# HOTEL OWNER Will Reflag or Sell 122 Marriott Int'l Properties / Kauai Beach Club Timeshare Co-Location Affected? [MERGED]



## controller1 (Oct 7, 2020)

On failure to meet 80% termination threshold for cumulative owner’s priority returns, *Service Properties Trust* (NASDAQ:SVC) has terminated the management agreements for 122 hotels with Marriott International (NASDAQ:MAR), effective January 31, 2021 and currently plans to transfer the branding and management of 98 of these hotels to Sonesta and to sell 24 hotels.









						Service Properties Trust cancels agreements with Marriott for 122 hotels (NASDAQ:MAR)
					

On failure to meet 80% termination threshold for cumulative owner’s priority returns, Service Properties Trust (NASDAQ:SVC) has terminated the management agreements for 122 hotels with...




					seekingalpha.com


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## TheBeachBum (Oct 7, 2020)

I looked at Service Properties Trust holdings, and they do own the Kauai Beach Resort and Beach Club. This may have some future impact on the two MVC properties adjacent to the resort.


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## n777lt (Oct 7, 2020)

I am very confused - What is the non-MVC property there? We purchased a week at the Beach Club in 1995, but traded in the week in  2006 (at a very substantial profit on paper) for a preconstruction purchase of MOC Napili Towers, so I have forgotten.  When Marriott reconstructed the buildings (post-Iniki) and developed the timeshare there, did they leave part of the property as a hotel?  I don't recall any separation of facilities, not even check-in.


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## SueDonJ (Oct 8, 2020)

n777lt said:


> I am very confused - What is the non-MVC property there? We purchased a week at the Beach Club in 1995, but traded in the week in  2006 (at a very substantial profit on paper) for a preconstruction purchase of MOC Napili Towers, so I have forgotten.  When Marriott reconstructed the buildings (post-Iniki) and developed the timeshare there, did they leave part of the property as a hotel?  I don't recall any separation of facilities, not even check-in.



If you search marriott.com for Kauai Beach Club you'll see both "Marriott's Kaua'i Beach Club ... a vacation ownership resort ..." and "Kaua'i Marriott Resort ... oceanfront resort" with the same address, 3610 Rice Street. Looking at the resort map I know that at least the unlabeled building to the left of the pool is hotel rooms because we tacked on a night there before checking in to Waiohai the next day. I think I remember that the check-in area was for both the hotel and timeshares with separate lines for each, maybe what's labeled B and C on the linked map? Not sure, it was a while ago.


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## SueDonJ (Oct 8, 2020)

TheBeachBum said:


> I looked at Service Properties Trust holdings, and they do own the Kauai Beach Resort and Beach Club. This may have some future impact on the two MVC properties adjacent to the resort.



Assuming the second co-located timeshare property is Kauai Lagoons just up the road, is it as integrated with Kauai Beach Resort in that if the hotel company chooses at a later date to sever the relationship then Kauai Lagoons would have no stand-alone pool or other amenities?


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## dioxide45 (Oct 8, 2020)

SueDonJ said:


> Assuming the second co-located timeshare property is Kauai Lagoons just up the road, is it as integrated with Kauai Beach Resort in that if the hotel company chooses at a later date to sever the relationship then Kauai Lagoons would have no stand-alone pool or other amenities?


I wouldn't consider Kauai Lagoons to be a co-located resort with Kauai Beach Resort. They are probably at least a mile apart with the land between owned by another entity. Kauai Lagoons has its own pool. I beleive there are cross charging privileges with the hotel, so if you go to a hotel restaurant you can charge it back to your room at Kauai Lagoons. In reality, I wouldn't see much of an impact on the vacation experience of someone at Kauai Lagoons with this change. They are two very distinct properties. Now Kauai Beach Club is a different situation.


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## MULTIZ321 (Oct 9, 2020)

_[MERGED]_

Interactive List of Another 98 Hotel Properties Sonesta Will Acquire Thanks to Marriott International, Incorporated - The Gate










						Interactive List of Another 98 Hotel Properties Sonesta Will Acquire — Thanks to Marriott International, Incorporated - The Gate
					

Brian Cohen created an interactive list of another 98 hotel properties Sonesta will acquire — thanks to Marriott International, Incorporated, of 122...




					thegate.boardingarea.com
				





Richard


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## pedro47 (Oct 9, 2020)

Wow. Virginia got hit hard .


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## melroseman (Oct 9, 2020)

Several years ago cross-charging privileges at Marriott Beach Club from Kauai Lagoons were discontinued.  As Dioxide noted, the Lagoons has it's own pool and there is an upscale restaurant at the Timbers next door, not useful for a quick meal or light breakfast, but plenty of restaurants nearby.  The impact on Kauai Beach Club will be significant I think.  The hotel and timeshares have operated more or less as a single unit, sharing all facilities.  We own there and it will be interesting to see how it all unwinds.  I think Marriott can expect some backlash for this one.


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## pedro47 (Oct 9, 2020)

The winner so far is Sonesta, they are requiring over 100 Marriott's hotels in the United States.


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## rthib (Oct 9, 2020)

pedro47 said:


> The winner so far is Sonesta, they are requiring over 100 Marriott's hotels in the United States.


Since they own 34% of Sonesta, that was the point.


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## dioxide45 (Oct 9, 2020)

It seems that the arrangement that Marriott had with the hotel owners of these properties really wasn't ideal. Paying a set return no matter the circumstances. I suspect Marriott stopped paying the returns as a strategic move to get out of the contracts. From what I read, these types of arrangements aren't really the norm, the hotel owners usually take on the risk and Marriott gets its management and license fees.


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## hangloose (Oct 9, 2020)

Kauai Beach Club has an MVCI timeshare section as well as a Marriott hotel section.  Kauai Lagoons is its own separate entity, fully MVCI timeshare and unrelated.

I imagine the MVCI timeshare piece of Kauai Beach Club will remain (as it is owned by the owners) but the Marriott hotel portion would not.

The rub is that that are on the same resort campus and I believe share some of the costs associated to the amenities on-site under an umbrella “Marriott” name.  Question I think is whether that will change?


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## dioxide45 (Oct 9, 2020)

We have seen similar situations in New Jersey and Spain. I suspect that the MVC owners will still continue to have to pay for whatever associate agreement they have with the hotel for use of the facilities. Unless of course MVC owns the facilities and the hotel leases them from MVC. Kauai Beach Club may have to put in its own checkin desk in order to facilitate checkins for guests staying at the vacation club.


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## CPNY (Oct 9, 2020)

Is it possible that Marriott buys the Kauai property?


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## dioxide45 (Oct 9, 2020)

CPNY said:


> Is it possible that Marriott buys the Kauai property?


Pre covid, possibly, but I don't see them wanting to take on the risk and inventory at this point.


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## CPNY (Oct 9, 2020)

dioxide45 said:


> Pre covid, possibly, but I don't see them wanting to take on the risk and inventory at this point.


I’m wondering if they pick and choose properties they don’t want to “lose”. Could this be one of them? I’m not familiar with the destination or competition in the area, but it seems there is a lot of buzz around this property


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## dlpearson (Oct 9, 2020)

Anyone notice Kauai Resort & Beach Club?  I presume this is the hotel portion/rooms of the property.  Wonder what (if any) impact it may have to owners there....




Edited to add: Whoops, just saw this is covered in this thread Service Properties Trust Will Reflag or Sell 122 [Marriott, Int'l Hotel] Properties


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## controller1 (Oct 9, 2020)

pedro47 said:


> The winner so far is Sonesta, they are requiring over 100 Marriott's hotels in the United States.



And this is in addition to over 100 IHG U.S.-based Service Properties Trust hotels also moving to Sonesta.


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## bazzap (Oct 9, 2020)

dioxide45 said:


> We have seen similar situations in New Jersey and Spain. I suspect that the MVC owners will still continue to have to pay for whatever associate agreement they have with the hotel for use of the facilities. Unless of course MVC owns the facilities and the hotel leases them from MVC. Kauai Beach Club may have to put in its own checkin desk in order to facilitate checkins for guests staying at the vacation club.


Yes, every shared resort property is probably different.
At Club Son Antem Mallorca, Spain quite a few of the facilities - golf courses, golf club restaurant, spa, many of the pools... were MVC’s rather than the hotels, so when another company took over the hotel management from Marriott International there was a need to work out which facilities could be shared and how the costs would be split.. 
Some issues were more challenging, such as security requirements where there were quite different views as to what was needed, so as MVC standards required a greater level we as owners had to pick up more of the cost.
The spa facilities sadly also had to be reduced, although these have been partially reintroduced more recently.


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## KauaiMark (Oct 9, 2020)

_[MERGED]_

 ...Including Kauai Marriott Beach Club









						Amazing. Marriott Just Lost 122 Properties In North America (Including a Major Hawaii Resort)
					

Service Properties Trust, a company that owns over a hundred properties that are currently operating under various Marriott brands, has announced that it is terminating all of its agreements with Marriott effective 31 January 2021. There doesn't look to be any going back so from 1 February next...




					travelingformiles.com


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## Fasttr (Oct 9, 2020)

HOTEL OWNER Will Reflag or Sell 122 Marriott Int'l Properties / Kauai Beach Club Timeshare Co-Location Affected? [MERGED]
					

On failure to meet 80% termination threshold for cumulative owner’s priority returns, Service Properties Trust (NASDAQ:SVC) has terminated the management agreements for 122 hotels with Marriott International (NASDAQ:MAR), effective January 31, 2021 and currently plans to transfer the branding...




					tugbbs.com


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## dioxide45 (Oct 9, 2020)

Shares of Marriott International were actually up on the news. So investors seem to see it as a good thing.


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## jabberwocky (Oct 9, 2020)

100 hotels out of 7500 or so isn't going to move the needle here.  The fact that 24 were in the process of being sold and another 9 were wanting to be disposed of but couldn't find a buyer speaks volumes.  The only standout is really the Kauai property.  These were likely underperforming properties.  Marriott did the calculation and figured it was better to give these up than to continue paying out.  I imagine that most of these can be easily replaced once travel starts to normalize - they simply need new investors willing to buy a franchise.


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## pedro47 (Oct 9, 2020)

Financially this is a good move by Marriott's  to sell  off those under performancing hotels to Sonesta.


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## dioxide45 (Oct 10, 2020)

pedro47 said:


> Financially this is a good move by Marriott's  to sell  off those under performancing hotels to Sonesta.


Marriott isn't selling anything. It is the owner of the hotels (not Marriot) that is pulling out and moving their hotels to Sonesta. Marriott doesn't own properties, they just manage, license or franchise them out. Kind of like McDonalds.


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## Superchief (Oct 10, 2020)

It appears that most of the hotels are Courtyards, so no big loss IMO. Many of the ones I am familiar with are older properties.


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## pedro47 (Oct 10, 2020)

dioxide45 said:


> Marriott isn't selling anything. It is the owner of the hotels (not Marriot) that is pulling out and moving their hotels to Sonesta. Marriott doesn't own properties, they just manage, license or franchise them out. Kind of like McDonalds.


Correction the owner of the hotels are  pulling out and are moving their hotels to Sonesta.


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## jabberwocky (Oct 10, 2020)

I’ve only stayed at a Sonesta once (Rittenhouse Square in Philly). To be honest, I wasn’t that impressed. The room was fine and clean, but pretty basic.

Given the lack of Sonesta hotels outside of the US, I can’t see how this would impact my travel plans at all.  There will still be plenty of Marriott, Hyatt or Hilton’s to choose from if I want to stick with a loyalty program. Sometimes there is a special hotel that is worth staying at, but Sonesta doesn’t really have any distinguishing features or locations that would lead me to choose them over another chain.


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## bogey21 (Oct 10, 2020)

Obviously the Owner of the properties was not happy with Marriott's performance and terminated them...

George


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## rthib (Oct 10, 2020)

bogey21 said:


> Obviously the Owner of the properties was not happy with Marriott's performance and terminated them...
> 
> George


Not really. Service Trust owns a controlling interest in Sonesta. They moved almost as many IHG hotels earlier this year. It is purely a move to bulk up their own brand. 
They had been trying to sell a bunch of these properties (including Kauai) earlier. Then in February renegotiate a bunch of the management contracts to include the opt out in early february.
Marriott decided that they didn't want to subsidise these hotels so they are letting them go. They are however disputing the timing of when it kicks in, so will be interesting to see what the lawyers say about all this.


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## pspercy (Oct 11, 2020)

https://beatofhawaii.com/will-kauai-marriott-default-foretell-problems-at-other-hawaii-hotels/

Just booked a week using DC points next year . . .


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## dougp26364 (Oct 11, 2020)

The article says it’s to early to tell how this will affect the timeshare owners. I’m wondering if this will be similar to what happened in HHI or in Vail. I believe in both of those it was Marriott that initiated removing its name and, both where before the destination club. 

If I was an owner at KBC, I had joined the DC and I had bought additional DC points to elevate my membership level, I think I’d be nervous first, then ticked off if I lost status because Marriott just wasn’t interested in my property anymore. 

And what about when Marriott spun off its timeshare portion so that it was its own company? What does that mean in this situation. Will it a
End up being something like when HGVC took over the management of Elara in Vegas from Westgate where there are Westgate owners having ownership rights in a Hilton managed timeshare? What a weird situation this could turn out to be.


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## JIMinNC (Oct 11, 2020)

dougp26364 said:


> The article says it’s to early to tell how this will affect the timeshare owners. I’m wondering if this will be similar to what happened in HHI or in Vail. I believe in both of those it was Marriott that initiated removing its name and, both where before the destination club.
> 
> If I was an owner at KBC, I had joined the DC and I had bought additional DC points to elevate my membership level, I think I’d be nervous first, then ticked off if I lost status because Marriott just wasn’t interested in my property anymore.
> 
> ...



Just theorizing here, but the hotel and timeshare portions of this property are already managed by two different companies  - Marriott Vacations Worldwide (timeshare) manages and operates the timeshare towers and Marriott International (hotel) manages the hotel tower. How the responsibility for the common areas is divided between the two companies depends on whatever legal agreements likely exist between the hotel company and the timeshare company.

I think it is unlikely that the timeshare portion of the property would change and move away from Marriott Vacation Club.

At minimum they will likely need to separate the front desk/check-in positions (separate check-in desks for Sonesta hotel and MVC timeshare) and perhaps they will need two concierge desks. Signage may get a bit messy and confusing. I would expect the MVC timeshare HOA and the hotel management company (Sonesta) will split the operating costs of pools and other common amenities on some pro-rata basis just as they likely split them today between MVC and Marriott International.

The cleanest option would be for Marriott Vacations Worldwide to just offer to buy the remaining hotel tower from SPT and convert those to timeshare interests that would just be deeded over to the DC Trust. But given the current economic environment, that might be hard to justify the capital outlay.


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## dioxide45 (Oct 11, 2020)

There are physical deeded weeks at KBC in the DC trust. That ownership doesn't go away if the hotel is sold or transfers management to Sonesta.


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## cowboy (Oct 12, 2020)

It would be interesting to know why initially,the property was split into two ownerships when Marriott renovated their portion into timeshares.


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## TravelAmore (Oct 12, 2020)

_[MERGED]_

Per the BestofHawaii.com, reported this morning the HOTEL is in default as of last week. No news or speculation on what will happen or what it means for timeshare owners. Marriott has not officially commented. Find the full article here: Beat of Hawaii


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## jabberwocky (Oct 12, 2020)

There is a much more fulsome discussion of this in another thread. You may wish to request this gets merged into that one.

_[Link disabled after merge.]_


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## dioxide45 (Oct 12, 2020)

cowboy said:


> It would be interesting to know why initially,the property was split into two ownerships when Marriott renovated their portion into timeshares.


Since Marriott wanted to sell deeded timeshare ownerships, there really wouldn't be any other way. A lot may also depend on who owns common areas and such also.


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## TravelAmore (Oct 12, 2020)

Thanks for letting me know, jabberwocky. I just requested a merge!


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## Dean (Oct 12, 2020)

This will be interesting and messy.  While there are quite a few and important differences between this and what happened with Spicebush, Swallowtail and the Saturday villas on HHI as well as Longboard Key and part of Vail; I could see the property being removed from the MVC system if this all goes south.  Vail is a better comparison IMO but we've seen other situations that tell us MVC is willing to move on even to resorts they actually built as I understand they have threatened both Aruba Ocean Club and Beachplace Towers with expulsion in the past, I'm not sure if there are other examples.   But I could also see a separate check in but no pool or other infrastructure coming out of this.


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## SueDonJ (Oct 12, 2020)

*Moderator Note:*_  Quite a few thread merges are happening so this has been re-titled. As things progress I expect this thread will focus on possible impacts to Kauai Beach Club; please let me know if you think anything else needs to be a stand-alone TUG thread. Thanks!_


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## JanT (Oct 12, 2020)

This makes me glad that we just sold our week back to MVCI.


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## vacationtime1 (Oct 12, 2020)

JanT said:


> This makes me glad that we just sold our week back to MVCI.



MVCI took our unit via ROFR earlier this year (we were sellers).  I'm happy to be watching this from a distance, too.

The public spaces for the timeshares and the hotels are inextricably connected; it's not only the matter of the check-in desk.  The half-acre pool, the parking, the open arcade, and the beach are shared amenities -- and are covered by a very detailed contract which presumably covers this situation.


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## PamMo (Oct 12, 2020)

Well, cr@p! I just got home from a month on the road and read about this. Our Marriott oceanfront KBC unit has been great to use, and has been an awesome trader with Marriott preference. Now what??? We had no heads up that this was even a possibility.


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## n777lt (Oct 12, 2020)

dioxide45 said:


> Since Marriott wanted to sell deeded timeshare ownerships, there really wouldn't be any other way. A lot may also depend on who owns common areas and such also.


I believe that Marriott originally took over the whole property after the devastation by Hurricane Iniki in 1992. It had been a Westin hotel with the fantasy Kauai Lagoons golf course and animal park on top of the hill. KBC timeshare sales were well underway in the fall of 1995, when we bought. Perhaps Marriott repaired the hotel first, to ensure cash flow while developing the timeshares (remember, MVCI wasn't a separate company back then)... but I don't know when they would have sold that property to Service Properties. Didn't Marriott (MAR) sell off a lot of their real estate around the same time they spun off MVCI, focussing instead on management contracts?
Maybe someone here can give a more definitive history - I'm just going off vaguely remembered lore.


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## 186158tch (Oct 17, 2020)

_[MERGED]_

How do you think the loss of the hotel side of the property to Sonesta will affect the Marriot Beach Club timeshare in Kauai?
We’ve always enjoyed trips there.
Is anyone there now or planning a stay?


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## dioxide45 (Oct 17, 2020)

Another ongoing thread_ [link disabled after merge.]_


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## MVCRoadWarrior59 (Jan 1, 2021)

_[MERGED.]_

Recently became aware of change of ownership at this MVC where I am an owner.


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## Mr. Vker (Jan 1, 2021)

MVCRoadWarrior59 said:


> Recently became aware of change of ownership at this MVC where I am an owner.



The hotel side changed ownership. MVC still owns the timeshare. No changes in ownership of the property you own.


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## Mowogo (Jan 2, 2021)

hangloose said:


> Kauai Beach Club has an MVCI timeshare section as well as a Marriott hotel section.  Kauai Lagoons is its own separate entity, fully MVCI timeshare and unrelated.
> 
> I imagine the MVCI timeshare piece of Kauai Beach Club will remain (as it is owned by the owners) but the Marriott hotel portion would not.
> 
> The rub is that that are on the same resort campus and I believe share some of the costs associated to the amenities on-site under an umbrella “Marriott” name.  Question I think is whether that will change?


I would say it all depends on how long the shared amenities contracts last, and when they expire how much renewal costs.


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## Mowogo (Jan 2, 2021)

JIMinNC said:


> The cleanest option would be for Marriott Vacations Worldwide to just offer to buy the remaining hotel tower from SPT and convert those to timeshare interests that would just be deeded over to the DC Trust. But given the current economic environment, that might be hard to justify the capital outlay.


Given the current economic environment around travel, I could see a lot of prime resort hotels going toward timeshare conversion since demand for hotels may be slow to recover.  There is a market as sales presentations are ongoing, and I could see quite a few resort owners deciding that with a delayed recovery they might be better off turning towers in sprawling resorts into timeshares now to get money coming in.  Especially if they did it as a management contract/partnership which is the trend for new HGVC developments.


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## T_R_Oglodyte (Jan 2, 2021)

It seems to me that one key issue will be how the common area expenses are allocated between the Marriott timeshare portion of the property and the hotel operation.  

Till now, Marriott has essentially sat on both sides of the table in setting the procedures for that allocation.  Going forward that could be more adversarial.


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## TheTimeTraveler (Jan 2, 2021)

Mowogo said:


> Given the current economic environment around travel, I could see a lot of prime resort hotels going toward timeshare conversion since demand for hotels may be slow to recover.  There is a market as sales presentations are ongoing, and I could see quite a few resort owners deciding that with a delayed recovery they might be better off turning towers in sprawling resorts into timeshares now to get money coming in.  Especially if they did it as a management contract/partnership which is the trend for new HGVC developments.




It's a good idea, however with the huge marketing costs and the time delays for converting such a project it doesn't make a lot of sense.  By the time they are ready to roll out a property as a timeshare the travel surge has returned and the demand for hotel space has resumed.

I think 2022 may be the year that things finally return to normalcy.



.


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## Mowogo (Jan 2, 2021)

TheTimeTraveler said:


> It's a good idea, however with the huge marketing costs and the time delays for doing such a project it doesn't make a lot of sense.  By the time they are ready to roll out a property as a timeshare the travel surge has returned and the demand for hotel space has resumed.
> 
> I think 2022 may be the year that things finally return to normalcy.
> 
> ...


In Hawaii, there is talk that it won’t be until 2024-2025 that travel fully recovers.  For Mega resorts, this is an opportunity to right size their inventory.  And in many cases renovations were needed anyway.


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## dioxide45 (Jan 2, 2021)

T_R_Oglodyte said:


> It seems to me that one key issue will be how the common area expenses are allocated between the Marriott timeshare portion of the property and the hotel operation.
> 
> Till now, Marriott has essentially sat on both sides of the table in setting the procedures for that allocation.  Going forward that could be more adversarial.


The thing is though, Marriott didn't sit at both sides. The hotels have long been owned by another outside owner. The issue in Kauai, is who owns what. Shared amenities may be owned by both parties. What is the split and how do they allocated expenses. If they have shared ownership, I suspect expenses are allocated based on percentage of ownership or percentage of units owned at the property by each entity.


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## T_R_Oglodyte (Jan 2, 2021)

dioxide45 said:


> The thing is though, Marriott didn't sit at both sides. The hotels have long been owned by another outside owner. The issue in Kauai, is who owns what. Shared amenities may be owned by both parties. What is the split and how do they allocated expenses. If they have shared ownership, I suspect expenses are allocated based on percentage of ownership or percentage of units owned at the property by each entity.


Yeah - I guess that's so.  

I remember in 1999, our first trip to Kauai, when we stayed in the hotel operation on a special promotion. When we were there we were invited on a timeshare tour, with about $150 in resort credits for attending.  We did, we were sold on timeshare, and we bought two one-bedroom units.  Later we learned there were other timeshares on the island, as well as the existence of the resale market,   We did some investigating, decided that what was then the Embassy Resort (now Point at Poipu) was a better fit for us, so we rescinded our Marriott purchase, and began looking for an Embassy resale.  

As we were looking around, I was looking at annual fees. and it struck me that given the grounds, landscaping, and facilities, the annual fees at the Marriott ought be greater than they were.  So I dug into the financial statements we had been given, and confirmed what I suspected - Marriott was subsidizing the fees.  As I recall it was about $300 (total annual fees at that time were about $1000).  I figured that was going to go away when sales were completed.  Which was another reason to rescind our purchase.  And the subsidy did end a year or two later, when sales were complete, and owners got a nasty bump in annual fees.


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## Ozziechick (Jan 4, 2021)

Received an email from our appointed owners representative, the President of the KBC Owners Association, late last week.  Buried deep within this email was the first "official" advice we personally have received from anyone vaguely associated with MVCI that the hotel section of the property had been rebranded. MVCI's silence has been deafening for almost 3 months.   All very well, Marriott Hotel's default shouldn't affect the ownership and occupancy rights of our Beach Club timeshare villas, however, the President's email did say "talks are presently taking place with Sonesta and MVC to ensure that the services you are accustomed to will continue to carry on into the future".  Almost 3 months down the line from default and subsequent termination, this speaks volumes regarding the question of service and facilities available to owners in the future and bearing in mind that the land owner and its 34% owned Sonesta Hotels don't owe us a cent in consideration (in fact I would imagine MVCI is negotiating from a position of disadvantage given the circumstances), I wonder how we as owners will fare in the immediate future and the long term in regards to the use of the facilities we take for granted and importantly the facilities that attracted us to the property in the first place.  We will wait to see.  Another point, maintenance fees are due this month, I wonder how folks that don't or can't pay will go, will they be able to just ignore written demands, default and walk away from their financial obligations without consequence, I somehow doubt it........(as seen, if you don't pay your "rent", the landlord will evict!).


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## dioxide45 (Jan 4, 2021)

Ozziechick said:


> Received an email from our appointed owners representative, the President of the KBC Owners Association, late last week.  Buried deep within this email was the first "official" advice we personally have received from anyone vaguely associated with MVCI that the hotel section of the property had been rebranded. MVCI's silence has been deafening for almost 3 months.   All very well, Marriott Hotel's default shouldn't affect the ownership and occupancy rights of our Beach Club timeshare villas, however, the President's email did say "talks are presently taking place with Sonesta and MVC to ensure that the services you are accustomed to will continue to carry on into the future".  Almost 3 months down the line from default and subsequent termination, this speaks volumes regarding the question of service and facilities available to owners in the future and bearing in mind that the land owner and its 34% owned Sonesta Hotels don't owe us a cent in consideration (in fact I would imagine MVCI is negotiating from a position of disadvantage given the circumstances), I wonder how we as owners will fare in the immediate future and the long term in regards to the use of the facilities we take for granted and importantly the facilities that attracted us to the property in the first place.  We will wait to see.  Another point, maintenance fees are due this month, I wonder how folks that don't or can't pay will go, will they be able to just ignore written demands, default and walk away from their financial obligations without consequence, I somehow doubt it........(as seen, if you don't pay your "rent", the landlord will evict!).


There will always be consequences to default. In the case of MVCI properties. Marriott Vacation CLub acts on behalf of the HOA to file a lien against your deed. Then failure to become current will then result in foreclosure. The end results would be the HOA owning the week unless it is sold to someone else at foreclosure sale. In the past, MVC had agreements with many HOAs to take these weeks back from the HOAs, but many of those agreements were suspended at the outset of COVID.


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## Ozziechick (Jan 5, 2021)

dioxide45 said:


> There will always be consequences to default. In the case of MVCI properties. Marriott Vacation CLub acts on behalf of the HOA to file a lien against your deed. Then failure to become current will then result in foreclosure. The end results would be the HOA owning the week unless it is sold to someone else at foreclosure sale. In the past, MVC had agreements with many HOAs to take these weeks back from the HOAs, but many of those agreements were suspended at the outset of COVID.


Agree with you, there certainly would be consequences to any owner's default. Tongue in cheek I was wondering out loud what the consequences would be to an owner on failure to pay their financial obligations to MVCI vs. Marriott Hotel's failure to pay theirs to the property owner in October 2020.  Really not my business or concern.  What is though, is that we are being required to pay our maintenance fees this month, which payment includes (amongst other things) the owners share of expenses for the maintenance of the resort facilities/amenities we expect use of and our share of the expenses for the provision of services we expect to receive in 2021 although both don't appear to be guaranteed at this stage.  At a meeting some time ago, we were told by an onsite hotel executive and an MVCI representative present that the expense split was something like 47% owners 53% hotel (I'm going from memory on these figures though) and that interestingly the oceanfront towers solely housing MCVI villas (Wai-ale-ale and Kilohana) were independent of the property as far as land/structure ownership goes, meaning that the vacation club owners owned the bricks and mortar, but I am starting to doubt anything we have ever been told over the years and I haven't read through our deeds recently.  The problems associated with a co-occupied site....it will be interesting to see how this all plays out especially the results of the "talks" between MVCI and the Sonesta Hotel Group.


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## BigMac (Jan 5, 2021)

Here is a news article from "beat of hawaii". The article said  that in addition to all 457 Marriott employees being laid of "The last time Sonesta referred to the property was in an earnings call two months ago. At that point, Sonesta’s president said, “We’ve been doing the design work for the Kauai Marriott, which will transition to Sonesta…We’ll be renovating that hotel in the second half of next year.”             
Kauai Marriott Troubles at Quarantine Hotel: 457 Employees Terminated (beatofhawaii.com)


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## TravelAmore (Jan 17, 2021)

Has a Marriott Kauai timeshare owner been able to exchange a 2021 week for a vacation through Interval with a travel date later than April 30th?? 
I tried to check an all destinations search thru Interval in the month of June 2021, and the system forced a date limitation to search between January and March 31.
I wonder if it is just my account or if it has something to do with the property changes. If you try an exchange pls post your results here or send a me a PM. Thanks!


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## vacationtime1 (Jan 17, 2021)

TravelAmore said:


> Has a Marriott Kauai timeshare owner been able to exchange a 2021 week for a vacation through Interval with a travel date later than April 30th??
> I tried to check an all destinations search thru Interval in the month of June 2021, and the system forced a date limitation to search between January and March 31.
> I wonder if it is just my account or if it has something to do with the property changes. If you try an exchange pls post your results here or send a me a PM. Thanks!



I have a KBC week deposited in Interval -- my 2020 reservation that I could not / would not use.  The Interval search tool allows me to search through 12/6/22 and recently offered me some December 2021 weeks at MKO which I declined.  I haven't seen anything for 2022 yet.


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## TravelAmore (Jan 17, 2021)

vacationtime1 said:


> I have a KBC week deposited in Interval -- my 2020 reservation that I could not / would not use. The Interval search tool allows me to search through 12/6/22 and recently offered me some December 2021 weeks at MKO which I declined. I haven't seen anything for 2022 yet.



Thank you for reporting, Vacationtime1 
Since my 2020 reservation was in March, I was only allowed an Interval AC in exchange. 
Now I want to exchange my 2021 week for travel elsewhere in May or June 2021. For some reason when I enter search dates for June 2021, I receive a dialog message indicating I must change my search date to one within January-March 31, 2021.


Sent from my iPhone using Tapatalk


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## TheTimeTraveler (Jan 17, 2021)

TravelAmore said:


> Thank you for reporting, Vacationtime1
> Since my 2020 reservation was in March, I was only allowed an Interval AC in exchange.
> Now I want to exchange my 2021 week for travel elsewhere in May or June 2021. For some reason when I enter search dates for June 2021, I receive a dialog message indicating I must change my search date to one within January-March 31, 2021.
> 
> ...




I would advise that you telephone Interval International on Monday morning and ask for their explanation......


.


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## judell (Feb 22, 2021)

Is the marriott waikoloa changing hands?? I read somewhere they are not renewing their management contract. Is that true? Thanks

_[Post moved into this existing thread; duplicate posts in other threads have been deleted.] <-- SueDonJ_


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## dioxide45 (Feb 22, 2021)

judell said:


> Is the marriott waikoloa changing hands?? I read somewhere they are not renewing their management contract. Is that true? Thanks


YOu may be thinking of the Marriott in Lihue. The Marriott Kauai Beach Club Hotel. It will no longer be a Marriott. There are still timeshare units co-located with the hotel property that will continue to be Marriott Vacation CLub timeshare units.


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## jlp879 (Mar 1, 2021)

From Beat of Hawaii









						Update on Kauai Marriott | Changeover at Kauai Bubble Resort
					

You're worried about Marriott Kauai and we hear you. What this means for hotel guests and timeshare owners?



					beatofhawaii.com


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## armrecsys (Mar 10, 2021)

Hi I am checking in The Marriott timeshare in July, first I was told that the checking was the same. When I called they said they don’t known where the checking is going to be.
I am  closing on a week there.  Hope I was not wrong to buy at this time.


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## wjarcher (Mar 11, 2021)

I have II trade at MKW in July, and II sent me the following email:

Please be advised that due to a change in management, check-in for the Marriott Kaua’i Beach Club will be at the adjacent hotel property – Royal Sonesta Kaua‘i Resort Lihue (formerly known as Kaua’i Marriott Resort).    

This is effective March 24, 2021.


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## dioxide45 (Mar 11, 2021)

wjarcher said:


> I have II trade at MKW in July, and II sent me the following email:
> 
> Please be advised that due to a change in management, check-in for the Marriott Kaua’i Beach Club will be at the adjacent hotel property – Royal Sonesta Kaua‘i Resort Lihue (formerly known as Kaua’i Marriott Resort).
> 
> This is effective March 24, 2021.


So it sounds like you still check in at the same place as before, it just has a different name. They could instead have people check in at Kalanipu'u (Kauai Lagoons)


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## zentraveler (Mar 11, 2021)

wjarcher said:


> I have II trade at MKW in July, and II sent me the following email:
> 
> Please be advised that due to a change in management, check-in for the Marriott Kaua’i Beach Club will be at the adjacent hotel property – Royal Sonesta Kaua‘i Resort Lihue (formerly known as Kaua’i Marriott Resort).
> 
> This is effective March 24, 2021.



Anyone know why the name/management change?


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## dioxide45 (Mar 11, 2021)

zentraveler said:


> Anyone know why the name/management change?


Look at the first post in this thread.


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## zentraveler (Mar 11, 2021)

dioxide45 said:


> Look at the first post in this thread.



Thanks; I think I do remember seeing but now re-reading it I realize I didn't know what "On failure to meet 80% termination threshold for _cumulative owner’s priority returns_" means.


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## rthib (Mar 11, 2021)

zentraveler said:


> Thanks; I think I do remember seeing but now re-reading it I realize I didn't know what "On failure to meet 80% termination threshold for _cumulative owner’s priority returns_" means.


Marriott was required to make payments regardless of hotel income so they defaulted.
But Sonesta has been doing this to a bunch of hotels to convert to their brand, My guess is Marriott figured that the cost to maintain the flag on one wing of the property was not worth it. They have other flagged properties on island. And remember Marriott is not MVCI, so impact to vacation club was probably not even considered.

Looked around and don’t see any changes but property is still pretty empty so hard to tell.


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## zentraveler (Mar 11, 2021)

rthib said:


> Marriott was required to make payments regardless of hotel income so they defaulted.
> But Sonesta has been doing this to a bunch of hotels to convert to their brand, My guess is Marriott figured that the cost to maintain the flag on one wing of the property was not worth it. They have other flagged properties on island. And remember Marriott is not MVCI, so impact to vacation club was probably not even considered.
> 
> Looked around and don’t see any changes but property is still pretty empty so hard to tell.



So Service Properties Trust "owns" these hotels and the management is done by Marriott, Sonesta, whomever etc. 

A similar hotel changed management hands at the Four Seasons Hotel which was similarly "part" of the vacation property at Four Seasons Aviara. It was quite an acrimonious split (now a Park Hyatt) and was a real loss for the Four Seasons vacation property in Carlsbad CA.


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## 1Kflyerguy (Mar 11, 2021)

rthib said:


> Marriott was required to make payments regardless of hotel income so they defaulted.
> But Sonesta has been doing this to a bunch of hotels to convert to their brand, My guess is Marriott figured that the cost to maintain the flag on one wing of the property was not worth it. They have other flagged properties on island. And remember Marriott is not MVCI, so impact to vacation club was probably not even considered.
> 
> Looked around and don’t see any changes but property is still pretty empty so hard to tell.



I wonder if Marriott actually intended to lose this hotel, or if instead they misjudged their leverage.  Maybe they were expecting Service Properties to blink, and allow them more time to pay..    I have seen that happen in other business situations..


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## dioxide45 (Mar 11, 2021)

1Kflyerguy said:


> I wonder if Marriott actually intended to lose this hotel, or if instead they misjudged their leverage.  Maybe they were expecting Service Properties to blink, and allow them more time to pay..    I have seen that happen in other business situations..


I think Marriott International was caught in a bad contract where they had to pay out a certain level of return regardless of the situation. When COVID hit, they didn't want to still pay out for what were empty hotels. THey were losing money. This got them out of the contract.


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## rthib (Mar 12, 2021)

1Kflyerguy said:


> I wonder if Marriott actually intended to lose this hotel, or if instead they misjudged their leverage.  Maybe they were expecting Service Properties to blink, and allow them more time to pay..    I have seen that happen in other business situations..


Sonesta was doing this and done this with hundreds of hotels, so I doubt Marriott was surprised.


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## rthib (Mar 12, 2021)

Talked to front desk today. He believes that Sonesta will keep the current lobby check-in (the one down the escalator and then left across from fishes and MVCI was going to relocate.
They all seem pretty clueless otherwise about what is happening. I didn't see any signage other than MVCI anywhere.


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## 1Kflyerguy (Mar 13, 2021)

dioxide45 said:


> I think Marriott International was caught in a bad contract where they had to pay out a certain level of return regardless of the situation. When COVID hit, they didn't want to still pay out for what were empty hotels. THey were losing money. This got them out of the contract.



True,  i would guess a lot of the hotel management contracts require some level of fixed guaranteed  payments back to the owner... 



rthib said:


> Sonesta was doing this and done this with hundreds of hotels, so I doubt Marriott was surprised.



I wasn't implying that Marriott was not aware of Sonesta, or the possibility of hotels changing flags, just wondering if they really wanted out of the contract or perhaps misjudged.  That hotel was frequently featured in Marriott's Hawaii advertising,  so they must consider it an aspirational destination that would help drive traffic to Marriott in general.   

We have never stayed there, and only visited once to eat at Dukes, so i don't that much about the property.  Maybe it needed a lot of renovations or was otherwise losing money over the long term and as both of you mentioned they were just as happy to give it up..


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## armrecsys (Mar 13, 2021)

Just like most changes no one who needs to know , knows nothing.


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## Swice (Mar 13, 2021)

It was the site of our very first "presentation" -- on our honeymoon in 1997.      The sales lady was super-- she chatted us up and found out we flew free on first class, we were staying free in a suite on points (work travel).    She was so laid back and said, "you don't need this right now, but I have to keep you a certain amount of time."    She showed us around and was so no pressure.     We walked out and looked at each other and said, "if we ever buy a timeshare, we will buy Marriott."    We did about four years later.


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## jetguy (Mar 20, 2021)

Swice said:


> It was the site of our very first "presentation" -- on our honeymoon in 1997.      The sales lady was super-- she chatted us up and found out we flew free on first class, we were staying free in a suite on points (work travel).    She was so laid back and said, "you don't need this right now, but I have to keep you a certain amount of time."    She showed us around and was so no pressure.     We walked out and looked at each other and said, "if we ever buy a timeshare, we will buy Marriott."    We did about four years later.


This was fun to read.  Kauai Beach Club was the site of our very first presentation -- on our honeymoon in 1997.  We had flown over free in F/C (work/travel) and were staying 5 days free, in a suite on a "Timeshare Presentation Offer".  Our stories diverge here.  We walked out and looked at each other...... as owners of an OF EOY Kauai week (this after much negotiation and sweetening of several previous offers, as my wife kept reminding me we weren't buying any timeshare).  We never regretted that decision and in 2007, went on to own a Maui MM1 fixed OF week.  We've had 24 years of awesome Hawaii vacations and still no regrets!


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## SueDonJ (May 26, 2021)

Now that the mechanics of the hotel acquisition appear to be understood, this thread is being locked to discourage questions/comments about the impacts being felt at the property itself.

There's a current thread here: Marriott Kauai Beach Club and co-located Royal Sonesta Hotel - Info/Questions


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