I commented about this in another post about Star Island. I don't think they don't have enough reserves, and even with Star Island it was stated they would only need to have annual increases of 3-4% for reserves to cover the ongoing reserve obligations. That isn't unexpected given annual inflation. At least that is how I interpreted it. So those necessary funding and reserves seemed like just big numbers to throw out there but may not have actually been anything out of the ordinary.
I tend to agree with that opinion.
So here is more info obtained from the Star Island OMNI documents (all documents accessible via
https://cases.omniagentsolutions.com/home?clientId=3756)
document 14
https://casedocs.omniagentsolutions...6/92f24838-dd9b-4103-9625-943b6fe7b45f_14.pdf
document 7
https://casedocs.omniagentsolutions.com/cmsvol2/pub_47566/9ed9c0e9-a7a2-4bff-a43e-935ff805525c_7.pdf
document 62
https://casedocs.omniagentsolutions...0-c2e0-4861-ac33-749324e20d70_62_Redacted.pdf
Seems like they have enough in the Reserves bank account shown later on below to pay the $6.8M 2026 repairs, renovations and capital improvements that is sighted in my previous post
https://tugbbs.com/forums/threads/a...am-resort-closure-actions.377729/post-3226964
I assume they have already performed the vast majority of the $6.1 million 2025 repairs, renovations and capital improvements shown in that previous post and paid for it (otherwise it would be shown as a liability I think) but don't know.
So in regards to the reserves it looks like they have enough currently to cover reserve things and then increase the reserve funding by the 3 to 4 % they state (basically the inflation rate as pointed out by dioxide45).
I don't think they are behind on normal operations (non reserve) funding but not sure. They do not appear to be indebt as far as I can tell by the documents unless I'm reading them wrong. I'm trying to get a 2025 detailed budget from an owner to analyze. I pay around $1400 for my interval per year (3 bedroom lockout) that is not part of the bankruptcy (bldg 12 in Vacation Break phas 1). So using that as a rough estimate for an interval in the bankruptcy bldgs I get
184 bankruptcy units * 52 intervals /unit * $1400/interval = $13.4M for the year for all those units combined (and that includes reserve funding in my payment), so $1.116M per month which they have in their Operating bank account (actually twice that). Not sure why I see in my previous post they used 332 units instead of 184 for some of the calculations.
So the financial statements shown in the bankruptcy documents don't appear to support bankruptcy. Likewise as dioxide45 pointed out as long as they are getting all
maintenance fees (or close to it) paid to the HOA then that does not support bankruptcy. Likewise the Summary of assets and liabilities doesn't show any financial issues.
The real reason for the bankruptcy , as indicated in many previous posts, is that Wyndham is owner of at least 47% of the units (or intervals) and is paying maintenance fees on probably a decent portion of those without any income to offset that and wants those buildings to be sold to alleviate that. Not sure why they don't just say that in the bankruptcy.
An AI summary does say
"Yes, a company can declare bankruptcy even if it appears profitable or in "good" financial shape on paper
, usually due to severe
cash flow problems, massive debt loads, unsustainable liabilities (like lawsuits), or strategic reasons to reorganize under Chapter 11. A company can be profitable (positive net income) but lack the
liquidity (cash) to pay immediate bills, leading to a "cash flow bankruptcy," or use bankruptcy (especially Chapter 11) to shed debt and restructure for future viability, even when creditors won't negotiate outside court. "
Snippets from the documents
Case 6:25-bk-07207-GER Doc 14
F. Pre-Petition Resolutions.
.
.
.
31. At the special meeting on September 25, 2025, with 98% of the voting interests
present at the meeting (in person or by proxy) voting yes and 2% of the voting interests voting no,
members of the Association also authorized the Board to:
suspend occupancy at the resort by members, guests and others as of December 31,
2025 (or shortly thereafter as deemed necessary or proper by the Authorized
Persons) without waiver of the right of the Association to re-commence occupancy
upon notice to members;
suspend collection of 2026 maintenance fees, without waiver of the right of the
Association to later seek payment of such fees and without waiver of member
obligations regarding same, upon notice to members;
waive the funding of reserves in the 2026 budget pursuant to Section 721.13(3)(c)3,
Florida Statutes;
refund to members 2026 maintenance fees received by the Association, if any,
without waiver of the right of the Association to later seek payment of such fees,
upon notice to members, and without waiver of member obligations regarding
same;
immediately suspend reservations (including cancelling any existing reservations
with occupancy dates after December 31, 2025) at the resort after December 31,
2025, without waiver of the right of the Association to later accept reservations at
the resort upon notice to members;
pursuant to Section 721.13(3)(c)2, Florida Statutes, transfer reserve funds of the
Association in the amount of $6,592,825 to pay operating expenses and costs of the
Association as set forth in the attached limited operations budget for 2026 or any
approved budget for the Association; and/or
take any and all action that they deem necessary or proper regarding the operation
and/or management of the Association.
.
.
.
.
H. Assets and Liabilities of Association.
35. As of the Petition Date, Debtor carries no secured debt. Debtor funds its operations
through the maintenance fees and assessments from Association Members with various interests
in the Property.
As set forth in Debtor’s Petition and statements and schedules, which the Debtor
intends to file in the coming days, the Debtor’s assets primarily consist of (a) $11,561,841.159 in
cash and cash equivalents, and (b) an undetermined value of the Association Interest in the
Property.
.
.
.
.
36. Star Island Development Corp. (“Declarant”) maintains and is the owner of the
pedestrian and vehicular ingress and egress through and over all passageways, corridors, lobbies,
restrooms, parking lots, green areas and elevators from the entrance of the Resort and all portions
of the common areas at the Resort (the “Common Areas”). Declarant also owns and maintains the
following amenities: (a) 40’ x 60’ heated swimming pool with 3,000 sq. ft. of deck and a 12 foot
adjacent spa, (b) nine standard size tennis courts, and (c) a 14,000 sq. ft. clubhouse and fitness
center (the “Recreational and Support Facilities”). Declarant also provides to Debtor access to the
following utilities at the Resort: (a) telephone lines, (b) electrical lines, (c) water lines, (d) sewer
lines, and (e) cable TV (collectively the “Utilities” and together with the Common Areas and the
Recreational and Support Facilities, the “Retained Properties”).
37. The Property is subject to that certain Declaration of Covenants, Conditions and
Restriction and Grant of Easements (the “DCCR”) dated July 2, 1999 and recorded by Declarant
on July 21, 1999 with the Clerk of Circuit Court of Osceola County, Florida in CL 99113026 at
OR 1638/2112, as amended. The DCCR gives each member of the Debtor a non-exclusive grant
of easement to use the Retained Properties. In exchange, each member of the Debtor is required to
pay “Club Dues” to the Declarant. The annual Club Dues are determined by multiplying the annual
Club Dues rate by the number of "sold weeks" in the Resort Facility. The Debtor allocates the Club
Dues among those sharing such payments consistent with the fractional ownership and pointsbased
system at the Resort and bills the members of the Debtor with its billings for the assessments
due the Debtor from its members. The rate can be changed at the Declarant’s discretion but cannot
exceed amounts charged to other owners at the project. In addition, the DCCR requires the Debtor
to pay its proportionate share of the cost and expense of such maintenance of the Retained Property
based upon the number of units existing in the Resort Facility in proportion to the number of units
existing in the project at the time Declarant incurs the cost of such maintenance. Debtor pays these
amounts to Submanager.
38.
In 2025, the Debtor paid the Submanager the average sum of $672,000.0010 per
month for the use of the Retained Properties. Debtor is current on its obligations to the Submanager
with respect to its obligations for use of the Retained Properties and anticipates continuing to do
so in the ordinary course of business during the course of the Chapter 11 Case
(edited 12/6/2025 1:26pm CDT: comment by me. This doesn't seem right per month if it is to cover Club fees (I pay $83 for my interval per year), phone and utilities (I pay $37 and $56 per year for my interval for that, and say even landscaping which I pay $10 per year for my interval) = $83 + $37 + $56 + $10 = $186/interval. So 184 units * 52 intervals/unit * $186/interval = $1.78M / year or $148K per month. I mean they the total maintenance fees using my maintenance fee as a base would be 184 units * 52 intervals/units * $1400 per interval = $13.4M per year or $1.16Mper month so they are saying they pay 60% for those things? That doesn't seem right)
.
.
.
I. First Day Motions.
.
.
.
57. Debtor maintains a cash management system in the ordinary course of Debtor’s
business. The Cash Management System is an integrated, centralized system that utilizes three
Bank Accounts through three separate Banks, including an Operating Account, a Tax Account,
and a Reserve Account. These accounts serve specific functions within the Cash Management
System, including making payments, collecting annual fees from owners, conservatively investing
funds, and segregating cash required for certain budgeted payment obligations (i.e., in the Reserve
Account and Tax Account). Debtor has specific Investment Guidelines with respect to certain
Bank Accounts that require investments only in certain, specific, safe investments, with the stated
goal of ensuring (a) safety of principal, (b) adequacy of liquidity, and (c) maximization of yields
(in order of importance). Two of the Bank Accounts are with depositories that have signed a
uniform depository agreement with the U. S. Trustee (i.e., Wells Fargo and Comerica14). The
remaining account is the Tax Account with Bank of America; by way of the Tax Motion (discussed
below), the Association will seek Court authorization to utilize approximately all of the funds in
the Tax Account to pay property taxes during the month of November 2025.
.
.
.
65.
In the ordinary course of operating its business, Debtor (a) incurs certain Taxes and
Fees to various Taxing Authorities, and (b) is charged amounts for services related to calculating
and estimating such Taxes and Fees. I understand that Debtor is generally current on its tax
obligations, but that approximately $1,003,593.33 in unpaid Taxes and Fees (which includes real
property taxes that are not past due) are accrued and outstanding as of the Petition Date.
66. Debtor must continue to pay certain of these taxes and fees in order to continue
operating its business and to avoid potential penalties and distractions during the Chapter 11 Case.
Debtor’s failure to pay the Taxes and Fees described in the Tax Motion could adversely affect
Debtor’s business operations, as Taxing Authorities may assert liens on Debtor’s property, assert
penalties or interest on past-due amounts, cancel licenses, and/or subject Debtor’s directors and
officers to personal liability for unpaid amounts. Moreover, Debtor’s failure to pay for certain
services (including the Accountant Services) related to the Taxes and Fees could result in a delay
in paying certain of the Taxes. I believe the relief requested in the Tax Motion is required to avoid
these potential disruptions and distractions.
--------------------------------------------------------------------
Case 6:25-bk-07207-GER Doc 7
.
.
.
EXHIBIT B
(Schedule of Bank Accounts)
Document 62
agreement. Most major timeshare companies are modernizing their resort portfolios, and the consensus here on TUG, and probably elsewhere, is that there's a proportionately older owner segment, mostly fixed week owners, that really do not like it, coupled with some owners who prefer more off the beaten path type resorts, that also do not like it (we fall into this latter category for our part personally), coupled with those who live in the northeasterly areas where most of these resorts reside that enjoy driving distance resorts that are closing. For these subsets of owners, it sucks to put it bluntly, but as you said, it is what it is.
