Hilton Grand Vacations strikes deal to acquire Diamond Resorts

[Talent312]

I wrote to the CEO's office of Diamond Resorts this past Tuesday. In the past, when I have written his office I usually receive a response within a couple of hours either via email, phone call, or both. This time, nada, zilch, 5 days later.

Since the announcement, Diamond sales staff are being very tight lipped about the pending merger.

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They may be too busy polishing their resumes and calling head-hunters.
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[Tamaradarann]

Most of the benefits received by Diamond owners in The Club come from what you refer to as Elite status. So since you don't get Elite status with your dirty points, same as we don't get Metal status (Silver, Gold, Platinum), what benefits do you get other than to book units?

You get all the benefits that come as a member that bought from the developer. Even buying from the developer doesn't just give you Elite Status, Elite Status Plus or Elite Status Premier. Only buying enough points FROM THE DEVELPER gives you that status. Those benefits are mainly discounts on making reservations, saving points, guest certificates. You can also get free room upgrades if available. There is a catch with that benefit. Under normal circumstances in Hawaii, where we normally want to stay, there are never rooms available the time that is needed to get upgraded. You also get access to a special non HGVC resort collection. However, that collection costs as much in points for one night that I pay for a week in the Hilton Hawaiian Village.

 

[brp]

This acquisition interests me because I have become bored with Hilton’s collection of resorts and DRI’s collection has something to offer that interests us......... if the price is right.

We're not bored in the sense that they have locations in places we have gone frequently and will continue to go (Big island annually, NYC 2-3 times/year). Even the occasional Vegas (where we actually own most of our points ).

We go plenty of other places and have various hotel memberships, statuses (stati? ) and points to use there.

With that said, fresh blood would be very welcome.

Cheers.

 

[Tamaradarann]

DRI dirty point owners are used to the restriction that they can only book resorts in their collection so IMO, they wouldn't bat an eye at not being able to book an HGVC resort since it's not in their collection.

However, I believe that goal is to merge the collections and get owners to benefit as much as possible from the entire timeshare system. To do that they need to experience each others collections, buy more points in one of the timeshares, pay reservation fees, get the benefits of the merger and rave about the new HGVC system to get others to buy into the system.

 

[Hubble]

This is interesting and I wonder what properties will be in the HGV system going forward?

I’ve stayed in a few Diamond properties. Some are really nice and some are meh.

Cabo Azul and Embarc Palm Desert are fantastic. I’d use my points for either one of those.

My favorite Diamond resort is the Royal Regency in Paris. No sales presentation. VA Beach and Williamsburg were nice, but the sales people were brutal. I understand they have outrageous resort fees now, so would never consider staying there.

 

[dougp26364]

However, I believe that goal is to merge the collections and get owners to benefit as much as possible from the entire timeshare system. To do that they need to experience each others collections, buy more points in one of the timeshares, pay reservation fees, get the benefits of the merger and rave about the new HGVC system to get others to buy into the system.

Simply put, the goal is to enhance the owners experience by getting then to pay more for the experience.

I’m hoping for a simple, relatively inexpensive, joiner fee. What I expect is a minimum purchase requirement. I’m not saying I wouldn’t buy more. I am saying at this point I wouldn’t be excited about it either.

 

[CalGalTraveler]

I don’t think you’ll see it play out this way. The ratio of high value weeks in desirable locations to owners will remain the same after the merger is complete as it was when both companies were separated. I think overall HGVC members own with Hilton because of the quality. They’re not likely to be in that big of a hurry to jump on DRI resorts, which overall are a lessor quality (based on our experience in both pools of resorts).

Where you may see an issue is in Hawaii where there is pent up frustration among HGVC members. Hilton will need to protect DRI owners of the Hawaiian trust. Even the most prudish of Hilton owners are likely to take a chance with a former DRI resort, just to get to Maui or Kauai. They might complain about it later but my bet is they’ll bite. Lake Tahoe may be the one other location I can think of were west coast HGVC members could be anxious for an opportunity to reserve.

Hilton can protect DRI deeded week and Hawaiian Trust owners by holding the line with their own club rules. That being you can’t book a club reservation until you’re within 9 months of the LAST day of your planned reservation. DRI allows trust owners to book, if I recall correctly, at 13 months, deeded weeks owners to book their home resort at 12 months and all others with points to book at 10 months. My memory was you needed to be on it at 10 months if you wanted to get a week at KBC or The Point at Poipu. If (and this is PURE speculation) HGVC holds those reservation availability dates, DRI owners won’t see a change in availability unless they wait until that 9 month date, then you’ll see a decline in availability.

As far as DRI owners booking into HGVC resorts, I bet Hilton does a pretty good job of protecting their own members. My guess is the points required to book into a “higher” level resort will dissuade the majority of DRI members. After all, what has HGVC got as far as location that DRI doesn’t already have? Maybe Oahu at HHV. Perhaps the Big Island resorts. Otherwise it will be much easier and cost effective for DRI owners to stay with their own collections.

Of course, your guess is just as good as mine. We probably won’t know who guessed correctly for another 5 years or more.

I appreciate your thoughts on timing. Very interesting. As indicated on this thread, there are more DRI locations than HI and Tahoe that would be of interest to HGVC owners: Cabo Azul, Sedona, Embarc (esp. Palm Desert, Whistler), Perhaps VA Beach (for East Coast owners), Paris.

The challenge is that today the "premium" portfolio, HGVC, has fewer locations than the DRI portfolio. IMO...unless the cost of enrollment is low, it will be difficult to upsell DRI trust owners just on quality alone especially if most HGVC resorts are in the same locations as DRI unless they expand the portfolio and assure more availabilty.

We've heard a lot about properties that HGVC owners would like to visit. Are there HGVC properties that DRI owners would like to visit?

In addition, if DRI owners are given the same 9 month club as HGVC this will cause much dissatisfaction in the HGVC base as more people (DRI upsell and HGVC) will be competing for limited premium HGVC inventory unless the DRI upsell brings a commensurate amount of premium VOIs (e.g. prime weeks in HI, Cabo Tahoe, Sedona) out of the trust and they become affiliate reservations available to HGVC club reservations to expand the pool of quality resort VOIs. Otherwise you have more owners competing for a finite pool of quality VOIs thus shrinking club opportunity for all.

We should also consider that HGVC is also competing with MVC which has many locations with MVC standard high quality. Although HGVC portfolio doesn't need to have as many locations as MVC, they will need to take steps to add in key locations. Perhaps adding Embarc, and weeks from HI and Cabo Azul and Sedona to the HGVC portfolio will be a first step?

 

[ccwu]

DRI dirty point owners are used to the restriction that they can only book resorts in their collection so IMO, they wouldn't bat an eye at not being able to book an HGVC resort since it's not in their collection.

I assume the exchange between DRI resorts and HGV would be like RCI or II exchange. Dri members will get what HGV members willing to deposit into the system that Dri club member could use club reservation to get the HGV resorts. So does HGV will be able to use the Rci portal to get Dri member deposited.

As being HGV member, we are not restricted to HGV resorts. We con convert points to HHONOR points to stay at world wide Hilton hotels. I assume Dri club members might be able to convert their points to HGV or HHonor points in return to reserve either Hilton hotels or HGV timeshares. You do lose the value by converting. I think the exchange portal is thru your own club portal just like HGV uses Rci to exchange. So if Dri dirty points owner can not use Dri club portal, I wonder if they would be able to exchange into HGV. Unless you own a HGV deed that would give you HGV points, you would be restricted to use your own club reservation.

HGV Maui resort is opening pretty soon. Most members go to Maui using either Rci exchange or using Hilton hotels. (I personally prefer Maui Waldorf Astoria).


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[Fried_shrimp]

You get all the benefits that come as a member that bought from the developer. Even buying from the developer doesn't just give you Elite Status, Elite Status Plus or Elite Status Premier. Only buying enough points FROM THE DEVELPER gives you that status. Those benefits are mainly discounts on making reservations, saving points, guest certificates. You can also get free room upgrades if available. There is a catch with that benefit. Under normal circumstances in Hawaii, where we normally want to stay, there are never rooms available the time that is needed to get upgraded. You also get access to a special non HGVC resort collection. However, that collection costs as much in points for one night that I pay for a week in the Hilton Hawaiian Village.

With Diamond, you also get discounted room rates within a certain period of time but unfortunately that discount is not as valuable as it used to be since it has changed to each resort's manager to decide if they want to provide the discount. Dirty members can also save their points (at not cost unlike HGVC). Metal members get X amount of free guest certificates a year whereas a dirty point owner has to pay for them (like a metal member who has used up their free ones) for $35 per certificate. Of course, with Diamond, you can make a family member or friend an Associate member on your account and reservations for those folks don't count against your guest certificates (as they are part of your account).

 

[Fried_shrimp]

However, I believe that goal is to merge the collections and get owners to benefit as much as possible from the entire timeshare system. To do that they need to experience each others collections, buy more points in one of the timeshares, pay reservation fees, get the benefits of the merger and rave about the new HGVC system to get others to buy into the system.

Unfortunately, I don't think you will find a Diamond member "raving" about the HGVC system since, compared to Diamond, HGVC kind of nickel and dimes y'all to death, IMHO.

 

[Fried_shrimp]

My favorite Diamond resort is the Royal Regency in Paris. No sales presentation. VA Beach and Williamsburg were nice, but the sales people were brutal. I understand they have outrageous resort fees now, so would never consider staying there.

Resort fees are only charged on non-Diamond reservations. That being said, if a Diamond owner decided to book a Diamond resort via II/RCI/Booking.com/etc..., they would be charge the resort fees even though they are owners. I would ASSUME, once the merger is complete, that HGVC owners would not be charged the resort fees on an HGVC reservation (considering y'all bought us and not vice versa).

Yes, the location of the Royal Regency is awesome for visiting Paris. IMO, you should also try Palazzo Soriano for visiting Rome or Alpine Club for visiting Salzburg and the Eagle's Nest.

FYI, the sales team at VA Beach and Williamsburg are kittens compared to the sales folk at the KBC.

 

[Fried_shrimp]

I appreciate your thoughts on timing. Very interesting. As indicated on this thread, there are more DRI locations than HI and Tahoe that would be of interest to HGVC owners: Cabo Azul, Sedona, Embarc (esp. Palm Desert, Whistler), Perhaps VA Beach (for East Coast owners), Paris.

The challenge is that today the "premium" portfolio, HGVC, has fewer locations than the DRI portfolio. IMO...unless the cost of enrollment is low, it will be difficult to upsell DRI trust owners just on quality alone especially if most HGVC resorts are in the same locations as DRI unless they expand the portfolio and assure more availabilty.

We've heard a lot about properties that HGVC owners would like to visit. Are there any HGVC properties that DRI owners would like to visit?

In addition, if DRI owners are given the same 9 month club as HGVC this will cause much dissatisfaction in the HGVC base as more people (DRI upsell and HGVC) will be competing for limited premium HGVC inventory unless the DRI upsell brings a commensurate amount of premium VOIs (e.g. prime weeks in HI, Cabo Tahoe, Sedona) out of the trust and they become affiliate reservations available to HGVC club reservations to expand the pool of quality resort VOIs. Otherwise you have more owners competing for a finite pool of quality VOIs thus shrinking club opportunity for all.

We should also consider that HGVC is also competing with MVC which has many locations with MVC standard high quality. Although HGVC portfolio doesn't need to have as many locations as MVC, they will need to take steps to add in key locations. Perhaps adding Embarc, and weeks from HI and Cabo Azul and Sedona to the HGVC portfolio will be a first step?

Strictly, IMO, HGVC offers very few locations that Diamond doesn't already have. I find the resorts Diamond offers to be plenty good enough for my needs so no, there aren't any HGVC properties that I would care to visit. Especially when that most likely would only be available with some type of upgrade or purchase to make my Diamond points eligible for use in HGVC.

 

[Fried_shrimp]

I assume the exchange between DRI resorts and HGV would be like RCI or II exchange. Dri members will get what HGV members willing to deposit into the system that Dri club member could use club reservation to get the HGV resorts. So does HGV will be able to use the Rci portal to get Dri member deposited.

As being HGV member, we are not restricted to HGV resorts. We con convert points to HHONOR points to stay at world wide Hilton hotels. I assume Dri club members might be able to convert their points to HGV or HHonor points in return to reserve either Hilton hotels or HGV timeshares. You do lose the value by converting. I think the exchange portal is thru your own club portal just like HGV uses Rci to exchange. So if Dri dirty points owner can not use Dri club portal, I wonder if they would be able to exchange into HGV. Unless you own a HGV deed that would give you HGV points, you would be restricted to use your own club reservation.

HGV Maui resort is opening pretty soon. Most members go to Maui using either Rci exchange or using Hilton hotels. (I personally prefer Maui Waldorf Astoria).


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That would require Diamond converting their access to RCI. Until 31 Dec 2020, we accessed II for exchanges outside of Diamond and they just recently revamped DEX for point owners and moved all of us to DEX and dropped II. Owners could continue utilizing II if they wished but would have to pay for their own II membership instead of having it included in their maint fees.

 

[Zenichiro]

Does anyone know if Diamond owns Teton Club? I’d definitely trade for that when we visit Yellowstone.

 

[CalGalTraveler]

Unfortunately, I don't think you will find a Diamond member "raving" about the HGVC system since, compared to Diamond, HGVC kind of nickel and dimes y'all to death, IMHO.

IDK...When the potential merger with HGVC was announced in late 2019 I started a poll in the Diamond Forum asking about owner happiness with the Diamond System since I knew zero about Diamond. Almost 60% (58.5%) of Diamond Owners said they were neutral or unhappy with Diamond. Not a good sat score for Diamond.

How Happy Are You With Your Diamond Ownership?

Would love to hear from Diamond Owners. If we are missing a major category, please let let me know. Also please add in the comments what you own and why you voted the way you did.

tugbbs.com

 

[CalGalTraveler]

@Fried_shrimp FYI to contrast, here is the happiness poll for HGVC owners (28% neutral/unhappy HGVC vs. 58% neutral/unhappy Diamond).

 

[Fried_shrimp]

IDK...When the potential merger with HGVC was announced in late 2019 I started a poll in the Diamond Forum asking about owner happiness with the Diamond System since I knew zero about Diamond. Almost 60% (58.5%) of Diamond Owners said they were neutral or unhappy with Diamond. Not a good sat score for Diamond.

How Happy Are You With Your Diamond Ownership?

Would love to hear from Diamond Owners. If we are missing a major category, please let let me know. Also please add in the comments what you own and why you voted the way you did.

tugbbs.com

View attachment 33646

I would be one of those top voters. I am very happy with my point ownership (14 years with Diamond now ever since they took over Sunterra). IMO, most of the people that are unhappy with Diamond are because of sales meetings where they were told half truths and some even lies and they bought into those lies. Also, I have found that many people buy because of some expected benefit and not because of wanting to travel more with Diamond and again, IMO, that is the absolute worst reason to make a purchase as a benefit can be changed or gotten rid of at the blink of an eye.

Any questions you have about Diamond I'd be happy to answer.

 

[Fried_shrimp]

@Fried_shrimp FYI to contrast, here is the happiness poll for HGVC owners (28% neutral/unhappy HGVC vs. 58% neutral/unhappy Diamond).

View attachment 33649

HGVC owners knew what they were getting into (regarding fees) when they purchased HGVC. Depending on how the merger goes, if Diamond owners are saddled with those same fees we would be very upset as we don't pay them at this time.

 

[Fried_shrimp]

IDK...When the potential merger with HGVC was announced in late 2019 I started a poll in the Diamond Forum asking about owner happiness with the Diamond System since I knew zero about Diamond. Almost 60% (58.5%) of Diamond Owners said they were neutral or unhappy with Diamond. Not a good sat score for Diamond.

How Happy Are You With Your Diamond Ownership?

Would love to hear from Diamond Owners. If we are missing a major category, please let let me know. Also please add in the comments what you own and why you voted the way you did.

tugbbs.com

View attachment 33646

To note: Embarq owners have nothing to do with Diamond and their owners other than paying their maint fees to Diamond. The two companies were never merged so Diamond has no access to Embarq resorts and vice versa unless exchanging through II.

 

[CalGalTraveler]

HGVC owners knew what they were getting into (regarding fees) when they purchased HGVC. Depending on how the merger goes, if Diamond owners are saddled with those same fees we would be very upset as we don't pay them at this time.

My crystal ball doesn't tell me exactly how they will structure. However one thing is certain. They need to pay for the debt acquired from the merger, the merger costs of re-branding, training staff, and IT, and upgrading DRI resorts to HGVC quality. They need to get the revenue from somewhere to pay for this.

 

[Fried_shrimp]

My crystal ball doesn't tell me exactly how they will structure. However one thing is certain. They need to pay for the debt acquired from the merger, the merger costs of re-branding, training staff, and IT, and upgrading DRI resorts to HGVC quality. They need to get the revenue from somewhere to pay for this.

There are many who theorize that Diamond's resorts won't be upgraded/branded HGVC. I agree that HGVC will need to get revenue from somewhere but if they expect Diamond owners to pony up, I'm afraid that a lot of them will just decide to walk since the value to stay won't be there (yes, I am one of those people). That would not be good for the HOA or HGVC to have a ton of extra units with no maint fees coming in on them. And unfortunately, they communicated the sale but no plan to go with the sale which makes a lot of folks on this side of the fence very nervous.

 

[CalGalTraveler]

There are many who theorize that Diamond's resorts won't be upgraded/branded HGVC. I agree that HGVC will need to get revenue from somewhere but if they expect Diamond owners to pony up, I'm afraid that a lot of them will just decide to walk since the value to stay won't be there (yes, I am one of those people). That would not be good for the HOA or HGVC to have a ton of extra units with no maint fees coming in on them. And unfortunately, they communicated the sale but no plan to go with the sale which makes a lot of folks on this side of the fence very nervous.

Who knows? Maybe they will offer low-cost deedbacks or upgrades to "dirty" resale deeded and points owners at desired resorts in order to obtain cheap inventory for the portfolio and give them equal access rights as developer purchases. There seems to be pent-up demand for this since Diamond made these distinctions. If there are 100k users and charge $1000 to enroll or deedback, that's an easy $100 million.

Remember, as long as the quality is upgraded to Hilton standards, HGVC can place inventory they own on Hilton.com and earn rental revenue until the property is purchased. So walking away is not as big an issue as with Diamond which didn't have a hotel portal for marketing and rentals.

 

[dayooper]

Unfortunately, I don't think you will find a Diamond member "raving" about the HGVC system since, compared to Diamond, HGVC kind of nickel and dimes y'all to death, IMHO.

I think there’s a misunderstanding here. Yes, there’s fees, but you only pay for them if you use them. Many members buy in a specific location to go there during that week. Those that use their home week pay no extra fees. None, zilch, nada. Why would someone want to just use their home week? So they get to go where they bought. Those desirable weeks come at a high upfront up cost, especially from the developer. If you are going to pay that much, you want some assurancesthat you can get what you pay for.

My MF’s and club dues were ~$1225 this year. I used my points for a week in Hilton head. Now, I‘m using a free booking I made last May and just moved the dat until I found what I want. I would have paid $67 last year (the fees went down this year) so I’m getting a week at Ocean Oak on Hilton Head Island for ~$1300, all fees included (I’m adding what I would have paid if I didn’t take advantage of the free booking). I’m not sure what the MF’s and costs are for a Diamond, but I’m completely happy with my costs. HGVC MF’s are generally some of the lowest out if major chain system. If you are using your points for hotel like stays, you will pay more. Then again, there’s members like us that take longer family trips. You pay for what you use.

I empathize with your position. You built a portfolio to take advantage of the system. If nothing else, the not knowing would increase my anxiety. The only thing I can say is that I have seen first hand how HGVC treats their owners. They have been very good to us and the core of our system has remained in place. While my guess is there will be changes, I believe they will try to keep you happy. If you don’t like the changes to the system, you will have options.

 

[Fried_shrimp]

Who knows? Maybe they will offer low-cost deedbacks or upgrades to "dirty" resale deeded and points owners at desired resorts in order to obtain cheap inventory for the portfolio and give them equal access rights as developer purchases. There seems to be pent-up demand for this since Diamond made these distinctions. If there are 100k users and charge $1000 to enroll or deedback, that's an easy $100 million.

Remember, as long as the quality is upgraded to Hilton standards, HGVC can place inventory they own on Hilton.com and earn rental revenue until the property is purchased. So walking away is not as big an issue as with Diamond which didn't have a hotel portal for marketing and rentals.

Diamond rents out unsold inventory all the time (via Booking.com and Redweek.com and we even have our own portal https://www.diamondresortsandhotels.com/ , it's just not as well known as Hilton's) but the problem is that it can't be guaranteed like it is with maint fees. I was speaking with a VP in Orlando this past summer and Diamond had a big spike in unpaid maint fees due to Covid and it was really starting to hurt.

You're right, who knows? I can only say what I will do and what others on my FB site have stated. Many have stated that if we, as Diamond owners, are forced to utilize HGVC rules (pay for exchanges in network, pay to save points, 3 night minimum instead of 2 nights), we will walk away. I've been an owner for 32 years (part of Diamond since Diamond acquired Sunterra 14 years ago) and I feel I have gotten my monies worth out of my investment. I am not going to throw good money after bad and one of the two primary reasons for me converting me fixed weeks to points was because I was tired of paying every increasing RCI exchange fees (the other being able to finally do 2 night weekend stays instead of just a whole week). To be forced back into that would be a slap in the face to me and I would rather walk than play under HGVC rules. As I said before, y'all knew what to expect when you purchased into HGVC. We didn't have a say. If HGVC allows Diamond to be Diamond with some cross utilization, that's fine and dandy and I'm sure we'll get along nicely. If HGVC tries to integrate us completely with y'alls rules, you'll probably hear a lot of hollering from this side of the fence.

Just my 2 cents worth.

 

[Fried_shrimp]

I think there’s a misunderstanding here. Yes, there’s fees, but you only pay for them if you use them. Many members buy in a specific location to go there during that week. Those that use their home week pay no extra fees. None, zilch, nada. Why would someone want to just use their home week? So they get to go where they bought. Those desirable weeks come at a high upfront up cost, especially from the developer. If you are going to pay that much, you want some assurancesthat you can get what you pay for.

My MF’s and club dues were ~$1225 this year. I used my points for a week in Hilton head. Now, I‘m using a free booking I made last May and just moved the dat until I found what I want. I would have paid $67 last year (the fees went down this year) so I’m getting a week at Ocean Oak on Hilton Head Island for ~$1300, all fees included (I’m adding what I would have paid if I didn’t take advantage of the free booking). I’m not sure what the MF’s and costs are for a Diamond, but I’m completely happy with my costs. HGVC MF’s are generally some of the lowest out if major chain system. If you are using your points for hotel like stays, you will pay more. Then again, there’s members like us that take longer family trips. You pay for what you use.

I empathize with your position. You built a portfolio to take advantage of the system. If nothing else, the not knowing would increase my anxiety. The only thing I can say is that I have seen first hand how HGVC treats their owners. They have been very good to us and the core of our system has remained in place. While my guess is there will be changes, I believe they will try to keep you happy. If you don’t like the changes to the system, you will have options.

This is one of the differences. Y'all reference everything by your underlying deed where you own at. For us, there is no underlying deed. Since I am in the US Collection, there are 55 resorts that are my "Home" resort.....as such. And as a Club member, I can access any Diamond managed resort without an exchange fee (just different booking windows). Now, they could come up with a rule that Diamond owners wouldn't have to pay an exchange fee if booking in our own collection (which would be fine with me as I rarely go out of collection anyway) but that still would devalue the Diamond ownership for many of our members (the Latino Collection is the smallest at only 1 resort in collection and the US is the largest with 55).

Yes, I am familiar with Fixed or Home week usage. Did that for the first 18 years of ownership. And I enjoy going back to what was my home resort quite often. But for the last 14 years, I have also been able to enjoy going to almost 400 other resorts as well without paying an exchange fee so why would we ever want to go back to just 1 resort that can be used without extra fees? Kind of like giving up your car and getting a horse to go back and forth to work with.

Just for reference, my maint fees last year were about $8,900 and I got about 100 nights usage out of them (mostly 2 bdrm units as we have travel buddies we take almost everywhere).

That is exactly my concern. We don't know where this is going and we also purchased out portfolio based on how the system worked. I'm hoping HGVC realizes that and kind of leaves us alone other than making some kind of cross connection ability so y'all can utilize our resorts as well. I think that would be the best outcome but as CalGirl stated, who knows? That's the hardest part.