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Apollo Group looking to buy HGVC [Merged]

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ocdb8r

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Trust products are a double-edged sword for both developers and buyers. They have some real advantages from a sustainability point (in my opinion) as the default risk is spread out among a much larger base of owners/resorts.

Developers
  • + Trust arrangements allow more control over the long term
  • + Trust products allow nearly infinite packages to sell
  • + Trust products allow a more stable sales cycle and infrastructure (not tied to the start/stop/finish cycle of individual resort projects)
  • + Trust products spread default risks across a broader pool
  • - Trust products are harder to manipulate pricing based on individual resort attractiveness (main lever is elevating number of points required for newer resorts but there is (some) pressure on this lever to avoid alienating current customers...I know many of the developers do it, but it always with lots of screaming).
  • - Trust products require a more robust legal arrangement
  • - Trust products are harder to sell as "deeded property" (which used to be a selling point for timeshares, but I think most consumers could care less at this point).
Owners (or Prospective owners)
  • + Trust products spread default risk across a broader pool
  • + Trust products are able to be designed to better reflect supply/demand dynamics and seasonality (someone occupying week 52 in Lake Tahoe is not paying the same maintenance fee as someone occupying (mud) week 18)
  • + Trust products allow greater resort diversity and usually more flexible vacation lengths (points overlays also allow this, but not to the same extent as a true trust product)
  • - Trust products entrench developers more and reduce owner rights/powers
  • - Trust products spread resort costs across a broader pool (this can be a win or lose depending on what resorts you actually vacation at)
I don't think they are all good or all bad. For many of us longer term timeshare owners who have been able to maximize our ownership via trading lower value weeks for higher value weeks or focusing on weeks with the lowest (overlay) points/maintenance fee ratio, trust products take some of the fun out of the game.
 

Cyberc

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Trust products are a double-edged sword for both developers and buyers. They have some real advantages from a sustainability point (in my opinion) as the default risk is spread out among a much larger base of owners/resorts.

Developers
  • + Trust arrangements allow more control over the long term
  • + Trust products allow nearly infinite packages to sell
  • + Trust products allow a more stable sales cycle and infrastructure (not tied to the start/stop/finish cycle of individual resort projects)
  • + Trust products spread default risks across a broader pool
  • - Trust products are harder to manipulate pricing based on individual resort attractiveness (main lever is elevating number of points required for newer resorts but there is (some) pressure on this lever to avoid alienating current customers...I know many of the developers do it, but it always with lots of screaming).
  • - Trust products require a more robust legal arrangement
  • - Trust products are harder to sell as "deeded property" (which used to be a selling point for timeshares, but I think most consumers could care less at this point).
Owners (or Prospective owners)
  • + Trust products spread default risk across a broader pool
  • + Trust products are able to be designed to better reflect supply/demand dynamics and seasonality (someone occupying week 52 in Lake Tahoe is not paying the same maintenance fee as someone occupying (mud) week 18)
  • + Trust products allow greater resort diversity and usually more flexible vacation lengths (points overlays also allow this, but not to the same extent as a true trust product)
  • - Trust products entrench developers more and reduce owner rights/powers
  • - Trust products spread resort costs across a broader pool (this can be a win or lose depending on what resorts you actually vacation at)
I don't think they are all good or all bad. For many of us longer term timeshare owners who have been able to maximize our ownership via trading lower value weeks for higher value weeks or focusing on weeks with the lowest (overlay) points/maintenance fee ratio, trust products take some of the fun out of the game.
From your post it seems that its only the developers that have something to gain by doing this.

Selling bundled products with crappy weeks with high value weeks gives you at best a mediocre product. I can see why developers want to do it, they can put in the silver weeks and a few platinum weeks and sell those.

Its a win-win for the developers and a lose-lose for the buyer.

This might have been covered already in the lengthy thread but what are the risks for current owners if a trust product is introduced? Will we still be able to book our home resort as we normally do in club season and at 12 months?
 

Ralph Sir Edward

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From your post it seems that its only the developers that have something to gain by doing this.

Selling bundled products with crappy weeks with high value weeks gives you at best a mediocre product. I can see why developers want to do it, they can put in the silver weeks and a few platinum weeks and sell those.

Its a win-win for the developers and a lose-lose for the buyer.

This might have been covered already in the lengthy thread but what are the risks for current owners if a trust product is introduced? Will we still be able to book our home resort as we normally do in club season and at 12 months?
It all depends no how the trust is set up.

A Marriott style trust setup would wreck the current home resort system. Who knows how the possible trust would be set up?

A pure trust system would have no conflict, as there would be no legacy ownership to worry about. Everybody would have equal access (as defined) to all inventory.

The real set of headaches is with the "hybrid" systems. How do you balance the rights of week owners with the rights of trust owners? In other words, how do you settle the conflict between trust owner and week owner over a single week? I will compare current HGVC system with Marriott.

HGVC settles the issue simply by giving the week owner an initial priority over the Points user, (Think of the HGVC points system as a sort of a points trust.) with a 3 month home week preference. This way, if you paid for a high valued week, like Hawaii (that you are paying high priced MFs for), you get first crack at the inventory. (Why not? You are paying for the privilege. . .) The drawback, of course, is the points (trust) users get the "leftovers".

The Marriott system works just the opposite. It gives the Trust system the first crack at the inventory. (This is controversial, but it is what I have personally observed, so I stand by my heresy.) There is a pecking order with Marriott, post Trust, as follows. The more weeks, the higher in the pecking order. The Trust effectively gets the first crack at inventory. (After all, their reservation computer program could "kick off" faster than any external person. How they actually reserve is a "black box"; nobody but MVC really knows how they do their DC reservations; nor is there any way to do an external "audit" of what they say.)

Of the inventory not allocated to the DC Trust, there are two window for reservations - the 13 month reservation and the 12 month reservation. Half the inventory is allocated to the 13th month window and half is allocated to the 12 month window. The 13th month reservation is for multiple week owners only, plus they have the right to reserve a reservation chain starting at the first week available at the 13th month. (reservation chain - I own say 4 weeks. I can book a week at the 13th month window and then book the other weeks, into the future, one week after the other. Advantage? I want an ultra high value week, say spring break. I start the chain 4 week in advance of the spring break week. Voila! I booked the spring break week in advance of everybody who doesn't have 4 weeks (or more). I then free up the first three weeks to make other, less valuable reservations.) The 12 month window is for everybody.

So the pecking order is Trust (black box), multiweek owners (with a pecking order inside of multiweek owners based on the number of week owned) , who have 2 windows to reserve with (access to all non trust reserved inventory), and single week owners who get only the access to 12 month window (1/2 of the non Trust inventory) competing with any residual demand from the multi week owners.

What would the HGVC merged "trust" look like? I don't know.

And what about affiliates? I did ask the President of Bay Club, and got a political answer back - much talk but no actual answer to the question. (The question was - would non-HGVC owners (it's an affiliate, remember, HGVC membership is not required) still have a owner's window, if HGVC went to something like a Marriott system.)
 

JIMinNC

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The Marriott system works just the opposite. It gives the Trust system the first crack at the inventory. (This is controversial, but it is what I have personally observed, so I stand by my heresy.) There is a pecking order with Marriott, post Trust, as follows. The more weeks, the higher in the pecking order. The Trust effectively gets the first crack at inventory. (After all, their reservation computer program could "kick off" faster than any external person. How they actually reserve is a "black box"; nobody but MVC really knows how they do their DC reservations; nor is there any way to do an external "audit" of what they say.)

Of the inventory not allocated to the DC Trust, there are two window for reservations - the 13 month reservation and the 12 month reservation. Half the inventory is allocated to the 13th month window and half is allocated to the 12 month window. The 13th month reservation is for multiple week owners only, plus they have the right to reserve a reservation chain starting at the first week available at the 13th month. (reservation chain - I own say 4 weeks. I can book a week at the 13th month window and then book the other weeks, into the future, one week after the other. Advantage? I want an ultra high value week, say spring break. I start the chain 4 week in advance of the spring break week. Voila! I booked the spring break week in advance of everybody who doesn't have 4 weeks (or more). I then free up the first three weeks to make other, less valuable reservations.) The 12 month window is for everybody.

So the pecking order is Trust (black box), multiweek owners (with a pecking order inside of multiweek owners based on the number of week owned) , who have 2 windows to reserve with (access to all non trust reserved inventory), and single week owners who get only the access to 12 month window (1/2 of the non Trust inventory) competing with any residual demand from the multi week owners.
I think you are correct that the Trust bookings/allocations are likely automated and they probably get their units reserved/allocated for any given week before most owners have the option to click "Reserve". However, based on information that has been posted on the TUG Marriott board over the years by a couple of TUGgers who seem to have had a contact of some sort within MVC management, they have been told that the Trust only is allowed to reserve proportional to their ownership of that particular component. In other words, if the Trust owns 40% of the Platinum season 2BR Ocean Front units at Hilton Head Grande Ocean, for any given week, they will allocate no more than 40% of the intervals for Trust owners, since that is proportional to their ownership. As you say, though, it is a "black box" and we have no way to conclusively audit exactly how they ARE doing it. I will say though, that over the last several years, I have been able to easily book prime time Maui whale season weeks with both our deeded weeks and our MVC points, and have seen no evidence that MVC sucks up all of the good weeks for the Trust and leaves the dregs for deeded week bookings.
 

JIMinNC

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This might have been covered already in the lengthy thread but what are the risks for current owners if a trust product is introduced? Will we still be able to book our home resort as we normally do in club season and at 12 months?
No one knows how they would set it up if they ever did do a Trust, but here is one way they could do it within the current HGVC structure:
  • They set up a US land trust into which they transfer all unsold weeks. At resorts that are sold out, the initial supply of weeks would be those they have reacquired through upgrades, ROFR, foreclosure, etc., so it would likely be a mix of all seasons, views, and unit types. At resorts where they are still actively selling "new" inventory, it would be whatever hasn't been sold, and the mix would depend upon what has already been sold.
  • All new resorts would go 100% into the Trust.
  • They could increase ROFR and/or buybacks to seed more attractive inventory into the Trust, focusing on resorts with limited inventory to make the Trust product more attractive to sell.
Once the Trust is set up and seeded with weeks, here is one way booking could work within the HGVC system.
  • Trust pool owners would have home resort priority for any inventory owned by the Trust from 12-9 months.
  • If the Trust owned 20% of a given unit type/season at a resort, once Trust owners booked 20% of the matching inventory at that resort, all home week availability for Trust owners would be gone. Given the way Hilton releases inventory, this allocation may have to be done on a week-by-week basis.
  • At nine months, the remaining Trust owned inventory would become available for club bookings just as happens today.
  • Existing deeded weeks owners would retain their home resort and club booking rights just as they do today.
 

terces

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If they go they decide to incorporate a Trust I can imagine that there will be numerous efforts to not only push the deeded owners to convert, but also to charge substantial fees for conversion, possibly by packaging extra benefits. Has this happened in MVC or elsewhere?
 

JIMinNC

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If they go they decide to incorporate a Trust I can imagine that there will be numerous efforts to not only push the deeded owners to convert, but also to charge substantial fees for conversion, possibly by packaging extra benefits. Has this happened in MVC or elsewhere?
In MVC you don't "convert" to the Trust. Legacy weeks owners can "enroll" in the points system (weeks owned prior to the 2010 launch of the Trust/points system) for a fee and sometimes even for free as an incentive to attend a presentation. This does not require the pre-2010 owner to surrender their deed and convert to Trust points. They still own what they have always owned, they just receive a points allocation for their week and can elect to convert their week to MVC Points in any given year if they so choose. That conversion effectively deposits their week for that year into an exchange pool along with the Trust-owned weeks, but they still own their deed. Resale weeks acquired after June 2010 are generally not eligible to "enroll" and can only be used as home weeks or for Interval International trades. MVC does offer enrollment specials for these post-2010 resale weeks from time-to-time, but those generally require purchase of at least 3000 Trust points at $12-$14/point ($35K+).

MVC no longer sells weeks in the U.S., so whenever current weeks owners go to a sales presentation, they are pitched Trust points as the way to add-on to their ownership. At least to date, I do not think that MVC has actively pursued the "trade-in your deed" sales approach. The Vistana side of their business (Westin and Sheraton Vacation Club) does use the trade-in approach, I believe, to upgrade their owners from deeded weeks to their Flex Trust products. It remains to be seen if, now that MVC and Vistana have common corporate ownership, whether the trade-in angle gets some traction on the MVC side.
 

ski_sierra

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I think you are correct that the Trust bookings/allocations are likely automated and they probably get their units reserved/allocated for any given week before most owners have the option to click "Reserve". However, based on information that has been posted on the TUG Marriott board over the years by a couple of TUGgers who seem to have had a contact of some sort within MVC management, they have been told that the Trust only is allowed to reserve proportional to their ownership of that particular component. In other words, if the Trust owns 40% of the Platinum season 2BR Ocean Front units at Hilton Head Grande Ocean, for any given week, they will allocate no more than 40% of the intervals for Trust owners, since that is proportional to their ownership. As you say, though, it is a "black box" and we have no way to conclusively audit exactly how they ARE doing it. I will say though, that over the last several years, I have been able to easily book prime time Maui whale season weeks with both our deeded weeks and our MVC points, and have seen no evidence that MVC sucks up all of the good weeks for the Trust and leaves the dregs for deeded week bookings.
It's good to see that MVC is being fair to all owners but I don't understand how this behavior aligns with MVC's business model. Marriott seasons often include a bunch of weeks that are not platinum at all. I think at Park City, some weeks are platinum when the ski resort is not even open. This variation in platinum-ness can be seen clearly in the DC points chart. Since a large % of the revenue comes from current owners and they want to sell Trust points, it would make sense for them to provide all the true platinum weeks to the trust owners to keep them happy. Leave the junk platinum inventory for the weeks owners. It is really hard to see why they would continue to be fair to weeks owners. In fact, it would make more business sense to make it difficult for unenrolled owners to book the true platinum weeks and tell them if they want to book the real platinum weeks, they need to spend tens of thousands to buy into the trust. Then repeat the process when the owner sells the week to someone else since enrollment doesn't transfer with resale. They have been fair so far but it is difficult to rationalize why they would continue to be fair in future. Unless there is some legal reason to do so.

I feel a lot safer with HGVC. My week is fixed and they cannot screw me out of usage even if they came up with a trust.
 

terces

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In MVC you don't "convert" to the Trust. Legacy weeks owners can "enroll" in the points system (weeks owned prior to the 2010 launch of the Trust/points system) for a fee and sometimes even for free as an incentive to attend a presentation. This does not require the pre-2010 owner to surrender their deed and convert to Trust points. They still own what they have always owned, they just receive a points allocation for their week and can elect to convert their week to MVC Points in any given year if they so choose. That conversion effectively deposits their week for that year into an exchange pool along with the Trust-owned weeks, but they still own their deed. Resale weeks acquired after June 2010 are generally not eligible to "enroll" and can only be used as home weeks or for Interval International trades. MVC does offer enrollment specials for these post-2010 resale weeks from time-to-time, but those generally require purchase of at least 3000 Trust points at $12-$14/point ($35K+).

MVC no longer sells weeks in the U.S., so whenever current weeks owners go to a sales presentation, they are pitched Trust points as the way to add-on to their ownership. At least to date, I do not think that MVC has actively pursued the "trade-in your deed" sales approach. The Vistana side of their business (Westin and Sheraton Vacation Club) does use the trade-in approach, I believe, to upgrade their owners from deeded weeks to their Flex Trust products. It remains to be seen if, now that MVC and Vistana have common corporate ownership, whether the trade-in angle gets some traction on the MVC side.
So has the result of all this with MVC been a devaluing of the resale value of fixed weeks?? I do know that MVC charges a monster activation fee of approximately $3 per point for any resales, which probably suppresses the resale value a lot. Is there any value to the MVC weeks now, or are they a throw-away?
 

ski_sierra

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So has the result of all this with MVC been a devaluing of the resale value of fixed weeks?? I do know that MVC charges a monster activation fee of approximately $3 per point for any resales, which probably suppresses the resale value a lot. Is there any value to the MVC weeks now, or are they a throw-away?
If I had to guess, only 5% of Marriott weeks are worth > $10k. A fixed week 51, 52 in Hawaii or ski resorts is certainly valuable. Weeks that require a large amount of DC points are also valuable.

I think more than 50% of Marriott weeks are worth less than $5k because Marriott has higher MF than HGVC and resale buyers are not treated well. A good 25% of those are negative value because they are low season with high MF. You can stay @ Marriotts in low season easily with exchanges or getaways.

But usage value is different than monetary value. I own a Marriott junk week which is valuable to me because of the exchange preference but it doesn't have much monetary value (< $2k).
 

CalGalTraveler

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One thing that is interesting about MVC is that weeks that are enrolled in their points program (equivalent to HGVC points associated with a deed) can be worth more than the underlying week because those points can be rented out from ANY MVC property (unlike HGVC, and Vistana which limit you to your home week). This incents many long-time owners of worthless weeks from deeding back and defaulting because they can get a lot more value through use, or by instantly renting out their points to other owners without having to be a landlord. Similarly, if you own a base level of points in their trust, you can rent points from other owners. This is an added dimension to MVC points which is attractive.
 
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ski_sierra

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One thing that is interesting about MVC is that weeks that are enrolled in their points program (equivalent to HGVC points associated with a deed) can be worth more than the underlying week because those points can be rented out from ANY MVC property (unlike HGVC, and Vistana which limit you to your home week). This incents many long-time owners of worthless weeks from deeding back and defaulting because they can get a lot more value through use, or by instantly renting out their points to other owners without having to be a landlord. Similarly, if you own a base level of points in their trust, you can rent points from other owners. This is an added dimension to MVC points which is attractive.
Another thing to consider is reservations with MVC points are pretty expensive. Atleast 5k points for 2 BR in peak season. Often times you can do better by renting it straight from Redweek instead of renting points from another owner. Using points for low season or low points weeks also has limited value since you can exchange into most low season resorts easily or stay on a getaway. Unless you want to stay in a studio. One Marriott studio stayed in was hardly better than a hotel room so I am not too keen on doing that.

MVC points have some niche use cases but when I looked into it, the cost benefit ratio was not very attractive for me and I felt I could do better in other programs. I feel the best time to buy Marriott was over 10 years ago.
 

CalGalTraveler

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In HGVC all properties are automatically enrolled in the points program with the initial points activation fee.

In MVC, weeks enrollment in their points program is optional and can be pricey requiring a purchase during a presentation of their pure "DC" points trust in addition to re-qualifying the resale property in the points trading system.

Many MVC weeks are falling out of their points trust inventory because enrolled points owners sell and the resale buyers aren't automatically re-enrolled like HGVC.

It wouldn't surprise me if MVC offers a mass re-enrollment campaign to get more weeks inventory available in their system, in conjunction with integrating the Vistana network (I hope I will be able to enroll my Westin unit to participate.)
 
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ski_sierra

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Many MVC weeks are falling out of their points trust inventory because enrolled points owners sell and the resale buyers aren't automatically re-enrolled like HGVC.

It wouldn't surprise me if MVC offers a mass re-enrollment campaign to get more weeks inventory available in their system, in conjunction with integrating the Vistana network (I hope I will be able to enroll my Westin unit to participate.)
What would be MVC's angle in offering this type of enrollment? How does that enable them to extract more money from current and new owners? I think majority of new owners don't buy based on any research (why would they buy direct if they did their research?) so there is no reason for the trust to acquire good weeks. The resale weeks owners who bought previously enrolled weeks probably bought for a reason and most of them wouldn't buy trust points from Marriott anyway unless they are pursuing some type of high volume enrollment of weeks.
 

CalGalTraveler

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What would be MVC's angle in offering this type of enrollment? How does that enable them to extract more money from current and new owners? I think majority of new owners don't buy based on any research (why would they buy direct if they did their research?) so there is no reason for the trust to acquire good weeks. The resale weeks owners who bought previously enrolled weeks probably bought for a reason and most of them wouldn't buy trust points from Marriott anyway unless they are pursuing some type of high volume enrollment of weeks.
Two reasons:

1) Fast, low risk money with high profit margin.
2) Network effects - obtaining more properties as trust inventory - potential upsell later for enrolled user after taking a bite of the points apple.

There has been a discussion on the MVC board but ultimately they have two choices with the Vistana integration:

1) Drip approach - convince owners one by one in a presentation to enroll and buy DC points for high $$$$.
Risks: We could be in a recession sometime in the near future. People will not spend.
Those who would have converted at this price already have; market is saturated.
Presentations are expensive margin-wise.

2) Low fee mass enrollment: Charge a low fee to gain mass conversion.
e.g. to your point, many Maui owners like us and MOC owners bought to use but would like to occasionally trade but don't want to trade full weeks in II. We want to rent out our points at times (I wouldn't mind renting out points instantly, but being a landlord is a hassle). The price tag in #1 is not justified but #2 might be worthwhile for these occasional trades.

someone ran a calculation on the MVC board that found if MVC could create a digital campaign to mass convert a significant portion of the remaining 40% of unenrolled MVC weeks plus Vistana, it could add up
to $400 million to their topline every year with high profit = easy money. Low risk.
 
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CalGalTraveler

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Here is the quote I was referencing in my prior post about mass enrollment:

More people paying DC fees is good for the company and probably good for everyone. If 200,000 unrolled owners suddenly pay $200 a year in DC fees, this is 400 million dollars that go straight to the earnings in the next 10 years. If they charge $1k for enrollment it adds another 200 millions to their bottom line right away! Does anyone know what kind of growth, what kind of effort they need to match that from the traditional sales?
To put things in prospective, they make about 150 millions in earnings from selling VOIs. If they increase their sales by 10% they will earn an additional 15 millions a year.
 

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Interesting analysis. Let's see how this plays out.

Meanwhile, I hope HGVC program doesn't get destroyed by a new owner.
 

JIMinNC

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So has the result of all this with MVC been a devaluing of the resale value of fixed weeks?? I do know that MVC charges a monster activation fee of approximately $3 per point for any resales, which probably suppresses the resale value a lot. Is there any value to the MVC weeks now, or are they a throw-away?
I was not a Marriott owner prior to the advent of points in 2010, but based on stuff I’ve read on the Marriott board here, resale weeks tended to sell for more 10 years ago. But the Great Recession tanked values too, so you can’t attribute all the decline to the points system. The fact that points don’t convey with resales probably has helped keep values from recovering fully from the recession-induced drop.

As far as values today, Hawaii MVC annual weeks sell for $10k to over $35k depending on resort and view, etc. The bigger Hilton Head resorts sell for $7k to $25k for Gold and Platinum OS/OV/OF. Aruba is in the same range. Those are the ones I’m most familiar with, but most Platinum and even some Gold MVC weeks at the major resorts sell for a minimum of $5k to $10k and up to $25K.

One clarification, the $3 per point fee to MVC on resales only applies to resale Trust points, not resale weeks. Since points don’t convey when weeks are resold, there is no such fee. Only a $95 ROFR waiver fee and a $25 transfer fee.
 
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JIMinNC

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If I had to guess, only 5% of Marriott weeks are worth > $10k. A fixed week 51, 52 in Hawaii or ski resorts is certainly valuable. Weeks that require a large amount of DC points are also valuable.

I think more than 50% of Marriott weeks are worth less than $5k because Marriott has higher MF than HGVC and resale buyers are not treated well. A good 25% of those are negative value because they are low season with high MF. You can stay @ Marriotts in low season easily with exchanges or getaways.
I think the 5% number is way low for values over $10k. Most if not all EY Hawaii weeks top that number if they are OV or OF, not just holiday weeks. Platinum OF/OV weeks in Hilton Head, Aruba, St Thomas, St Kitts, FL Palm Beaches, and Newport Coast should also be over $10k, I think. Platinum ski weeks probably are also, but I don’t really follow those. But given the percentage of MVC locations covered by the real noted above, I think the number may be closer to 25% than 5%.

My experience has always been that HGVC and MVC resale weeks seem reasonably comparable in price, but since so much HGVC is concentrated in Orlando, Vegas, Big Island, and Waikiki, it’s hard to compare apples to apples with MVC’s more extensive geographic reach.
 
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JIMinNC

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Since a large % of the revenue comes from current owners and they want to sell Trust points, it would make sense for them to provide all the true platinum weeks to the trust owners to keep them happy. Leave the junk platinum inventory for the weeks owners. It is really hard to see why they would continue to be fair to weeks owners. In fact, it would make more business sense to make it difficult for unenrolled owners to book the true platinum weeks and tell them if they want to book the real platinum weeks, they need to spend tens of thousands to buy into the trust. Then repeat the process when the owner sells the week to someone else since enrollment doesn't transfer with resale. They have been fair so far but it is difficult to rationalize why they would continue to be fair in future. Unless there is some legal reason to do so.
What you have to remember is that for all practical purposes points used by an enrolled owner function exactly like Trust points in the MVC system. Both varieties of points generally get co-mingled in the internal Exchange pool, so Trust owners are not limited to booking just the weeks allocated to the Trust ownership, and enrolled owners are not just limited to weeks deposited into the pool by other enrolled owners. Basically any person using MVC Points has access to the Trust inventory as well as the enrolled inventory that owners opt to elect for points. So that tends to expand the availability of desirable weeks, probably making it less necessary for MVC to play games. MVC still has to allocate specific inventory each week to Points vs. Weeks, but my suspicion is both pools are now large enough that they can satisfy demand in most cases without resorting to the types of games you suggest would be in their interest. I think they understand that happy owners are more likely to buy more points, so maybe they feel using the carrot approach is more effective than using the negative/stick approach.

Having said all that, MVC sales has long used the fear of losing access if you don't own Trust points as a sales/fear tactic to entice/scare enrolled owners into buying Trust points, but based on everything I've experienced and also read on the Marriott board here over the last five or six years, that fear is unjustified and top season Platinum weeks are still available to weeks owners, and points owners also get their share. From time-to-time there will be specific cases where a Marriott owner comes onto TUG complaining that they can no longer book the weeks they used to be able to book and blame that on MVC hogging the inventory for Points usage, but for every one of those, there will generally be someone else who responds and says they had no issue booking what the complaining person said they couldn't. So as in anything else in timeshares, YMMV.
 
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I know that this thread has been has been speculation on what could happen but it has been an educational experience for me anyways about two other TS systems. I am thankful for those that have taken the time to inform us HGVC only types. I also see that implementing a trust product for HGVC isn’t straightforward and I don’t really thinks that it will solve the problem either. In fact, it could actually have the opposite effect that HGV is looking for.
 

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My experience has always been that HGVC and MVC resale weeks seem reasonably comparable in price, but since so much HGVC is concentrated in Orlando, Vegas, Big Island, and Waikiki, it’s hard to compare apples to apples with MVC’s more extensive geographic reach.
I do believe that’s HGVC’s biggest drawback is lack of geographic reach. While it has gotten better with the additions of Southern California, South Carolina, Chicago and the ski resorts, they need more. As a Midwesterner, there is only one easy trip for me (Chicago) so there needs to be some closer. Everything else is at least a two day drive.

With that being said, isn’t it a little more cost effective with HGVC? The flexibility of the system combined with the generally lower MF’s make the cost of ownership and travel lower than MVC Weeks? At least that’s what I have been thinking. I haven’t really been studying MVC so I could be very wrong, but it seems the MF’s are, on average, lower with HGVC.
 

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I do believe that’s HGVC’s biggest drawback is lack of geographic reach. While it has gotten better with the additions of Southern California, South Carolina, Chicago and the ski resorts, they need more. As a Midwesterner, there is only one easy trip for me (Chicago) so there needs to be some closer. Everything else is at least a two day drive.

With that being said, isn’t it a little more cost effective with HGVC? The flexibility of the system combined with the generally lower MF’s make the cost of ownership and travel lower than MVC Weeks? At least that’s what I have been thinking. I haven’t really been studying MVC so I could be very wrong, but it seems the MF’s are, on average, lower with HGVC.
Yes, HGVC is cheaper on an ongoing manner (MFs) than MVC. Plus a week owner has an initial priority over a points owner, unlike MVC. Retail prices tend to be higher. MVC has more different places, though. You pays your money and makes your choice.
 

Ralph Sir Edward

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I know this is a HGVC thread, but I will insert the following on MVC. . .

MVC could solves all it's problems between legacy owners and points owners - and make a big ongoing profit, to boot!

HOW?????

Offer any (and all) legacy weeks owners the right to join the DC trust, under the following term. The price to joins is the current bunch of up-front fees, plus current resale value Marriott charges for transfer fees (currently $3 a point). Once joined, it can't be reverted back to no DC trust property type.

The advantage to Marriott is - every time the the week is resold, they would get $3 a point, for nothing. No sale force, ect. Plus if the purchaser is new to Marriott, all those joining fees. Currently Marriott get nothing from resales of weeks.
 

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FWIW...It's interesting that MVC is now pursuing Asia sales more heavily. Perhaps because HGVC has a stronghold there and seems to be vulnerable with the Apollo and trust rumors. However HGVC has reported that Asians don't trust trusts and prefer to buy a specific deed (rightfully so). All MVC sells now are their trusts.
 
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