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BIG TROUBLE at Morritts Tortuga & Grand

Caladezi

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Frank, if you'll go back and read my post again, you'll see that I said I only had an issue if the post had been copied verbatim without the permission of the author. You clarified that with your response. I also paid you a compliment when I said that if you had posted with the permission of the author, you had done a good thing.

Regarding my posting on the Morritt Owners Forum, immediately upon our becoming non-owners, I notified the moderator that we were no longer owners at Morritt's and I posted the same information on the Owners Forum. My access to the forum wasn't terminated, so I continued to read about events at the resort. Should I have continued to notify the moderator that I still had access to the Owners Forum? Perhaps. How many times am I required to do that? I suppose I rationalized that I wasn't harming anyone if I confined my activities to reading and if I avoided posting. I did post on that forum today, realizing that my access would probably be terminated immediately. As you know, that post was to inform another owner that, contrary to his belief, the information had indeed been posted on a public forum. I fully expected that post to result in the termination of my access privileges but, as you noted in your follow-on post, some information just needs to be made available.

Over the years, you and I have been on opposite sides on some issues and on the same side on others. I've always respected your views, even when they differed with mine. I regret that you took offense to my post because it was not my intent for the post to be interpreted as a personal attack on you.

Rod, this is going to be a long and hard fight for the Morritts owners. Yes, we have been through many issues and I too have always respected your views. I have always considered you to be a very intelligent and informed person. Your opion is important and should be included in any decisions made by anyone who might consider a purchase at Morritts. The fact that you no longer own at Morritts will by default cause you to be removed from that forum. This will be our loss, not yours. I hope that through TUG you will continue to be involved and help with our cause in any way that you can.
 

asroberts

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cheap resale

We are thinking of buying a resale unit..We were told that the MF was $750, now I read $975!!! Is that true? What about 2010? What would happen if the property goes under?
We were there in June and enjoyed the resort alot.
What do you guys think?
Angela
 

jadejar

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Angela,

The maintenance fees for a 1-bedroom unit are $750. They are $975 for a 2-bedroom unit. That is for 2009. We don't know yet what they might be for 2010 if there is an increase.
 

caddie

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We are thinking of buying a resale unit..We were told that the MF was $750, now I read $975!!! Is that true? What about 2010? What would happen if the property goes under?
We were there in June and enjoyed the resort alot.
What do you guys think?
Angela

These are "right to use'' contracts at Morritt's, not deeds. So it is unclear to me what would happen if they "went under'' and the bank took it over. Does anybody really know? Do our contracts have to be honored by the bank or a future owner?
 

Jamerican71

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This is worrisome for my Nov 2009 exchange to Morritts. Will we be okay for our vacation? Why does the Morritt's board have a separate section for owners. This was done shortly after Ivan but it doesn't make sense to me. While I feel for the owners there is another interested group of exchangers who also want the information. In all the negative items I've read about Morritts, it seems that David's name is always involved. Are there any viable solutions to correct this huge budget shortfall?
 

Htoo0

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I believe the reason for a separate area for 'owners' on the un-official morritts site (morritts closed it's forum so this is an owner's site) is because some owners felt discussions of morritts problems should be kept out of public view. However, please let me stress this is only MY HUMBLE OPINION as to the the reason for the "owner's only" section. You would have to ask the site's creator for a definitive answer to your question. I personally would not be concerned about your exchange. David's name is always involved because he is morritts. According to the latest news I've heard he has a repayment plan in place. I believe you can go to wwwdotmorrittsdotcom and click on 'members services' to read the letter. Hope this helps.
 

caddie

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He hardly has a replayment plan in place. He SAYS he will announce one at an Aug. 24 board meeting. That is a big difference. Why not announce it now? They've been asking him for a repayment plan since January, according to what we've read on the forum. He owes nearly $3-million. I wouldn't be so sure that the November trip is safe. It probably is, but who knows? That is the whole point of all this. Associations that operate (combined) on about $8-million a year cannot function forever without $3-million of it.
 

Caladezi

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He hardly has a replayment plan in place. He SAYS he will announce one at an Aug. 24 board meeting. That is a big difference. Why not announce it now? They've been asking him for a repayment plan since January, according to what we've read on the forum. He owes nearly $3-million. I wouldn't be so sure that the November trip is safe. It probably is, but who knows? That is the whole point of all this. Associations that operate (combined) on about $8-million a year cannot function forever without $3-million of it.

That debt could be approaching the $4 million dollar mark soon. All that the audit covered was 2008. Is there any reason to think that he has paid for 2009--I think not. Soon he will owe 2010 fees and --well, you get the idea. What the associations need is immediate payment in full. A repayment plan in large sums could only work if all other fees were kept current and no other monies were "borrowed" from association funds. The speculation is that the money just isn't there to do this. How long can the resort survive under these circumstances? I can't answer that and I imagine that there are only a few who can, but my best guess would be not very long. Unless this debt is repaid and the developer is able to keep current, the others would have to face huge MF increases and perhaps another SA. It that happens they won't stand for it and will walk. That makes the problem even worse. So, how safe is a November week? Probably OK as things stand since progress moves slowly in Grand Cayman.
 
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Jamerican71

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I hope things work out for everybody involved.

So, at what point do I put other plans in place....how does the process even work? Some have said don't worry and I'm usually the glass if half full but this budget shortfall is gong to be difficult to close.
 

Htoo0

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Sorry if my post(s) sounds too rosy. Anyone who knows me should know better. The question was about a November stay. My guess is the resort will be OK through 2009 but as far as long term health, that is an entirely different matter. I certainly am not claiming, "Have no fear, everything's going to be alright."
 

Caladezi

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I hope things work out for everybody involved.

So, at what point do I put other plans in place....how does the process even work? Some have said don't worry and I'm usually the glass if half full but this budget shortfall is gong to be difficult to close.

That decision is one that only you and those going with you can make. If it were me, I wouldn't change my plans. There is some risk but I don't think that it will be a problem for a November trip. Just my opinion.

One thing that I would advise you however, is that if you do go don't fall for a sales pitch!! Wait awhile for that.:wall:
 
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I believe the reason for a separate area for 'owners' on the un-official morritts site (morritts closed it's forum so this is an owner's site) is because some owners felt discussions of morritts problems should be kept out of public view. However, please let me stress this is only MY HUMBLE OPINION as to the the reason for the "owner's only" section. You would have to ask the site's creator for a definitive answer to your question. I personally would not be concerned about your exchange. David's name is always involved because he is morritts. According to the latest news I've heard he has a repayment plan in place. I believe you can go to wwwdotmorrittsdotcom and click on 'members services' to read the letter. Hope this helps.
If I recall correctly, and I could be wrong, the owners only section was created at the "request" of individuals of a litigious nature.
 
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Am certainly not defending the organization, as there is plenty of reason to be angry. But there was never any evidence in the past that the developer didn't pay his maintenance fees. Nobody hired a dishonest auditor. Why would any auditor want to risk their reputation and license to stick up for this guy? That is a reckless claim you have made there.

The fact is the place was flush with cash, the developer actually propped up the associations to keep the maintenance fees artifically low so he could sell more timeshare, there was loose budgeting and everyone was happy and hardly paid attention. . . It has only been since Ivan that these problems have surfaced, and only in 2008 that we learn there is a big deficit due to the developer not paying his share. The focus needs to be on now and what is wrong -- a huge association shortfall caused by the developer -- not on what somebody perceived to be a problem before we really had problems.

I'm not so sure about the developer propping up the associations. Yes, there were developer subsidies in the past, but how often where they more than the "management fee" and other moneys that the developer collected? In other words, if you take a nickel from me in January and give me back a penny in December, are you really subsidizing me?
 

bdvorachek

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As an auditor....

I wouldn't get too worked up about this announcement; it is common place in business for this to occur and the board will work out a suitable repayment plan for him. People owe sums of money in business all the time; the audit is required to report but did they issue a going concern opinion on this issue or did this just present the facts? If there is truly financial concern that the resort was going to run out of cash and shut down a going concern report would have been issued and referenced in the audit letter. If somebody could be kind enough to send me a copy of the audit...I would appreciate it.

I also own one week there and the very thing that was a draw to me on the resale market was the maintenance fees. While people think $975 is high, please try to find a comparable place to stay for less than $250 a night on the island. I have tried after staying there with my company a couple years back...still a deal at $975....
 

ralphd

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I wouldn't get too worked up about this announcement; it is common place in business for this to occur and the board will work out a suitable repayment plan for him. People owe sums of money in business all the time; the audit is required to report but did they issue a going concern opinion on this issue or did this just present the facts? If there is truly financial concern that the resort was going to run out of cash and shut down a going concern report would have been issued and referenced in the audit letter. If somebody could be kind enough to send me a copy of the audit...I would appreciate it.

I also own one week there and the very thing that was a draw to me on the resale market was the maintenance fees. While people think $975 is high, please try to find a comparable place to stay for less than $250 a night on the island. I have tried after staying there with my company a couple years back...still a deal at $975....

The annual maintenance fee is not the subject of this thread.

Do you have information which the owners have not seen?

Are you employed by, friend of or related to the subject of the thread?:doh:
 

bdvorachek

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Not related...

No I am not related nor have any other involvement with Morritts other than I own one week there. I am, however, a CPA with 12 years of audit experience and know that things are always as bad as they appear when it comes to auditor's notes in the statements. $3.0 million of debt, while I am sure meets disclosure requirements, would prompt a going concern by auditors if the issues were as major as people posting the demise of the resort. Maybe I am a glass half full kind of person but I would wait on calling on the prophets of doom...
 

caddie

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I wouldn't get too worked up about this announcement; it is common place in business for this to occur and the board will work out a suitable repayment plan for him. People owe sums of money in business all the time; the audit is required to report but did they issue a going concern opinion on this issue or did this just present the facts? If there is truly financial concern that the resort was going to run out of cash and shut down a going concern report would have been issued and referenced in the audit letter. If somebody could be kind enough to send me a copy of the audit...I would appreciate it.

I also own one week there and the very thing that was a draw to me on the resale market was the maintenance fees. While people think $975 is high, please try to find a comparable place to stay for less than $250 a night on the island. I have tried after staying there with my company a couple years back...still a deal at $975....

Thanks very much for your input, especially coming from a person familiar with audits. But have you seen it? It points out quite bluntly that there truly is a financial concern. The board has been trying to work out a re-payment plan since Janaury with no success. It wasn't until this information was made public last week that the developer put forth that he will be announcing a re-payment plan. And while people may owe sums of money in business all the time, they typically don't keep it from the very people they owe. I wish I was able to have your optimism.
 

ralphd

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No I am not related nor have any other involvement with Morritts other than I own one week there. I am, however, a CPA with 12 years of audit experience and know that things are always as bad as they appear when it comes to auditor's notes in the statements. $3.0 million of debt, while I am sure meets disclosure requirements, would prompt a going concern by auditors if the issues were as major as people posting the demise of the resort. Maybe I am a glass half full kind of person but I would wait on calling on the prophets of doom...

Just like AIG, BoA, Citibank, Region Bank, GM, Chrysler and several other banks/companies.
 

Carolinian

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In timeshare budgets there is one place that management / HOA's seem to invariably go to finance shortfalls, and that is the reserves. The resort can keep going in the short run by failing to maintain reserves, but that will catch up with it in the end when renovations are due and there is no money for it, so they have to do a big SA. I suspect this may be what you will find is going on at Morritts and if so it is a ticking time bomb.

You need to get the HOA out of the hands of the developer, and you probably need a local attorney to advise owners if and how this may be possible under local law. An indepedent HOA could then sue the developer for the money owed, and probably end up with ownership as a result.
 

Htoo0

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Well now, if morritts ever had a reserve, I would be surprised. People should keep in mind we're still missing an entire building from Ivan. As far as I know OF studio 'owners' haven't had their paid for units since 2005. I'm not sure what they are being given in exchange but I doubt it's Ocean Front.
 

Caladezi

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The Tortuga Club had a big SA about a year or two ago which we were told was for renovations to the pool buildings and new furniture. The SA was paid but the repairs and replacement is very far from done. A very few of the units had some very minor work but nothing was really accomplished. I can guess where the money went. The Grand owners also had a SA to "build up their reserves" this SA was paid by the owners except the developer failed to pay his. Perhaps he thought that in this case it was a reverse flow of cash. Someone who has done this type of thing should be in jail, not pretending to figure out a repayment plan.
 

Topcat

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First I own 2 weeks at the Grand and can not really speak to the other buildings.

We were there from July 11 to 25. I was really disapointed in the appearance and upkeep of the unit. Tiles had been cracked and corners broken off and instead of fixing it correctly, they had just filled in with caulk. There was 1 area on the brickwalkway around the Grand pool (side that is closest to the ocean) where the concrete retaining ring for the pavers was broken and missing, the sand had washed out from under the pavers and they had settled for a large area to the extent you had to be careful walking in the area.

One thing I found real disturbing (maybe because I am a design engineer as my background) was the lack of building plans for the Grand since they are not that old. We had water puddling on the floor by the front door the entire stay (between 1/8 and 1/4 inch deep for the entire hallway to the point housekeeping placed 4 towels for us to walk on). They never resolved the problem. First the said they had no plans so did not know what piping was leaking, maybe someone overfilled a tub above us? Then the response was it is just condensation and to not run the AC!! It also happened in 2007 and was found to be a cracked pipe in the unit above us then.

The point is if the developer does not pay his share immediately, the facilities are going to go to s**t real fast. They have already started to decay due to lack of proper maintenance. No way would I consider them as being near the level they were in 2004 when we purchased and I would be real suprised if RCI keeps them at the level they have been considered for the last couple of years. Since his share is about a third of the entire budget, how can a budget that gets the grounds to the level expected be developed or even one to maintain them at their currently lower level? If he has not paid for 2008 who honestly thinks he has paid for 2009? Means the amount presented in the audit is really about half of what he owes. AND will he pay his 2010 fees that are coming due in January? What about the units that he took back from owners in 2008 and 2009 for not paying fees?
 
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caribbean

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A 2BR Morritts Grand just sold on eBay for $997. WOW!!! I saw one go for about $3000 about 6 months ago.
I sold mine for $20K in 2005 right after the resort announced the re-opening date. What a difference.
Out of curiosity, what are the retail prices on the units now?
 

Tia

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Water leaks not repaired leads to mold...


...the Grand since they are not that old. We had water puddling on the floor by the front door the entire stay (between 1/8 and 1/4 inch deep for the entire hallway to the point housekeeping placed 4 towels for us to walk on). They never resolved the problem. First the said they had no plans so did not know what piping was leaking, maybe someone overfilled a tub above us? Then the response was it is just condensation and to not run the AC!! It also happened in 2007 and was found to be a cracked pipe in the unit above us then.

...?
 
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