# SBP 2,581 delinquent owners



## Transit (Nov 13, 2009)

I received a financial newsletter from SBP with a bill for an additional maint fee of 130.00. It states a 21.5% increase directly due to owner delinquency and that the increase would have be less than 2% if they could have collected the fees.......Game over.
I also received a similar letter from SVV where the news isn't as grim yet .Still waiting for the SDO letter.


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## gregb (Nov 13, 2009)

As reported in another thread, WKORV has about 600 delinquent unit weeks out of a total of about 14,500 for a little over a 4% delinquency rate.

Greg


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## myip (Nov 13, 2009)

Transit said:


> I received a financial newsletter from SBP with a bill for an additional maint fee of 130.00. It states a 21.5% increase directly due to owner delinquency and that the increase would have be less than 2% if they could have collected the fees.......Game over.
> I also received a similar letter from SVV where the news isn't as grim yet .Still waiting for the SDO letter.


What is the total owners in SBP - what % is delinquency?


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## timeos2 (Nov 13, 2009)

*Sounds like a runaway sales force to under qualified buyers*



Transit said:


> I received a financial newsletter from SBP with a bill for an additional maint fee of 130.00. It states a 21.5% increase directly due to owner delinquency and that the increase would have be less than 2% if they could have collected the fees.......Game over.
> I also received a similar letter from SVV where the news isn't as grim yet .Still waiting for the SDO letter.



Over two thousand delinquent? How many total are there? That is terrible - and doesn't happen overnight (or lets say a year or two even). It would seem no one (MANAGEMENT) has been doing their job and following up on delinquent owners. Or it's the nightmare scenario where to make sales they are moving weeks to owners who can't pay but now the mortgage is superior to the Association claim for fees but the mortgage company doesn't want to hold the title so they won't foreclose. THAT can kill a resort as those weeks pile up with no way to solve the problem! 

This is an all too typical situation when a developer is the management and the seller and the mortgage source, etc.  They have one loyalty, it's to their bottom line, and the individual owners end up paying the bills. Not good.


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## jarta (Nov 13, 2009)

timeos2,   ...   "Or it's the nightmare scenario where to make sales they are moving weeks to owners who can't pay but now the mortgage is superior to the Association claim for fees but the mortgage company doesn't want to hold the title so they won't foreclose. THAT can kill a resort as those weeks pile up with no way to solve the problem!"

Starwood had and has age and income requirements to purchase.  eBay has none.

More likely, the problem is caused by all those secondary owners that Starwood could not screen getting in cheap for a few dollars and, having no loyalty to Starwood and hurting from the economy and being in over their heads, just took a hike.

It now turns out Starwood resorts seem to be proactive in planning for delinquent assessments and raising assessments to cover any shortfall.  Maybe it's Marriott who is sticking its head in the sand and not planning for delinquencies.  (Maybe Marriott has no delinquencies.  But I find that hard to believe in this lousy economy.)

Time will tell.

But, the bills still have to be paid.  As James Carville said to Bill Clinton:  "It's the economy, stupid!"

BTW, only 1 Harborside, 6 Westin and 26 Sheraton weeks are currently for sale on eBay.  Marriott has 67 weeks for sale on eBay.   ...   eom


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## Transit (Nov 13, 2009)

There are 314 units x 52 weeks = 16328 thats about 15%. I'm not sure exactly how it's actually broken down because of the different size units and eoy but 2581 delinquent owners is absurd.


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## DeniseM (Nov 13, 2009)

jarta said:


> More likely, the problem is caused by all those secondary owners that Starwood could not screen getting in cheap for a few dollars and, having no loyalty to Starwood and hurting from the economy and being in over their heads, just took a hike.



There are people with loyalty to Starwood????  Who knew!  

I would bet, that a lot of these owners are are older owners on fixed incomes who bought from Starwood, or the previous developer, a long time ago before MF's got so high.


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## timeos2 (Nov 13, 2009)

*Mismanagement at it's worst*



jarta said:


> timeos2,   ...   "Or it's the nightmare scenario where to make sales they are moving weeks to owners who can't pay but now the mortgage is superior to the Association claim for fees but the mortgage company doesn't want to hold the title so they won't foreclose. THAT can kill a resort as those weeks pile up with no way to solve the problem!"
> 
> Starwood had and has age and income requirements to purchase.  eBay has none.
> 
> More likely, the problem is caused by all those secondary owners that Starwood could not screen getting in cheap for a few dollars and, having no loyalty to Starwood and hurting from the economy and being in over their heads, just took a hike.



That seems highly unlikely as there aren't THAT many eBay/resales that would already be delinquent.  But if they were then it is REALLY a management problem as those wouldn't have a mortgage thus they should be immediately foreclosed on by the Association and resold. It is not doing the fiduciary duties of the oard or management if they aren't following up on that in a timely manner. Over 2000 weeks don't go delinquent in a matter of months so this is obviously a bad pattern of neglect by someone in charge. It will lead to BIG and unfair fee increases for those who do pay and can bring a resort to its knees when delinquent weeks start approaching 10% of the total (and this is over that already!).  

It is a VERY bad sign and owners should be raising heck over it with management and the Board. A real sign of total mismanagement.


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## AwayWeGo (Nov 13, 2009)

*Who's Likelier To Go Delinquent -- Full-Freighters Or eBay Buyers ?*




timeos2 said:


> That seems highly unlikely as there aren't THAT many eBay/resales that would already be delinquent.  But if they were then it is REALLY a management problem as those wouldn't have a mortgage thus they should be immediately foreclosed on by the Association and resold.


Just guessing here, but overall I would expect savvy & thrifty eBay resale timeshare buyers to be more conscientious about paying everything due, right on time, than the people who got fast-talked & arm-twisted into buying their timeshares at full freight on the never-never plan. 

Just saying. 

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​


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## london (Nov 13, 2009)

*Well Said*



AwayWeGo said:


> Just guessing here, but overall I would expect savvy & thrifty eBay resale timeshare buyers to be more conscientious about paying everything due, right on time, than the people who got fast-talked & arm-twisted into buying their timeshares at full freight on the never-never plan.
> 
> Just saying.
> 
> -- Alan Cole, McLean (Fairfax County), Virginia, USA.​



Well said, I would agree with Alan's thoughts.


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## malyons (Nov 13, 2009)

so do you get a refund if/when those payments are made?  would seem premature to go sending out an extra bill if they are just "delinquent", and not foreclosed on and therefore uncollectible.  I'll readily admit that if you're delinquent at this point, the odds of collecting may be small, but still seems like they should take any payment received from these 2500 units and put it in a pool to pay back the $130 each owner is chipping in.


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## Transit (Nov 13, 2009)

malyons said:


> so do you get a refund if/when those payments are made?  would seem premature to go sending out an extra bill if they are just "delinquent", and not foreclosed on and therefore uncollectible.  I'll readily admit that if you're delinquent at this point, the odds of collecting may be small, but still seems like they should take any payment received from these 2500 units and put it in a pool to pay back the $130 each owner is chipping in.



Yes, if paid, you get a reduction in fees.


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## AwayWeGo (Nov 13, 2009)

*Wait Till Next Year.*




malyons said:


> so do you get a refund if/when those payments are made?  would seem premature to go sending out an extra bill if they are just "delinquent", and not foreclosed on and therefore uncollectible.  I'll readily admit that if you're delinquent at this point, the odds of collecting may be small, but still seems like they should take any payment received from these 2500 units and put it in a pool to pay back the $130 each owner is chipping in.


In effect, that's what happens in the annual timeshare resort budget process. 

That is to say, all those delinquencies add up to an extra $130 in fees that each responsible owner has to cover this year.  

Say the collections people get super-aggressive while all those folks who are in arrears see the error of their ways & fork over everything that's overdue, plus penalties & interest.  The positive financial result of that shows up in the following year's budget cycle in the form of lower fees for everybody, as all those catch-up payments bring in a major influx of extra cash. & the responsible owners will no longer have to cover the deadbeats' unpaid fees.

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​


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## timeos2 (Nov 13, 2009)

*Death Spiral of debt and foreclosure. Uh oh.*



jarta said:


> It now turns out Starwood resorts seem to be proactive in planning for delinquent assessments and raising assessments to cover any shortfall.  Maybe it's Marriott who is sticking its head in the sand and not planning for delinquencies.  (Maybe Marriott has no delinquencies.  But I find that hard to believe in this lousy economy.)



And a follow up on this part. Yes, for one year when it is obvious what level of delinquency is likely to be in place it is important to include an allowance for bad debt that realistically covers the past due fees. If not the budget is out of whack. 

But that can only be phase 1 of the plan. Phase two, which should be well underway even during the budget cycle, is to get those weeks back to paying status. That means serious collection efforts and a quick foreclosure process. It should never go beyond one year from delinquent to foreclosed IF there is no mortgage.  Because there will be a fresh batch of delinquents the next year. If left unfixed the pile grows exponentially. It is a death march that can spiral out of control in just a few years if not handled early. Early is NOT 15% delinquent in one year! 

But what if there IS a mortgage? Even bigger problems as those place the fees second in line. This becomes a super serious issue as those weeks are likely to remain delinquent for 5 years or more. There is little an Association can do except push the lender to foreclose. If the lender is the developer (or an arm of them) it can get really ugly. It basically means the paying owners will be picking up the tab for those weeks for many years to come. Higher fees for zero return. If that is the case you had better hope your core of owners is loyal and remain willing to pay big money to cover 15% or more annual weeks of non-performing inventory. If not the dominoes start to fall as paying owners drop out & the delinquents grow thus the fees go higher for fewer and fewer that pay. You can see that it can't go on long. 

Time to call the management, developer and BOD to the carpet and find out exactly what is going on, who owes what and how they intend to turn it around before the next budget cycle. If they don't have a workable answer then this resort has a limited time to live.


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## jarta (Nov 13, 2009)

timeos2,   ...   "Time to call the management, developer and BOD to the carpet and find out exactly what is going on, who owes what and how they intend to turn it around before the next budget cycle. If they don't have a workable answer then this resort has a limited time to live."

I agree - at least as to the BOD and management.

The value of some of the older resorts Starwood took over from Sheraton certainly looks marginal.  Maybe it's time to whittle down the SVO family of resorts to make the chain a really luxury timeshare resort system.

BTW, I was told at my owner update today that Starwood has its eye on Turtle Bay Resort on the north shore of Oahu.  The hotel has excess surrounding property that would be developable once the economy turns.  Take it for whatever it's worth.  The economy is not close to turning around yet for the hotel, resort and vacation industry.    ...   eom


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## DanCali (Nov 13, 2009)

jarta said:


> Starwood had and has age and income requirements to purchase.  eBay has none.



Yes, they have "requirements" but they might as well not exist because they never verify them. I have been to three developer presentations over the years. At none of these was I asked to provide proof of income or homeownership in order to attend - I just had to answer "yes" to a couple of questions. At one of the presentations I couldn't get them to turn down the pressure so I told them one of us was on the job market at the time so we didn't think it was prudent to buy given our single income (normally both of us work). I would have thought the salesperson would agree and let us go but instead he came up with a "brilliant" idea how I can just use our home equity line of credit to finance the whole thing - I was speechless while he quickly did the math for me...

I am not saying eBay buyers are more responsible than developer buyers. I don't know who are defaulting on payments. But at least ebay buyers don't take 15% loans to buy the timeshares. Someone using developer financing has both MFs and interest payments to worry about AND their asset depreciates 50%-70% the moment they buy it... That's not a recipe for success.



jarta said:


> BTW, only 1 Harborside, 6 Westin and 26 Sheraton weeks are currently for sale on eBay.  Marriott has 67 weeks for sale on eBay.   ...   eom



Marriott has over 50 resorts and about 400,000 owners - based on your numbers, Starwood has more units for sale as a fraction of the total. Moreover, there aren't many Marriotts that sell for $1, or don't sell at all...


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## jarta (Nov 14, 2009)

"STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Vacation Ownership & Residential Revenues and Expenses
For the Nine Months Ended September 30,
UNAUDITED ($ millions)

*2009 2008 % Variance*

Originated Sales Revenues (1) -- Vacation Ownership Sales 239 434 -44.9%
*Other Sales and Services Revenues (2) 150 156 -3.8%*
Deferred Revenues -- Percentage of Completion 23 (27) n/m
Deferred Revenues -- Other (3) (29) 3 n/m
Vacation Ownership Sales and Services Revenues 383 566 -32.3%
Residential Sales and Services Revenues 4 47 n/m
Total Vacation Ownership & Residential Sales and Services Revenues 387 613 -36.9%
Originated Sales Expenses (4) -- Vacation Ownership Sales 156 305 48.9%
*Other Expenses (5) 123 155 20.6%*
Deferred Expenses -- Percentage of Completion 12 (14) n/m
Deferred Expenses -- Other 13 21 38.1%
Vacation Ownership Expenses 304 467 34.9%
Residential Expenses 2 5 60.0%
Total Vacation Ownership & Residential Expenses 306 472 35.2%
(1) Timeshare sales revenue originated at each sales location before deferrals of revenue for U.S. GAAP reporting purposes
*(2) Includes resort income, interest income, gain on sale of notes receivable, and miscellaneous other revenues*
(3) Includes deferral of revenue for contracts still in rescission period, contracts that do not yet meet the requirements of SFAS No. 66 or SFAS No. 152
and provision for loan loss
(4) Timeshare cost of sales and sales & marketing expenses before deferrals of sales expenses for U.S. GAAP reporting purposes
*(5) Includes resort, general and administrative, and other miscellaneous expenses*
Note: Deferred revenue is calculated based on the Percentage of Completion ("POC") of the project. Deferred expenses, also based on POC, include
product costs and direct sales and marketing costs only. Indirect sales and marketing costs are not deferred per SFAS No. 152."

http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9MTgwODd8Q2hpbGRJRD0tMXxUeXBlPTM=&t=1

Hope the link works.

Management revenue is shown in (2); Management expense is shown in (5).

Could anyone explain why, if Starwood charges a straight percentage of assessments and the assessments were increased from 2008 to 2009, the category where that *revenue* is reported shows a decrease in the Category footnoted as 2 of 3.8% from $156M to $150M?

Also, if Starwood is taking no action to reduce the cost of management of the resorts, why does the category where that expense is reported shows a decrease, in the Category footnoted as 5, of 20.6% from $155M to $123M?

Sales revenue is shown in (1).  Sales expense is shown in (4).   ...   eom


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## xcg001 (Nov 14, 2009)

My blood boils when I read such nonsense since I own several units at SBP (all bought resale thank you).
First of all for the clueless guys like you - you can not transfer week until the deed is free and clear of any obligations and all fees are paid on the account.

We EBay buyers are money smart buyers that know value of a good credit history and would never waste $500-$2000 on a week we can not pay MF and can not use. Quite the contrary - we EBay buyers are prepaying MFs as soon as possible to secure the best weeks for use/rent/exchange. We EBay buyers have no problem dumping the week back on EBay even for $1 if worse come to worst since we own these weeks (all prime season) free and clear and we do not have any ridiculous ideas of how valuable our "investment" weeks cost. 

It is the poor suckers that has been bamboozled by a slick salesman to buy weeks for thousands of $ financed at 15% interest that are in arears. These poor souls can not even dump their weeks for a dollar since most of them still pay their 15% mortgage and do not even have a clean deed. And quite some of these people still believe in the fairy tales of the salesman that sold it them explaining how these weeks are going to appreciate in value.

The biggest problem is the HOA that is not going aggressively after delinquent owners since such foreclosed week can not pay any mortgage and will have to go back to Starwood. And I am sure Starwood would not want to be on the hook for the MF on these foreclosed weeks. The sad thing is that you can not even help these users - you can help the ones that own their weeks free and clear by offering them to give their usage to someone else in exchange of MF or sell it for them. And this is where a real owner controlled HOA will have to step in. 

And of course one thing that make the situation worse than resorts in HI is that Myrtle Beach is very seasonal area - nobody wants to go during the winter and people are finally starting to realize that off season weeks has 0 (in my opinion even negative) value at such high MFs.




jarta said:


> More likely, the problem is caused by all those secondary owners that Starwood could not screen getting in cheap for a few dollars and, having no loyalty to Starwood and hurting from the economy and being in over their heads, just took a hike.


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## DanCali (Nov 14, 2009)

jarta said:


> "STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
> Vacation Ownership & Residential Revenues and Expenses
> For the Nine Months Ended September 30,
> UNAUDITED ($ millions)
> ...



The definition of this line item is "resort income, interest income, gain on sale of notes receivable, and miscellaneous other revenues". You are assuming that it is all "resort income" - not necessarily correct.

In 2008 SVO sold notes receivable for a gain of $10M - $15M (see here - last paragraph under "vacation ownership"). This was a one time gain in 2008 so, after exluding this item in 2008, "resort income + misc revenues" were only about $140M-$145M. In 2009 the number is $150M.

In addition, I don't know what is included in "misc revenues". For example, SVO used to rent units on behalf of owners and take a cut. This was not foreclosed units, just a pure rental program. This was discontinued at some point, but I am not sure when. If 2008 "misc" revenues included these rental commissions and 2009 did not, then the "resort income" in 2008 was even lower than $140M-$145M. 

In sum, after you account for these it's more likely that actual management fee revenues did increase proportionally to the average MF increase.



jarta said:


> Also, if Starwood is taking no action to reduce the cost of management of the resorts, why does the category where that expense is reported shows a decrease, in the Category footnoted as 5, of 20.6% from $155M to $123M?



I think this one is relatively easy to answer. 

The definition of that line item is "resort, general and administrative, and other miscellaneous expenses". The "general and administrative" costs are expenses that can be reduced by reducing headcount at headquarters, call centers, and other non-resort locations (which SVO did). If they cut 300 employees which each cost the firm $100K a year (after all the fringe benefits) you get $30M in annual savings without actually cutting costs at any of the resorts... Here are $10M-$15M in annual savings...


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## jerseygirl (Nov 14, 2009)

xcg001 said:


> And of course one thing that make the situation worse than resorts in HI is that Myrtle Beach is very seasonal area - nobody wants to go during the winter and people are finally starting to realize that off season weeks has 0 (in my opinion even negative) value at such high MFs.



Fred alluded to something the other day that really got me thinking.  I think the network that is so revered here on TUG may actually be detrimental to owners overall.

Marriott has MANY one or two season resorts in its 50+ resort network -- Phoenix, Palm Desert, Lake Tahoe, Colorado, Branson, New Jersey, Hilton Head, *Myrtle Beach*, Utah, Williamsburg, and even their Europe locations.  But, even off-season owners obtain value from their ownerships (and therefore have an incentive to pay their maintenance fees) because:


Owners control the deposit process.  Inventory comes and goes daily -- it's not dependent on catching a "bulk banking." Last minute cancellations of plans can and do happen -- there is often great availability in the flexchange period if you follow the sightings board.
Marriott's preference period is far superior to Starwood's.  It extends into flexchange, where the "lowest of the low" can grab the "highest of the high."  Not necessarily the way I'd choose to plan my vacations, but I could certainly see myself owning an off-season week or two just to play under these conditions.  And, again, that would give me a reason to continue to pay the maintenance fees on my otherwise pretty worthless week(s).

The StarOption/network process is out-of-balance in so many places.  Just to name one:


A summer one-BR owner at Harborside cannot visit Lagunamar during prime season.
A summer two-BR owner at Harborside cannot visit Lagunamar during prime season unless they're willing to downgrade to a one-BR unit.

There are many more examples, but I think most of you know what they are. Either the Starwood executives failed to take economics, or StarOption valuations are established simply to generate sales,  Case in point -- Lagunamar.  And, even when Starwood realizes they've made a mistake, they don't fix it.  Case-in-point:  For phase one at WSJ, fall owners receive more SOs than summer owners (I guess that in addition to not taking economics, they don't make time in their busy lives for children!).  They fixed this in the new phase.  But, although they bumped the number of SOs slightly for all Phase One owners this year, fall (hurricane season) owners still receive more SOs than summer owners in direct contradiction to the new phase.  I've read the docs -- they can make changes at any time, they just choose not to.  

I think we would ALL be better off if Starwood worked like the current* Marriott process and owners and II controlled the trading process under conditions similar to Marriott's.  I've owned in the past, and/or continue to own a combination of high quality/high demand, high quality/low demand, medium quality/high demand and medium quality/low demand (dog) weeks.  I've studied the trading power patterns for years and overall, I think II does an excellent job managing supply and demand (although, I'm still on strike ).  I think if we let them handle it the way they handle Marriott's program, our low season owners would be able to obtain value and therefore pay their maintenance fees.  Our "prime week" owners would be motivated by ACs and the prioritized ability to trade back into their own resorts (e.g., true float ability for fixed HRA and WSJ owners).  Imagine a world where I could deposit a one-BR Harborside summer week, and get two weeks at Lagunamar (one with the deposit, one with the AC) ... vs today's world where I'm not allowed to go to Lagunamar (boo hoo ... good thing there are Royals and a Grand Mayan nearby).  And, a WKORV/WPORV owner could grab my Harborside week with one half of their lockoff.   

Elite members would lose their waitlist capabilities -- is that a big deal?

Anyway -- thanks Fred, for making me think differently.

* I haven't followed the situation completely, but I sincerely hope Marriott is not about to screw up a good thing.


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## Transit (Nov 14, 2009)

jerseygirl said:


> Fred alluded to something the other day that really got me thinking.  I think the network that is so revered here on TUG may actually be detrimental to owners overall.



Yes I agree.Most owners want in network Starwood units. It's proving time and time again with the difference in resale prices of the Mandatory and Voluntary resorts.Before the recent changes many units (non-SVN) were being 'rescued" from ebay by people who would actually use them.The only redeeming factor for these unit were they traded well.If there were SO's attached to all Starwood resorts I don't think we would have ever seen any on ebay for a dollar. If the Interval /Starwood change didn't take place I think many more of these units would be in the hands of owners that would use them and pays the fees.This is a unique and specific product that only people who really want would buy from ebay or other discount outlets.

 Boy did I mess up the quote !


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## Transit (Nov 14, 2009)

jarta said:


> The value of some of the older resorts Starwood took over from Sheraton certainly looks marginal.  Maybe it's time to whittle down the SVO family of resorts to make the chain a really luxury timeshare resort system.



Even the lowest of the low Starwood resort units are still better than 95 % of the resorts listed in II and RCI. It is a luxury timeshare system.Starwood needs to keep this in place and *keep improving benefits * to the system.If an owner  from a top shelf resort trades into one of the lesser value resorts they should still feel they are in a luxury resort. Without this, it just isn't a good "system" and future buyers will look to other "Systems" like Hyatt where quality is consistent and where they are more likely to be comfortable at *any* of the resorts.The recent refurbishments at Vistana and Jenson beach look incredible but the stigma of unpopular policies remain. At this point the only things I can see to level the playing field for Starwood is to get a grip on the delinquencies,place all of it's current and future units in SVN,Create new Developments in *NEW PLACES*,and keep the luxury feeling at a high level at all their resorts.


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## Fredm (Nov 14, 2009)

jerseygirl said:


> Fred alluded to something the other day that really got me thinking.  I think the network that is so revered here on TUG may actually be detrimental to owners overall.
> 
> 
> 
> ...


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## jarta (Nov 14, 2009)

Dan,

"First of all for the clueless guys like you - you can not transfer week until the deed is free and clear of any obligations and all fees are paid on the account."

Except, I was not talking about selling to someone else.  I was talking about taking a hike because the downstroke was so small.  When you have so little invested, why not walk away from the annual fee, let the resort foreclose the lien and hope the resort doesn't chase you for $1,000 to obtain a judgment by hiring an attorney in your home state.

It is not easy to collect small amounts when you have to chase all over the US to do it.  If you think it is, since you are into name-calling, you are the one who is clueless.

BTW, foreclosing the lien does nothing to recover the assessment money.  Plus, while most state statutes make it easy to do, it's an additional expense to perfect the lien and take title.  But, it must be done as a last resort.    ...   eom


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## DanCali (Nov 14, 2009)

jarta said:


> Dan,
> 
> "First of all for the clueless guys like you - you can not transfer week until the deed is free and clear of any obligations and all fees are paid on the account."
> 
> ...



Jim,

I think you have me confused with someone else... The post you are referencing is not mine and I didn't do any name calling... 

I replied to your post seeking some clarifications on why SVO's financials don't show that they have owners' interests in their minds. Curious to hear your further thoughts.

As for your reply to the "other person" my opinion is that if SBP or SDO is trading on eBay for $1, both the person who bought the TS on eBay and the developer purchaser have $1 at stake... the purchase price is irrelevant.


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## DeniseM (Nov 14, 2009)

Folks - lets stick to the facts and avoid name calling...


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## jarta (Nov 14, 2009)

Dan,

Sorry, it was xcg, not you

But, you wrote:  "In 2008 SVO sold notes receivable for a gain of $10M - $15M (see here - last paragraph under "vacation ownership"). This was a one time gain in 2008 so, after exluding this item in 2008, "resort income + misc revenues" were only about $140M-$145M. In 2009 the number is $150M."

However, your reference is to the 2008 2nd quarter prediction (Outlook section) of what might happen later in the year.  Here's what really happened (from the 4th quarter report).  Things had changed in the economic climate from the summer to year end in 2009.  The projected one time gain never happened; it turned into a one time loss.

"In addition, the Company recorded a $22 million impairment charge to write down its economic retained interests in securitized vacation ownership notes receivable based on a change to the expected future cash flows as a result of the current economic climate."

http://www.reuters.com/article/pressRelease/idUS119299+29-Jan-2009+BW20090129

Since we are supposed to stick to facts, not predictions and suppositions.

Gotta catch a plane home from WKV.  Bye-bye.   ...   eom


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## DanCali (Nov 14, 2009)

jarta said:


> Dan,
> 
> Sorry, it was xcg, not you
> 
> ...



That is a fair point - it is not clear what they did manage to sell and what they didn't... They did write off the $22M on what they didn't. 

It is however possible that those losses on what they didn't sell are included under "Deferred Revenues" (see below) while the gains are under "Other Sales and Services Revenues". Otherwise why would the call that line item "gain on notes receivable" (and not "losses")?  The large change in "Deferred Revenues" is a bit odd otherwise. I don't know (and don't really care) what those notes were exactly to really figure this out.


Deferred Revenues -- Other (3) (29) 3 n/m
(3) Includes deferral of revenue for contracts still in rescission period, contracts that do not yet meet the requirements of SFAS No. 66 or SFAS No. 152 and provision for loan loss

Regardless of all that, this is too vague for us to figure out without digging deeper and that is the main point which I think you missed... The main point of my post was that if a line item contains "resort income, interest income, gain on sale of notes receivable, and miscellaneous other revenues" you were assuming it was all resort income and your assumption happens to reflect better on SVO management. 

I have no idea what is buried under "miscellaneous" or why they would call a line item "gains" if it actually was "losses" so I prefer to not jump to conclusions that management is all of a sudden looking after owners' interests. In my mind if they did care then fees would not go up 10%-15% a year, especailly this year... they would find a way to contain cost increases in line with 0%-3% inflation a year, just like Worldmark does.

Similarly in regards to "resort, general and administrative, and other miscellaneous expenses". My feeling here is that the costs cuts came fom the G&A reductions in the form of layoffs.

Travel safe!


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## Transit (Nov 14, 2009)

Fredm said:


> jerseygirl said:
> 
> 
> > Fred alluded to something the other day that really got me thinking.  I think the network that is so revered here on TUG may actually be detrimental to owners overall.
> ...


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## DeniseM (Nov 14, 2009)

Transit said:


> This is a win win. Even the owners at  top Marriott resorts will deposit to II because they feel can get a even exchange. Most owners at Starwood's top resorts wouldn't never take a chance.Once they do they will never do it again.



Especially now that "request first" is gone - who is going to deposit an expensive week with no idea if they will get the exchange????


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## xcg001 (Nov 14, 2009)

I am sorry but you still have no idea how we (bargain hunters) operate. While it is true that collecting from a timeshare is very difficult for the HOA destroying someones credit history is extremely easy. And let me tell you that for us "bargain hunters" credit history is a lot more valuable than $1000 (heck I will not let someone trash my credit history even for $10,000).

Also if for any reason I end up in a difficult financial situation it will take me only 10 minutes to create an EBay auction and dump my primary season weeks (and even request MFs refund if I paid such - you should check auctions, almost all of these require MFs refund if you give also usage for the current year).

This is luxury that someone with thousands of $ mortgage at 15% rate can not afford. It is poor guys like this that are really trapped - they can not give their TS even for free since they owe a money to the mortgage while having almost no value and thus being severely upside down. This is one of the fundamental reasons for bankruptcies/foreclosures - being hugely upside/down on loan versus collateral for almost any case whether it is car, home or timeshare.

As I said quite the contrary, bargain hunters know that it is best to prepay MFs as soon as the reservation window is open to grab the best of the best weeks. Of course I have to pay the difference now between the estimated MF that Starwood charged me in the summer versus the actual ones but even at 21% increase it is peanuts versus loosing my exchanges for WKORV and HRA. On top of that some of my prime weeks are already rented so I have absolutely no incentive not to pay all that difference. Quite the contrary - I promise you that I will prepay my MFs the moment when reservation window open next summer so that I can again grab reservations at prime time. 



jarta said:


> Dan,
> 
> "First of all for the clueless guys like you - you can not transfer week until the deed is free and clear of any obligations and all fees are paid on the account."
> 
> ...


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## xcg001 (Nov 14, 2009)

As for the Starwood financials - I am sorry but from these vague financial statements it is very difficult to figure anything about whether their decreased revenue comes from except for the obvious reason - weak sales and people defaulting on ridiculous 15% interest mortgages.
These financial statements are so generic that you can hide an island in them and nobody would notice. What I directly care is the 10% Management fee they insist on collecting from my resort as indicated on the MF statement.
And this is 10% of the total amount including 20% they had to increase in expectation of such foreclosures. Of course I can not fault Starwood for wanting to make as much money as possible, what I fault them for is usurping the HOA for their own gain. Because a real HOA by law has to look for interests of the owners first, not their puppet masters. 



jarta said:


> Dan,
> 
> Sorry, it was xcg, not you
> 
> ...


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## TUGBrian (Nov 14, 2009)

if anyone is unable to carry on a discussion without resorting to name calling, they will be unable to play with the rest of the class very soon.


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## jarta (Nov 14, 2009)

Dan,   ...   Any gain on the sale would be booked as revenue.  But, since there was a net loss on the sale, it would be booked as an expense.

(One reason the total expenses are lower this year is from the one time net loss (not gain) from the paper.)

In this economy, selling off paper will not generate a gain.  Probably won't for a few years yet.

So, if Starwood is taking a percentage of the assessments (as seems to be the Gospel here on TUG), any substantial increases in assessments will generate commensurately larger revenues to Starwood from management of the resorts.  That seems impossible since the revenues from management are down, 2009 over 2008, not up.

I just don't think a lot of people who are making statements like that know how to read a financial statement.  The Starwood one may have different categories.  But the main revenue one for management operations is management fees.  (Revenue and expenses are segregated in the financial statement for sales operations and management operations.)

Please don't take my statements as a general defense of everything about Starwood - a company that is arrogant, bottom-line oriented and certainly sometimes wrong.  The yearly assessments are indeed high.  There are, without a doubt, "non-performing" weeks where the assessments have not been paid.  Without those weeks the increase would have been 2%.  (People have been saying that Starwood has been renting these weeks and keeping all of the rental payments.  If that were so, wouldn't that be a reason for increased revenue - rather than decreased revenue - for Starwood from management.)  At Maui, Starwood has said that most of the non-performers are mortgage-free.  Still, as a last resort, Starwood should be foreclosing the "non-performers" and getting those weeks - one way or another - in the hands of someone who will pay the assessments.

This thread started with the posting of a letter from Starwood explaining the large increase in 2010 assessments.  People had been wondering what was causing the increases and blaming Starwood for not letting them know.  Then, when the reason is revealed, it is not believed here.  Go figure!

The fall-back defense of people with an anti-Starwood agenda is that Starwood is cooking the books - apparently just to confuse TUGgers.  Starwood is a huge corporation that has the SEC (sometimes), financial analysts and shareholders looking over its shoulder.  In this post-Enron environment, they would be crazy to cook the books for such a limited audience.  Timeshares is a small part of the Starwood empire.

BTW Dan, thank you for graciously accepting my apology and wishing me well.  The flight home was less than 3 hours from Phoenix to Chicago.  Kierland villas were jammed last week.  The hotel was much more crowded than it was last March when I was last there.  And, very importantly, the shops at the Kierland Commons were jammed with buyers.  At least in Scottsdale, the economy is jumping!  Next up?  Harborside in 3 weeks.   ...   eom


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## CeeWoo (Nov 14, 2009)

DeniseM said:


> I would bet, that a lot of these owners are are older owners on fixed incomes who bought from Starwood, or the previous developer, a long time ago before MF's got so high.



I'm starting to worry that will be me in just a few years 

I may well come here someday, and ask if anyone wants a free unit that has no mortgage


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## GrayFal (Nov 14, 2009)

jerseygirl said:


> Fred alluded to something the other day that really got me thinking.  I think the network that is so revered here on TUG may actually be detrimental to owners overall.
> 
> Marriott has MANY one or two season resorts in its 50+ resort network -- Phoenix, Palm Desert, Lake Tahoe, Colorado, Branson, New Jersey, Hilton Head, *Myrtle Beach*, Utah, Williamsburg, and even their Europe locations.  But, even off-season owners obtain value from their ownerships (and therefore have an incentive to pay their maintenance fees) because:
> 
> ...





Fredm said:


> jerseygirl said:
> 
> 
> > Fred alluded to something the other day that really got me thinking.  I think the network that is so revered here on TUG may actually be detrimental to owners overall.
> ...


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## gregb (Nov 14, 2009)

TimeOS2 made a comment in an earlier post that I think needs clarification.  



timeos2 said:


> But what if there IS a mortgage? Even bigger problems as those place the fees second in line. This becomes a super serious issue as those weeks are likely to remain delinquent for 5 years or more. There is little an Association can do except push the lender to foreclose. If the lender is the developer (or an arm of them) it can get really ugly.



Just because the MF are secondary to a mortgage, I do not believe that it prevents the HOA from starting foreclosure.  Just like if you don't pay the 2nd mortgage on your home, the lender of the 2nd mortgage can start foreclosure.  Yes any payments that the HOA would ultimately get would be after the first mortgage is paid.  But I believe they can at least force the issue by starting foreclosure.

Again, starting foreclosure is not really to take the property back, but rather to force the owner to pay their fees.

Greg


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## pointsjunkie (Nov 15, 2009)

i think many of us are losing sight with what is really going on in the US. there are many people who were doing very well back in 2008 and paid all there bills on time and then the walls fell in around them, unemployment, losing  money that they saved for years, etc. Many are losing their homes, cars and don't know how they are going to put  food on the table, losing a timeshare and not paying their MF's is certainly NOT HIGH UP on their list to pay.

they would love to pay their obligations if they could,but eating, housing, and taking care of the kids are the top priority NOT going on a vacation in 2009 or 2010. 

so for all of us who are able to pay the MF's, although exceptionally high ,be grateful that you can. and enjoy everyone of those vacations with your loved ones.


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## jerseygirl (Nov 15, 2009)

Good point Barbra.  We should be grateful that we're not in their shoes.  I'd rather be able to complain about the high maintenance fees than not be able to pay them at all.


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## tomandrobin (Nov 15, 2009)

jerseygirl said:


> The StarOption/network process is out-of-balance in so many places.
> 
> Elite members would lose their waitlist capabilities -- is that a big deal?



Starwood Staroptions will never be fixed. 

As an elite member, I don't find wait listing a big deal. In my case, I have 5 weeks of ownership. So, at a minimum I am reserving/managing five reservations each year. In reality, its more like 10 per year. If a week is not available, I just move on. Also, most owners who own multiple weeks, usually own where they want to go already (Katherine being the exception).


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## jerseygirl (Nov 15, 2009)

tomandrobin said:


> Starwood Staroptions will never be fixed.



Yeah -- I know.  It just drives me nuts to see it the way it is.  I can't see myself trading my HRA or WSJ units even if they did fix them  ...



tomandrobin said:


> As an elite member, I don't find wait listing a big deal.



Thanks!  Can you think of any elite-related perks that would be lost if Starwood abandoned the network and starting trading like Marriott?  Not that I think this is going to happen -- I'm just curious.  And, I do wonder if the increased costs of running the network are contributing (significantly) to the higher maintenance fees (e.g., Westin Maui is $400 or so higher than Marriott Maui, right?)?  



tomandrobin said:


> In my case, I have 5 weeks of ownership. So, at a minimum I am reserving/managing five reservations each year. In reality, its more like 10 per year. If a week is not available, I just move on. Also, most owners who own multiple weeks, usually own where they want to go already (Katherine being the exception).



I'm a combination of those types -- I own at two "where I want to go" locations (HRA, WSJ), several "trade within the system" weeks (Hilton, Hyatt and my Starwood traders -- one in the network, the rest via II until I went on strike!), and several "let's go somewhere new and different" weeks (non-branded, strictly trader units).  It works for us!


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## timeos2 (Nov 15, 2009)

*Correct but why spend the money?*



gregb said:


> TimeOS2 made a comment in an earlier post that I think needs clarification.
> 
> 
> 
> ...



Greg you are correct that the Association can go ahead and foreclose even with the mortgage as the superior lien, but why would they? A foreclosure averages $1000 in direct expense to the Association. If they end up with the week to be resold or at least given to a new, paying owner then over a year or two the outlay makes sense. But foreclosing on a week with a mortgage means they have spent $1000 but cannot resell or give away the wek as the mortgage holder is still the superior lien and THEY aren't responsible for the fees the delinquent owner (who owes both the fees and the mortgage) is. Unless the mortgage holder forecloses - which would also extinguish the HOA claim that they paid $1000 to enforce! - the week will remain delinquent and in limbo. Hardly a good way to throw another $1000 into the mix of delinquent fees due. These weeks are a nightmare for the Association and sit directly at the door of the developer who sold them. And thats the same group who are supposed to be collecting the fees. You can see this is not a good situation and the developer/management has a basic conflict they are not addressing. 

The answer I've found is to have an independent management step in and go after every owner for payment. Also push the mortgage holders to act. Eventually (5 years) there is a process to force nonperforming weeks to act but the clock on the 5 year period doesn't start until direct action is taken. If management isn't/won't taking the necessary steps to get those weeks back to paying status the other owners face a minimum of 5 years of covering those past due fees and, from what we see here, the clock hasn't started running as management isn't doing the work needed to fix the problem. 

This situation cries out for an independent Board and a new management. Nothing less appears to be effective. If it were my resort I'd be leading the owners revolt or, if it appears the support isn't there for such a big move, get out while I can at any cost. Current management is running things into the ground on the backs of the paying owners.


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## tomandrobin (Nov 15, 2009)

jerseygirl said:


> Yeah -- I know.  It just drives me nuts to see it the way it is.  I can't see myself trading my HRA or WSJ units even if they did fix them  ...



Very true....I get offers for my HRA and WSJ weeks all the time. Trades that I could never get via staroptions or II.


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## LisaRex (Nov 15, 2009)

If Starwood were contributing money to the HOA for rentals there would be a line item on the HOA for "rental income."  There isn't one. 

What WAS listed was "developer contribution" which they'd have us believe was an amount that the developer contributed to our bottom line because they were swell guys.  I suspect instead that it was our share of rental income.  Since 600 owners were delinquent in 2009, that is 600 weeks that Starwood had at their disposal to rent out, book with points, or put into II for exchanges.  And we should have gotten a share of those proceeds -- at a very minimum, enough to offset delinquencies. 

In 2009, Starwood was budgeted to voluntarily contribute $1.1M to the master assciation and $300k to the apartment owners, for a total of $1.4M.  They ended up contributing $200k. Their reasoning for backing out? Because we saved money in other areas.  So instead of using it to offset the 30% increase it just threw at our feet, instead Starwood diverted it to bolster THEIR bottom line. 

Even if the HOA bends over backwards to implement cost savings, for every dollar we save, we're losing a dollar from the "voluntary contribution" line.  It reminds me of the lottery system here in Ohio.  They sold it to the voters by promising that every dollar in profit would be funneled into our school system.  What they didn't tell us is that for every dollar that was put INTO  schools via the lottery, they'd take a dollar that had been previously been contributed by the General Fund OUT.  Net sum gain was zero. 

Starwood's MFs have almost doubled in 5 years.  They couldn't manage their way out of a corn maze.  

It won't last.  Either the entire system is going to collapse as more and more people bail on a product that is worth less than they owe, or it's going to be sold off in a few years to a third party.  Because they can't continue to look at owners as cash cows.


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## jerseygirl (Nov 15, 2009)

tomandrobin said:


> Very true....I get offers for my HRA and WSJ weeks all the time. Trades that I could never get via staroptions or II.




Yeah, me too.  My favorite is when someone with a 148,100 SO week offers one side (e.g., the one-BR side) for a 2-BR at HRA .... because ... gee, that's what the StarOption chart indicates would be fair.  :hysterical:


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## tomandrobin (Nov 15, 2009)

jerseygirl said:


> Thanks!  Can you think of any elite-related perks that would be lost if Starwood abandoned the network and starting trading like Marriott?  Not that I think this is going to happen -- I'm just curious.  And, I do wonder if the increased costs of running the network are contributing (significantly) to the higher maintenance fees (e.g., Westin Maui is $400 or so higher than Marriott Maui, right?)?



Being Platinum so far has been good for us. Late check-out is also a plus. Having the extended period before converting to starpoints is a nice option. 

Waitlisting is not a wasted perk, just not for us. Owners in Phase 1 at HRA, WSJ hillside villas probably benefit from this more then I do. My units are all float weeks. Also, I can see someone at one of the Hawaii resorts locking in their summer week, hoping to get a HRA, WSJ or WLR week at 8 months.


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## jerseygirl (Nov 15, 2009)

LisaRex said:


> If Starwood were contributing money to the HOA for rentals there would be a line item on the HOA for "rental income."  There isn't one.
> 
> What WAS listed was "developer contribution" which they'd have us believe was an amount that the developer contributed to our bottom line because they were swell guys.  I suspect instead that it was our share of rental income.  Since 600 owners were delinquent in 2009, that is 600 weeks that Starwood had at their disposal to rent out, book with points, or put into II for exchanges.  And we should have gotten a share of those proceeds -- at a very minimum, enough to offset delinquencies.
> 
> In 2009, Starwood was budgeted to voluntarily contribute $1.1M to the master assciation and $300k to the apartment owners, for a total of $1.4M.  They ended up contributing $200k. Their reasoning for backing out? Because we saved money in other areas.  So instead of using it to offset the 30% increase it just threw at our feet, instead Starwood diverted it to bolster THEIR bottom line.



Thanks Lisa -- I remember skimming over that part in one of the recent inserts that came with MF invoices ... meant to go back to it to try to understand it better, but forgot to do it.

I think you could be on to something big and we need to make it a point to understand it fully.

There should be multiple ways that money is flowing from Starwood to the HOA:

-- Prop-ups, which are done when a resort is new (I think these are voluntary and done so they can display artificially low rates to prospects, but I could be wrong)
-- Owner's share of rental proceeds
-- Starwood's share of MFs for unsold inventory (could be lumped in with all other MF revenue, but I'd like to see a breakout)

We need a CPA to chime in on which reports we need to fully understand the situation.


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## jerseygirl (Nov 15, 2009)

tomandrobin said:


> Being Platinum so far has been good for us. Late check-out is also a plus. Having the extended period before converting to starpoints is a nice option.



Got it ... good points.  Of course, these could continue to be offered if we went to a Marriott-style trading system.



tomandrobin said:


> Waitlisting is not a wasted perk, just not for us. Owners in Phase 1 at HRA, WSJ hillside villas probably benefit from this more then I do. My units are all float weeks.



I thought there were recent changes (negative -- is there another kind where Starwood is concerned  ) to the waitlist procedure.  I don't know if I'm entitled to waitlist ... have never tried ... am completely ignorant on the process.  Like you, if something is not available, I move on.  But, it does sound like this is the possible area where Elite owners could be harmed by moving to a Marriott-style system.  



tomandrobin said:


> Also, I can see someone at one of the Hawaii resorts locking in their summer week, hoping to get a HRA, WSJ or WLR week at 8 months.



Either I had a REALLY bad call center agent, or a recent experience would lead me to believe this doesn't work well (at least where popular weeks are concerned).  As always, I "hold" our deeded week HRA reservations (2 units, same week, bought at different times so 2 reservation #s involved). Not holding your weeks is a GIANT risk.  I was calling frequently to try to change from late may to June.  One morning, I hit the jackpot and one unit was available.  The agent told me she could not grab and hold it until she cancelled my May reservation and by that time, it would probably be gone.  That made no sense to me whatsoever ... and I told her that I was pretty sure it had been done for me in the past (same situation -- changed from May to June without a problem), so it would appear that the prior agent was able to "hold" the available week until he could process the cancellation and free up the SOs needed to make the new reservation.  

She assured me that she had been there 3 years (blah blah blah) and that it was impossible for her to hold that week for me until the SOs were free (i.e. until after she cancelled the existing reservations).  I'm not usually rude to call center employees (they have my sympathy), but I just hung up on her as I could see I was getting nowhere -- in fact, she announced, "it's already gone," while I was trying to explain that this process didn't make any sense.

Here are the possibilities as I see it:


She was an idiot and had no idea what she was talking about
My account is labeled, "Screw her every chance you get," just like Nodge's account is labeled, "Give him the unit next to the dumpster."  
The reservation system is even worse than we ever thought -- if that Hawaii owner referenced in your post is holding their summer week and has no other available SOs, they'll never get an HRA or WSJ trade because of the processing time needed to cancel the first reservation.


**** James **** -- I need your expertise.  Was this agent just stupid or is it really impossible to "hold" an available unit while you process a cancellation that would free up the SOs to obtain the reservation?


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## jarta (Nov 15, 2009)

jerseygirl said:


> Can you think of any elite-related perks that would be lost if Starwood abandoned the network and starting trading like Marriott?



There is also the 10% bonus for higher Elites on converting Staroptions to Starpoints that would be lost.  This option makes the points 10% less expensive.

The ability to keep a specific reservation and wait list at the same time (sort of like what II took away) is a big benefit for higher Elites.  It would be lost.

Also, as tomandrobin pointed out, a 4/5 Star Elite has until October 1 of each year to decide whether to convert Staroptions to Starpoints.  That is a big advantage in flexibility that probably would be lost.  Non-elites have only until March 1 (and only every other year?) which forces a very early vacation decision.  Of course, if you are not in SVN, you have no Staroptions to convert.

Most higher Elites are quite happy with their treatment by Starwood.   ...   eom


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## jarta (Nov 15, 2009)

Lisa,   ...   I switched my reserved Harborside 3-br Platinum to a St. John 3-br Platinum at 8 months out a couple of months ago.  It was easy as pie.  But, maybe I was just lucky.  

Not many SVN members can do that because they do not have the Staroptions that match up (196,900).  It's one of the reasons (Aruba 3-br also affected my thinking, sigh) I bought a 3-br in Platinum season at Harborside  - and later even retroed it in case I want the Starpoints.   ...   eom


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## jerseygirl (Nov 15, 2009)

I usually regret responding to one of your posts, but I'll give it a try!



jarta said:


> There is also the 10% bonus for higher Elites on converting Staroptions to Starpoints that would be lost.  This option makes the points 10% less expensive.



Again, this wouldn't need to change as converting to StarPoints has nothing to do with internal or external trading.



jarta said:


> The ability to keep a specific reservation and wait list at the same time (sort of like what II took away) is a big benefit for higher Elites.  It would be lost.



As stated above, I don't really understand this side of things ... but, it does sound like the one area (mentioned so far) that would have a negative impact on Elite owners.  However, since even the "Elitist of the Elite" aren't able to trade into the uber-popular resorts like WSJ and HRA during anything other than hurricane season (and that's even hard at WSJ), I'm not sure it's overly important.  All the rest of the resorts don't seem to require the use of the waitlist, except for maybe holiday weeks.  Please note, I'm not totally disregarding this benefit, I'm just questioning whether or not its value is excessive.



jarta said:


> Also, as tomandrobin pointed out, a 4/5 Star Elite has until October 1 of each year to decide whether to convert Staroptions to Starpoints.  That is a big advantage in flexibility that probably would be lost.  Non-elites have only until March 1 (and only every other year?) which forces a very early vacation decision.  Of course, if you are not in SVN, you have no Staroptions to convert.



Again, immaterial to what we're discussing.



jarta said:


> Most higher Elites are quite happy with their treatment by Starwood.   ...   eom



I'm sure you're correct as it relates to the SPG side of things, room placement, etc -- all things that wouldn't need to change as a result of what we're discussing.


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## jarta (Nov 15, 2009)

jerseygirl,   ...   To James:  "I need your expertise. Was this agent just stupid or is it really impossible to "hold" an available unit while you process a cancellation that would free up the SOs to obtain the reservation?"

How it works.  If you have a reservation, first you ask the agent if there is availability for a particular week.  If the answer is "yes," you cannot make the new reservation until the old one is canceled.  The cancellation frees up the Staroptions so that they can be used for the new reservation.

If you tell the agent you want to cancel the reservation and free up the Staroptions for the new reservation, the process of doing that takes less than 15-30 seconds.

During that 15-30 seconds, another person could call and inquire about the same type of unit for the same week and take the open week while you are canceling.

I have used this process many times.  I have never lost an "open" reservation.

Usually, since Platinum season is early in the year and all my weeks are Platinum, what I do is at 12 months out I reserve what I think would be good at my home resorts.  Then, at 8 months out, I decide whether to reconsider resorts, drop off some of the smaller 1-brs to by October 1 use for converting to Starpoints or to amalgamate for reservations elsewhere later in the year.  Being a 5 Star Elite and making the changes to my home resort reservations, I don't even get charged the $29 for dropping the reservations (or parts of them).

For those who use the SVN system, it is really easy and really flexible.   ...   eom


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## jerseygirl (Nov 15, 2009)

Thanks Jarta.  I've been at this game a lot longer than you, and I do use the SVN system for my HRA weeks -- I know how it works.  I've done exactly what you've explained in the past, and have been successful in changing my May weeks to early June (before all the NY/NJ schools are out).  But, I had a different experience recently and the agent I had on the phone was not capable of making the switch in 15 seconds.  And, as us old-timers know, late June and July weeks are a different story ... even 15 seconds will mean the week is gone.

You know, I saw a really funny old "Frasier" episode the other day where Frasier's boss told him it was "shameless" how he managed to bring up Harvard in every conversation.  I'll make you a deal, if you stop reminding us that you're 5-Star elite in every post, I promise to try to stop pointing out your lack of long-term experience, understanding of the history of Starwood, etc.  eom


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## jarta (Nov 15, 2009)

jerseygirl,   ...   "And, as us old-timers know, late June and July weeks are a different story ... even 15 seconds will mean the week is gone."

That is not what I have experienced.  I made one of those trades you say the "Elitest of the Elite" cannot make, a reservation at 8 months out by canceling my Harborside reservation just 2 months ago.  "Lisa, ... I switched my reserved Harborside 3-br Platinum to a St. John 3-br Platinum at 8 months out a couple of months ago. It was easy as pie. But, maybe I was just lucky."

But, since I'm probably just a lucky "newbie," could you please direct me to a post on TUG where someone dropped an existing reservation and lost it before the new one could be made?   ...   eom


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## Aussiedog (Nov 15, 2009)

*Getting back to the original issue*

I wish that more TS systems and solo resorts did what I know some of you have at just a few resorts.  

I wish that the resort or system would take the weeks that are not encumbered by a mortgage, just MFs, and offer the deeds to other owners at that resort.  Seems to me that if the HOA could divest itself of some of the MF burden it could really help the resort's go-forward financial health.

I am aware of two resorts that allow current owners to rent extra weeks for the cost of the MFs, specifically to help with the shortfall.  That has to help some, right?

Of course with Starwood this would require a total change in policy, like putting resort income back into the resort to offset resort expense.....  

I have been very happy with Starwood as a non-SVN owner, maybe because I rent and use and don't trade.  If I did not have my 2010 weeks rented already I would be tempted to "re-eBay" my purchases now.  Guess I will wait and see how this next year shakes out.

Ann


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## DeniseM (Nov 15, 2009)

jarta said:


> jerseygirl,   ...   *To James:  "I need your expertise.* Was this agent just stupid or is it really impossible to "hold" an available unit while you process a cancellation that would free up the SOs to obtain the reservation?"



Just to clarify - I believe this statement from Jersey girl was directed to James1975NY - who used to work for Starwood, and whom we call our "Starwood expert," not to jarta, whose name is also James.


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## jerseygirl (Nov 15, 2009)

jarta said:


> jerseygirl,   ...   "And, as us old-timers know, late June and July weeks are a different story ... even 15 seconds will mean the week is gone."
> 
> That is not what I have experienced.  I made one of those trades you say the "Elitest of the Elite" cannot make, a reservation at 8 months out by canceling my Harborside reservation just 2 months ago.  "Lisa, ... I switched my reserved Harborside 3-br Platinum to a St. John 3-br Platinum at 8 months out a couple of months ago. It was easy as pie. But, maybe I was just lucky."



Based on the number of SOs you quoted, you obviously got a 3-BR in the new phase during platinum season (most of which does not involve school vacations). I will readily acknowledge that the addition of float weeks in the new phase will lead to greater availability, and that's a good thing for all who want to trade in.  You were still lucky -- and I congratulate you -- but we're still not talking about the exact same circumstances -- the rarity of exchanging into a Harborside summer week (starting in mid-June).  



jarta said:


> But, since I'm probably just a lucky "newbie," could you please direct me to a post on TUG where someone dropped an existing reservation and lost it before the new one could be made?   ...   eom



I never said that it happened to anyone.  I just relayed my experience (there was no way I was going to drop my existing May reservation and chance losing them both).  I was simply pointing it out in response to TomnRobin's point about a Maui owner wanting to hang onto their prime summer week, and as a way to warn others about the risks should the same thing happen to them.


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## jarta (Nov 15, 2009)

jersey girl,

"Originally Posted by jarta  
But, since I'm probably just a lucky "newbie," could you please direct me to a post on TUG where someone dropped an existing reservation and lost it before the new one could be made? ... eom 



> jerseygirl: *I never said that it happened to anyone*. I just relayed my experience (there was no way I was going to drop my existing May reservation and chance losing them both). I was simply pointing it out in response to TomnRobin's point about a Maui owner wanting to hang onto their prime summer week, and *as a way to warn others about the risks should the same thing happen to them*."



I'm sorry.  So, it has never happened in the history of TUG.  That means the "risk" you are warning people about must be pretty small.  

Moreover, to irrevocably lose the existing reservation, someone will have had to gobble it up by calling and requesting the same unit and week during the short period between canceling it and finding out the "open" week had been taken and was not "open.".  Otherwise, the canceled reservation would itself be "open."   ...   eom


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## jerseygirl (Nov 15, 2009)

Jarta -- 

I'm not going to argue with you any further ... so feel free to post the last word.  The unit disappeared in the 15-30 seconds we were discussing how she would go about getting it for me.  You either get that or you don't.  I can't be any clearer.


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## DeniseM (Nov 15, 2009)

Let's get back on track here, folks - let's focus on the issues, and not the personalities - Thanks!


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## l2trade (Nov 15, 2009)

Jarta,
I've tried so hard to stay silent on this thread.  I cannot any longer.  I agree with what Jerseygirl and others have shared here.  You lost me way, way back on post #5, when you said:



jarta said:


> Starwood had and has age and income requirements to purchase.  eBay has none.
> 
> More likely, the problem is caused by all those secondary owners that Starwood could not screen getting in cheap for a few dollars and, having no loyalty to Starwood and hurting from the economy and being in over their heads, just took a hike.



Now, seriously, do you really believe that?  

This is so far from reality that I feel no need to defend my POV... so feel free to post the last word on that too.  :hysterical:


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## Loriannf (Nov 15, 2009)

*I did lose an existing reservation while waiting*

A couple of years ago I tried to trade my WSJ for an HRA.  First, of course, they had to cancel my WSJ to free up the SO's for the HRA, but HRA during a week we wanted was available.  By the time the agent, on the Elite line, managed to cancel my WSJ, the HRA was gone AND SO WAS MY WSJ!!!!  It took many, many hours and phone calls to get my WSJ back (and it wasn't ' our exact week and unit, since it was of course, GONE).  We didn't manage to get into HRA through SO's since I'm now afraid to try.  We did get in through a direct exchange.

Lori


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## gmarine (Nov 15, 2009)

jarta said:


> timeos2,   ...   "Or it's the nightmare scenario where to make sales they are moving weeks to owners who can't pay but now the mortgage is superior to the Association claim for fees but the mortgage company doesn't want to hold the title so they won't foreclose. THAT can kill a resort as those weeks pile up with no way to solve the problem!"
> 
> Starwood had and has age and income requirements to purchase.  eBay has none.
> 
> ...



Jim

This post is absolutely hysterical. If I didnt know you would say anything to defend Starwood no matter how ridiculous, I would have thought you were joking.

Starwood has no age requirement to purchase. Having any age requirement to purchase would be discriminatory.  

An income requirement only comes into play if a purchaser wants to finance through Starwood, as it would financing though any company.

You may be referring to the income/age requirement that many developers have which apply to taking the tour for the freebies they offer. They do this to make sure the person/persons taking the tour would be eligible to finance a purchase. 

However, these income requirements are never verified before the tour so you might want to look for another way to defend Starwood.


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## jarta (Nov 15, 2009)

george,

Laugh all you want.  Starwood (as well as other timeshare places) do it by restricting access to promotions.

The restrictions have even been posted on TUG.

http://www.tug2.net/ads/mpromo.shtml

I found out about it when my adult son, an exchange trader, wanted to go to the Harborside promotion and pick up the $125.  He was told he was too yoiung (he was 24 and met the income restriction).

BTW, anyone who wants to buy at Starwood must fill out an income disclosure which starts with below $50K.  And, they keep it.

I don't see eBay or Stromann asking questions like that.   ...   eom


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## jarta (Nov 15, 2009)

Loriannf,

Your experience proves that a very unlikely event can happen.  It also proves that when it occured, Starwood (with some deserved persistent nudging by you) made you whole.

Sorry it happened to you.  Glad you finally got something comparable.  And, Go Cats!   ...   eom


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## DanCali (Nov 15, 2009)

jarta said:


> george,
> 
> Laugh all you want.  Starwood (as well as other timeshare places) do it by restricting access to promotions.
> 
> ...






			
				gmarine said:
			
		

> You may be referring to the income/age requirement that many developers have which apply to taking the tour for the freebies they offer. They do this to make sure the person/persons taking the tour would be eligible to finance a purchase.



Jim - there is no contradiction here. George agrees that there is an income restriction to attend the 90 minute promotion which gives you points or cash rewards. You both agree on this.

Again, you are missing the main points:

(i) There is no restriction on income if you call the direct sales via phone and buy a unit directly from them without financing. Some EOY on the mainland are not that expensive, even from the developer (of course you can get them oneBay for much less or free).

(ii) Even if there was an $60,000 household income restriction - that is not a very high number. In fact, I don't think that it is prudent for households that have a $60K pretax income to be using such a significant portion of their after-tax cash on WSJ, HRA, or WKORV MFs... It was different when MFs were at $1300 but no purchaser was told MFs would double over 5 years. Starwood salespeople always tell people MFs go up to reflect "cost ofliving adjustments".

If this is truly the "ultra-luxury" chain as you claim, why not use the $250K "magic number" that identifies the "rich" these days for a minimum purchase requirement. I don't think Starwood is that luxurious and service-oriented (compared to the Ritz and Four Seasons). They cater to the upper median of incomes (median household income in the US was about $50K in 2007), but MFs have gone way beyond what most of those people should be paying for a 1 week "prepaid in the upfront cost" vacation. I'm not saying people can't pay the MFs - I'm saying that for some households it's probably not prudent to do, especially since it's not what they thought they bought into.

(iii) So if people attended a 90 minute presentation and lied on the disclosure (they never actually ask to see income documentation) do they have a case to return the unit to the developer? One could make the case that it is Starwood's fault for not verifying income properly... 

The disclosure is meaningless and useless to all parties after a purchase, so what does it matter if they keep it?


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## jarta (Nov 15, 2009)

> Dan,   ...   "In fact, I don't think that it is prudent for households that have a $60K pretax income to be using such a significant portion of their after-tax cash on WSJ, HRA, or WKORV MFs... It was different when MFs were at $1300 but no purchaser was told MFs would double over 5 years."



I agree that a significant portion of after-tax income should not be spent on timeshare MF.

I also agree that no purchaser was told that MFs would double over 5 years at WKORV.

Nobody told me 5 years ago that gas prices would double or airfares would skyrocket or that the economy would crater so badly that home and condo prices in places like California, Florida, Las Vegas and Phoenix would be 50% of what they were.  Or, that unemployment would be more than 10%.

I also don't know that Starwood would have built 2 timeshare resorts in Maui knowing that the Maui tax policy would change and become very anti-timeshare or 3 in Hawaii knowing that Hawaii would place a prohibitive service surtax on every timeshare dollar collected.

And, nobody told me that a substantial portion of my co-owners at Starwood resorts would stop paying their assessments.

I don't like paying high assessments and certainly don't like paying those of my deadbeat co-owners.  But, bills must be paid and, hopefully, the luxury (or "wanna be" luxury) standards at Starwood will be maintained.

All of the above uncertainty is not Starwood's fault.  Sometimes, life is a crap shoot.      ...   eom


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## Ken555 (Nov 15, 2009)

jarta said:


> All of the above uncertainty is not Starwood's fault.  Sometimes, life is a crap shoot.      ...   eom



And sometimes it's caused by irresponsible, biased, single-minded Board members neglecting their duty in representing and protecting the owners and the HOA ahead of all other interests. The actions of the Boards for Starwood properties in recent years and their lack of transparency and willingness to communicate with the owners is an affront to all. 

If the decision to raise MFs was made as a last resort, after exploring all other options, then the Board should say so. This includes: 

- review and change, if necessary, policies to increase the HOA revenue in any way possible. specifically, the renting of weeks where the MFs have yet to be paid (for the benefit of the HOA)

- renegotiate our contracts with Starwood for the management of the resort to lower our overhead costs. 

- communicate with owners in an open and constant manner. improved communication alone would alleviate much of the confusion and lack of trust we have of Starwood

I would welcome any Starwood Board member to join us here and have a thoughtful reasoned discussion. Many of us are completely justified in our opinion that the HOA Board is neglecting the owners and putting Starwood's interests first - and it's difficult to convince us otherwise without more transparency on the specifics of the financing and decision making options. This becomes a critical issue in troubled times like we're going through right now, and anyone who dismisses this out of hand really ought to rethink his position.


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## rickandcindy23 (Nov 15, 2009)

jarta, most resorts are not having these major problems collecting maintenance fees.  You have some sort of idea that resale buyers aren't as responsible as people who overpaid to buy from Starwood.  It's ridiculous logic.  I don't see a single person walking away from their obligations here, and we are resale buyers.  

I am on the board at two Colorado resorts that aren't managed by the developer. * We hire and fire the management companies for our resorts*, and as board members, we pretty much have "hands on" knowledge of collections.  Neither resort has more than 3% of people that don't pay, but one resort has an inordinate number of weeks that have had problems getting people to pay for years and years (lots of dead owners, we think).  We have weeks that are prime summer and ski that are owned by people who aren't paying, for whatever reason.  Some were put into LLC's, specifically so the people could walk away.  We don't own those weeks, but we have to be creative and rent them, or we allow other owners to bank them into RCI or II.  Also, many of the weeks are now owned by the HOA.  This particular resort is almost 30 years old and has been through more than its share of problems, many structural, and early on, people defaulted on their loans and fees and lost the weeks to the lien holder.  It was a mess.  

Starwood should have a good collections department, and they should consider renting the weeks that aren't paying, then put the money into the HOA.  _*But where is the accounting?*_  Why do we have to question what the heck they are doing with these weeks, and if they are doing anything, is it in the best interests of the owners?


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## jw0 (Nov 16, 2009)

*a theory.*

I've been giving this matter some thought, and wanted to put the following idea forward.  Please don't flame me, I am not a Starwood employee.  I am a recent SVO owner who owes much to tug for whatever knowledge I have.

For weeks/months, I've read many messages on this board from owners unhappy with the new II policies re: trading starwood units.  Some have suggested either some sort of grand conspiracy, or simply blame Starwood corporate greed.

With the recent release of the MF bills, showing how much of the increase is from delinquent fees, I was wondering - what if the new II policy isn't a bad thing, at least as far as the HOA is concerned?

Think about this - I would conjecture that many of the delinquencies may be off-season owners, or at least owners who are unsuccessful at reserving the prime weeks (after all, the prime owners could probably rent their unit out to pay the MFs).  If these unused weeks are rented out, then at least in theory the HOA would recoup some $ for the lost MFs by having Starwood rent out the week.  But if the week is off-season, then not much can be expected as the rental price is low.

On the other hand, with the new II policy, then perhaps Starwood could offload some of the less desirable weeks into II for trading (since even off-season Starwood weeks may be tradeable into many properties) and keep the higher demand weeks for rent.  I do not dismiss the likelihood that Starwood greed plays a part here, but (as long as some of this $ goes back to the HOA) then it actually would be best for the HOA and ALL the owners if the highest demand weeks could be kept for rent, to bring in as much $ as possible to make up for the lost MFs.

Just a thought.  Before one gets too upset about the new II policy, one should consider the possibility that the policy may in fact be good for the HOA as well as Starwood.  (of course, this whole line of thought depends upon the supposition that the HOA does get a cut of the rental proceeds).

BTW, I do see a line item for "Club rental revenue" on my SBP budget listing.  Could this be the HOA's cut of the unit rentals?  If so, it's a paltry sum - $39,526 for the year.  Do any other resorts have a similar line item?

Sincerely,
John.


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## l2trade (Nov 16, 2009)

I disagree.  The new II policy is a bad thing as far as the HOA should be concerned.

Rentals to recoup delinquent accounts for the HOA is bottom of the barrel on the Starwood inventory management priority list.  After all, these are delinquent accounts, so they come last for Starwood to rent out.  Before that comes rentals to support SVN conversions, developer owned inventory and rentals on behalf of dues paying owners.  Not to mention, all the dues paying owners still having priority to reserve the high demand week if it is made available.  The new system will likely do little or nothing at all to save some of the highest demand weeks for Starwood to rent out on behalf of the HOA.  And, even if it does, Starwood takes ~50% cut.  The HOA likely still loses money.  If there is a profit after everyone's cut, that money goes to the account of the delinquent owner.  Another reason why delinquent accounts come last.

The most likely scenario is that the new system saves higher demand weeks for Starwood to rent out for themselves to recoup money for SVN point conversions.  The best situation for the HOA is to get these delinquent accounts back in the hands of dues paying owners.  Having Starwood rent them out is still a losing proposition under the new system.  The new system favors SVN at the expense of non-SVN usage rights and trade values with II.  And, of course, the HOA cannot resell these deeds (at voluntary resorts) with SVN.  So, it doesn't surprise me that resale values at some voluntary resorts have plummeted to near nothing in just the past few months since the new system was implemented.

Yes, I admit that MF increases, unhappy owners complaining about the new II trading rules and rising awareness of delinquency issues doesn't help the resale market either.


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## jw0 (Nov 16, 2009)

Thanks for your response.  You may indeed be correct.  I especially agree that the best thing would be to have owners who are paying their MFs.

Unfortunately, this is not the case at SBP (>2000!).  What a sign of the times.  It will not be easy to get these weeks into the hands of MF-paying owners, especially the off-season weeks that can be rented for less than the MFs.  What sane person would buy that?

There's a lot of guessing and assuming in both our posts.  I will try to e-mail starwood to try to get any answers.  Sticking to the facts:

1. A large number of weeks (15%?  20%?) are delinquent.
2. These weeks will be unused until/unless the MFs are paid in full.

What I don't know -

3. What happens to these weeks?  Does the unit sit empty for a week?  Are they rented out?
4. If rented out, does a percentage of the $ come back to the HOA?

If so, then as owners we are left to try to maximize the rental proceeds.  I was hoping that the II trading policy, however unfair/illegal/bad idea it may be, may in fact help maximize the proceeds by freeing up higher demand weeks for rent, which would bring in more $ to the HOA.  I certainly don't know whether this actually happens.  If the delinquent fees cannot be rented out (perhaps legally they cannot), or if the percentage coming back to the HOA is 0 or negligible, then the logic in my argument fails.

Sincerely,
John.


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## jerseygirl (Nov 16, 2009)

John,

That's a great idea to email the HOA to ask your questions.  I would be specific about the fact that you would like to hear back from an HOA member on the mystarcentral message board.  If not, my experience tells me you'll get a canned answer.

I would be also be specific with regard to some of the questions, e.g.:


How many of the delinquent owners are SVN members and how many are not?
Is our inventory kept separate?  (Non-SVN owners' inventory should be kept open for non-SVN owners until the 60-day mark.  If they're co-mingling inventory, then all non-SBP SVN members would have access to unreserved prime (and non-prime, for that matter) weeks at the 8-month mark, making it unavailable for rent.
What steps are they taking to rent delinquent weeks, foreclose, etc.?

There's probably more I would ask, but that's all I can think of for now!


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## timeos2 (Nov 16, 2009)

*Rental of delinquent time has to be #1 along with better collection procedures*



l2trade said:


> If there is a profit after everyone's cut, that money goes to the account of the delinquent owner.  Another reason why delinquent accounts come last.



Actually at least according to Fl timeshare law/statute the delinquent weeks are FIRST on the rental priority list. That's because recovering that money, which by rights should be going to the Association after whatever percentage the management gets by contract, benefits every owner. Each dollar recovered lowers the allowance for bad debt thus lowering the annual fee. Why should any other rental activity - especially rentals to benefit management / developer or individual owners - come before that?  

The bigger problem in this case is how on earth can management allow things to reach a 15%+ delinquency?  THAT is unacceptable and grounds for removal of whatever company is handling collections.  Get them out and bring in someone who can do the job.


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## Transit (Nov 16, 2009)

We don't know exactly what units they are renting first. My guess is Starwood unsold inventory first and the best weeks snatched from II deposits.Then HOA gets to rent the crumbs.


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## l2trade (Nov 16, 2009)

timeos2 said:


> Actually at least according to Fl timeshare law/statute the delinquent weeks are FIRST on the rental priority list. That's because recovering that money, which by rights should be going to the Association after whatever percentage the management gets by contract, benefits every owner. Each dollar recovered lowers the allowance for bad debt thus lowering the annual fee. Why should any other rental activity - especially rentals to benefit management / developer or individual owners - come before that?
> 
> The bigger problem in this case is how on earth can management allow things to reach a 15%+ delinquency?  THAT is unacceptable and grounds for removal of whatever company is handling collections.  Get them out and bring in someone who can do the job.



timeos2,
I am repeating what my HOA board was told firsthand by Starwood.  Yes, the laws may vary by state.  While the delinquent weeks may be FIRST on the HOA rental priority list, they are LAST on the priority list for Starwood.  If Starwood is renting on behalf of the HOA, then the priority remains LAST.

Actually timeos2, I completely agree with your bigger questions, logic and conclusions.  So, please don't take my word on this matter.  It would be great for someone to get this information in writing from Starwood corporate, Starwood association management and the particular HOA board(s) you are referencing.  I'd like to see this stuff in writing from them, so please share if you get a clear response.  You may end up with 3 conflicting priority lists.  Please remember that conflicting priorities aren't the only variable here.  There may also be further conflicts based on the reality and complexity of inventory management rules and timing of decisions.  For example, if you don't pay 2010 fees by the due date in 2010, the highest demand weeks may already be gone for 2010 due to the 12 month rolling window for owners.

IMHO, the SVN program is broken for voluntary resorts with legacy non-seasonal deeds during this recession.  SVN point formulas appear in conflict with reality and what is in the best interests of ALL owners.  Resolving the delinquency issue should be the top priority for everyone.  If that means losing the SVN program and/or Starwood branding for SBP & SDO and regaining our legal rights to the weeks we reserve, then I welcome it versus the current situation.  I might even want to buy more resale weeks under that scenario.


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## jerseygirl (Nov 16, 2009)

l2trade said:


> IMHO, the SVN program is broken for voluntary resorts with legacy non-seasonal deeds during this recession.  SVN point formulas appear in conflict with reality and what is in the best interests of ALL owners.  Resolving the delinquency issue should be the top priority for everyone.  If that means losing the SVN program and/or Starwood branding for SBP & SDO and regaining our legal rights to the weeks we reserve, then I welcome it versus the current situation.  I might even want to buy more resale weeks under that scenario.



I couldn't agree more -- I'd welcome SBP being pulled from Starwood's management.  And, I'll go one step further and say the entire SVN program is broken, not just for voluntary resorts.  First, there are the unrealistic SO valuations that hinder trading.  Even if the valuations were more realistic, it's never (at least for some number of years) going to be easy to trade into certain resorts ... and it's that very "supposed ease of trade" that convinces many prospects to buy.  Once reality hits, they realize they didn't really buy what they thought.  I point back to my earlier post where I stated that I'm beginning to believe the "network" is detrimental to owners overall (compared to the way Marriott's current program works, which is a pretty good basis for comparison).  And -- think about the fees.  Marriott owners have to pay for reservation agents (who also sometimes help with deposits to II -- but owners can do this themselves online, or via a phone call to II, once they have a reservation).  Starwood has to pay for reservation agents AND the extra people required to pick up the phone and say, "I'm sorry, there's no availability at Harborside/WSJ" .... all day long, 365 days a year.  I wonder how much money this is adding to our maintenance fees?


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## xcg001 (Nov 16, 2009)

l2trade, I am in full agreement with you - if fixing the resort means loosing Starwood branding I am all for it. But I do hope that it is still possible to have a good independent HOA board and still keep Starwood as a manager. After all Marriott is perfectly happy to manage resorts where HOA is completely owner elected.


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## abdibile (Nov 16, 2009)

Transit said:


> I received a financial newsletter from SBP with a bill for an additional maint fee of 130.00. It states a 21.5% increase directly due to owner delinquency and that the increase would have be less than 2% if they could have collected the fees.......Game over.
> I also received a similar letter from SVV where the news isn't as grim yet .Still waiting for the SDO letter.



I do not fully get that:

Did you get that letter weeks after the 2010 maintenance fees were set and invoices mailed? 

Meaning you were asked to pay MFs in a certain amount and a month later (6 weeks before MFs are due) they just realize thet they need an additional $130?

Or was it just the normal Maintenance Fees letter with this position increased significantly vompared to 2009?

I received SDO MF letter and it was not an extreme increase.


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## Twinkstarr (Nov 16, 2009)

abdibile said:


> I do not fully get that:
> 
> Did you get that letter weeks after the 2010 maintenance fees were set and invoices mailed?
> 
> ...



I got my Lakeside Terrace bill, and they did increase the line item for deliquent MF's(it was $30 dollars for 2009, $60 for 2010).


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## xcg001 (Nov 16, 2009)

John,

I would disagree with you that SVN control of the inventory helps anybody but Starwood. Starwood should have absolutely no saying what owner reserve or do with their property. What can help though is independent HOA that has a website for the owners to communicate easily and can post weeks in for rent/sale/distress. If you know you have difficulty paying MFs by the due date and can easily offer your time to someone that can use it I am pretty sure many people would use such feature. Of course in order for this to work HOA can and should act as a trust agent so that people renting from someone are not afraid that later original owner may reverse their reservation. Since HOA control who is using the resort they can easily enforce such binding agreement. Dealing with off season weeks is more difficult but there can still be creative ways to dispose of these or these to be offered to existing owners hugely discounted if it gets close to the check-in.
Also since we are already paying more than 20% of the budget for these delinquencies how about giving all paying members 2 days from the low season for free as long as we pay for the housekeeping. 

Another way to dispose of mid/low season weeks is to let owner deposit them in their own II/RCI  accounts. Heck, some of the mid-season weeks are designated as RED time in RCI points for deposit grid so these can be used for such deposits at ok value (small part of the lock-offs are even good value). Even blue/white weeks can be ok for PFD with RCI if these are discounted enough. I can probably buy some of these weeks for PFD if I don't have to burden myself with perpetual ownership of that week.
Also for someone willing to go to Orlando/Branson/Las Vegas and other overbuild areas these may provide some value as a trader in II since SBP has pretty good resort quality rating anyway. Also large part of the lockoff and 2BR non lockoff can be used by people living within 100miles if discounted enough.

Anyway the whole point is that for all this to happen such weeks and the whole process has to be controlled by the HOA rather than Starwood. It is ok to let Starwood rent low season week for 50% discount but how about HOA trying at the same time to rent it on their own? If the HOA can get more than 1/2 of what Starwood rents it for (and keep in mind Starwood rentals comes with daily cleaning) then go for it.



jw0 said:


> If so, then as owners we are left to try to maximize the rental proceeds.  I was hoping that the II trading policy, however unfair/illegal/bad idea it may be, may in fact help maximize the proceeds by freeing up higher demand weeks for rent, which would bring in more $ to the HOA.  I certainly don't know whether this actually happens.  If the delinquent fees cannot be rented out (perhaps legally they cannot), or if the percentage coming back to the HOA is 0 or negligible, then the logic in my argument fails.
> 
> Sincerely,
> John.


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## xcg001 (Nov 16, 2009)

abdibile,

this is from the proposed budget so paying for these are mandatory. The total budget for the next year without reserves is $10,666,851. Out of these 2,217,882 is directly under "Uncollectible Accounts".



abdibile said:


> I do not fully get that:
> 
> Did you get that letter weeks after the 2010 maintenance fees were set and invoices mailed?
> 
> ...


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## Transit (Nov 16, 2009)

abdibile said:


> I do not fully get that:
> 
> Did you get that letter weeks after the 2010 maintenance fees were set and invoices mailed?
> 
> ...



I had received a letter asking to pay maintanece fees early to be entered in thanks a million contest and get some discount vouchers. I payed online early.Now the regular yearly bill came in with the additional fees.


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## LisaRex (Nov 16, 2009)

Transit said:


> I had received a letter asking to pay maintanece fees early to be entered in thanks a million contest and get some discount vouchers. I payed online early.Now the regular yearly bill came in with the additional fees.



Oh, and about that great Promo.  On Flyertalk there was a report that one of the winners of an airlines' million mile giveaways actually refused the winnings once they discovered that they'd be liable for the thousands of dollars of taxes on the million miles.  Apparently the airline valued them at their best redemption rate, making them appear to be worth far more than they'd be worth to most people.


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## K2Quick (Nov 16, 2009)

LisaRex said:


> Oh, and about that great Promo.  On Flyertalk there was a report that one of the winners of an airlines' million mile giveaways actually refused the winnings once they discovered that they'd be liable for the thousands of dollars of taxes on the million miles.  Apparently the airline valued them at their best redemption rate, making them appear to be worth far more than they'd be worth to most people.



Here are the prizes you can win and what their "up to" value is listed as (I assume you'd get a 1099 for that amount).  I'd probably turn down the prize, too, in some of these cases (a week at Vistana Villages is worth $3,500?):

One (1) Prizewinner will be awarded One Hundred Thousand (100,000) Starwood Preferred Guest® Starpoints® (valued at $3,500.00 USD). 

One (1) Prizewinner will be awarded Fifty Thousand (50,000) Starwood Preferred Guest Starpoints (valued at $1,750.00 USD). 

One (1) Prizewinner will be awarded Twenty-Five Thousand (25,000) Starwood Preferred Guest Starpoints (valued at $875.00 USD). 

One (1) Prizewinner will be awarded Ten Thousand (10,000) Starwood Preferred Guest Starpoints (valued at $350.00 USD). 

One (1) Prizewinner will be awarded Five Thousand (5,000) Starwood Preferred Guest Starpoints (valued at $175.00 USD). 

One (1) Prizewinner will receive a Vacation Certificate valid for seven (7) consecutive nights accommodations at The Westin St. John Resort & Villas, USVI (retail value up to $14,000 USD). 

One (1) Prizewinner will receive a Vacation Certificate valid for seven (7) consecutive nights accommodations at The Westin Ka’anapali Ocean Resort Villas, Lahaina HI (retail value up to $10,745 USD). 

One (1) Prizewinner will receive a Vacation Certificate valid for seven (7) consecutive nights accommodations at The Westin Princeville Ocean Resort, Princeville HI (retail value up to $10,745 USD). 

One (1) Prizewinner will receive a Vacation Certificate valid for seven (7) consecutive nights accommodations at The Westin Lagunamar Ocean Resort, Cancun, Mexico (retail value up to $5,600 USD). 

One (1) Prizewinner will receive a Vacation Certificate valid for seven (7) consecutive nights accommodations at Sheraton Vistana Villages, Orlando, FL (retail value up to $3,500 USD).


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## carl2591 (Nov 16, 2009)

Transit said:


> There are 314 units x 52 weeks = 16328 thats about 15%. I'm not sure exactly how it's actually broken down because of the different size units and eoy but 2581 delinquent owners is absurd.



i thought the resort could only sell 51 weeks, one week for maintenance issues. It used to be that way in SC in the late '80's. now with everyone going to points it might be changed.  

so if its 51 then the % late is higher not much but higher.. 16.1% still a problem that will get worse before it get better.  so far I am glad i only own in south africa.. seems to be more stable.


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## Transit (Nov 16, 2009)

carl2591 said:


> i thought the resort could only sell 51 weeks, one week for maintenance issues. It used to be that way in SC in the late '80's. now with everyone going to points it might be changed.
> 
> so if its 51 then the % late is higher not much but higher.. 16.1% still a problem that will get worse before it get better.  so far I am glad i only own in south africa.. seems to be more stable.



You may be right .There may also be other variables.


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## gregb (Nov 16, 2009)

carl2591 said:


> i thought the resort could only sell 51 weeks, one week for maintenance issues. It used to be that way in SC in the late '80's. now with everyone going to points it might be changed.
> 
> so if its 51 then the % late is higher not much but higher.. 16.1% still a problem that will get worse before it get better.  so far I am glad i only own in south africa.. seems to be more stable.



In the Owners Handbook, when they discuss the share of expenses, they explicitly us a multiplier of 52.  While a unit may only be "rented" for 51 weeks, as far as expenses and other things, the resort still has to operate for 52 weeks a year.  So per Starwoods own words, you need to use 52, not 51.

Greg


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## LisaRex (Nov 16, 2009)

K2Quick said:


> Here are the prizes you can win and what their "up to" value is listed as (I assume you'd get a 1099 for that amount).  I'd probably turn down the prize, too, in some of these cases (a week at Vistana Villages is worth $3,500?): One (1) Prizewinner will receive a Vacation Certificate valid for seven (7) consecutive nights accommodations at The Westin Ka’anapali Ocean Resort Villas, Lahaina HI (retail value up to $10,745 USD).



Acc. to the site below, they issuer will send the winner a 1099 for the amount valued. So assuming you're in a 30% tax bracket, you'd end up paying $3200 in federal taxes for winning 7 days in Hawaii, $4200 for St. John, $1680 for Cancun, $1050 for Orlando or the 100k StarPoints. What you'd pay in state or local tax would vary by location. 

http://www.bargaineering.com/articles/prize-winnings-tax.html 

Makes me want to run to the mailbox to get my MFs in early.


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## jerseygirl (Nov 16, 2009)

Hmmm ... notice that the cash valuations don't match the SO valuations.   They really do think we're stupid, don't they?


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## l2trade (Nov 16, 2009)

jerseygirl said:


> Hmmm ... notice that the cash valuations don't match the SO valuations.   They really do think we're stupid, don't they?


I think they do.  Or, they think we are few in number and confined to the 'extreme fringe TUG website'.  LOL.  Let them underestimate us.  I will not give up.  

As owners, we may be a captive customer base - that just makes us more determined to voice our discontent when we aren't being treated well as customers.  Others will hear our voices.  The brand names Starwood, Sheraton & Westin apply to more than just us.  Hotel renters make choices of where to stay with each reservation.  Those 'renters' far outnumber us and long term, they are much more important to the bottom line.  

IMHO, Starwood is the one being stupid here!


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## clsmit (Nov 16, 2009)

To go back to the original topic, the SBP letter noting the level of delinquency was for the PALMETTO phase, which is the brand-new phase, under construction in 2007- 2008 until now. So at least 90% of the owners there (my guess) are original, with the units purchased from Starwood. From staying there for Spring Break 2008 and watching countless tours pass by I'm predicting that they sold a ton of EOY studios and 1BRs and not very many EY 2BR LOs. I'd also guess that they had a disproportionate amount of Starwood financing (compared, say, to WSJ). Therefore, it would not surprise me that many of these people later decided they didn't want what they had purchased and figured the only way out was to stop paying. 

I feel for these people who had purchased what they now cannot afford, but I don't appreciate the huge increase in MFs this year as a result. Starwood can write off the lost income and re-sell the unit; the current SBP Palmetto owners are left with 20+% increases in MFs in the meantime.


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## jerseygirl (Nov 17, 2009)

Thanks for the clarification Carol.  I didn't think I had seen that number (2581 delinquent owners) in the financials for my phase one units, but thought perhaps I had just missed it.

Very interesting ... you're correct about the number of resale owners at that phase ... it's VERY rarely (if ever) available for sale on ebay ... too soon ... too much upside down financing.


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## bogeygolf (Nov 17, 2009)

clsmit said:


> To go back to the original topic, the SBP letter noting the level of delinquency was for the PALMETTO phase,
> 
> Starwood can write off the lost income and re-sell the unit; the current SBP Palmetto owners are left with 20+% increases in MFs in the meantime.



Are you saying the increase in MF only affects SBP Palmetto owners or are you saying the the 2581 delinquencies are mostly from the SBP palmetto owners?  If so, how do you know this?  

Just to clarify, I'm an owner at SBP, not palmetto phase, and I got the letter with the increase in MF.  The letter specially states and is addressed to "All owners in the Broadway Plantation Owners Association, Inc."


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## tschwa2 (Nov 17, 2009)

In the last 8 months I bought an EOY 2 bedroom (not lockout) at SBP and an annual 2 bedroom (not lockout) at SBP Palmetto.  I have not received my MF info for Palmetto in the mail yet.  

Per mystarcentral.com and the mailed bill the MF for SBP 2 bedroom is $440.81 (755.54) due 1/6/10 vs $362.88 ($685) 2009

Per mystarcentral.com the MF for SBP-Palmetto 2 bedroom is $708.45 due 1/4/10 (no breakdown) vs $663.32 2009

Plantation phase is also smaller than Palmetto 1030sf vs 1215sf.


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## myip (Nov 17, 2009)

My Palmetto 2 bedroom lO increase is only 6.8% from 2008.
2008: $874.86 , 2009: $943.40  Increase of $59.54 = 6.8%

My original 2 bedroom (non lock-off) increase 21.47% from 2008.
2008: $725.77, 2009: 881.62 Increase of $155.85 = 21.47%


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## jw0 (Nov 19, 2009)

*response*

Hi, I thought I would share the response I got from sending an e-mail via mystarcentral.

My message:
Hello, my name is John ***** and I am an owner of a 2BR week at SBP.

I had some questions regarding the unused weeks of owners delinquent in paying their maintenance fees. I understand that there are 2,581 owners delinquent, so that is a large number of weeks that may be unused if the fees are unpaid.

Are these weeks then rented to other guests? If so, does the HOA get a percentage of the rental income? If so, is this extra income reflected in the budget? I am presuming that the "Club Rental Revenue" is this income - but if so, I am concerned why this number is so small - to expect $39,526 of income from the rental of some fraction of 2,581 weeks is very small indeed.

I appreciate your help in clarifying these matters for me, and for your time in considering my message. As an owner, I only wish to understand the budget a little better.

Sincerely,
John *****

Their response:
Dear Mr. *****, 

Thank you for contacting Association Management. 

When a unit owner is delinquent in paying their maintenance fees they are denied use rights associated with their ownership interest. This is called being "locked out". The delinquent owner cannot make a reservation. Every effort is made to make this process as efficient as possible and rent the unit in the open market to generate the maximum revenue for the nights that are able to be rented. The nights are marketed through different channels by Starwood and part of the Starwood Reservation system. The unit week is broken down into nights and the nights are rented as hotel rooms to owners and the general public. After the costs of rental are deducted such as nightly housekeeping the net proceeds are then applied to the owners account in effort to reduce the balance owed to the association. It is important to note that Owners in good standing receive priority rental over these "lockout rentals". 

Should you require further assistance or have additional questions please do not hesitate to contact us back. 

Telephone: 

Toll-Free 1.888.986.9637 
Direct 407.903.4635 
United Kingdom 0.800.89.5065 
Mexico 001.800.847.8262 
Japan 0053.113.0318 
All Other Countries 407.903.4640 

Email: associationmgmt@starwoodvo.com 

Fax: 407.418.7771 

Hours of Operation (Eastern Time zone): 
Monday– Thursday, 8:00 a.m.– 9:30 p.m. 
Friday, 8:00 a.m.– 5:30 p.m. 
Saturday- Sunday, Closed 

Sincerely, 

Wilbia Santiago 
SVO Management Inc.

(me again):
For one, this e-mail corroborates what I2trade was saying, that delinquent week rentals come LAST in priority.
For two, I'm glad to hear some confirmation that the HOA does potentially get back something for the rental.
For three, one might infer that whatever proceeds the HOA receives from this rental are generally not enough to cover the MFs.  I'm still surprised that the amount is so puny, though.
It's too bad.  When I was at SBP last October, I'd say the complex was maybe half-full.  We still enjoyed the property and the week, even though it was not "prime time", and I thought it was still a very good deal for the amount of $ we paid for the vacation.
What a pickle.  I think the best we can hope for is for the economy to turn around, for people to start vacationing again, and paying for and enjoying the use of their timeshares.

-John.


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## DanCali (Nov 19, 2009)

jw0 said:


> Their response:
> Dear Mr. *****,
> 
> Thank you for contacting Association Management.
> ...






jw0 said:


> (me again):
> 
> ...
> For three, one might infer that whatever proceeds the HOA receives from this rental are generally not enough to cover the MFs.  I'm still surprised that the amount is so puny, though.
> ...



John,

It is not surprising the amount is so puny. It's surprising there is anything left over...

Suppose they rent a 2BR villa for $200/night, which is probably generous for some locations (the charge about $150 for SVV for some nights). So that's $1400 for the week.

Off of that number, I beleieve Starwood gets a rental commission which is probably 30%-50%, more likely 50%. So you have about $700 left over.

From those $700, they have 7 housekeeping charges for a 2BR villa. If they charge $100 per housekeeping charge (which would be reasonable for a 2BR condo), there is really not much left over from the rental for the HOA. Keep in mind that they charge owners quite a bit more than $100 for one and a half cleanups per week, so maybe the HOA actually owes them money to cover the housekeeping charges for the rentals (I'm a bit cynical here, but would you really be surprised if that was the case?)

Of course Starwood made money from the rental commission and housekeeping... the more delinquencies, the better off they are, at least in regards to these charges!

The whole manner in which rentals of delinquent units are handled is broken.


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## LisaRex (Nov 19, 2009)

At the risk of asking the obvious, why are we Owners being double billed for housekeeping?  We pay it already in our MFs, to the tune of $450/week.  If a vacant unit is rented out from Starwood for Starwood's benefit, they are supposed to reimburse the HOA for housekeeping, per the OA, because, of course, it is WE who pay the housekeepers.  If Starwood rents out the unit on behalf of the HOA, it would make absolutely no sense to deduct housekeeping prior to reimbursing the HOA because the fee is supposed to go to the HOA!


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## jarta (Nov 19, 2009)

jw0,   ...   Giving the owner rental credit against the delinquent assessment has to happen.  It's the law.

Title 40, Section 721.13(6)(f)2 of the Florida statutes provides:

"The notice of intent to rent, which may be included in the notice required by paragraph (b), must state in conspicuous type that: 

a.  The managing entity's efforts to secure a rental will not commence on a date earlier than 10 days after the date of the notice of intent to rent. 

b.  Unless the purchaser satisfies the delinquency in full, or unless the purchaser produces satisfactory evidence that the delinquency does not exist pursuant to paragraph (b), the purchaser will be bound by the terms of any rental contract entered into by the managing entity with respect to the purchaser's timeshare period or appurtenant use rights. 

c.  *The purchaser will remain liable for any difference between the amount of the delinquency and the net amount produced by the rental contract and applied against the delinquency pursuant to this paragraph*, and the managing entity shall not be required to provide any further notice to the purchaser regarding any residual delinquency pursuant to this paragraph."

http://www.leg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&Search_String=&URL=Ch0721/SEC13.HTM&Title=->2009->Ch0721->Section%2013#0721.13

So, the net amount from the rental must be applied against the delinquency to reduce it.  In others words, the net rental is credited to the account of the delinquent owner, not directly to the resort.  *That's why no separate category of "rental income" shows on the budget or the annual financial statement.*

That's Florida.  I just don't have time to search every State's laws to find the provision, but I am confident South Carolina has a similar provision concerning rentals.    ...   eom


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## jarta (Nov 19, 2009)

Lisa,   ... Please read my response above.  You are way off-base in your accounting.   ...   eom


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## Ken555 (Nov 19, 2009)

jarta said:


> So, the net amount from the rental must be applied against the delinquency to reduce it.  In others words, the net rental is credited to the account of the delinquent owner, not directly to the resort.  *That's why no separate category of "rental income" shows on the budget or the annual financial statement.*



This should mean that the net revenue from such a rental would be applied to the HOA account just like MFs, and therefore reduce the amount owed by non-paying owners. 

Jarta, Do you think Starwood is under any obligation to show the details of the rental transactions to other owners? It might be interesting to see exactly how much gross revenue is received and expenses paid for each such rental.


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## jarta (Nov 19, 2009)

Ken555,   ...   "Do you think Starwood is under any obligation to show the details of the rental transactions to other owners? It might be interesting to see exactly how much gross revenue is received and expenses paid for each such rental."

Obligation?  Details?  How deep detailing is deep enough?  No, I don't really see an obligation to itemize and disclose the costs and rent for each week that is rented.  The HOA board runs the day-to-day operations of the resort.  

As long as the HOA board is informed, I see no obligation.  The Florida and other state statutes force fiduciary responsibilities on the manager.  The record of rentals will be there for people to inspect if they are that concerned.

However, it sure would be nice if Starwood was a little more "loose-lipped."  It would reduce the sometimes inaccurate accusations made here on TUG.  Starwood, like any arrogant large corporate entity, can be its own worst enemy.

The problem here is that people have been looking for the "missing" rental income on the delinquent units.  There wouldn't be such a category.  The net rental would be credited to the delinquent account and would show up in the total paid assessments.

I have always wondered how so many obviously hurting sellers on eBay can show that the assessments are current.  I would assume that Starwood or the HOA lets the delinquent owners know that they will rent out the unit once (or, maybe, twice) and deposit the net proceeds.  But, they also tell the delinquents that they surely will file a lien and foreclose if it happens again.   ...   eom


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## K2Quick (Nov 19, 2009)

jarta said:


> The problem here is that people have been looking for the "missing" rental income on the delinquent units.  There wouldn't be such a category.  The net rental would be credited to the delinquent account and would show up in the total paid assessments.



I think I understand the accounting from a rental:
DR Cash
CR Starwood Commission Expense Payable
CR Resort Housekeeping Expense
CR Deliquent Units Accounts Receivable (if anything's left over)
CR HOA Rental Revenue (if anything's left over)

Where it probably gets really messy is trying to figure out how to allocate anything left over after commissions and housekeeping to specific delinquent units.  When Starwood takes a reservation, it's not taking a reservation for a specific unit.


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## LisaRex (Nov 19, 2009)

jarta said:


> Lisa,   ... Please read my response above.  You are way off-base in your accounting.   ...   eom



Perhaps.  But when my elected HOA board chooses to remain veiled behind an impenetrable corporate wall, even as their management has led to a near doubling of maintenance fees over the course of five years, rather than open themselves up for honest inquiry, one is left to speculate.  

Thrice I have requested the date of the next HOA meeting, beginning on October 27th. I have yet to receive an answer from the organization that calls itself "Board Relations."  They do have a rich sense of humor. Thrice I have asked for my HOA's contact information so that I can ask questions such as how rental income is recorded.  On 10/9, I even telephoned Starwood corporate and asked the agent for this apparently super-confidential information.  The agent put me on hold, took my phone number, and said she'd call me back.  I have yet to receive an answer. 

By comparison, the elections in Iran are more open and honest. 

You want to put your blind faith in Starwood management because you golfed with a board member once and he seemed like a swell dude. Bully for you.  Me? I need more than that.  Starwood has chosen to keep us in the dark. Starwood has chosen to circumvent the checks and balances required by law for the sole purpose of preventing abuse of power by having the current board hand-pick its successors. Starwood has chosen to keep Owners at arms length from the very Board that exists to represent our interests. 

The stink of mistrust which permeates these boards can be laid directly at Starwood's feet. They can choose to clear the air, or they can wallow in it. 

"The meme for blind faith secures its own perpetuation by the simple unconscious expedient of discouraging rational inquiry."
-Richard Dawkins


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## timeos2 (Nov 19, 2009)

*Spread over all*



K2Quick said:


> =
> 
> Where it probably gets really messy is trying to figure out how to allocate anything left over after commissions and housekeeping to specific delinquent units.  When Starwood takes a reservation, it's not taking a reservation for a specific unit.



The allocation is simple. At the end of the fiscal year the total amount of rental income is spread equally over all delinquent accounts. No individual week or units are specifically rented and each delinquent owner only gets whatever small part of the total credited toward their fees due. All owners benefit as the total bad debt is reduced by that amount.  But no resort is going to come close to making up 15% or more of the total fees due through rentals. Not a chance.


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## LisaRex (Nov 19, 2009)

Nor, incidentally, is there a chance in hell that we will ever learn how much the HOA makes on an average rental and how much management pockets.


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## Troopers (Nov 19, 2009)

jarta said:


> jw0,   ...   Giving the owner rental credit against the delinquent assessment has to happen.  It's the law.
> 
> Title 40, Section 721.13(6)(f)2 of the Florida statutes provides:
> 
> ...



Good stuff Jarta.

At WKORV, there is a revenue line item titled "Club Rental Revenue".  If that's not income received from delinquent weeks, any idea what the source is?

See this thread.


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## jarta (Nov 20, 2009)

Troopers,   ...   "Club Rental Revenue"

I don't own at WKORV and have never been there - yet.  I just do not know enough about the resort to say.  You say the rental is "$108,326 (for all units annually)."  Are the words in the parenthsesis included in the document you have.

Without more information I really cant say what the category includes.  Sorry.   ...   eom


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## jarta (Nov 20, 2009)

LisaRex,   ...   ""Perhaps   ...   You want to put your blind faith in Starwood management because you golfed with a board member once and he seemed like a swell dude. Bully for you.  Me.  I need more than that."

Sorry you must resort to personal attacks when you are shown to be wrong.

At the time my wife and I played golf with Cap Witzler, president of the Kierland HOA, and his wife Suzy, I was already a Five Star Elite.  Meeting the "swell dude" didn't influence my becoming Five Star Elite.

My wife and I had played golf in the Mountain Vista SVOpen last year and weren't paired with anyone on the HOA board.  My next stop was Kierland.  I was going there for a vacation with my brother and sister and our spouses.  The SVOpen was being held that week.  After I made the reservations and only about a week before I was to arrive, I got an email inviting us to play in the Kierland SVOpen.

When we showed up our mixed two-some was paired with their mixed two-some.  Probably nobody who was serious about the tournament wanted to play with a mixed two-some.  We played.  Our team finished at or near the bottom.  Who cares?  It was golf!

It was only after the tournament while the four of us were sitting around having a drink that I found out he was the president of the Kierland HOA.  He was hardly a "swell dude."  For God's sake, he was an IRS collection supervisor before he retired!  Are they usually swell guys?  Cap was intelligent and very straight-forward.  We got along and I met him again in the coffee shop at WKV last March.

I do not put "blind faith" in Starwood.  Almost every post of mine contains references to arrogance and corporate double talk.  But, I am quite happy owning at 6 Starwood resorts and I am happy all are in the SVN.  I never intended to use II for trading (the one time I used it, it worked great).  I am very pleased with the treatment I get when I call Starwood and the flexibility of the SVN system.  (Have you noticed that the TUG Five Star Elites rarely have much to say about Starwood's incompetence or evil?)

I try not to post now, but when I do I mainly post to point out inaccuracies and misinformation being included in the constant invective against Starwood.

I enjoy my timeshares.  I just returned from Kierland and will be out of Chicago 7 weeks before the end of April.  I am content to let the HOA boards of the Starwood resorts run those resorts.  I will be too busy enjoying my timeshares.  I think that, in the real world, my attitude is quite prevalent.   ...   eom


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## Henry M. (Nov 20, 2009)

I tend to agree with Jarta a lot of the time. While Starwood is not without faults, I also don't see them as the prince of evil or incompetent idiot they are often viewed as around here. I still enjoy my units and SVN membership and don't feel any of the angst that TUG has. 

Sure I don't like my MF increases any more than the next person and it is nice to get some of the insights based on real information that occasionally makes its way here. However much of the discussion is based on pure speculation predisposed to go against Starwood, no matter what they try to do. On TUG Starwood is always guilty unless they can prove otherwise.


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## gmarine (Nov 20, 2009)

emuyshondt said:


> I tend to agree with Jarta a lot of the time. While Starwood is not without faults, I also don't see them as the prince of evil or incompetent idiot they are often viewed as around here. I still enjoy my units and SVN membership and don't feel any of the angst that TUG has.
> 
> Sure I don't like my MF increases any more than the next person and it is nice to get some of the insights based on real information that occasionally makes its way here. However much of the discussion is based on pure speculation predisposed to go against Starwood, no matter what they try to do. On TUG Starwood is always guilty unless they can prove otherwise.




Would you mind sharing an example of this "speculation predisposed to go against Starwood" ?

Since you say you dont like your maintenance fee increases, have you voiced your opinion to your resorts HOA and/or Starwood and questioned why Starwood increases are so much higher than similar branded resorts such as Marriott ?


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## DeniseM (Nov 20, 2009)

For some people, the increase in maintenance fees may be no big deal, because they have money to burn.  I wish I was in that position, but I'm not.  I work for a living, and I simply cannot afford to pay $2,400 for accommodations for one week of vacation.  I guess I fall into the category of "the working poor that shouldn't have bought at WKORV!"     However, when I bought, the maintenance fee was only about $1,200 and that was feasible.  Little did I know that in 8 years it would double!     

If the escalating maintenance fees are just a big yawn for some of you, congratulations - it must be great to be in that position, but hopefully you realize that we aren't all millionares here on TUG and for many of us, the escalating maintenance fees are a real HARDSHIP!  YMMV....


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## DanCali (Nov 20, 2009)

jarta and emuyshondt - it's great to hear you are still enjoying Starwood and SVN. There is a reaosn why most people on this board bought in to begin with and it's a relatively safe bet that most people here were Starwood fans at some point.

The thing that bothers me the most (which I think many owners tend to miss because it is a secondary effect) is the loss in equity value that comes along with the increases in MFs. 

It's one thing to increase MFs at 5%-10% annually on a consistent basis, which is already beyond most goods and services in the economy, so obviously 20%-30% when we are in a deflationary environment is an outrage. But with every such increase beyond some reasonable benchmark like the CPI, comes a loss in equity value - i.e., resale prices go down. The true cost of ownership over the years is at least what you pay in MFs PLUS what you lose in equity value (and mind you that resale prices were declining even when housing was booming, so the economy is not the main culprit). *Unfortunately by the time owners realize MFs have become high for them to afford, only then they realize their units are worth a small fraction of what they paid...* And you can't fault them for buying in and not expecting 10% annual MF increases because NOTHING grows at 10% forever - it's just not sustainable.

I'm not sure if either of you has done the math for what you own using current resale prices, but this is the main reason that I am outraged. In many cases annual 7-night accomodations cost $5K or more. WKORV is a prime example of this - while MFs, excluding SVN fees, went from approximately $1100 in 2004 to about $1850 in 2009 (I'm ingnoring taxes and delinquencies here by excluding 2010 fees), resale values declined from approximately $40,000 to $20,000 for an OV unit. That's a loss of $4000 a year, in addition to MFs. Would you have bought in knowing this was the cost? Well, not me... Now it's even worse because prices are likely to fall more once 2010 MFs are advertised to all. No matter how you can justify ownership with the rising MFs, once you take equity depreciation into account it's near impossible to come out ahead.

Even WKV which is the best "value" in SVN has MFs for a 2BR around $1300. Those were the fees were a 2BR in Hawaii not too long ago while the fees at Kierland were much less... in fact they were around $800 in 2005! Has the cost of living/labor/materials in Arizona really gone up by 60% over 5 years? This reeks of irresponsible management (at the very least) at varying degrees no matter where you look within SVN... For comparison Marriott Canyon Villas fees increased from $640 in 2004 to $840 in 2008  (and $880 in 2009). Excluding developer subsidies, their operating expenses actually went down - imagine a world where that can happen, literally a few miles away! - Marriott's fee increases are not immaterial either but pale in comparison to Starwood's in literally every place in the world....*can ANYONE defend Starwood on this?*

It's very hard to still feel good about ownership when you feel like you are being taken to the cleaners. And I'm a relatively new resale owner so I haven't even lost that much... 

I don't think this issue is unique to Starwood, but I think Starwood is among the very worst in controlling maintenance fees. It's one thing if this was beyond Starwood's control but I believe Starwood could have done a better job in controlling MFs over the last few years, including the most recent year; I think they choose not to for reasons only they know... we are left to speculate.


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## Troopers (Nov 20, 2009)

I also tend to agree with Jarta and I have no status with Starwood.  

We're all pretty smart and educated folks but I *FIRMLY* believe nothing is as simple and obvious as it seems.  Tell me what you do for a living and I bet I can ask you a really simple question that's   to me.  I'm sure you'll be able to respond with depth and knowledge which will clear the mud for me.

I reserve my judgement until I think I have a pretty good understanding of the situation/question.  I think that's fair to ask of everyone.  It's too easy to cast blame and pass judgement without due diligence.


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## tomandrobin (Nov 20, 2009)

emuyshondt said:


> I tend to agree with Jarta a lot of the time. While Starwood is not without faults, I also don't see them as the prince of evil or incompetent idiot they are often viewed as around here. I still enjoy my units and SVN membership and don't feel any of the angst that TUG has.
> 
> Sure I don't like my MF increases any more than the next person and it is nice to get some of the insights based on real information that occasionally makes its way here. However much of the discussion is based on pure speculation predisposed to go against Starwood, no matter what they try to do. On TUG Starwood is always guilty unless they can prove otherwise.



Guilty of sharing similar views also.


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## DeniseM (Nov 20, 2009)

Tom - Are the escalating maintenance fees a financial hardship for you?  If they were, wouldn't that make a difference?  My maintenance fee at WKORV has doubled since we bought there.  I'm a teacher who took a pay cut this year - I can't afford to spend that much on a vacation.  Fortunately, we have been able to rent for the last 3 years to cover our MF, but I don't know how long that will last.  When you can't rent your TS for enough to cover the MF, something is very, very wrong...  I guess that is when I will cut my losses and dump it.


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## Troopers (Nov 20, 2009)

DanCali said:


> The thing that bothers me the most (which I think many owners tend to miss because it is a secondary effect) is the loss in equity value that comes along with the increases in MFs.



You bring up an interesting point.

For me, it really doesn't bother me because I'm not selling.  Equity value is meaningless until the day you sell.  I suppose the equity loss means that it will take 20 years(?) to break even rather than the 10 years I initially calculated.  And I wasn't planning to sell when I broke even anyways.


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## Troopers (Nov 20, 2009)

DeniseM said:


> When you can't rent your TS for enough to cover the MF, something is very, very wrong...  I guess that is when I will cut my losses and dump it.



IHMO...something is very, very wrong when MF exceed comparable hotel accommodation costs.


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## gmarine (Nov 20, 2009)

tomandrobin said:


> Guilty of sharing similar views also.



Since you share the views of the post you quoted would you please show where the "pure speculation predisposed to go against Starwood" is ?


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## optimist (Nov 20, 2009)

Troopers said:


> IHMO...something is very, very wrong when MF exceed comparable hotel accommodation costs.



Nobody pays $45,000 upfront for the privilege of staying at a hotel. 

The idea behind a timeshare is that you pay a large amount UPFRONT so  you can pay less down the line.


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## Troopers (Nov 20, 2009)

optimist said:


> Nobody pays $45,000 upfront for the privilege of staying at a hotel.
> 
> The idea behind a timeshare is that you pay a large amount UPFRONT so  you can pay less down the line.



Very very true.  Even with the large increases, isn't one still paying less?


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## gmarine (Nov 20, 2009)

Troopers said:


> I also tend to agree with Jarta and I have no status with Starwood.
> 
> We're all pretty smart and educated folks but I *FIRMLY* believe nothing is as simple and obvious as it seems.  Tell me what you do for a living and I bet I can ask you a really simple question that's   to me.  I'm sure you'll be able to respond with depth and knowledge which will clear the mud for me.
> 
> I reserve my judgement until I think I have a pretty good understanding of the situation/question.  I think that's fair to ask of everyone.  It's too easy to cast blame and pass judgement without due diligence.




There are some things that are very simple and obvious.

Several Starwood resorts have maintenance fee increases of over 20% when Marriotts in the same area have increases of less than half that.

Starwoods new Interval trading system takes away an owners right to do as they wish with a reservation. You can argue all you want that trading power etc isnt a right, and you are correct. However, once I make a reservation it is mine. I can do what I want with it. Starwood is telling me I cant give that reservation to II. I have spoken at length with II about this. It is Starwoods doing. If Starwood will let me give II my reserved week, II will accept it.

Starwood also refuses all requests for documents pertaining them having the legal right to do this. 

If you really want to do your due diligence and make an informed opinion, read the affected resorts CC and Rs as well as all the posts and responses received from Starwood.


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## jarta (Nov 20, 2009)

Dan,   ...   "The true cost of ownership over the years is at least what you pay in MFs PLUS what you lose in equity value (and mind you that resale prices were declining even when housing was booming, so the economy is not the main culprit). *Unfortunately by the time owners realize MFs have become high for them to afford, only then they realize their units are worth a small fraction of what they paid... *"

Since your post is directed to me .....

The true cost includes the loss of equity.  I knew timeshares rapidly decline in resale value before I bought.  I am not planning on selling.  So, I have no loss - yet.  When I (or my heirs sell) there will be a big loss - even on the 3 of 6 weeks I didn't buy directly from Starwood.

DeniseM is right.  There are various income earners in the SVN system.  I have been lucky in life.  So, I travel (usually) first class.  And, if I want to do that?  It's my money and I worked hard (and was lucky too) to earn it.  I'll spend it as I want to.  You can be jealous of me or think that's pompous of me.  So, what!  This is merely a discussion board on the Internet and I really can't control how you feel.  And, quite frankly, I just don't care.

But, that doesn't mean that I have no sympathy for those who do not have the assets and income I have.  The economy has hurt people badly.  My 26 year old son can't find a job.  He is competing against unemployed 40 year olds who have a wife and 2 or 3 kids to support.  They also have 15 (or so) more years of experience in their field.  So, I support him now.

I assume there are lots of people like him who purchased Starwood timeshares and cannot pay their normal expenses - much less increasing timeshare assessments.

But, owning property carries with it obligations of ownership.  Single family owners must maintain their homes.  Condo owners must pay those assessments for the HOA to maintain their common elements.  Timeshare owners must pay those assessments for their HOA to maintain the properties.  For the last 2 categories, the loss of control that comes with being part of an association where the board determines the assessments can be painful.  But, those who purchase a timeshare must suffer through that loss of control.  Associations are governed by their boards.  It's the only way.

That doesn't mean that every increase or decrease in assessments is justified or unjustified.  The HOA board runs the associations.  The individual members can attend and watch at board meetings to see what decisions are taken.  But, they have no standing or right to participate in board meetings.

There is nothing wrong with questioning expenses by a HOA.  But, when conclusions are reached without hard facts and misinformation is posted and re-posted and re-posted as truth or fact on mere assumption?  That's unfair.

I could post and re-post and re-post that Starwood properties are collecting delinquent assessments and Marriott properties are ignoring their delinquencies.  But, I don't know that that's true.  I presume that Marriott has delinquencies related to the economy.  But, I don't post my presumption as fact.  All I care is that, if the Starwood properties are having delinquency problems, the problems are being addressed.  And, to me it looks like they are.

I assume the Starwood HOAs are doing all they can to contain costs.  I resent accusations without proof that the HOAs are letting Starwood steal from the owmers to line its corporate pockets.  So, I say so.  If anyone has any proof of stealing, please post it.

However, I agree that Starwood spins the best version of facts when it communicates with owners.  Every large corporation does that these days.  Starwood is not unique in having a PR department that looks over and standardizes all communication.

So, continue to question all expenses.  But, learn the statutes and declarations that apply to the resorts.  Without that knowledge (which Starwood knows in and out), you will merely flounder.  If you make a written request to see information and Starwood doesn't respond, please don't come to TUG and cry about it.  Sue Starwood (pro se and in small claims court) and I am sure you will end up getting whatever is required to be disclosed by the appropriate statute.  Most likely (and I am a lawyer and mean this), you will win and then can post what you got and explain what it means and have the added pleasure of having stuck it to Starwood.  Please ask for fees to cover Starwood's bad faith refusal to turn over the documents.

Of course, only one win against Starwood might change its arrogant attitude.  That would be a good thing.  However, while you are doing that, I will be enjoying my timeshares.  I have other issues to worry about in my life.

Good luck to you.   ...   eom


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## Troopers (Nov 20, 2009)

jarta said:


> So, continue to question all expenses.  But, learn the statutes and declarations that apply to the resorts.  Without that knowledge (which Starwood knows in and out), you will merely flounder.  If you make a written request to see information and Starwood doesn't respond, please don't come to TUG and cry about it.  Sue Starwood (pro se and in small claims court) and I am sure you will end up getting whatever is required to be disclosed by the appropriate statute.  Most likely (and I am a lawyer and mean this), you will win and then can post what you got and explain what it means and have the added pleasure of having stuck it to Starwood.  Please ask for fees to cover Starwood's bad faith refusal to turn over the documents.



In regards to WKORV, I recently posted here a relatively simple way to file a complaint with Hawaii's Dept of Consumer Affairs.

A complaint by an owner may not get much attention.  But I'm sure a state investigation will, assuming one has a case.


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## l2trade (Nov 20, 2009)

gmarine said:


> Since you share the views of the post you quoted would you please show where the "pure speculation predisposed to go against Starwood" is ?



I second that question.  I know I have posted many views against Starwood over the past two months.  None of them are "pure speculation predisposed to go against Starwood".  Theses discussions are all grounded in reality.  Our viewpoints are quite legitimate.  

One thing I hope we can all agree on is that the current level of delinquencies is not good.  You may not want to sell, but you should care if fewer folks want to buy.  It matters because all owners will pay for units that nobody wants.  That is simple supply and demand.  I think we can agree which of those is greater right now.  Sure, you may not see our complaints in the same way because your usage is different.  For example, my ownership experience as a non-SVN owner is totally different compared to an SVN 5 * Elite.  Sure, you may also blame it all on the economy.  However, rising MF & problems with the new trading system are legitimate topics to discuss online here and raise complaints about.  If Starwood would work with us in good faith to resolve our complaints, I would be one of the first to compliment them for doing so.  I really want to be a happy owner.  I call it as I see it, good and bad.  I agree that there is no need for "pure speculation predisposed to go against Starwood".  So please show us, where is that happening?


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## DanCali (Nov 20, 2009)

jarta said:


> The true cost includes the loss of equity.  I knew timeshares rapidly decline in resale value before I bought.  I am not planning on selling.  So, I have no loss - yet.  When I (or my heirs sell) there will be a big loss - even on the 3 of 6 weeks I didn't buy directly from Starwood.
> 
> DeniseM is right.  There are various income earners in the SVN system.  I have been lucky in life.  So, I travel (usually) first class.  And, if I want to do that?  It's my money and I worked hard (and was lucky too) to earn it.  I'll spend it as I want to.  You can be jealous of me or think that's pompous of me.  So, what!  This is merely a discussion board on the Internet and I really can't control how you feel.  And, quite frankly, I just don't care.



I don't think you are pompous, and am certainly not jealous. Everyone is entitled to their opinions. Despite living in CA, I'm all for capitalism and success via meritocracy. Since I work in financial services, I've had my share of success and first class travel, as well as unemployment when cycles end, so I can relate with many of the things you mention.

What I disagree with is that even someone who has more money than they care about won't take $100,000 in cash and flush it down the toilet. When you consider that many people bought Starwood timeshares for that amount (or more) and those timeshares will be worthless soon enough if Starwood doesn't get its act together - that's esentially what they did. There are also many people who simply can't afford losing 100% of their investment by buying into Starwood or paying outrageous maintenance fees which they never expected, and I empathize with those people. If I had annual 7-night accomodations costs of $5000 to $10,000 after equity losses I'd find it hard to enjoy my vacations. Personally, I am glad I stopped with Starwood when I did because I can book from the spg website directly for much less than the cost of MFs + equity losses.



jarta said:


> That doesn't mean that every increase or decrease in assessments is justified or unjustified.  The HOA board runs the associations.  The individual members can attend and watch at board meetings to see what decisions are taken.  But, they have no standing or right to participate in board meetings.
> 
> There is nothing wrong with questioning expenses by a HOA.  But, when conclusions are reached without hard facts and misinformation is posted and re-posted and re-posted as truth or fact on mere assumption?  That's unfair.




The Starwood HOA is a joke. You've seen how the "gatekeepers" prevent people from getting in touch with anyone who matters. You've seen how they discourage attendance via late notifications. Not to mention screening candidates...

When I look at Marriott's Historical MFs  and compare their trend to Starwood side by side (AZ desert vs. AZ desert, CA desert vs. CA desert, Maui vs. Maui, Kauai vs. Kauai, SC vs. SC etc) I'm just at a loss for words... Even ignoring 2009-2010 fees and delinquencies Marriott annual increases over the 2003-2008 period, which are not low by any measure, are humane compared to what Starwood did to their owners... Is Marriott irresponsible all this time, better managed, or more honest?

And in regards to the ease you make it sound to sue Starwood - even if I was 100% justified, like most ordinary people, I don't have the time or resources to spend on taking on their well-paid army of lawyers. It is much easier to just sell a timeshare on eBay and walk away. Of course Starwood knows this and treats us accordingly...


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## Ken555 (Nov 20, 2009)

Marriott Ko Olina MFs are *lower* in 2010.


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## Transit (Nov 20, 2009)

The culmination of Starwood issues are having a impact on the way Starwood perceived. The issues affect different resorts and owners in different ways.These are *real issues* and they are starting to pile up. I certainly have enjoyed my vacations with Starwood and would like to in the future.Ignoring these issues will not make them go away.


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## DeniseM (Nov 21, 2009)

jarta said:


> *DeniseM is right. *



WOW!  Now those are some words I never expected to hear from you, Jim!
:rofl: :rofl: :rofl:


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## jarta (Nov 21, 2009)

DeniseM   ...   You are usually right on.  You are intelligent and hardworking and dedicated to this board.  You are especially helpful to newbies who need advice on the ins and outs of timesharing.  Keep it up.   ...   eom


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## l2trade (Nov 21, 2009)

jarta said:


> DeniseM   ...   You are usually right on.  You are intelligent and hardworking and dedicated to this board.  You are especially helpful to newbies who need advice on the ins and outs of timesharing.  Keep it up.   ...   eom



Jarta, I agree with you on that.


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## DeniseM (Nov 21, 2009)

Ahhhhh....Thanks guys!


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## Joshadelic (Nov 21, 2009)

l2trade said:


> Jarta, I agree with you on that.



Ditto!!!!!


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## smitty328 (Nov 23, 2009)

Ken555 said:


> Marriott Ko Olina MFs are *lower* in 2010.



The high tax rates only apply to Maui, not the rest of Hawaii.

Apparently all of the units are valued at 1.4 million. Ocean front or view, island view or parking lot front makes no difference.


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## DeniseM (Nov 23, 2009)

smitty328 said:


> The high tax rates only apply to Maui, not the rest of Hawaii.



Yes, but it wasn't JUST the taxes that went up - they raised the MF, too!  
Also - there are other resorts on Maui that didn't raise their maintenance fee this year, despite the tax hike.


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## Ken555 (Nov 23, 2009)

DeniseM said:


> Yes, but it wasn't JUST the taxes that went up - they raised the MF, too!
> Also - there are other resorts on Maui that didn't raise their maintenance fee this year, despite the tax hike.



Exactly. Something is wrong if Starwood resorts are alone in increasing rates while others do not. It's also been posted elsewhere on TUG that the Marriott in Maui fought the tax increase and won (anyone have more info on this?).


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## gregb (Nov 23, 2009)

DeniseM said:


> Yes, but it wasn't JUST the taxes that went up - they raised the MF, too!



True, the total MF went up, but much of the increase is outside the control of the resort mgmt.  The big increases are property tax ($307.63), reserves for owner delinquencies ($215.77) and a shortfall in the 2009 operating budget ($119.35).  Resort Mgmt does not control the tax assessments, and they assure us they are doing what they can to challenge the assessment.  They have little control over delinquencies.  Yes they should be trying to collect and again they assure us they are doing so.

The prior year shortfall means they didn't do a good job in Nov. 2008 estimating how much they would spend operating the resort for 2009.  They have to make that the 2009 shortfall, so it is added to the 2010 budget.  

If you take those three items out, then the operating costs have actually decreased by $27.77!     And in fact, if they had predicted the 2009 budget better and charged us the extra $119.35 in 2009, then the operating budget for 2010 would actually be $147.12 lower than 2009.    

Greg

BTW these figures come from the annual summary and 2010 forecast included with my 2010 MF bill for WKORVN.


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## DeniseM (Nov 23, 2009)

gregb said:


> True, the total MF went up, but much of the increase is outside the control of the resort mgmt.  The big increases are property tax ($307.63), reserves for owner delinquencies ($215.77) and a shortfall in the 2009 operating budget ($119.35).  Resort Mgmt does not control the tax assessments, and they assure us they are doing what they can to challenge the assessment.  They have little control over delinquencies.  Yes they should be trying to collect and again they assure us they are doing so.



Greg - I respectfully disagree.  The BOD is responsible for the 2009 shortfall and for deciding how to deal with the delinquencies.  I know it's already been discussed, but I don't think anyone knows how the forfeited weeks will be used.  Non-paying owners are losing the right to use their unit this year and we are covering their maintenance fees - what is being done with those weeks?  Is the rent coming back to the HOA?  On Maui, where Starwood rents the units for at least twice the MF, even if they only rent half of the delinquent units, that would be enough to cover all the MF's!  So are we going to show a surplus in next year's budget because of the $215.77 we are paying this year to cover delinquinces?  

Plus, we aren't just talking about this year - we are talking about MF's that have doubled since I bought preconstruction about 7-8 years ago.


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## gregb (Nov 23, 2009)

DeniseM said:


> Greg - I respectfully disagree.  The BOD is responsible for the 2009 shortfall and for deciding how to deal with the delinquencies.  I know it's already been discussed, but I don't think anyone knows how the forfeited weeks will be used.  Non-paying owners are losing the right to use their unit this year and we are covering their maintenance fees - what is being done with those weeks?  Is the rent coming back to the HOA?  On Maui, where Starwood rents the units for at least twice the MF, even if they only rent half of the delinquent units, that would be enough to cover all the MF's!  So are we going to show a surplus in next year's budget because of the $215.77 we are paying this year to cover delinquinces?



I agree that the board underestimated the 2009 costs.  That is part of my point.  If they had correctly estimated the 2009 budget, then the increase for 2010 would be about $240 less than it is.

As for the delinquencies, I guess it comes down to if you believe the board when they tell us that they are doing what they can to collect these and to recover the money.  Lots of interesting ideas about how to share the unused weeks with owners have been discussed.  But from my perspective, I think the best outcome for owners is for the units to be rented.  And yes, if they are, I expect that that money would come back to the association and show up as revenue next year.

I agree that the increases in MF over the years have been quite high.  But I think that this year, the problems were not due to poor management, but rather circumstances outside the control of the board.

Greg


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## DanCali (Nov 24, 2009)

gregb said:


> If you take those three items out, then the operating costs have actually decreased by $27.77!     And in fact, if they had predicted the 2009 budget better and charged us the extra $119.35 in 2009, then the operating budget for 2010 would actually be $147.12 lower than 2009.



As Denise points out, the problem is the track record. This is starting to sound like the PC vs. Apple "Broken Promises" commercial... 

2009: If you take the delinquencies out, MFs would have been flat
2008: If it wasn't for soaring energy prices, MFs would have been down
2007: If it wasn't for skyrocketing travel costs, MFs would have been lower
2006: If it wasn't for a special assessment, fees would have been flat...
.
.
.

Every year there is some excuse why MFs have to keep rising with no end in sight. It's just not credible when it's year after year after year... And it all points to Starwood because they control the HOAs.

Starwood has quite a few resorts in many states. The main things in common are management and costs spiraling out of control at each and every one of them. While rising costs are not unique to Starwood, the level of increases eclipses any other company that I know of in the industry. Whether it's independent resorts like the Maui Schooner, or larger organizations like Worldmark, Marriott, Hilton, Hyatt, or the Four Seasons - I don't think any of these see double digit percentage increases year after year, 80% to 100+% increase in 5-6 years at all resorts. Every year they make it sound like a one time event, and the next year it turns out that the "one time" event from last year became permanent and was augmented by a new "one time" line item. I think it's ludicrous if they cannot control any of this... At best it's severe incompetence, although I can think of worse things to call it.


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## smitty328 (Nov 24, 2009)

Ken555 said:


> It's also been posted elsewhere on TUG that the Marriott in Maui fought the tax increase and won (anyone have more info on this?).


The sales guys in Maui say that Marriott and Starwood have teamed up against the county of Maui and are protesting the tax rate. The county is not able to spend the funds until the protest is settled.


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## Ken555 (Nov 25, 2009)

smitty328 said:


> The sales guys in Maui say that Marriott and Starwood have teamed up against the county of Maui and are protesting the tax rate. The county is not able to spend the funds until the protest is settled.



In that case, what are the 2010 MFs for the Marriott in Maui? Did they increase in a similar amount to WKORV?


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## jarta (Nov 25, 2009)

Ken555,   ...   "Quote:
Originally Posted by smitty328  
The sales guys in Maui say that Marriott and Starwood have teamed up against the county of Maui and are protesting the tax rate. The county is not able to spend the funds until the protest is settled. 

In that case, what are the 2010 MFs for the Marriott in Maui? Did they increase in a similar amount to WKORV?"

No, the Marriott taxes did not rise like WKORV and WKORV-N.

The management response to the TripAdvisor "review" highlighted on another thread said that *only* Starwood had its property reassessed and taxes increased this year.

I had posted that I hoped there was no link between pressing for the building construction permits for WRORV-3 and the tax increase.  Singling out of Starwood by Maui government would be an indication that there might be a link.  The fact that the Marriott taxes were not increased - yet - would be another indication that only Starwood property received an increase..

So, maybe all timeshare owners on Maui should be pulling for Starwood to beat the tax increases back.  If Starwood loses, the same market value approaches to value which are better applicable to hotels could be used for all timeshare properties in Maui (or in Hawaii).  This could be a very high-stakes game that is resolved by the Supreme Court of Hawaii.  Or, not.

You just can't tell for sure what the full story is.  But, why wouldn't Starwood's statements make reasonable sense?   ...   eom


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## DanCali (Nov 26, 2009)

jarta said:


> The management response to the TripAdvisor "review" highlighted on another thread said that *only* Starwood had its property reassessed and taxes increased this year.



The "management representative" you are referring to had this to say:

Management response from stueyman, owner 
(Management representative)
Nov 12, 2009 
This review is written while uninformed completely
We just received our annual report and maintenace fee bill.
Yes, the fees are expensive but all owners know the costs, prior to buying.
The property taxes have skyrocketed due to the State coming after each fractional owner adding $400 to our bill alone
....pricey...yes... worth it ?
Darn Right ! Absolutely love KORS and Maui itself and can't wait to get back


Frankly, "stueyman" sounds more like an owner worried about the value of his equity. He also identifies himself as an owner so I have no idea how he got to post a management response.

Moreover, if he is actually part of management then what kind of management is this? He concludes with "Darn Right"? Are you kidding me? This is the guy we are paying to manage our property? And how come he never addressed any other concerns of dissatisfied visitors (like 55 other "poor" or "terrible" reviews)?

In fact, stueyman lives in Alberta and also posted the following review (as a user) :

What you Need to Know about this property”
Barcelo Bavaro Palace
   stueyman Alberta
27 Mar 2009 | Trip type: Family 9/10 found this review helpful
Just returned from a week at Barcelo Bavaro Palace, Punta Cana. Have travelled for 20 years, mostly with our timeshares or renting others. 
Overall, the Barcelo beach & property itself is the nicest along the entire beach and would recommend it for sure.
You need to know the following: <snip>

So much for "stuey the manager" and believeing a single word he has to say because $3100 for a 2BR Dlx and $2600 for a 2BR are probably NOT worth it and certainly not costs owners were aware of as recently as 2 months ago.

And by the way, I don't know if Maui Marriott owners were taxed or not (and, because of what I say in the next paragraph, I don't think it matters much) but I wouldn't rely on stuey to get my answer...

I still believe taxes are not the problem here and talking about the taxes diverts us from the real issue/problem which is how MFs have skyrocketed from 2004-2009 at all SVN properties... This continued in 2010 both in Maui (much of it due to taxes) and outside of Maui where there were no tax issues. Yes, it would be extremely nice if the Maui taxes would go away, but that won't solve much because in a year MFs will probably still be at the same level for some new reason Starwood will likely come up with. The real problem is that no other management company comes close to this level of MF hikes and we are basically paying for either terrible management or pure greed. And that bad part is that we don't seem to have a solution to this problem...


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