Wyndham is closing a handful of legacy resorts - dedicated chart/tracker located in the first post for this unfolding set of events

[robbie0001]

That seems really insanely low to me considering the thresholds in the founding and governing documents of the residential HOA's i've been involved in. In my current HOA, you could not even call a HOA meeting to order with 20%, let alone change any policies the HOA board is delegated authority to and definitely not change any of the covenants or disband the HOA/Sell the property

Wyndham owns 1880 interval weeks out of 3200, so their voting guarantees a quorum. At 58% of all voting interests, they alone meet the quorum requirement of the Original Declarations/Bylaws. It would take 80% of all other owners to block Wyndham-supported measures, but typically only about 15% send in their proxy votes. HOA give the appearance that all owners have a say in what is happening. In reality, the average owner's vote means very little.

 

[comicbookman]

I don't when and how Wyndham consolidated its interest in ORIC, but ORIC was likely much more valuable to Wyndham prior to Bonnet Creek being built. Wyndham stands to make $10 million (or more) from the sale. Considering that Wyndham likely received many deeds for little or no consideration, ORIC actually worked out very well for Wyndham. Its the original owners (who bought from the developer) who lost thousands.

Timeshares work really well for the developers and management companies, but a 95% loss of initial investment (for those who bought in the 1980s), under an HOA, is simply not an acceptable outcome.

Of course WYndham has paid many millions in Maint. fees which have kept ORIC alive far longer than it would have otherwise survived, so there is that.

 

[Floridaman76]

Sidebar topic, unrelated to the timeshares. But I found it interesting that Wyndham still owns over 1,200 individual, undeveloped home lots within FF Glade. And they pay community club fees of something like $55/mo on each of those lots. They are trying to unload them to the current developer of FF Glade (who is a former Wyndham executive). The lots have little market value currently as there are no roads, water, infrastructure. But remain a significant legacy liability for Wyndham.

Well that certainly is fascinating new information.

I wonder if that Wyndham liability could or will somehow be deducted from any proceeds of the sale of the developed properties and screw over owners.

I'm sure there's an escape provision or payoff required by Wyndham to the developer or whomever is the recipient of those dues currently. And if Wyndham has never exercised that option then that fee must be substantial, or if their only other escape option was to end the timeshare enterprise at this location in it's entirety.

Anyone who has been to this location knows there's really no jobs there, and such, demand for new residential housing units is also nonexistent.

Crossville is in the middle of nowhere, about dead inbetween Nashville and Knoxville. Too far away (1.5-2 hours) to be a commute option to either location.

 

[Rolltydr]

It was not a Wyndham resort when it was built. The HOA gave Wyndham increasing control over time, and Wyndham modified the bylaws to suit its interests to the detriment of people who originally bought from the developer (not my situation by the way, but I think their destruction of ORIC is a clear example of how the timeshare model simply does not work, and I feel bad for people who invested in ORIC and have now lost their retirement savings). Wyndham's handling of ORIC over time shows that its timeshares are not investments, and use of Wyndham properties can often be arranged through 3rd party services at less cost than maintenance fees for those who own in Club Wyndham Access.

As an aside, why should anyone ever believe anything that Wyndham says about a timeshare purchase or vacation program? They can, and will, change bylaws whenever they want based on their control of HOAs. .

As much as some people want to believe they actually own the resort(s) that they stay in, they do not. They own a tiny little fraction in most cases and should never expect to actually be a decision-maker when it comes to the disposition of an entire resort. I would never expect for anyone, except Wyndham and it’s major stockholders, to make those decisions. When I buy a ticket to attend a football game and sit in a certain seat, it doesn’t give me the right to make any decision about what happens to that seat in the future. Same for timeshares. As long as it’s a timeshare and I can purchase a ticket for a week, that’s all I’m owed. Anybody who believes otherwise hasn’t been paying attention and anyone who doesn’t do their homework before purchasing a timeshare has only themselves to blame.

And, that doesn’t mean I approve of Wyndham’s sales tactics. I most certainly do not and I got myself on the Do not Gift list so I don’t have to deal with them. However, I purchased my first contract with Wyndham from Wyndham. I had a relative who had been an owner for 20 years and was very happy with the resorts and he could justify the cost. I did the same initially but when I wanted more points, I bought resale. We love most of the resorts we’ve been to and we much prefer the timeshare space to hotels. We’ve been owners for over 15 years and are very happy. Vacations cost money. I don’t obsess over my dollars/thousand points. I know how much I paid for my contracts, how much I pay each month in maintenance fees, and how much vacation time we get for that amount. I value my time more than I value a dollar. It is precious to me and, at age 71, I’m on the downhill side of my timesharing life. I choose to enjoy that time in some of the many, many resorts that are available, rather than spend it chasing conspiracy theories about why Wyndham would close a poorly rated, underperforming resort that it’s customers (yes, that’s what we really are) do not want to stay at. I’ve never stayed at ORIC but most people here seem to think it’s one of Wyndham’s worst locations. So, Wyndham is eliminating a resort that people don’t like rather than pouring more money into it. That sounds like a good business decision to me.

As for Wyndham changing the bylaws whenever they want… of course they do. Just like every other company changes their internet Terms of Use every few weeks/months in case you haven’t noticed. They do so to try to stay ahead of the competition and various legal quagmires. That’s how they stay in business.

 

[robbie0001]

Of course WYndham has paid many millions in Maint. fees which have kept ORIC alive far longer than it would have otherwise survived, so there is that.

True. And now they will get the proceeds for interval ownership which cost them next to nothing to acquire. Income and expense ratios were still profitable until recently which is why ORIC was not liquidated previously. They don't want to pay special assessments for the $5 million that the resort requires for updating and upgrades. This seems to be the motivation to sell, not I/E ratios up to this time.

 

[comicbookman]

True. And now they will get the proceeds for interval ownership which cost them next to nothing to acquire. Income and expense ratios were still profitable until recently which is why ORIC was not liquidated previously. They don't want to pay special assessments for the $5 million that the resort requires for updating and upgrades. This seems to be the motivation to sell, not I/E ratios up to this time.

I wasn't defending Wyndham. I was just pointing out something that seems to get lost a lot. Wyndham is an owner just like we are. They pay maintenance and as you said special assessments. Any change in costs affects them on a larger scale then for individual owners. They have a big incentive to keep costs down and to punt when needed. Just like owners walk away, sell and turn in their ownership because it no longer is economical for them. I don't see why this behavior should come as surprise to anyone. It does not make Wyndham evil. Their sales tactics make them evil, but not really their management of the resort system (except for their reluctance to do IT well).

 

[robbie0001]

As much as some people want to believe they actually own the resort(s) that they stay in, they do not. They own a tiny little fraction in most cases and should never expect to actually be a decision-maker when it comes to the disposition of an entire resort. I would never expect for anyone, except Wyndham and it’s major stockholders, to make those decisions. When I buy a ticket to attend a football game and sit in a certain seat, it doesn’t give me the right to make any decision about what happens to that seat in the future. Same for timeshares. As long as it’s a timeshare and I can purchase a ticket for a week, that’s all I’m owed. Anybody who believes otherwise hasn’t been paying attention and anyone who doesn’t do their homework before purchasing a timeshare has only themselves to blame.

And, that doesn’t mean I approve of Wyndham’s sales tactics. I most certainly do not and I got myself on the Do not Gift list so I don’t have to deal with them. However, I purchased my first contract with Wyndham from Wyndham. I had a relative who had been an owner for 20 years and was very happy with the resorts and he could justify the cost. I did the same initially but when I wanted more points, I bought resale. We love most of the resorts we’ve been to and we much prefer the timeshare space to hotels. We’ve been owners for over 15 years and are very happy. Vacations cost money. I don’t obsess over my dollars/thousand points. I know how much I paid for my contracts, how much I pay each month in maintenance fees, and how much vacation time we get for that amount. I value my time more than I value a dollar. It is precious to me and, at age 71, I’m on the downhill side of my timesharing life. I choose to enjoy that time in some of the many, many resorts that are available, rather than spend it chasing conspiracy theories about why Wyndham would close a poorly rated, underperforming resort that it’s customers (yes, that’s what we really are) do not want to stay at. I’ve never stayed at ORIC but most people here seem to think it’s one of Wyndham’s worst locations. So, Wyndham is eliminating a resort that people don’t like rather than pouring more money into it. That sounds like a good business decision to me.

As for Wyndham changing the bylaws whenever they want… of course they do. Just like every other company changes their internet Terms of Use every few weeks/months in case you haven’t noticed. They do so to try to stay ahead of the competition and various legal quagmires. That’s how they stay in business.

This is not how Wyndham markets their timeshares. Isn't there a class action lawsuit against Wyndham for false advertising (like claims that buying a timeshare is an "investment")? Are Wyndham's business practices some of the reason why so many timeshare exit companies exist? If all I want is to be a customer when staying in a place to sleep, isn't that the definition of a making a reservation (even in Wyndham properties). T&L may be the driving force behind closing under-performing locations. Supposedly, new locations in Chicago and Boston are the main focus moving forward.

 

[comicbookman]

This is not how Wyndham markets their timeshares. Isn't there a class action lawsuit against Wyndham for false advertising (like claims that buying a timeshare is an "investment")? Are Wyndham's business practices some of the reason why so many timeshare exit companies exist? If all I want is to be a customer when staying in a place to sleep, isn't that the definition of a making a reservation (even in Wyndham properties). T&L may be the driving force behind closing under-performing locations. Supposedly, new locations in Chicago and Boston are the main focus moving forward.

Where did the Chicago and Bosten rumor come from?

 

[Lisa P]

We've never stayed at Fairfield Harbor but from the multiple really bad reviews it gets we're wondering why it's not on the list of resorts being dropped.

Hey Jan, I can answer this one. Wyndham no longer manages any of Fairfield Harbour.

Capital Vacations (which bought out VRI) manages that resort. Only owners who contracted with FF/CW to convert their fixed weeks to CWS points (or originally FairShare Plus points) are still giving their usage to Wyndham each year as they (we) recieve that year's allotment of CWS points.

Now Capital Vacations is soliciting owners to relinquish their week(s) to Capital Vacations by asking the owners to pay $480 legal fees plus 2 years' prepaid maintenance fees. Capital has a past history of charging very large assessments and helping resorts... fall off a cliff financially. So the choice for FF Harbour owners is a gamble... pay up now to walk away ...or... risk paying them much, much more in fees if they're able to take control of the HOA.

At least Wyndham is offering to let FF Glade owners either walk away soon without fees, or hold on until it's sold, or accept a swap to CWA. These are all better than what's happening at FF Harbour. From a much earlier post on this thread, the one remaining Lake Lure (FF Mountains) section that's still managed by Wyndham (Maple Ridge?) has their HOA considering dropping Wyndham and switching to management by Capital Vacations... an exceedingly poor choice, I'm afraid.

 

[Rolltydr]

This is not how Wyndham markets their timeshares. Isn't there a class action lawsuit against Wyndham for false advertising (like claims that buying a timeshare is an "investment")? Are Wyndham's business practices some of the reason why so many timeshare exit companies exist? If all I want is to be a customer when staying in a place to sleep, isn't that the definition of a making a reservation (even in Wyndham properties). T&L may be the driving force behind closing under-performing locations. Supposedly, new locations in Chicago and Boston are the main focus moving forward.

Another lawsuit. Look back over the last 25-30 years and let us know how many lawsuits against Wyndham have been successful.

 

[Rolltydr]

Chicago and Boston are the main focus moving forward.

Great! I’d love to visit Chicago again and I’ve never been to Boston. Some great historical sites there and I’m a lifelong Celtics fan so maybe I could take in a game!

 

[Twenty20]

I think it was early on when we first heard about the resort closures that someone related to a board member for the FG Community Association posted about the dues in one of the Facebook groups. That the Wyndham pays $1M in dues, probably more I'm guessing based on what you posted. How that's going to be a big shortfall for the Association to have to pass on to everyone owning there.

It's likely ownership of those lots goes back to the Fairfield days. If there was a good market you'd think Wyndham would have either built by now or divested the company of them.

So the area that those lots are held in, has yet to ever be developed. It was platted and lots sold way back in the 70s and 80s under the original Fairfield developer. It's a complicated history, developer bankruptcies, etc.

 

[Twenty20]

Well that certainly is fascinating new information.

I wonder if that Wyndham liability could or will somehow be deducted from any proceeds of the sale of the developed properties and screw over owners.

I'm sure there's an escape provision or payoff required by Wyndham to the developer or whomever is the recipient of those dues currently. And if Wyndham has never exercised that option then that fee must be substantial, or if their only other escape option was to end the timeshare enterprise at this location in it's entirety.

Anyone who has been to this location knows there's really no jobs there, and such, demand for new residential housing units is also nonexistent.

Crossville is in the middle of nowhere, about dead inbetween Nashville and Knoxville. Too far away (1.5-2 hours) to be a commute option to either location.

The lot issue has absolutely nothing to do with the timeshares. It is a bigger issue for the local community club that operates all the amenities in that community (golf courses, lakes, etc).

FF Glade has continued to grow at a pretty stable, consistent pace for decades. They build about 100-150 new homes per year there. It's almost exclusively a retirement community.

 

[zeld]

If Wyndham received the deed when converting from week to points (which is questioned above) then they would be responsible for paying the maintenance fee yearly even after they stop managing the resort. What happens???

1. The county or state taxes on the deeds are not paid and the county or state has a process to collect unpaid taxes. Many will put the property up for auction. What other options are there?

2. Does the timeshare have the ability to take over ownership of a deed that is not paying yearly maintenance fees? Then who would actually own the deed?

3. My understanding is that the timeshare is owned by the deed holders. There is an elected team who meets yearly and decides on the needs of the timeshare. Any decisions are made by deed holders although most of the deed holders pass their vote to the team. If a single company owns over or near half of the votes, they would be able to win every vote.

4. If there is a bankruptcy and there is a buyer paying for the timeshare, then does any excess money go to the deed holders? What if the deed holder was not current on paying maintenance yearly fees?

Thanks

 

[comicbookman]

If Wyndham received the deed when converting from week to points (which is questioned above) then they would be responsible for paying the maintenance fee yearly even after they stop managing the resort. What happens???

1. The county or state taxes on the deeds are not paid and the county or state has a process to collect unpaid taxes. Many will put the property up for auction. What other options are there?

2. Does the timeshare have the ability to take over ownership of a deed that is not paying yearly maintenance fees? Then who would actually own the deed?

3. My understanding is that the timeshare is owned by the deed holders. There is an elected team who meets yearly and decides on the needs of the timeshare. Any decisions are made by deed holders although most of the deed holders pass their vote to the team. If a single company owns over or near half of the votes, they would be able to win every vote.

4. If there is a bankruptcy and there is a buyer paying for the timeshare, then does any excess money go to the deed holders? What if the deed holder was not current on paying maintenance yearly fees?

Thanks

I have a couple of deeds that have been converted to points. I retain ownership of the deeds.
1. Why would the county and state taxes not get paid?

2. The timeshare can foreclose on a deed if maintenance fees are not being paid.

3. Yes

4. If the deed holder was not current, any money dispersed would have the amount owed deducted from the disbursement. If money is still owed, they can be sued for the balance owed, just like anybody else that owes the timeshare money.

 

[dioxide45]

Quorum requires 20% of owners' total votes...measures pass with 67% of vote
Wyndham voted 1880 out of 2038 "yes" votes (there were 26 "no" votes).

Wyndham obviously started the process to sell knowing the likelihood of passing the bankruptcy measure based on their controlling interest and the likelihood of poor owner voting. Even if all other owners voted "no", and the bankruptcy measure did not pass, Wyndham was not going to renew their contract with ORIC. ORIC was essentially dead in the water as a points-based system unless it found another management company (which is unlikely to happen without $5 million in renovations/updates).

I live in a deed restricted community governed by a HOA. That's the way it is for us when we have to make material changes to the HOA Covenants. It requires a supermajority of owners.

Not percentage of recorded votes, but it requires a 60% or more recorded vote of all owners. It would be crazy to think that such a substantive change could be made by "we have a quorum, now we need only 65% of recorded votes" to pass.

HOA's in Florida by law have a 30 year sunset clause and we went throught this about 10 years ago, we had to hold the vote 3 times because we could not get an acceptable number of owners to even place their vote on the topic. Each time, the number of votes in favor of maintaining the deed restrictions passed overhwelmingly but we did not have the number of total votes required for the vote to be considered valid.

This varies wildly by state and the governing documents of the HOA itself dictate a lot of these terms. Who knows what the terms are in these affected HOA's.

I think the difference here was that it wasn't a vote to terminate or sunset the property. It was a vote for bankruptcy and probably doesn't have the same high threshold. This seems to be an attempt to sidestep the actual formal processes of closing the resort. They have to convince a judge that this is the proper way to go about it. Will a bankruptcy judge allow them to close the resort in such a manner that may not be in line with Florida law and without the votes that may have be required if they hadn't gone the bankruptcy route? If this were such an easy way out, why don't more old resorts do this instead of going through the process outlined in the CC&R and under Florida Law?

 

[comicbookman]

I think the difference here was that it wasn't a vote to terminate or sunset the property. It was a vote for bankruptcy and probably doesn't have the same high threshold. This seems to be an attempt to sidestep the actual formal processes of closing the resort. They have to convince a judge that this is the proper way to go about it. Will a bankruptcy judge allow them to close the resort in such a manner that may not be in line with Florida law and without the votes that may have be required if they hadn't gone the bankruptcy route? If this were such an easy way out, why don't more old resorts do this instead of going through the process outlined in the CC&R and under Florida Law?

My guess is that there are enough delinquent owners to convince a judge that this is the best way to go. Of course that is pure speculation on my part. Wyndham has very good lawyers, so I am sure they have no doubt they will be able to proceed.

 

[chapjim]

I think the difference here was that it wasn't a vote to terminate or sunset the property. It was a vote for bankruptcy and probably doesn't have the same high threshold. This seems to be an attempt to sidestep the actual formal processes of closing the resort. They have to convince a judge that this is the proper way to go about it. Will a bankruptcy judge allow them to close the resort in such a manner that may not be in line with Florida law and without the votes that may have be required if they hadn't gone the bankruptcy route? If this were such an easy way out, why don't more old resorts do this instead of going through the process outlined in the CC&R and under Florida Law?

The OIRC vote was about whether to file Chapter 11 bankruptcy to facilitate the sale of the entire resort. There's no reason to think that a resort organized in Florida under Florida law and which engaged a Florida law firm is trying to circumvent Florida law. The threshholds for a quorum (20% of owners) and to decide an issue (66.67% of voters present in person or by proxy) were in the resort's By-Laws, which presumably were compliant. Rather than sidestepping formal processes, it establishes formal processes, all under the supervision of the Bankruptcy Court.

Chapter 11 bankruptcy freezes things financially -- an automatic stay provides a period of time in which all judgments, collection activities, foreclosures, and repossessions of property are suspended and may not be pursued by the creditors on any debt or claim that arose before the filing of the bankruptcy petition. Chapter 11 does not discharge debts.

I don't think this was an "easy way out" for OIRC. Chapter 11 is complex and expensive but should provide a more orderly way out if not an easy way out.

Edit: It is OIRC (Orlando International Resort Club) not ORIC.

 

[dioxide45]

The OIRC vote was about whether to file Chapter 11 bankruptcy to facilitate the sale of the entire resort. There's no reason to think that a resort organized in Florida under Florida law and which engaged a Florida law firm is trying to circumvent Florida law. The threshholds for a quorum (20% of owners) and to decide an issue (66.67% of voters present in person or by proxy) were in the resort's By-Laws, which presumably were compliant. Rather than sidestepping formal processes, it establishes formal processes, all under the supervision of the Bankruptcy Court.

Chapter 11 bankruptcy freezes things financially -- an automatic stay provides a period of time in which all judgments, collection activities, foreclosures, and repossessions of property are suspended and may not be pursued by the creditors on any debt or claim that arose before the filing of the bankruptcy petition. Chapter 11 does not discharge debts.

I don't think this was an "easy way out" for OIRC. Chapter 11 is complex and expensive but should provide a more orderly way out if not an easy way out.

Edit: It is OIRC (Orlando International Resort Club) not ORIC.

Do you know if the condo governing documents had a provision for closing and divesting the property or some other sunset clause?

The property also didn't seem to actually be bankrupt. They, in fact, stated in their letter that they were financially stable. It does seem like a way to sidestep other processes for shutting down a property. Perhaps this is just another way to do it but if this is an option, why don't other properties go the same route?

 

[paxsarah]

There's been a bit of discussion/wondering here and on Facebook about the CWA offer along the lines of - how much CWA inventory does Wyndham actually own? Inspired by the extreme detail in the Kingsgate financial report I received this week, I wondered if the information was available in the PTVO financial documents that are on the Club Wyndham website - and it is! Wyndham owns over 7 billion CWA points, out of over 51 billion total points that comprise CWA.

 

[dioxide45]

There's been a bit of discussion/wondering here and on Facebook about the CWA offer along the lines of - how much CWA inventory does Wyndham actually own? Inspired by the extreme detail in the Kingsgate financial report I received this week, I wondered if the information was available in the PTVO financial documents that are on the Club Wyndham website - and it is! Wyndham owns over 7 billion CWA points, out of over 51 billion total points that comprise CWA.

View attachment 114707

What does that translate into in terms of inventory through sales? I know Marriott Vacations wants to have about 18 to 24 months of inventory. I would suspect other developers like to keep something similar. This allows them a buffer to continue to sell while they work on other projects to add more points or re-aquire inventory (foreclosure and Certified Exit) to then convey to the CWA trust to sell. I suspect 7 billion points is a lot. We really don't know how much that will be cut after the property divestures and CWA conversion.

 

[HitchHiker71]

Do you know if the condo governing documents had a provision for closing and divesting the property or some other sunset clause?

The property also didn't seem to actually be bankrupt. They, in fact, stated in their letter that they were financially stable. It does seem like a way to sidestep other processes for shutting down a property. Perhaps this is just another way to do it but if this is an option, why don't other properties go the same route?

The scuttlebut on the reasoning for the OIRC bankruptcy was due to an explicit bylaw that essentially required a unanimous vote to sell the resort. Since that would be all but impossible to meet, the bankruptcy route was the most expedient option as that only required a 2/3 ownership vote in comparison. This bylaw requirement specific to selling the resort does not exist for the other impacted resorts from what I've observed, at least to date, nothing along this line has been mentioned by anyone either here on TUG or elsewhere whether publicly or privately.

 

[dioxide45]

The scuttlebut on the reasoning for the OIRC bankruptcy was due to an explicit bylaw that essentially required a unanimous vote to sell the resort. Since that would be all but impossible to meet, the bankruptcy route was the most expedient option as that only required a 2/3 ownership vote in comparison. This bylaw requirement specific to selling the resort does not exist for the other impacted resorts from what I've observed, at least to date, nothing along this line has been mentioned by anyone either here on TUG or elsewhere whether publicly or privately.

That seems to make sense. Thanks for clarifying.

 

[CO skier]

Thanks for this posting. I looked into it as a result. My offer on an eBay auction for Bentley Brook that had expired (not one of those two, though) without any bidding interest was accepted, and now I may have a ticket to ride.

Update on the eBay auction a month ago from the broker -- flaky sellers. I am sure it would have been interesting, had it worked out.

"Good morning, I'm reaching out to you regarding the transfer for this property. We've been trying to get a hold of the sellers who are an older couple and they have not been responding. We've tried for a few weeks with no luck so the transfer agent wants to cancel this transfer so that it doesn't become further delayed."

 

[bnoble]

I don't when and how Wyndham consolidated its interest in ORIC, but ORIC was likely much more valuable to Wyndham prior to Bonnet Creek being built. Wyndham stands to make $10 million (or more) from the sale. Considering that Wyndham likely received many deeds for little or no consideration, ORIC actually worked out very well for Wyndham. Its the original owners (who bought from the developer) who lost thousands.

Timeshares work really well for the developers and management companies, but a 95% loss of initial investment (for those who bought in the 1980s), under an HOA, is simply not an acceptable outcome.

First, I'd dispute the idea that OIRC was "much more valuable" to Wyndham at any point in its history. It gives off failed-condo-turned-timeshare vibes, in a middling area of a town in which you cannot swing a dead cat without hitting a timeshare. I've booked a stay there, and it's not horrible for a Universal-area visit, but even then I'd rather be at any of a half-dozen other timeshares in that end of town.

But, I'll bite: Let's suppose Wyndham never entered the OIRC picture. In such an alternate universe, what is the best possible realistic outcome for those original owners? Because I don't think there are many such universes in which such owners sell a week for more than $5K in the Year of Our Lord, 2025.

That's not to say that such owners never got anything out of it. Hopefully they had many decades of vacations that they enjoyed. And, if they did, they probably got their money's worth. Could they have done it less expensively? Sure! But that doesn't mean they didn't get some value.