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How do you guys feel about Starwood's MF Increases?

j4sharks

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I have been contacted by a well known lawfirm to discuss Starwood's MF increases. I will take the call later today.

My own observation is that there is a big discrepancy between what the sales reps tell buyers (i.e. that MFs typically go up 1-3%) and what has actually been happening (e.g. up 10-11% annually for past 3 years in Maui). When you consider how tightly Starwood controls the HOA governance, including the renewal of its own contract to manage the properties, and the fact that owners have no real recourse to object to the fee increases (lest you lose the $$ you paid to become an owner by walking away), it is a question on my mind. Mind you, I love WKORV and WKV (where I own) and I think Westin does a good job running the properties; however, I am troubled by the seemingly absolute power Starwood has over my MFs.

How do other Starwood owners feel?
 

LisaRex

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I share your concern.

A red flag went up when I read the Owner's Handbook (which, of course, you don't see until after you own) and realized that Starwood gets the exclusive right to rent out or sell for cash and/or StarPoints any unbooked inventory, and they aren't required to reimburse the HOA one dime for these stays. Ultimately that means that we Owners are given the burden of maintaining the properties without being able to recoup the costs for the wear and tear borne by these rentals. It's a deeply troubling one-sided arrangement.

Equally or perhaps more troubling is the unfair and imbalanced stacking of the HOAs, which are supposed to represent management AND owners. The SVO HOAs are jokes.

I don't know about you, but my sole contact from my HOA is notice that I owe them money. I am not given any updates on how we fared last year, they don't address any questions or concerns, nor do they provide me any information other than a top-line budget report. I have never been provided contact information for any HOA board member in case I want to communicate with them. Notice of HOA meetings is given so late that it would be a hardship to attend.

The most recent proxy ballot didn't even list people's names, let alone useful information such as bios or contact information. I was only given the option of checking whether I wanted to vote for all, none or just the folks who showed up. I could have voted for Bernie Madoff for all I know. And that is absolutely ridiculous. I have essentially given up POA to an entity whose membership is kept secret from me.

Also ridiculous is that non-Starwood sanctioned people who do show an interest in running are not given any cooperation. One Owners reported that he could not be listed on the ballot because he hadn't been screened, and approved, by the current HOA. ARE YOU KIDDING ME? And even if somehow we were able to get our name on a ballot, we have no means of communicating with our constituency except via public means because Starwood won't release the Owners' names and addresses. There's no published process that I know of for how to run if I wanted to and there is certainly not an invitation to run for office.

Bottom line is that SVO currently does have absolute authority over their HOAs. In addition to double digit increases in annual MFs, owners are being socked with special assessments that run in the thousands. And we have no meaningful representation on the HOA, so our only recourse is to sell our timeshare or sue them. How ridiculous and sad.

The only good news is that the SAs are motivating people to take action. I know some SVV owners are VERY upset about the recent special assessments, and perhaps that will be the straw that breaks the camel's back. We really do need to do something to break up this plutocracy or they will continue to act in a way that is both unethical and arrogant.

HOAs were formed to provide a balance against two competing interests. SVO pretends to have HOAs but for all intents and purposes they are rubber stampers. And they are so arrogant that they don't even try to hide it.
 
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DavidnRobin

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so much to say...

I think the bigger issue is lack of 'true' Owner representation and accountability of SVO HOAs - I believe this could be a very good basis for legal action.

SVO control of HOA boards and the lack/blocking of contact between owners is essentially collusion between SVO and supposedly an independent board - tackle this and things like accountability of MFs increases can be dealt with. Until this is challenged - SVO Owners will be kept in the dark and controlled by SVO without representation.
 

LisaRex

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Leave it to David to say in 25 words what it took me 253,509 words to say.

He's such a man.

:)
 

steve1000

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I echo the concerns noted above and, as an attorney, I believe there may very well be grounds for a cause of action against Starwood. I own timeshares with several of the major hotel sponsors - and Starwood's MFs annually and consistently increase by double digits and in a significantly greater percentage than any of my other timeshares. As noted above, I believe this is because Starwood controls the HOAs. For this reason, I would never consider purchasing another Starwood timeshare.
 

Scott & Laura

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Mf Increases

I too agree there is a problem with Starwoods accounting and forthrightness.

I contacted Starwood two(2) years ago about how they determined MF fees. They would only provide their annual 10K report, and refused to explain in any way whatsoever.

The issue that Starwood is in a service industry and refuses to operate in a transparent and straightforward manner leaves me puzzled.

We had freinds attend a meeting to purchase a timeshare and they were told that Starwood never raises the Mfees more than 3-4%. We showed them the annual increases and they went back and discussed it with the salesman. The salesman insisted that "we" were completely wrong and provided our freinds wrong information.

Starwood apperas to "me" to manipulate board represenation, who can attend meetings, and attaches priorly undisclosed terms and conditions to the contracts after purchase is made.

For a service industry management team to manipulate costs and expenses in a secretive manner is unconscionable. Starwood reports to the press that "The Owners" want the increases is ludicrous.

I think an attorney reviewing the conduct and a forensic accountant reviewing the assesment of maintenace fees would go a long way to alleviating a concern "I" have and maybe others share that Starwood may be manipulating things and unduly or "errantly" raising fees.

It may be done perfectly in order but Starwood does not seem to be open about how they come to MF fees. At WKORV look at all the Villas and the fees of ~$1800 per year for a 2 BDLO. Thats ~$ 94,000 per year per unit. Are the total expenses that high? What are their true costs to maintain and replace items? We were told by Starwood employees that they do not sell all weeks completely and retain units to rent, are they adding the MFee's for those units to us?

Scott
 

ian

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HOA increases in double digits every year? My property taxes don't even increase that much! :mad: Not only is it appalling, it's a terrible business move that slights the company's supposedly best and most "brand loyal" customers.

At this rate, WPORV will be $4000+ per year within 5 years!

I would join a class action suit in a heartbeat.
 

DavidnRobin

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Unfortunately - a well-represented and well-designed lawsuit would be very costly - and thus, the rub...
 

Westin5Star

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I would also join a class action but it would be very costly. I would think a case could have most of the proceeds go the the attorney(s) and then we owners would benefit by lower increases in the future or possibly even a decrease in the near future.
 

Westin5Star

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Starwood- 2009 MF Decrease!!!

Starwood- Business or Bureaucracy
After reading the recent posts on the dramatic increases in MF and resort / SVO control of the boards of directors, I started wondering how Starwood is run. In this economy, I know of many businesses that are dramatically cutting costs while other entities (so as not to make this political) are planning huge spending increases such as bailouts, infrastruture, and continuing to hire new employees. I know many businesses that have implemented 10-30% paycuts for their entire staffs after laying off many others. If Starwood is truely a business and because labor and property taxes are a major portion of the MFs, shouldn't we have expected to see a MF decrease this year???

OK- so we did not get a MF decrease which is just amazing to me but how in the world do they justify a double digit increase. Maybe they are just a little slow in reacting to things. I am sure that they have already institued 20% paycuts, reduced their non-sales staff by 20% and have filed with each resort's county to have the property taxes lowered based on the new and reduced property values.
 
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steve1000

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I assume a law firm would take this on a contingent fee basis - and if the case was successful - or more likely settled - although most of any recovery would go the lawyers, the result would be increased owner representation on the HOA (hopefully, an opportunity for owners to ultimately control the HOA) and increased control over MFs.
 

Westin5Star

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I assume a law firm would take this on a contingent fee basis - and if the case was successful - or more likely settled - although most of any recovery would go the lawyers, the result would be increased owner representation on the HOA (hopefully, an opportunity for owners to ultimately control the HOA) and increased control over MFs.
Steve, is it legal for me to fund some attorney's (as salary) to take this case and then for me to collect the settlement? I believe that this would be a great investment for me which I am looking for since stocks and real estate haven't been too good lately.
 

steve1000

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Sorry that would not be allowed. Such a case would almost certainly be a class action case and the class would be entitled to the damages after the attorneys recover reasonable fees - approved by the court - for their services.
 

djp

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While I totally agree that the maintenance fee increases can be ridiculous (I was much more troubled last year when SMV had the 20% increase, this year it held steady), and our lack of control on the HOA's is wrong, and starwood corporate at times seems either malevolent or incompetent, the challenge seems to be, how to change things without destroying, the thing we have all paid significant cash to own. In this economy a highly publicized class action lawsuit, with a significant payout, could make it tougher for SVO to survive, at which point we all lose. Merely speculation, as I do not know how strong a position SVO is in,
 

James1975NY

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You can contact your association "management" and ask for the contact information for the board members of the respective HOA. You probabaly will not get a phone number but you will get a fax and or an e-mail.

I would start with communicating that you are demanding reasonable notification of board meetings.

Keep your mail! Having a post dated envelope with your untimely notifcation of a board meeting is excellent evidence of your inability to participate. I also manage HOA's in FL with a colleague that has his CAM license and I understand there are serious reprocutions of not providing ample notice of meetings to the HOA members as required by FLA law.

I cannot believe that a two bedroom, two bath villa (Bella) pays $1050 at SVV. Multiply that by 51 and its over 51,000 per year. Then multiply that by the number of villas in the HOA.......are you kidding me? I would love to see the budget. Of course that includes the SVN fee so.......
 

DavidnRobin

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Not a lawyer...

Because of the separation of the resorts in operation - I more directive law suit may be a better approach. Chop them down one at a time - because if one falls successfully the others may have to succumb.

The premise of the lawsuit would be straight-forward and not one looking for monetary compensation - and that would be to force the HOA to allow for reasonable and adequate communication between Owners so they can vote in HOA members that represent the Owners. Sort of the spirit of our forefathers (loosely) - no taxation w/o represenation - since this is essentially the issue.

A directive lasuit could look at one HOA - e.g. 'WKORV' - and force adequate communication between Owners so well-informed decisions with true accountability can be established.
 
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pharmgirl

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To me a potential problem that seemed to occur in st John's is charging a fee for refurbishing units. bad planning since the yearly fee for our units includes a significant cost to be set aside for future costs. Furniture in maui seemed already shabby in Feb 2008 in first building
 

Westin5Star

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MF Should Decrease for 2009!

I feel that MF should actually decrease in this economy; not increase by double digits.

Many businesses that I know have cut staff and then have taken payroll cuts for employees from between 10-30%. Property taxes should also go down because they are based on a percentage of property values. Finally, costs of cleaning products, carpet, furniture, paint, etc. have and will continue to drop dramatically. Therefore, almost every single cost of this BUSINESS should be reduced; not increased!

Not a political statement- just a fact: The government is spending huge amounts of money in this bad economy on bailouts and infrastructure while they continue to hire and give raises. Why is Starwood being run like the government and not like a business???

Based on the facts of the situation, our MF should all have been reduced by at least 10% this year! I believe that a lawsuit to give owners control of the boards, proper disclosure, and thus appropriate MF is in order.
 

elizfield

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Maybe the problem is- they are running it like a business. Future purchasers would never buy from them if they talked to current owners- so they've already accounted for that fact in their business model. And unlike EVERYONE ELSE in this economy- they've got us captured! Watch as they discount the h**l out of a night at any westin just to get business, but they know they can count on us to fund maintenance.
 

Westin5Star

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Business should be seeking and taking active steps to make a profit, therefore, the bailout companies do not qualify as true "businesses". A business also knows that long-term their customers happiness with their products and services is what will keep them in business and profitable. In this scenario and if Starwood were being run like a business as I feel it should, we should have all had double digit MF decreases for 2009!
 

calgarygary

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Ok-with a def like that I understand---but I bet GM wouldn't agree ;)
I don't think there are many businesses that exist today that are going to qualify. I wonder how different the economy would be if executives could only exercise stock options 5 years after they were issued? At least it would force a longer term picture on them.

As far as *Wood is concerned, my only cost is annual mf as I was reimbursed the original resale purchase price. Whenever I review their business practices, I believe that I overpaid!
 

calgarygary

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Why were you reimbursed the original purchase price?
Purchased from a pcc, they substituted PGA for VV and sent me a refund which I told them I didn't want. I wanted a VV. They replaced the EOY 1 bedroom with an every year 2 bedroom and told me to cash the cheque. That whole mess is what brought me to tug and I consider myself very lucky that I didn't have to wait until after a developer purchase to find this great board.
 
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