The Future of Weeks ownership

[chkvtzn]

I saw this letter posted on another board. Would love to hear the opinions of others. I think that it is Spot On!



For years, legacy Marriott Vacation Club weeks owners believed we purchased something straightforward: deeded vacation ownership with meaningful reservation rights tied to a season, a view category, and a resort we loved.

Many of us paid premium prices specifically for Platinum season ownership at resorts like Marriott's Ocean Pointe because we understood that demand, scarcity, and owner priority created long-term value. We believed we were buying into a community of owners — not a corporate inventory management system.

But the evolution of the Destinations Club and the Marriott Trust has fundamentally changed the nature of what many of us originally purchased.

Today, Marriott is no longer simply the manager of our resorts. Through the Trust, Marriott has become one of the largest owners of Platinum inventory while simultaneously controlling the reservation systems, points allocations, inventory management, and exchange mechanisms that determine who actually gets access to that inventory.

That creates an obvious conflict of interest.

Every Platinum week Marriott reacquires through ROFR, foreclosure, or surrender and places into the Trust increases Marriott’s corporate control over high-demand inventory. Those weeks no longer belong to independent legacy owners with traditional usage expectations. Instead, they become fuel for the Destinations Points system — a system from which Marriott profits repeatedly through points sales, financing, fees, and inventory flexibility.

Meanwhile, legacy weeks owners increasingly report:

• greater difficulty reserving prime weeks,
• reduced availability,
• diminished exchange value,
• and rising annual maintenance fees.

At what point do owners ask the obvious question: are HOA costs being shifted disproportionately onto remaining weeks owners while an ever-growing percentage of premium inventory is controlled by the Trust?

Transparency is badly lacking.

Why is there no easily accessible owner ledger showing exactly how many Platinum weeks are owned by:

• individual legacy owners,
• the Marriott Trust,
• Marriott-affiliated entities,
• and unsold developer inventory?

Why shouldn’t every owner have the right to know precisely how much of their resort is now effectively under Marriott corporate control?

If the Trust owns a substantial percentage of Platinum inventory, that fact directly affects:

• reservation competition,
• governance influence,
• resale value,
• and the overall character of ownership itself.

Many of us bought weeks — not points. We bought certainty — not algorithmic inventory allocation. We bought into the understanding that owner interests and management interests were aligned.

Today, they increasingly are not.

That is why owners should begin demanding:

1. A full public accounting of Trust-owned inventory at every MVC resort.
2. Annual disclosure of all reacquired weeks and their disposition.
3. Independent audits of reservation allocation practices.
4. Greater owner oversight of HOA governance.
5. A moratorium on additional Platinum week acquisitions into the Trust until full transparency is provided.

This is not opposition to points owners. It is a demand for fairness, transparency, and protection of the ownership expectations upon which legacy weeks purchasers relied when they invested tens of thousands of dollars into Marriott Vacation Club properties.

The fundamental question is simple:

When the corporation becomes both the dominant owner of inventory and the operator controlling access to that inventory, who is truly being protected — the owners, or the system itself?

 

[Hindsite]

This is not an issues because of the points, system, its the same for where weeks are the only inventory. Consider what would have happened, and does happen, at independent resorts, if MVC had not invented the points system. Consider what would be happening if MVC does not take back weeks that owners want to get rid of or abandon.
Both of those scenarios end up with the HoA "owning" the abandoned or given back weeks, and the responsibility for paying the maint fees for those weeks and working out if they can recover some or all of the cost via rentals. Currently MVW shareholders hold the risk associated with the very significant volume of weeks that they own and pay maint fees for. Create a solution for those problems before you reject the current approach, flawed as it is, and don't put the burden on individual owners to pay for. MVW is under no obligation to take back or pay the maint fees on weeks that nobody wants, so who is going to pay instead?

MVC owns lots of inventory at many resorts and effectively has a controlling interest in the owner board/HoA. Many bemoan the lack of engagement from the +80% of individual owners who don't bother to vote, but they most likely bought knowing that it was a decent brand that was running the resort and feel no need to get involved, as that's not what they want from vacation lodging. There are a vocal few who feel that they are getting nowhere with driving their agenda of the "interests" of the bulk of owners, but do they really? Really? Really? or is it more about their personal mission? Frankly I'm glad that someone else makes the rather tricky decision on what type of microwave to equip the units with as I've seen a staggering range of views on just that from people who profess not to know that there is a microwave in the unit as they don't go on vacation to cook, right through to those who are outraged that the microwave has none of the extensive bells and whistles that they have in their home, when they travel to their "Home from home". Scale up that rather trivial example across all resort operations and put on your big pants and either muck in with supporting the management team in resolving these issues, or step away as this is not a spectator sport. I am very, very grateful to those volunteer owners who do step up and put their time in to put forward alternative views and often hold local management to account, but I'm not convinced that they have a greater effect than guest satisfaction scores do, they may do, I just don't know or need to know. There is no HoA at the Bonvoy hotels that I stay in and that seems to work well enough.

 

[davidvel]

Sums up pretty well what I have been saying for over a decade.

 

[Dean]

My view on this is that it's much ado about nothing. The system has evolved, high demand reservations have always been difficult and the membership as a whole is more educated about reserving than ever. For 13 month reservation the points system has little to no effect, it's only effect is when someone reservers more than one week at a time (that crosses over to the next calendar week) in points for a single reservation. 12 months have always been difficult which is why many recommended the 13 month reservation option years ago (before points) for such options by purchasing a second week or more. I do believe that points has some effect on the 12 month reservations but not as much as some would like to believe.

IMO the trust should get more Platinum weeks both to improve trust maintenance fees and to improve availability. Right now the off season owners are effectively fighting for the best weeks anyway.

We all signed up for a system that controls reservations unilaterally without input, we agreed to that legally. We should not have signed on if that was not acceptable.

 

[jp10558]

I guess I don't know much about MVC, but these were floating weeks then? I would think a fixed week/unit couldn't be bumped by a trust without buying it from the owner.

In terms of floating weeks I guess I don't really see much difference to points for bookings. You are competing and just have to try and win.

 

[RookWDW]

My view on this is that it's much ado about nothing. The system has evolved, high demand reservations have always been difficult and the membership as a whole is more educated about reserving than ever. For 13 month reservation the points system has little to no effect, it's only effect is when someone reservers more than one week at a time (that crosses over to the next calendar week) in points for a single reservation. 12 months have always been difficult which is why many recommended the 13 month reservation option years ago (before points) for such options by purchasing a second week or more. I do believe that points has some effect on the 12 month reservations but not as much as some would like to believe.

IMO the trust should get more Platinum weeks both to improve trust maintenance fees and to improve availability. Right now the off season owners are effectively fighting for the best weeks anyway.

We all signed up for a system that controls reservations unilaterally without input, we agreed to that legally. We should not have signed on if that was not acceptable.

When MVW buys or ROFRs a week from an owner, they dump that into the trust and then convert that into the point system right? So, even if they buy silver season weeks, don't those just turn into points that can then be rented in any season and potentially squeeze out the remaining weeks owners? That's the part I do get.

 

[ljmiii]

When MVW buys or ROFRs a week from an owner, they dump that into the trust and then convert that into the point system right?

If the week is at a resort outside the US (or at the Custom House in Boston) it can’t be in the trust. And many weeks that are ROFR’d that could be put in the trust are instead resold at full price along with points as part of a hybrid deal.

 

[davidvel]

We all signed up for a system that controls reservations unilaterally without input, we agreed to that legally. We should not have signed on if that was not acceptable.

You may have, but I never signed up for such a system. I bought a property governed by CC&Rs that have specific reservation requirements, and require all owners to be treated equally and without favor. I did not "sign up" for a system that allows the HOA and manager to be controlled by entities that favor their own interests above owners. If you did, that is silly.

 

[dioxide45]

If the week is at a resort outside the US (or at the Custom House in Boston) it can’t be in the trust. And many weeks that are ROFR’d that could be put in the trust are instead resold at full price along with points as part of a hybrid deal.

That isn't where Hybrid weeks come from. Hybrid weeks come from owners who have listed their weeks with the Marriott Resale Department. Hybrid US weeks are also not sold at full price. At least not the full price they were when they sold as weeks. They are sold at a determined resale price via the resale department. I understand that all the domestic USA weeks that Marriott gets back go into the trust (except Custom House). I don't know if, on the Vistana side, they are still in the practice of not conveying high end inventory to the trust. Think oceanfront Maui or peak ski season in Colorado. They've traditionally sold these as weeks even though they had the Westin Flex trust.

 

[Dean]

When MVW buys or ROFRs a week from an owner, they dump that into the trust and then convert that into the point system right? So, even if they buy silver season weeks, don't those just turn into points that can then be rented in any season and potentially squeeze out the remaining weeks owners? That's the part I do get.

Exactly. However, they are limited by the volume of weeks available to the trust system which includes those in the trust AND any weeks elected for points. One of the issues is they are not limited to any given week. An extreme example would be a resort with 10 weeks in Platinum but with quite a bit of variance between weeks (like MGO) and say 100 units for sake of discussion. Further assume that 10% of the Platinum weeks are in the trust combined with enrolled Platinum weeks elected so 100 out of 1000. While only 100 weeks could be reserved using points, all 100 of those weeks could be the highest demand week and could potentially. Obviously it would never go quite this far but they don't limit which weeks can be reserved using points other than by availability.

You may have, but I never signed up for such a system. I bought a property governed by CC&Rs that have specific reservation requirements, and require all owners to be treated equally and without favor. I did not "sign up" for a system that allows the HOA and manager to be controlled by entities that favor their own interests above owners. If you did, that is silly.

What you and bought gave MVC 100% control of the reservation system without additional input. All floating week resorts I am aware of in the MVC system have this stipulation. When many of the resorts were originally sold, the 13 month reservation option did not exist. They made that change without member input. I realize that the Trust and points system is quite a bit different but the control remains the same. The only exceptions would be true fixed week options like HP & Monarch.

 

[jp10558]

When MVW buys or ROFRs a week from an owner, they dump that into the trust and then convert that into the point system right? So, even if they buy silver season weeks, don't those just turn into points that can then be rented in any season and potentially squeeze out the remaining weeks owners? That's the part I do get.

Sure, people can book them with points, but isn't it true that the sliver weeks get less points than the platinum weeks? So owners booking with points would have to either be giving up multiple silver weeks or another platinum week similar to an II exchange I would think.

 

[RookWDW]

Sure, people can book them with points, but isn't it true that the sliver weeks get less points than the platinum weeks? So owners booking with points would have to either be giving up multiple silver weeks or another platinum week similar to an II exchange I would think.

Yes, for an owner with an enrolled week who elects for points. The issue, IMO, is that if MVW buys back or ROFRs a bunch of low season weeks, dumps those into the trust, converts them all to points, then sells those points in the new point system to new points owners who are not restricted by the weeks calenders, you just increased the demand for the high value weeks.

 

[VacationForever]

When MVW buys or ROFRs a week from an owner, they dump that into the trust and then convert that into the point system right? So, even if they buy silver season weeks, don't those just turn into points that can then be rented in any season and potentially squeeze out the remaining weeks owners? That's the part I do get.

No. The availability to book the days for all trust owners is limited to what are in the trust. So if there are 10 platinum weeks and 100 silver weeks, bookings can only be done against 10 platinum weeks and 100 silver weeks. Hence point booking is extremely difficult if you are wanting to book the platinum season.

 

[Tuggernaut]

The original post mentioned Marriott Vacation Club and platinum weeks and the difficulty of weeks owners to reserve prime weeks.

I have a question regarding the below scenario:

There are 11 weeks at Marriott's Grande Ocean that are in platinum season and they are weeks 24-34.

Let's say that I own a resale deeded platinum week at Marriott's Grande Ocean, and I enjoy going there every summer, so I don't have a membership in Interval International.

If I wait until week 20 (a month before platinum season begins), to reserve a platinum week (say I'm flexible and I will take any platinum week), will there be a platinum week available for me to reserve? Or is it highly likely that there will be no platinum week available?

 

[craigd]

Exactly. However, they are limited by the volume of weeks available to the trust system which includes those in the trust AND any weeks elected for points. One of the issues is they are not limited to any given week. An extreme example would be a resort with 10 weeks in Platinum but with quite a bit of variance between weeks (like MGO) and say 100 units for sake of discussion. Further assume that 10% of the Platinum weeks are in the trust combined with enrolled Platinum weeks elected so 100 out of 1000. While only 100 weeks could be reserved using points, all 100 of those weeks could be the highest demand week and could potentially. Obviously it would never go quite this far but they don't limit which weeks can be reserved using points other than by availability.

What you and bought gave MVC 100% control of the reservation system without additional input. All floating week resorts I am aware of int he MVC system have this stipulation. When many of the resorts were originally sold, the 13 month reservation option did not exist. They made that change without member input. I realize that the Trust and points system is quite a bit different but the control remains the same. The only exceptions would be true fixed week options like HP & Monarch.

No - painful to read this drivel.

 

[Hindsite]

If I wait until week 20 (a month before platinum season begins), to reserve a platinum week (say I'm flexible and I will take any platinum week), will there be a platinum week available for me to reserve? Or is it highly likely that there will be no platinum week available?

For floating weeks, yes you are entitled to a week in the season that you own. You are not entitled to your preference of week in the season that you own. Once you get to 60 days (IIRC) before check-in, MVC has the rights to take and use the inventory elsewhere. Which is quite sensible to avoid unused inventory. If you happen to get yourself into the position where you do "forget" to book more than 60 days ahead of check-in and MVC don't have anything available to give you, then they usually offer a replacement week that is deposited to II.

As a weeks owner I don't want to have to pay for excess inventory in the weeks reservation system, to accommodate people who either demand access to their preferred week or can't make a reservation more than 60 days before check-in. MVC's job is to try and anticipate what weeks people will want to reserve and have just enough inventory available to do that. I think they do it reasonably well given they can't magic enough inventory to fully meet peak demand or make inventory for low demand dates vaporise.

 

[bizaro86]

MVC has the rights to take and use the inventory elsewhere. Which is quite sensible to avoid unused inventory.

What benefit do the owners of the property get from this? That really seems like carrying water for MVW - they get the proceeds from renting/using those, not sure how the $0 and additional wear and tear on their units helps owners.

If I owned a vacation rental I wouldnt let the management company rent out unoccupied time for their own account just to avoid it being empty. That solely benefits MVW and is in the docs because nobody reads them before buying.

 

[ocdb8r]

In my view, some of this is right and some of this is wrong (referrring to the letter in the OP). Some things I think worth clarifying:

1) MVC does not "own" any of the weeks in the trust; it exercises a great deal of "control" over those weeks as manager/trustee of the trust, but the trust itself owns each of the weeks. It may seem pedantic, but I think it's important to at least ackowledge that a separate entity bound by the rules of the trust (while ackowledging that MVC weilds a great deal of power over the trust);

2) As has been pointed out, MVC (has and continues to) weild a great deal of power over each of the individual HOAs, meaning many of the concerns expressed here are not new and not tied solely to the trust. It's important to note that for every resort sold as weeks (which is the vast majority of MVC resorts), it is the individual HOAs that have ultimate power over how the resort (and reservations ) are run. Only via MVCs influence and control over the HOAs are they able to manage inventory (via their management contract with each HOA);

3) As others have pointed out, there have always been demand issues and peak seasons were always competitive for reservations. What has changed is that in the pure weeks system (even a floating one) if you owned 3 silver season weeks, no matter what you had to somehow use 3 silver season weeks. Similarly if you owned 1 platinum week, you had to use that one platinum week. The points system allows owners of [the equivalent of, or actually) 3 silver season weeks to reserve a single platinum week....and vice versa, the owner of a single platinum week can reserve three silver season weeks (this is just an illustrative example...of course the actual points allocation varies). The reality is this just puts massive pressure on the Platinum weeks as no matter the points allocations, I don't think demand will "balance" the way the system implies.

4) I agree with others that "transparency" on how everything shakes out feels lacking. I do note that the trust is audited, including audits specific to the reservation system and allocations....but the actual scope of that audit and what it is auditing against is a bit opaque. I guess I take some comfort in there being some sort of independent look each year, but there's not enough trasnaparency to make me feel certain there isn't scope for abuse.

 

[Dean]

Yes, for an owner with an enrolled week who elects for points. The issue, IMO, is that if MVW buys back or ROFRs a bunch of low season weeks, dumps those into the trust, converts them all to points, then sells those points in the new point system to new points owners who are not restricted by the weeks calenders, you just increased the demand for the high value weeks.

They are not very likely to buy back the lower season weeks though they may get them in other ways. Points can only received the number of weeks at a given resort for a given season that are in the trust plus those where members elected points. So there is a control on the volume. There just isn't as tight a control on which weeks within a season.

No - painful to read this drivel.

Instead of being derogatory, do you have anything constructive to add? What I posted is completely accurate though the extreme which would never be the reality as each process proceeds somewhat in parallel. But the principle holds that points are more likely to reserve the better weeks within a season.

 

[Hindsite]

If I owned a vacation rental I wouldnt let the management company rent out unoccupied time for their own account just to avoid it being empty. That solely benefits MVW and is in the docs because nobody reads them before buying.

With your vacation rental you bear the cost of weeks that go unused. Ultimately all weeks have maint fees paid on them, either by the individual owner, MVW or the Land Trust, so its a question of who gets allocated the cost of unused weeks. Owners that do leave it too late are often indignant that they can't book at week, even if they wouldn't actually use it in the next 60 days, so MVC has to have a way to give them something and that comes at a cost that someone has to pay.

What we don't know for sure, is whether the "cost" of any surplus weeks in the weeks reservation system goes, and what happens when MVC take control of them. For weeks inventory that they own they pay the maint fees, so it could be that they pass back some value that they recover if they succeed in monetising them, less a fee of some kind, or it could be that they keep any value that the generate. Somewhere in the cost models for weeks maint fees will be a provision for unused inventory that owners will be paying somehow, that's just standard inventory control practice. They will metricate the equivalent of "inventory losses" in the business as weeks inventory is essentially perishable inventory, similar to the "breakage" problem for the points system. Points owners will be paying for days that don't get used in their maint fees.

 

[RookWDW]

No. The availability to book the days for all trust owners is limited to what are in the trust. So if there are 10 platinum weeks and 100 silver weeks, bookings can only be done against 10 platinum weeks and 100 silver weeks. Hence point booking is extremely difficult if you are wanting to book the platinum season.

That's much better then, and I clearly didn't understand. Just to confirm - if for an example there are 100 total platinum weeks for the season, and MVW purchased 20 of those platinums and converted then into the trust and into points and then sold those points - when points owners go to search for a platinum week at the early possible time they are limited only to book those 20 weeks? And the remaining 80 weeks owned by weeks owners can only be booked by those who own weeks? But ... per Dean's comment, there is no allocation of which of the platinum weeks are the 20 versus the 80 so if there are more desirable platinum weeks then the points and weeks owners are all competing for those most desirable of the platinum weeks?

 

[Dean]

That's much better then, and I clearly didn't understand. Just to confirm - if for an example there are 100 total platinum weeks for the season, and MVW purchased 20 of those platinums and converted then into the trust and into points and then sold those points - when points owners go to search for a platinum week at the early possible time they are limited only to book those 20 weeks? And the remaining 80 weeks owned by weeks owners can only be booked by those who own weeks? But ... per Dean's comment, there is no allocation of which of the platinum weeks are the 20 versus the 80 so if there are more desirable platinum weeks then the points and weeks owners are all competing for those most desirable of the platinum weeks?

That is correct. My thoughts on the priority is the following:

1. Weeks owners are in the best position if they can reserve at or before 13 months out.
2. Points owners who have true 13 month access come next
3. At 12 months it's just a free for all assuming the typical week timing (F, S, S)

 

[RookWDW]

That is correct. My thoughts on the priority is the following:

1. Weeks owners are in the best position if they can reserve at or before 13 months out.
2. Points owners who have true 13 month access come next
3. At 12 months it's just a free for all assuming the typical week timing (F, S, S)

Thanks, that helps. I'm still planning out to build and add on more resale weeks, slowly over the next several years. Planning on when we can slow down and take much more vacation time. I was starting to doubt if this was a good idea given the changes.

 

[Dean]

Thanks, that helps. I'm still planning out to build and add on more resale weeks, slowly over the next several years. Planning on when we can slow down and take much more vacation time. I was starting to doubt if this was a good idea given the changes.

I'll add that a resort with a Thursday check may give an advantage to the weeks side due to the points release schedule for 12 month reservations.

 

[bizaro86]

With your vacation rental you bear the cost of weeks that go unused. Ultimately all weeks have maint fees paid on them, either by the individual owner, MVW or the Land Trust, so its a question of who gets allocated the cost of unused weeks. Owners that do leave it too late are often indignant that they can't book at week, even if they wouldn't actually use it in the next 60 days, so MVC has to have a way to give them something and that comes at a cost that someone has to pay.

What we don't know for sure, is whether the "cost" of any surplus weeks in the weeks reservation system goes, and what happens when MVC take control of them. For weeks inventory that they own they pay the maint fees, so it could be that they pass back some value that they recover if they succeed in monetising them, less a fee of some kind, or it could be that they keep any value that the generate. Somewhere in the cost models for weeks maint fees will be a provision for unused inventory that owners will be paying somehow, that's just standard inventory control practice. They will metricate the equivalent of "inventory losses" in the business as weeks inventory is essentially perishable inventory, similar to the "breakage" problem for the points system. Points owners will be paying for days that don't get used in their maint fees.

Unused weeks are a soft cost not a hard cost. The maintenance fees are calculated by taking the total costs and dividing by the number of owned intervals. If someone doesn't use their interval that slightly reduces the costs for everyone (no wear and tear on the unit, no power/water use). If MVW takes that interval for free (as the docs allow them to do) that doesn't benefit anyone else - the utilities are used by their guest and MVW pays no money to the HOA.

That clearly benefits MVW but since they are paying zero to the HOA there isn't a benefit to the owners.

Depositing unused weeks to II and giving those deposits to late-booking owners is a different thing (and I agree that's a good practice) but taking unused weeks for free at 60 days and renting them to encore packages and cash guests is a different situation.