From the NY Post - Hilton fears bad rep over timeshare deal

[1Kflyerguy]

They surely could. The argument being made here, and I agree, is that the Hilton name and the association with Hilton brings very much value to HGVC to the point where, without that, it may not be worth what they're paying to purchase it.

Cheers.

I agree, the affiliation with Hilton adds a lot value to HGV. Many people seem to love the ability to convert club points to HH points. Not as Tuggers value that, but i think that does appeal to many. The call center hand-off where people making hotel reservations by phone get passed over to HGV seems to generate a reasonable of sales tour flow with people booking the sales packages. Not to mention the value many of us place on the HH Amex points.

For whoever ends up as the owner, the value is less without the Hilton name.

 

[tombanjo]

It could be seen as a bit of a poison pill, honor the name and relationship, or the premium brand goes poof.

 

[vacationtime1]

I'm not seeing how Hilton's brand license answers my question. I'm suggesting that Wyndham Destinations cannot afford HGV. My question is how can WYND finance a merger and satisfy HGV share holders.

Since I’m not a finance person, I really don’t know and, quite frankly, don’t care. It’s not my job to figure that out. I don’t know the inner workings of Wyndham’s finances. My guess is the only people that can answer that question are those involved. While I have appreciated your input on the potential merger, I am not enjoying this particular aspect of the discussion. I always try to reply to those that ask questions as it’s the polite thing to do, even if it’s something I really don’t want to talk about.

I’m of the thought process that I want things to stay the same. If they are sold, I want to be as far away from Apollo and Diamond as possible. So, let me stay in my happy place where HGVC is HGVC and not Diamond until I have to deal with it.

Private equity partnerships finance acquisitions with debt. Apollo would have HGVC take on a pile of debt to finance the purchase (and pay Apollo fees for doing the transaction) and then raise prices (management fees, etc.) to pay off that debt. If HGVC's cash flow can cover that debt, all is well. If not, Apollo will eventually jettison the carcass of HGVC after it has sucked it dry.

WYND would presumably use the same game plan. I'm sure they (or their investment advisors) have a group of MBA finance types who know how to do this.

 

[geist1223]

This would especially be the case if Wyndham is chosen. It has been many years since Wyndham acquired Worldmark, 2006 if memory serves - and there really is little to no integration in existence between Club Wyndham and Worldmark from a timesharing standpoint apart from Club Pass, and there is still zero website inventory search and cross system reservation integration supported to this day. You have to call into Wyndham if you are a Club Wyndham owner to “see” if there’s any available Worldmark inventory and it costs $99 per reservation when you actually book a vacation across the two systems. So 14 years and counting with no systems integration. If HGVC were to be acquired, it’s a pretty safe bet it would be left alone for the foreseeable future, at least based upon past Wyndham performance.


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There never will be a true and complete integration between Wyndham and Worldmark. It would take a Super Majority vote of Worldmark Members (not including Developer owned Points) to change Worldmark enough to allow for such an integration. Nor will there ever be online access for Club Pass. When you make a Club Pass Reservation (Wyndham or Worldmark) there has to be Points from the other system in the Pool. One reason a Wyndham Member might not see have much availability is only a very small % of Worldmark Members make Reservations through Club Pass. Thus not many Worldmark Points in the Pool. The Point Cost for a Worldmark Member is too high. I can Book a 2 Bedroom at Bali Hai through RCI for 10,000 Worldmark Points. But through Club Pass that same Reservation is 20,000 Worldmark Points. So why should a Worldmark Member ever use Club Pass?

 

[HitchHiker71]

There never will be a true and complete integration between Wyndham and Worldmark. It would take a Super Majority vote of Worldmark Members (not including Developer owned Points) to change Worldmark enough to allow for such an integration. Nor will there ever be online access for Club Pass. When you make a Club Pass Reservation (Wyndham or Worldmark) there has to be Points from the other system in the Pool. One reason a Wyndham Member might not see have much availability is only a very small % of Worldmark Members make Reservations through Club Pass. Thus not many Worldmark Points in the Pool. The Point Cost for a Worldmark Member is too high. I can Book a 2 Bedroom at Bali Hai through RCI for 10,000 Worldmark Points. But through Club Pass that same Reservation is 20,000 Worldmark Points. So why should a Worldmark Member ever use Club Pass?

There was a clear indication directly from the COO at the annual Wyndham owners meeting in Austin this year that online reservations using Club Pass will be delivered. They didn’t clearly indicate this deliverable will come as part of Project Holiday - the newer online reservation system coming later this year - but it’s on the technology roadmap. The current “dial in” Club Pass reservation system was only “phase one” from what I heard with my own ears.


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[alwysonvac]

For those hoping HGVC is eventually sold to Marriott or II (which is also owned by Marriott), be careful what you wish for. We Hyatt owners are feeling the full effect of Marriott ownership this year after absorbing huge MF increases in 2020, ranging from a minimum of 8% up to as much as 40% over 2019 rates, when Hyatt was still owned by Hyatt...

This caught my attention, since Vistana was purchased by Marriott.

Your post is a little misleading. Some of the MFs were lower than 8%. I think the highest in the 2020 MF thread was 15% with the exception being the resort in Puerto Rico.

From the HYATT 2020 MF thread - https://tugbbs.com/forums/threads/sticky-2020-hyatt-maintenance-fees.296295/

​

Charlieth0 posted​

Hyatt Pinon Pointe EOY ​

2.6% increase over (last even year in 2018) ​

​

echino posted ​

Hyatt Residence Club Bonita Springs, Coconut Plantation​

2020 Total $1,418.34​

-1.8% decrease ​

​

HenryT posted​

Hyatt Sunset Harbor ​

Total $1,763.57​

0.37% increase​

​

You posted the following at 8% and indicated the main drivers for the increase​

FYI, the proposed budget for Hyatt Highlands Inn calls for a stiff 7.9% increase from $1,590 in 2019 to $1,716 in 2020. Ugh. That said, all of the roofs--which were wood shingle and, therefore, a definite fire hazard--have been or are being replaced with fire resistant materials.​

​

Here is the breakdown courtesy of the owners association president:​

​

There was only one Hyatt resort in Puerto Rico that was in the 40% range and it was due to the one time special assessment. These owners also had their MF reduced by 50% for two years and transaction fees waived if they used their points within the club. If they were paying full MF for the previous years maybe this won’t seem so steep at 21.27% quoted below (which excludes the one time special assessment).
NOTE: Insurance rates typically increase after a hurricane.

grevas1 posted
Hyatt Hacienda del Mar 2020-
Operating Fee- $1533.14 = 30% increase from 2019
Reserve fee- $350 = -7.72% decrease
M/F- $1883.14 = 21.27% increase

Disaster Recovery Reserve (one time fee)= $420.10
Total fees for 2020- $2303.24 = 48.32% from 2019

grevas1 posted
According to the newsletter the management team sends out, if you call Hyatt the transaction fees will be waived if used within Hyatt Residence Club. As for maintenance fees, my maintenance fees have been slashed/reduced by 50% for the last two years.
View attachment 13292

 

[WalnutBaron]

This caught attention, since Vistana was purchased by Marriott.

Your post is a little misleading. Some of the MFs were lower than 8%. I think the highest in the 2020 MF thread was 15% with the exception being the resort in Puerto Rico.

From the HYATT 2020 MF thread - https://tugbbs.com/forums/threads/sticky-2020-hyatt-maintenance-fees.296295/

​

Charlieth0 posted​

Hyatt Pinon Pointe EOY ​

2.6% increase over (last even year in 2018) ​

​

echino posted ​

Hyatt Residence Club Bonita Springs, Coconut Plantation​

2020 Total $1,418.34​

-1.8% decrease ​

​

HenryT posted​

Hyatt Sunset Harbor ​

Total $1,763.57​

0.37% increase​

​

You posted the following at 8% and indicated the main drivers for the increase​

FYI, the proposed budget for Hyatt Highlands Inn calls for a stiff 7.9% increase from $1,590 in 2019 to $1,716 in 2020. Ugh. That said, all of the roofs--which were wood shingle and, therefore, a definite fire hazard--have been or are being replaced with fire resistant materials.​

​

Here is the breakdown courtesy of the owners association president:​

​

There was only one Hyatt resort in Puerto Rico that was in the 40% range and it was due to the one time special assessment. These owners also had their MF reduced by 50% for two years and transaction fees waived if they used their points within the club. If they were paying full MF for the previous years maybe this won’t seem so steep at 21.27% quoted below (which excludes the one time special assessment).
NOTE: Insurance rates typically increase after a hurricane.

grevas1 posted
Hyatt Hacienda del Mar 2020-
Operating Fee- $1533.14 = 30% increase from 2019
Reserve fee- $350 = -7.72% decrease
M/F- $1883.14 = 21.27% increase

Disaster Recovery Reserve (one time fee)= $420.10
Total fees for 2020- $2303.24 = 48.32% from 2019

grevas1 posted
According to the newsletter the management team sends out, if you call Hyatt the transaction fees will be waived if used within Hyatt Residence Club. As for maintenance fees, my maintenance fees have been slashed/reduced by 50% for the last two years.
View attachment 13292

Thanks for the correction. FYI, here are the increases by resort as reported by Hyatt owners for 2020:

Hyatt Pinon Pointe (Sedona) 7.9%
Hyatt Hacienda Del Mar (Puerto Rico) 21.3% + Disaster Recovery Fee=48.3%
Hyatt Windward Pointe (Key West) 13.7%
Hyatt Beach House (Key West) 14%
Hyatt Highlands Inn (Carmel) 7.9%

Those are the resorts being reported so far.

 

[geist1223]

There was a clear indication directly from the COO at the annual Wyndham owners meeting in Austin this year that online reservations using Club Pass will be delivered. They didn’t clearly indicate this deliverable will come as part of Project Holiday - the newer online reservation system coming later this year - but it’s on the technology roadmap. The current “dial in” Club Pass reservation system was only “phase one” from what I heard with my own ears.


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And Wyndham's other computer updates/changes have been so smooth and worked so well.

 

[pedro47]

The hedge funds managers are loving this, because it is driving down their cost to takeover this division of Hyatt. IMHO.

 

[Mowogo]

All the uncertainty is why I’ve been happy to pick up Vegas low seasons, since I know I can rent them most years in a worst case scenario, since CES is in the low season for all the Vegas properties.


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[brp]

All the uncertainty is why I’ve been happy to pick up Vegas low seasons, since I know I can rent them most years in a worst case scenario, since CES is in the low season for all the Vegas properties.

Are you doing Home Week bookings for CES, or just renting part weeks? Also, what venues are you using for renting, if I may ask?

Cheers.

 

[Mowogo]

They would be home week, right now my portfolio is Paradise, which is right next to CES venues.


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[CalGalTraveler]

@Mowogo Interesting strategy. We also own Paradise. It would be nice to have a fallback for years we dont need the points. What kind of profit do you realize? Where do you advertise? How far in advance do they book?

 

[Mowogo]

@Mowogo Interesting strategy. We also own Paradise. It would be nice to have a fallback for years we dont need the points. What kind of profit do you realize? Where do you advertise? How far in advance do they book?

I haven’t actually rented out yet, but for reference one year before I discovered how easy it was to buy, I paid $1200 to stay in a 2BR at Wyndham Grand Desert during the same week


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[AwayWeGo]

Takeover of HGVC by Walmart or Amazon would have the most entertainment value.

( Just saying. )

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[rog2867]

My suggestion: If you care about this and have thinking similar to Hilton, I suggest you send an email to reinforce their fears. Let them know that HGVC managed by Wyndham or Diamond will irreparably damage your view of the Hilton brand and that you'll consider leaving both Hilton and HGVC if something like this were to occur. I guarantee you Wyndham and Diamond are pulling out every trick in the book to make Hilton feel ok about this...and we should be making sure Hilton knows this matters to owners. You can send an email to the CEO's office (of course he won't be reading these, but they are more likely to get to the right hands) at christopher.nassetta@hilton.com with cc to ir@hilton.com.

I understand there may be some who think it might not be so bad being merged into Wyndham or Diamond, but I for one am not interested in becoming part of those behemoths.

I sent it to them both, even got a response from Chris office. Saying thanks for my input.

 

[MamaBess]

I sent it to them both, even got a response from Chris office. Saying thanks for my input.

Thank You for the email contacts. I sent off our email this morning expressing our concerns over this matter. I did let them know that my husband and I opted NOT to purchase any more HGV products due to the possibility of the sale of HGV to Wyndham or Diamond. I also let them know that we have recommended the same course of action to my sister-in-law. I made it very clear that there is much discussion of this possible action in the vacation ownership world, and that those of us who have been loyal to HGV are very concerned. Thanks again for this info. I dont know how much good it will do, but we need to do what we can.

 

[Tamaradarann]

Thank You for the email contacts. I sent off our email this morning expressing our concerns over this matter. I did let them know that my husband and I opted NOT to purchase any more HGV products due to the possibility of the sale of HGV to Wyndham or Diamond. I also let them know that we have recommended the same course of action to my sister-in-law. I made it very clear that there is much discussion of this possible action in the vacation ownership world, and that those of us who have been loyal to HGV are very concerned. Thanks again for this info. I dont know how much good it will do, but we need to do what we can.

I sent a letter also and included that if another company bought HGVC and significantly changed the flexibility of the reservation system that I would be selling all of my 6 HGVC timeshares.

 

[Mr Smith]

IMHO Hilton wouldn’t care if you sold your hgvc properties. It has little benefit to them. You need to let them know it will affect your view of Hilton and you will not only sell your hgvc properties, but also refuse to use Hilton hotels as you feel it tarnishes their name/brand. By stating you won’t use Hilton Hotels you will hurt their direct revenue as well as the smaller 5% from hgvc.

 

[Tamaradarann]

IMHO Hilton wouldn’t care if you sold your hgvc properties. It has little benefit to them. You need to let them know it will affect your view of Hilton and you will not only sell your hgvc properties, but also refuse to use Hilton hotels as you feel it tarnishes their name/brand. By stating you won’t use Hilton Hotels you will hurt their direct revenue as well as the smaller 5% from hgvc.

I didn't contact Hilton and Hilton is not the company that is being taken over. I contacted HGVC. They do care about resales since that is one of the factors negatively effecting their sales. We also stay for many nights at HGVC properties and usually don't advertise resales to other guest. That would change if HGVC is bought by another company and we start to sell our timeshares.

 

[Mr Smith]

Maybe I’m missing something here.

If the current HGVC ownership sells to another company, the current HGVC ownership will not care if you sell your properties as they will no longer own it.

Although Hilton does not own HGVC, it is my understanding they have the right to prevent HGVC from continuing to use the Hilton name/brand. If they do so, they can potentially kill the value of HGVC as it will no longer have access to Hilton customers for sales and also Hilton branding (a big part of HGVC’s value). This may prevent a purchase of HGVC if they know upfront Hilton will pull the rights to the Hilton brand.

Hilton does not want a new company with a current bad/lower reputation dragging the Hilton name through the mud. This will hurt the Hilton brand and hotels. By telling Hilton (not HGVC) this will affect their brand, it will reinforce their concerns and hopefully push them to continue to try and kill this deal

 

[tombanjo]

I agree that Hilton Hotels has more ability to influence this deal as they have rights to the name and access to their customer base which is a prime source for sales leads. The value of just a collection of management agreements with properties formerly known as Hilton is not as great as the present value with HGVC and Hilton closely working together.

 

[Tamaradarann]

Maybe I’m missing something here.

If the current HGVC ownership sells to another company, the current HGVC ownership will not care if you sell your properties as they will no longer own it.

Although Hilton does not own HGVC, it is my understanding they have the right to prevent HGVC from continuing to use the Hilton name/brand. If they do so, they can potentially kill the value of HGVC as it will no longer have access to Hilton customers for sales and also Hilton branding (a big part of HGVC’s value). This may prevent a purchase of HGVC if they know upfront Hilton will pull the rights to the Hilton brand.

Hilton does not want a new company with a current bad/lower reputation dragging the Hilton name through the mud. This will hurt the Hilton brand and hotels. By telling Hilton (not HGVC) this will affect their brand, it will reinforce their concerns and hopefully push them to continue to try and kill this deal

I guess it depends on how your view the management of HGVC and who is making the decisions to sell HGVC. My position came from the perspective that top HGVC management either controlled or influenced the decision to sell HGVC to a private equity firm. Unless the private equity firm cleans house of top management they will continue to work in their current jobs for a new ultimate boss.

However, I totally agree that the Hilton name is a major factor in this takeover. I don't think that Hilton needs to be told about the effects that this takeover could have on their name. They know these other timeshare companies better than we do. Their ability to withhold the Hilton Brand Name is the ultimate hammer. How they use it will be interesting.

 

[terces]

Hilton and HGVC are so closely tied at the hip that I just cannot imagine them letting Diamond take over the important role HGVC plays in helping Hilton monetize some of its assets. For instance at Ocean Towers, HGVC is in the process of converting 600 rooms from Hilton Hotels to HGVC timeshares. Here is my "back of the napkin" math for the project: 600 rooms x 52 weeks x $53,000 per week = One Billion Six Hundred and Fifty Million Bucks. Is Hilton really going to let these second rate operators take over the important job of selling these timeshares. I doubt it. Maybe Hilton and HGVC just simply need to privative the company and take it off the market

 

[JIMinNC]

Hilton and HGVC are so closely tied at the hip that I just cannot imagine them letting Diamond take over the important role HGVC plays in helping Hilton monetize some of its assets. For instance at Ocean Towers, HGVC is in the process of converting 600 rooms from Hilton Hotels to HGVC timeshares. Here is my "back of the napkin" math for the project: 600 rooms x 52 weeks x $53,000 per week = One Billion Six Hundred and Fifty Million Bucks. Is Hilton really going to let these second rate operators take over the important job of selling these timeshares. I doubt it. Maybe Hilton and HGVC just simply need to privative the company and take it off the market

I know Hilton Hotels bought the Hilton Waikoloa hotel in 2002 from the investment group that previously owned it, but I believe that when Hilton Hotels spun off HGVC into a new company they also spun off the hotel real estate assets they owned into an REIT owned by other investors. So if that is the case, any proceeds from the sale of Ocean Tower would not accrue to Hilton Hotels, but to the investors in the REIT.