HOTEL OWNER Will Reflag or Sell 122 Marriott Int'l Properties / Kauai Beach Club Timeshare Co-Location Affected? [MERGED]

[zentraveler]

Marriott was required to make payments regardless of hotel income so they defaulted.
But Sonesta has been doing this to a bunch of hotels to convert to their brand, My guess is Marriott figured that the cost to maintain the flag on one wing of the property was not worth it. They have other flagged properties on island. And remember Marriott is not MVCI, so impact to vacation club was probably not even considered.

Looked around and don’t see any changes but property is still pretty empty so hard to tell.

So Service Properties Trust "owns" these hotels and the management is done by Marriott, Sonesta, whomever etc.

A similar hotel changed management hands at the Four Seasons Hotel which was similarly "part" of the vacation property at Four Seasons Aviara. It was quite an acrimonious split (now a Park Hyatt) and was a real loss for the Four Seasons vacation property in Carlsbad CA.

 

[1Kflyerguy]

Marriott was required to make payments regardless of hotel income so they defaulted.
But Sonesta has been doing this to a bunch of hotels to convert to their brand, My guess is Marriott figured that the cost to maintain the flag on one wing of the property was not worth it. They have other flagged properties on island. And remember Marriott is not MVCI, so impact to vacation club was probably not even considered.

Looked around and don’t see any changes but property is still pretty empty so hard to tell.

I wonder if Marriott actually intended to lose this hotel, or if instead they misjudged their leverage. Maybe they were expecting Service Properties to blink, and allow them more time to pay.. I have seen that happen in other business situations..

 

[dioxide45]

I wonder if Marriott actually intended to lose this hotel, or if instead they misjudged their leverage. Maybe they were expecting Service Properties to blink, and allow them more time to pay.. I have seen that happen in other business situations..

I think Marriott International was caught in a bad contract where they had to pay out a certain level of return regardless of the situation. When COVID hit, they didn't want to still pay out for what were empty hotels. THey were losing money. This got them out of the contract.

 

[rthib]

I wonder if Marriott actually intended to lose this hotel, or if instead they misjudged their leverage. Maybe they were expecting Service Properties to blink, and allow them more time to pay.. I have seen that happen in other business situations..

Sonesta was doing this and done this with hundreds of hotels, so I doubt Marriott was surprised.

 

[rthib]

Talked to front desk today. He believes that Sonesta will keep the current lobby check-in (the one down the escalator and then left across from fishes and MVCI was going to relocate.
They all seem pretty clueless otherwise about what is happening. I didn't see any signage other than MVCI anywhere.

 

[1Kflyerguy]

I think Marriott International was caught in a bad contract where they had to pay out a certain level of return regardless of the situation. When COVID hit, they didn't want to still pay out for what were empty hotels. THey were losing money. This got them out of the contract.

True, i would guess a lot of the hotel management contracts require some level of fixed guaranteed payments back to the owner...

Sonesta was doing this and done this with hundreds of hotels, so I doubt Marriott was surprised.

I wasn't implying that Marriott was not aware of Sonesta, or the possibility of hotels changing flags, just wondering if they really wanted out of the contract or perhaps misjudged. That hotel was frequently featured in Marriott's Hawaii advertising, so they must consider it an aspirational destination that would help drive traffic to Marriott in general.

We have never stayed there, and only visited once to eat at Dukes, so i don't that much about the property. Maybe it needed a lot of renovations or was otherwise losing money over the long term and as both of you mentioned they were just as happy to give it up..

 

[armrecsys]

Just like most changes no one who needs to know , knows nothing.

 

[Swice]

It was the site of our very first "presentation" -- on our honeymoon in 1997. The sales lady was super-- she chatted us up and found out we flew free on first class, we were staying free in a suite on points (work travel). She was so laid back and said, "you don't need this right now, but I have to keep you a certain amount of time." She showed us around and was so no pressure. We walked out and looked at each other and said, "if we ever buy a timeshare, we will buy Marriott." We did about four years later.

 

[jetguy]

It was the site of our very first "presentation" -- on our honeymoon in 1997. The sales lady was super-- she chatted us up and found out we flew free on first class, we were staying free in a suite on points (work travel). She was so laid back and said, "you don't need this right now, but I have to keep you a certain amount of time." She showed us around and was so no pressure. We walked out and looked at each other and said, "if we ever buy a timeshare, we will buy Marriott." We did about four years later.

This was fun to read. Kauai Beach Club was the site of our very first presentation -- on our honeymoon in 1997. We had flown over free in F/C (work/travel) and were staying 5 days free, in a suite on a "Timeshare Presentation Offer". Our stories diverge here. We walked out and looked at each other...... as owners of an OF EOY Kauai week (this after much negotiation and sweetening of several previous offers, as my wife kept reminding me we weren't buying any timeshare). We never regretted that decision and in 2007, went on to own a Maui MM1 fixed OF week. We've had 24 years of awesome Hawaii vacations and still no regrets!

 

[SueDonJ]

Now that the mechanics of the hotel acquisition appear to be understood, this thread is being locked to discourage questions/comments about the impacts being felt at the property itself.

There's a current thread here: Marriott Kauai Beach Club and co-located Royal Sonesta Hotel - Info/Questions