest at the same price and on the same terms contained in the Offer to Buy.  If the Developer decides to buy it, then the Developer will send you written notice of that decision within ten (10) business days after the Developer receives your notice of the Offer to Buy.  The Developer's notice will create a binding contract between you and the Developer to buy your Vacation Ownership Interest on the terms stated in the Offer to Buy (subject, however, to a reasonable extension of the closing date).  If the Developer does not send notice of its decision to buy the Vacation Ownership Interest within the ten (10) business day period, then you may sell your Vacation Ownership Interest to the person who submitted the Offer to Buy.  If the Offer to Buy is changed in any way (for example, a reduction in the price, a change in the Buyer or an assignment of the Buyer's rights to someone else), or if the sale does not close within ninety days, then the Offer to Buy will be considered a new Offer to Buy and you must re-submit it to the Developer and the requirements of this section will apply again.  If the Developer chooses not to buy the Vacation Ownership Interest, this will not constitute consent by the Developer of a sale or other  transfer of the Vacation Ownership Interest to a Competitor.


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## rebrewer

pathways25 said:


> RIGHT OF FIRST REFUSAL TO PURCHASE.
> 
> If you receive an offer to buy (the "Offer to Buy") your Vacation Ownership Interest and if you want to accept it, you must first notify the Developer before accepting the offer and must provide a complete copy of the Offer to Buy.  The Developer will then have the right and an option to buy your Vacation Ownership Interest at the same price and on the same terms contained in the Offer to Buy.  If the Developer decides to buy it, then the Developer will send you written notice of that decision within ten (10) business days after the Developer receives your notice of the Offer to Buy.  The Developer's notice will create a binding contract between you and the Developer to buy your Vacation Ownership Interest on the terms stated in the Offer to Buy (subject, however, to a reasonable extension of the closing date).  If the Developer does not send notice of its decision to buy the Vacation Ownership Interest within the ten (10) business day period, then you may sell your Vacation Ownership Interest to the person who submitted the Offer to Buy.  If the Offer to Buy is changed in any way (for example, a reduction in the price, a change in the Buyer or an assignment of the Buyer's rights to someone else), or if the sale does not close within ninety days, then the Offer to Buy will be considered a new Offer to Buy and you must re-submit it to the Developer and the requirements of this section will apply again.  If the Developer chooses not to buy the Vacation Ownership Interest, this will not constitute consent by the Developer of a sale or other  transfer of the Vacation Ownership Interest to a Competitor.



Thanks very much for this.

Lost another one...


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## PamMo

I've been watching this 2BR WKORV oceanfront deluxe corner unit auction on eBay. It just ended with winning bid of $12,600 - http://www.ebay.com/itm/141179616964?_trksid=p2055120.m1438.l2649&ssPageName=STRK:MEBIDX:IT

I don't see any way that $16,040.74 (all in) will get past ROFR. Unless the seller "doctors" the sales price. Those are really nice units - even with the high MF's.


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## PatDexter

2BR EY Plat WMH passed ROFR for just under $1k.


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