Bill Marriott's Blog comments on SpinOff

[pwrshift]

http://www.blogs.marriott.com/marriott-on-the-move/2011/12/two-focused-companies.html#comments

Good place to tell him what you think.

 

[gblotter]

I left my comment. I doubt it will get posted. Marriott decided to declare failure and walk away from the timeshare business. Its all about juicing the share price of Marriott International stock (and the Marriott family are the biggest shareholders). Timeshare owners now have to pay (handsomely) even just to be associated with the Marriott name - one more "innovative" way to turn the screws. At this point they don't care that this move has alienated some of their most loyal customers. How sad that Mr Marriott has forgotten that it takes years to build a good reputation but only minutes to lose one.

 

[MALC9990]

So perhaps it is time to kick the old guy off the Vacation Club TV channel at all the resorts. We know he's a hypocrite but we don't need the crass hypocrisy rammed down our throats every time we turn on the TV in our villa.

 

[rrlongwell]

If I understand correctly, the timeshare arm was spun off to shareholders, if he was one of the largest shareholds before the spin-off and he did not sell off his shares in the spin off, he would probably be one of the largest shareholders in the spin-off.

 

[vacationhopeful]

Could we start a poll as to which is more irritating: Mr Marriott TV or DVC TV?

Both are commericals to benefit their corporations - Mr Marriott would be a bigger insult to me as a Marriott Timeshare Owner.

 

[Numismatist]

If I understand correctly, the timeshare arm was spun off to shareholders, if he was one of the largest shareholds before the spin-off and he did not sell off his shares in the spin off, he would probably be one of the largest shareholders in the spin-off.

Yes, but he's betting that splitting the two creates MORE value for him by allowing MAR to grow faster while Spinco stays stagnant.

He can dump Spinco when MAR increases enough.

 

[bogey21]

I left my comment. I doubt it will get posted. Marriott decided to declare failure and walk away from the timeshare business. Its all about juicing the share price of Marriott International stock (and the Marriott family are the biggest shareholders). Timeshare owners now have to pay (handsomely) even just to be associated with the Marriott name - one more "innovative" way to turn the screws.

The writing was on the wall years ago when Marriott replaced their original Rental and Resale Programs with programs more favorable to Marriott's profitability. I was so upset with their self serving actions that I sold all 5 of my Marriott Weeks. I'm glad I saw the light in time to get out whole.

George

 

[gblotter]

The writing was on the wall years ago when Marriott replaced their original Rental and Resale Programs with programs more favorable to Marriott's profitability. I was so upset with their self serving actions that I sold all 5 of my Marriott Weeks. I'm glad I saw the light in time to get out whole.

Hi George. I don't question the wisdom to divest yourself of Marriott timeshares. Things have certainly gone downhill since then. I am curious as to why you continue to participate in this Marriott forum after all these years given that you no longer have a dog in this fight. All are welcome here - I'm just curious.

 

[EducatedConsumer]

How could one blame Marriott for spinning off a losing proposition like Marriott Vacation Club? I think spinning off MVCI represented a stroke of brilliance by Marriott. They unloaded a liability, and recognized that the opportunity for growth of the timeshare business in the forseeable future is abysmal. I expect that our Marriott stock will flourish as a result of Marriott dumping their timeshare business. As to the spin-off stock that we are the recent recipients of, I expect that that stock will soon have no value. From my personal perspective, with few exceptions, the very model from which timeshare was attractive in the past, is bust. The last place that I'd appropriate money today is to a timeshare or the timeshare industry. That ship left port two year's ago.

 

[gnorth16]

The last place that I'd appropriate money today is to a timeshare or the timeshare industry. That ship left port two year's ago.

That is a pretty generic statement. Although I agree that buying shares in the MVCI spinoff is not a wise investment, does your statement also include not buying a timeshare, or continue holding a timeshare if you currently had one?

There are more than monetary reasons associated with timeshares and travelling which have been debated countless times. By grouping all timeshares as one and combining the entire industry as a whole, your comment becomes very narrow minded and uneducated.

I would highly recommend changing your ID from "Educated Consumer."

 

[hotcoffee]

. . . They unloaded a liability, and recognized that the opportunity for growth of the timeshare business in the forseeable future is abysmal. . . .

I have said it numerous times in this forum, the glory days of timesharing are gone forever. The world economic climate has less-and-less wiggle room as time goes by. It is true that people will continue to take vacations for the foreseeable future, but purchasing timeshares and vacation condominiums will increasingly become a luxury that more-and-more people simply will decide that they can do without.

I think timeshare companies will have to think of ways to find profit in the vacation habits of their existing customer base to survive. I doubt that they will be able to get it from sales.

 

[bogey21]

Hi George. I don't question the wisdom to divest yourself of Marriott timeshares. Things have certainly gone downhill since then. I am curious as to why you continue to participate in this Marriott forum after all these years given that you no longer have a dog in this fight. All are welcome here - I'm just curious.

I guess it is because I was once so hyped up with Marriott getting into the timeshare business. I originally bought Monarch on HHI which was Marriott's entree into Time Sharing, then I bought Sabal Palms pre-construction, the first TS they built themselves. Later I bought at three other Resorts. I thought I was in Time Share heaven. As I became disillusioned with changes Marriott was making I sold, but curiosity has kept me watching to see what additional changes were being made. Others may disagree, but I think it is sad what Marriott has done to what I once considered a great product.

George

 

[EducatedConsumer]

That is a pretty generic statement. Although I agree that buying shares in the MVCI spinoff is not a wise investment, does your statement also include not buying a timeshare, or continue holding a timeshare if you currently had one?

There are more than monetary reasons associated with timeshares and travelling which have been debated countless times. By grouping all timeshares as one and combining the entire industry as a whole, your comment becomes very narrow minded and uneducated.

I would highly recommend changing your ID from "Educated Consumer."

I believe the entire (economic) value proposition of timesharing is significantly flawed in this economy, and as a result, I would not purchase one or encourage anyone in our Circle of Friends/Family to purchase one. For those who are after the "qualitative (e.g. vacation experience) aspects and once perceived benefits" of timesharing, in this economy, I believe their needs can be better served (in most cases today) by renting vs owning.

We own six hotel company branded upper-tier timeshares (peak seasons), and with the exception of our DVC ownership, they're all next to worthless now on the secondary market, and I believe the secondary market (and buyer performance in that market segment) is the best available barometer for timeshare value today. We are presently retaining our timeshares for probably two or three reasons, (1) they're next to worthless to resell, so why bother, (2) we'll maximize our enjoyment of them, to the extent possible (and recognize that we could probably rent the accommodation of our choice for less money and far less hassle (no crazy reservations windows, exchange companies with brainless personnel whose native tongue is hard to distinguish), and without the unknown of "product refinements (e.g. non consumer-friendly product denigrations), and (3) I have not one good sense about the future of the economic basis for timesharing.

As to the knowledge that I bring to the table, as a "behaviorist," I've counseled numerous timeshare organizations and timeshare salespeople on the purchase seeking behaviors of potential timeshare owners for many years. I can say with unwavering confidence, and business acumen, that the modern day timeshare industry is a train wreck.

So, with all due respect, I'll not change my ID, and allow it to stand on its merits (including a few graduate degrees, long-standing business experience in this specific market segment, and an understanding of the industry that few non-industry observers could shadow).

 

[rthib]

How much Property does Marriott Own?

If you did not at least think this would happen then you did not do any due diligence on Marriott.

While people love Marriott hotels and like the service and amenities, Marriott owns only a handful of hotels.
Most are owned by others who pay to use the Marriott and name and work to live up to it's standards.
Marriott from time to time has played in the real estate market but has always been better as a Management company than as an owner.
Vacation Clubs was a change and as a company it is a good move.

Marriott has a long track record of holding people who use it's name to a high standard and I don't see that changing.

 

[sparty]

...Marriott from time to time has played in the real estate market but has always been better as a Management company than as an owner.

....Marriott has a long track record of holding people who use it's name to a high standard and I don't see that changing.

True about playing in the real estate market. They still want to play in the market, but only as a hotel developer rather than a timeshare developer.

Before even the announcement of the spinoff, insiders in Vacation Club were telling me they were fustrated. The hotel portion wouldn't let them invest in anything.

The hotel side would say "How long to does it take to sell out a timeshare development? How many shares need to be sold?" vs build a hotel, sell the whole thing in one shot at a nice profit to a Marriott franchisee 1 year from the start of construction and then collect recurring management fees.

With that logic the timeshare business claimed they couldn't compete internally with the hotel business.

Now the timeshare business is free from that. Thus all the ROFR activity and re-investment that was previously stiffled by the hotel side.

As far as holding the francishees to a high standard. The hotel side knows this is a problem. Marriott can't do it. Look at what happened in Hawaii, the franchisee dumped Marriott when Marriott tried this. If you're a really well traveled Marriott member, wait till you get in a real pickle sometime, Marriott will try like crazy to help, but the franchisee will only do what is in the franchisee's best interest. They don't listen to Marriott and Marriott knows it.

 

[ronparise]

rthib has it right

J Willard Marriott

Marriott at it core is a franchise and management company...if they can get away with it they neither own or manage the asset...they simply lend their name to the enterprise.

To get to this point they obviously had to develop that name and to do that they did build and develop and operate and manage restaurants, motels, hotels, airline catering, institutional kitchens, fast food businesses,

Its no surprise that they would figure out the timeshare business and then get out of the development end in favor of the management

 

[BocaBoy]

Before even the announcement of the spinoff, insiders in Vacation Club were telling me they were fustrated. The hotel portion wouldn't let them invest in anything......With that logic the timeshare business claimed they couldn't compete internally with the hotel business.
Now the timeshare business is free from that. Thus all the ROFR activity and re-investment that was previously stiffled by the hotel side.

I have heard this several times from MVCI people. I am convinced it is true. MVCI should now be a much more nimble company and able to take advantage of opportunities that they were not previously allowed to pursue. I have studied this very carefully, and if they are well enough capitalized (as they claim they are), I think the spinoff will be a good thing for the Marriott timeshare business and the owners of their weeks.

 

[fizzysoup]

I have heard this several times from MVCI people. I am convinced it is true. MVCI should now be a much more nimble company and able to take advantage of opportunities that they were not previously allowed to pursue. I have studied this very carefully, and if they are well enough capitalized (as they claim they are), I think the spinoff will be a good thing for the Marriott timeshare business and the owners of their weeks.

And what about the resorts that are intrinsically linked with a JW Marriott Hotel?

Phuket Beach Club & Son Antem, I believe! How will they fare in this new scenario?
We have been 'assured that the annual $50m US$ fee for use of the Marriott name and the 2% royalties will have no impact on our 'investment' or maintenance fees!!

Who is kidding here?

 

[timeos2]

I guess it is because I was once so hyped up with Marriott getting into the timeshare business. I originally bought Monarch on HHI which was Marriott's entree into Time Sharing, then I bought Sabal Palms pre-construction, the first TS they built themselves. Later I bought at three other Resorts. I thought I was in Time Share heaven. As I became disillusioned with changes Marriott was making I sold, but curiosity has kept me watching to see what additional changes were being made. Others may disagree, but I think it is sad what Marriott has done to what I once considered a great product.

George

The main problem as I see it with timeshare - Marriott is not alone in this - is that the sales model of 50%+ overhead makes it a poor value at retail and the glut has ruined any resale value.

But beyond that is the Corporate view that resorts/systems need to be ongoing cash generating "divisions". Once you buy most other real estate type items you control how money is allocated to it. Even in a condo type situation it is you and your fellow owners that set the budgets, decide what gets done and basically maintain control.

With timeshare far too many developers don't design, build, sell and then move on from the property. Instead we have more of a "hotel" model where they don't just expect but actually demand a hefty return but it's not on their money anymore - it's yours! It's that 10-25% return on top of already hefty actual costs that push total cost way beyond the level where it represents good vacation value in far too many cases.

In the original timeshare model it was much closer to a condo model where once sales were done the developer was gone and the actual owners handled things. We still own two of those and have found them to be great values. We have owned Wyndham, Wastegate, DVC and others but all proved to be poor values in the long run. In each case the heavy handed management by the developer that should have been long gone from the picture (except for DVC which uses a different model) ruined the value proposition. More and more rising fees are killing the value of the brand names.

This move by Marriott to remove themselves from any ownership and simply charge what I see as an outrageous fee to do nothing more than have the name on the door is the ultimate slap at the owners. Thankfully we ultimately resisted the great temptation to buy into the gorgeous Marriott resorts/system. We dodged a bullet and now feel sorry for those that bought into the dream turning nightmare.

 

[fizzysoup]

Thankfully we ultimately resisted the great temptation to buy into the gorgeous Marriott resorts/system. We dodged a bullet and now feel sorry for those that bought into the dream turning nightmare.

We are grateful for your sympathy, but it doesn't ease our pain.

Some good input here. Keep it coming. Together we can be strong!

 

[OldPantry]

I believe the entire (economic) value proposition of timesharing is significantly flawed in this economy, and as a result, I would not purchase one or encourage anyone in our Circle of Friends/Family to purchase one. For those who are after the "qualitative (e.g. vacation experience) aspects and once perceived benefits" of timesharing, in this economy, I believe their needs can be better served (in most cases today) by renting vs owning.

We own six hotel company branded upper-tier timeshares (peak seasons), and with the exception of our DVC ownership, they're all next to worthless now on the secondary market, and I believe the secondary market (and buyer performance in that market segment) is the best available barometer for timeshare value today. We are presently retaining our timeshares for probably two or three reasons, (1) they're next to worthless to resell, so why bother, (2) we'll maximize our enjoyment of them, to the extent possible (and recognize that we could probably rent the accommodation of our choice for less money and far less hassle (no crazy reservations windows, exchange companies with brainless personnel whose native tongue is hard to distinguish), and without the unknown of "product refinements (e.g. non consumer-friendly product denigrations), and (3) I have not one good sense about the future of the economic basis for timesharing.

As to the knowledge that I bring to the table, as a "behaviorist," I've counseled numerous timeshare organizations and timeshare salespeople on the purchase seeking behaviors of potential timeshare owners for many years. I can say with unwavering confidence, and business acumen, that the modern day timeshare industry is a train wreck.

So, with all due respect, I'll not change my ID, and allow it to stand on its merits (including a few graduate degrees, long-standing business experience in this specific market segment, and an understanding of the industry that few non-industry observers could shadow).

Geez. It's tricky to agree with someone, but dislike the utterly pompous way the point is made. The criticism leveled against you was that you were being overly broad. I think that's fair. There must SURELY be pockets of opportunity SOMEWHERE in the timeshare universe. Still, I think you were close to the truth. But why drag in the resume? Can't the points stand on their own?

 

[SueDonJ]

... Thankfully we ultimately resisted the great temptation to buy into the gorgeous Marriott resorts/system. We dodged a bullet and now feel sorry for those that bought into the dream turning nightmare.

We are grateful for your sympathy, but it doesn't ease our pain.

Some good input here. Keep it coming. Together we can be strong!

Some of us don't believe we need sympathy because we're not in pain.

While John's wealth of timeshare knowledge is extensive, he and his wife obviously have a preference for a timeshare model that is as far removed from the big developers' as it's possible to be. No problem there, everybody has their favorites and what's right for one isn't necessarily right for another.

My problem with John is that he constantly extolls his personal preference on TUG as though it is the ONLY timeshare model that DOES work for everyone. I and others have had repeated discussions with him wherein we try to explain why our preference is with the "big developer model." It offers things that can't be found with John's favorite model - things like multiple high-end amenities and an extensive Activities Program at our home resorts, a large network of similarly-designed resorts, an owner preference when exchanging to those other resorts, a related customer loyalty program for hotel and air travel, a customer service network backed by a quality leader in the hospitality industry, etc ... And granted, John is correct when he says all those things come with a price.

But if we continue to tell John in all these discussions that we are aware of that price and don't mind paying it because we feel we're getting value from the model that WE prefer, at some point John's repeated "there is only one good timeshare model" mantra starts to sound like condescension. Or at least that's what I read every time he writes about his ideal timeshare with no nod towards these past discussions.

John, I like you, I like reading you. Someday I might even change my preferred timeshare model to the one you favor, and I'll be very grateful then to make good use of your expertise and advice. But until then, I wish you would at least acknowledge one time, just one time, that those of us who prefer a different model than you do are not wrong. We're simply different. Honestly, Don and I are having a wonderful time using our Marriott timeshares and don't feel at all as though we're living a nightmare. Reading TUG religiously leads me to believe that there are many others exactly like us.

 

[bogey21]

But if we continue to tell John in all these discussions that we are aware of that price and don't mind paying it because we feel we're getting value from the model that WE prefer............

You are absolutely right. Although my preference is to spend as little as I can for decent Resorts located in places I like to go, that doesn't mean the way I look at the Time Share world is the only right way. It is clearly reasonable for others to prefer different models.

George

 

[SueDonJ]

You are absolutely right. Although my preference is to spend as little as I can for decent Resorts located in places I like to go, that doesn't mean the way I look at the Time Share world is the only right way. It is clearly reasonable for others to prefer different models.

George

Thank you, George. I also like reading you and others like you who were with Marriott at the beginning and know better than anybody all the different changes that have come throughout the years. Your combined knowledge helps the rest of us with our planning and expectations.

 

[IngridN]

Some of us don't believe we need sympathy because we're not in pain.

While John's wealth of timeshare knowledge is extensive, he and his wife obviously have a preference for a timeshare model that is as far removed from the big developers' as it's possible to be. No problem there, everybody has their favorites and what's right for one isn't necessarily right for another.

My problem with John is that he constantly extolls his personal preference on TUG as though it is the ONLY timeshare model that DOES work for everyone. I and others have had repeated discussions with him wherein we try to explain why our preference is with the "big developer model." It offers things that can't be found with John's favorite model - things like multiple high-end amenities and an extensive Activities Program at our home resorts, a large network of similarly-designed resorts, an owner preference when exchanging to those other resorts, a related customer loyalty program for hotel and air travel, a customer service network backed by a quality leader in the hospitality industry, etc ... And granted, John is correct when he says all those things come with a price.

But if we continue to tell John in all these discussions that we are aware of that price and don't mind paying it because we feel we're getting value from the model that WE prefer, at some point John's repeated "there is only one good timeshare model" mantra starts to sound like condescension. Or at least that's what I read every time he writes about his ideal timeshare with no nod towards these past discussions.

John, I like you, I like reading you. Someday I might even change my preferred timeshare model to the one you favor, and I'll be very grateful then to make good use of your expertise and advice. But until then, I wish you would at least acknowledge one time, just one time, that those of us who prefer a different model than you do are not wrong. We're simply different. Honestly, Don and I are having a wonderful time using our Marriott timeshares and don't feel at all as though we're living a nightmare. Reading TUG religiously leads me to believe that there are many others exactly like us.

I agree wholeheartedly. While we have exchanged into one of the 'other' timeshare models due to location, my preference is the Marriott and other high-end hotel resorts and I am willing to pay for it. To each his own. Neither is right or wrong.

Ingrid