# Point @ Poipu good news



## Kauai Kid (Sep 9, 2010)

2011 maintenance fees are decreasing 4.9%

Not a misprint, decreasing.

Sterling


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## MOXJO7282 (Sep 9, 2010)

I've seen a few mention decreases in MFs. I'm hoping its an industry trend. Last year I had one, my Marriott Aruba Surf go down about 3% I believe.


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## Fisch (Sep 9, 2010)

Kauai Kid said:


> 2011 maintenance fees are decreasing 4.9%
> 
> Not a misprint, decreasing.
> 
> Sterling



That is good news.


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## Kauai Kid (Sep 9, 2010)

Fisch said:


> That is good news.



Of course, it might be just to soften the blow when Diamond hits the owners with a special assessment to pay for water intrusion repairs and replacing missing soffits @ the Point @ Poipu.


Sterling


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## dougp26364 (Sep 10, 2010)

Kauai Kid said:


> Of course, it might be just to soften the blow when Diamond hits the owners with a special assessment to pay for water intrusion repairs and replacing missing soffits @ the Point @ Poipu.
> 
> 
> Sterling



Owners will pay for repairs and maintenace to their resort one way or the other. Either through increased collections for cash reserves or through an SA that has to be voted on by the ownership. The risk with SA's is that owners may not vote for the improvements. At that point the resort either stands still while others around make improvements, making their resorts more valuable to their owners for stays and/or exchanges or, the begin to decline. When Sunterra was the management company, it was our opinion that many resorts were in a state of decline or, weren't updating often enough to keep up with other options. When Sunterra was in control we elected NOT to exchange into those resorts. To many other quality choices to take the risk. 

The thing to watch for is cash reserve collections. Are the MF's being balanced out by reducing the amount collected for cash reserves. If that's the case, it might look good in the short term but, long term it could be a big mistake. Despite the fact my PT's MF's are higher than what I'd like them to be, I'm still pushing for more money to be collected for the cash reserve funding. I perfer to have a surplus vs a deficit. Unforseen bills can and do happen and, when they do, I want the money to be there rather than have to vote on and then pay for a SA. Plus, with the money in cash reserves, the only voting that has to go on is how/what to upgrade, not if the upgrade should happen at all.


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## Kauai Kid (Sep 10, 2010)

The fees have increased at the Point but those monies are not being used for maintenance or upgrades but for exorbitant "management" fees.

That is why many Diamond Resort owners, including the Point @ Poipu owners, are up in arms.


Sterling


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## dougp26364 (Sep 10, 2010)

Kauai Kid said:


> The fees have increased at the Point but those monies are not being used for maintenance or upgrades but for exorbitant "management" fees.
> 
> That is why many Diamond Resort owners, including the Point @ Poipu owners, are up in arms.
> 
> ...



I understand this point of view but, I will say that with other timeshare systems, good management costs money. Sunterra was not good management. If they were, they'd still be managing the properties rather than DRI.

As a for instance, I own with 4 different management companies, DRI, Marriott, Hilton and Southwind. Hilton offsets costs with rentals and other fee's. Marriott is well known for being expensive but, the service is generally top notch as are the resorts. Southwind, on the other hand, is inexpensive and it shows. Sure the resorts are nice enough but on the service end, they can be difficult to deal with. MF billing can be an experience from year to year, there are minor issues at the resorts and, I often have to call and leave a message rather than getting through immeadiatly to someone who can handle something simple like, taking my MF payment, making a reservation of getting a week deposited for exchange. The last time I wanted to deposit my week for exchange, it took me at least four phone calls. The person who handled it was on vacation and, the extension I was told to dial (had to hang up and redial again) didn't work. Sometimes you get what you pay for.


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## brriguy (Oct 5, 2011)

*water intrusion my rear end!!!!!*



Kauai Kid said:


> Of course, it might be just to soften the blow when Diamond hits the owners with a special assessment to pay for water intrusion repairs and replacing missing soffits @ the Point @ Poipu.
> 
> 
> Sterling



I just got my bill and yes $2000 charge for a so called intrusion. Googled and found this page. Now I am posting my riffs with the resorts also.
Water from where???  No tsunami hit Kauai and the resort is elevated high/far enough from sea level to get any type of damage.  Does anyone know what happened exactly???  Or is this another way the Fk'd up board makes decisions to put more money in their pockets???


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## shinger69 (Oct 5, 2011)

I also received the $2000 bill.  I don't even recall receiving any information about the assessment of a vote.  If anyone was at a meeting where the vote was taken I would like to know some details.  Also, I would love to have any and all documentation to ensure the vote/assessment complies with applicable law.


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## T_R_Oglodyte (Oct 6, 2011)

The water intrusion problem has been known for five or six years now. It's been discussed several times in the owner newsletters. There has been litigation between the resort and its insurers about whether the damage was covered under insurance policies.  About a year ago the Board concluded that the chances of recovery through litigation were too unlikely to put off the repairs any longer.  (The repairs couldn't be started when the case was being litigated because they would have been destroying evidence.)

So the work begins now.

****

As far as the legal basis for the special assessment, if you read the timeshare program documents (which were signed by whoever made the original purchase of your deed from the resort and are incorporated by reference into your deed), you will find that the Board of Directors of Homeowners Association at the resort explicitly has the authority to levy special assessments.

The recourse for owners is to elect a different Board of Directors.  Generally no more than 10% of owners submit proxies for the elections.


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## Kauaigrl00 (Oct 6, 2011)

Lucky you only got a $2,000 - we got $3353.32


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## cnytodd (Oct 11, 2011)

T_R_Oglodyte said:


> The water intrusion problem has been known for five or six years now. It's been discussed several times in the owner newsletters. There has been litigation between the resort and its insurers about whether the damage was covered under insurance policies.  About a year ago the Board concluded that the chances of recovery through litigation were too unlikely to put off the repairs any longer.  (The repairs couldn't be started when the case was being litigated because they would have been destroying evidence.)
> 
> So the work begins now.
> 
> ...



Sorry Steve, but burying something like this in the newsletter doesn't cut it.  Eight day's notice about informational meetings in California, especially for someone who lives on the US east coast, doesn't cut it.  Paying the bulk of the assessment before work starts on a five year project doesn't cut it (I sure hope the contractor/project management company isn't getting paid more than 10-15% at the front end of the project). Do you (assuming you are speaking for the Board of Directors, as it appears you are) expect us to be happy about this?

The fact of the matter is that this very sizable charge beyond the maintenance fees is a surprise that isn't going to sit well with the owners. That should be patently obvious.  Most of us would assume insurance WOULD cover this, as we would with our own homes.  At the very, very least, when it became known that the likely course of action was to hit the owners up for the cash, a letter to those owners specifically addressing the topic was warranted.  I never saw one in MY mailbox.

And as for my next proxy, you can be sure I will be returning it enthusiastically. And I will not be voting for a single incumbent.


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## T_R_Oglodyte (Oct 11, 2011)

cnytodd said:


> Sorry Steve, but burying something like this in the newsletter doesn't cut it.  Eight day's notice about informational meetings in California, especially for someone who lives on the US east coast, doesn't cut it.  Paying the bulk of the assessment before work starts on a five year project doesn't cut it (I sure hope the contractor/project management company isn't getting paid more than 10-15% at the front end of the project). Do you (assuming you are speaking for the Board of Directors, as it appears you are) expect us to be happy about this?
> 
> The fact of the matter is that this very sizable charge beyond the maintenance fees is a surprise that isn't going to sit well with the owners. That should be patently obvious.  Most of us would assume insurance WOULD cover this, as we would with our own homes.  At the very, very least, when it became known that the likely course of action was to hit the owners up for the cash, a letter to those owners specifically addressing the topic was warranted.  I never saw one in MY mailbox.
> 
> And as for my next proxy, you can be sure I will be returning it enthusiastically. And I will not be voting for a single incumbent.



First, I'm not speaking for the Board of Directors. I'm an ordinary owner, tied into the site both via deed and via points in the Hawaii Collection.  

What I am trying to do in my posts is take an objective position in a difficult situation.  That's part of what I do in my job; I deal often with people in stressful situations; I occasionally am involved in situations in which clients are facing hundreds of thousands to millions of dollars in unanticipated penalties and costs. Part of my job is getting people to step back, take a deep breath, and start working with reality.  It's often means passing on information that isn't particularly wanted, but it is what it is.

***

I certainly do think the board has done a terrible job of informing members, and I have sent a message to the board about that. They've clearly known about the extent of the problem for some time, but utterly failed to let owners know that something this big was coming.  As indicated, I've known that an assessment was coming; I am, frankly, aghast at the size and I am trying to sort out  my options for how to deal with it.  

And no, I don't have a pipeline to any one on the board; I've sent in e-mail comments to the Board of Directors e-mail address that is at the homeowners website.

*****

As for the insurance issue, we can only speculate since I don't have policies in front of me.  I would expect, though, that the resort carried ordinary casualty types of insurance, which provides protection for sudden and accidental occurrences - hurricanes, floods, earthquakes, burst pipes, etc.  In that respect it's probably similar to what is in your homeowners insurance policy. Sudden and accidental policies specifically exclude slow and progressive types of events, which is exactly what this damage is.  

And I would lay odds that if you look at your own homeowners insurance policy, you will find that that policy covers you only for sudden and accidental events.  If so, your insurance policy is probably not going to cover damage to your house if your roof and walls are leaking and damage accrues gradually over an extended time.

Again I'm not trying to defend the Board - but I think it's going overboard to infer there was clearly some kind of malfeasance or negligence on the part of the Board that this isn't an insured event.  This is *precisely* the type of event that property and casualty insurers go to pains to exclude from policies.


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## T_R_Oglodyte (Oct 12, 2011)

cnytodd said:


> Paying the bulk of the assessment before work starts on a five year project doesn't cut it (I sure hope the contractor/project management company isn't getting paid more than 10-15% at the front end of the project).


added comments.  

They are not asking people to pay the bulk of the assessment before work begins.  For most people it will be spread out over three years; for people who own multiple units, it's gets stretched out over the full five-year period.

The reality is that financing for construction project has to be front-end loaded.  That's why builders take out construction loans - money is paid before the project is completed.  If this is a five-year project, collecting the bulk of the money in relatively even chunks over the first three years strikes me as about correct.  

One big question that I have is, given the size of the assessment, what is are the implications of extending the project over a longer period so that annual payments can be reduced?  What would alternative project schedules are feasible to accomplish that? How much would that add to the overall cost of the project? What would the annual assessments look like under such a scenario?

The Board has a lot more 'splainin' to do to sell this to owners.

*****

Typical practice for a project manager on a project such as this depends on how the project management contract is structured. One option is to engage a construction manager who then hires and manages all of the contractors in getting the job done.  Essentially the CM is fully responsible for executing the project.  This model gives a single point of contact for running the project, and the contractors doing the actual are subcontractors to the CM.  There are various ways of structuring this type of contract; one common is that the CM has a contract price not-to-exceed, and the invoice for the costs of the subcontractors, plus a markup, plus time-and-materials for their staff time.  Another approach is a fixed fee, where the CM generates its revenues on the spread between what it pays its subs and what it receives from the client.  (IMHO - this is almost always a bad way to run a project.)

The other model for a CM is for the owner to hire a general contractor to complete the project, and retain a CM to oversee the contractor.  This is appropriate when the owner doesn't have the staff or expertise to manage the construction project itself . In this case the CM works directly for the owner and is independent of the general contractor; essentially the CM is a consultant to the owner.  In this case, the CM bills on a time-amnd-materials basis, with a cost-not-to-exceed.

*********

It's almost unheard of in my experience for a CM to take it's cut of the project upfront.  The only circumstances in which that might be done is when an owner is in financial trouble, and the CM is concerned that the owner is going to go bankrupt and the CM will get stuck a bunch of unpaid invoices.  In those cases a CM might insist on either prepayment or placement of funds into an escrow account that will be used to pay for the CM's services. Those circumstances are pretty rare, as most CMs will simply not take on any job that involves that degree of risk; even if they are protected for payment on their invoices a collapsed project almost always results in litigation, with the CM inevitably being named in the lawsuits. The CM then burns all of its profits defending themselves.  So most of the time when a project is that troubled they either walk away or demand a huge profit margin so that they can still make money even if there is litigation.


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## dbrin (Oct 17, 2011)

shinger69 said:


> I also received the $2000 bill.  I don't even recall receiving any information about the assessment of a vote.  If anyone was at a meeting where the vote was taken I would like to know some details.  Also, I would love to have any and all documentation to ensure the vote/assessment complies with applicable law.


Dito! First time I hear about this! There was no warning at all! I am completely outraged.


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## dbrin (Oct 17, 2011)

Kauai Kid said:


> The fees have increased at the Point but those monies are not being used for maintenance or upgrades but for exorbitant "management" fees.
> 
> That is why many Diamond Resort owners, including the Point @ Poipu owners, are up in arms.
> 
> ...



Completely agree - it's outrageous!


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