HRC to acquire Welk Resorts [MERGED]

[dmelcher13]

This could be interesting...


Dave

 

[Redien]

Just got an email about this from the Welk Side. Pretty much looks the same as the one from the HRC side.

Not sure how to feel about this.

 

[alwysonvac]

Marriott Vacations Worldwide Announces Agreement to Acquire Welk Resorts For Approximately $430 Million

/PRNewswire/ -- Marriott Vacations Worldwide (NYSE: VAC) ("MVW" or the "Company") announced today that it has entered into a definitive agreement to acquire...

www.prnewswire.com

ORLANDO, Fla., Jan. 26, 2021 /PRNewswire/ -- Marriott Vacations Worldwide (NYSE: VAC) ("MVW" or the "Company") announced today that it has entered into a definitive agreement to acquire Welk Resorts ("Welk"), one of the largest independent timeshare companies in North America, for approximately $430 million, including approximately 1.4 million MVW common shares. The acquisition is expected to close early in the second quarter of 2021.

Welk opened its first vacation ownership resort in 1984 and today operates a portfolio of eight upper upscale vacation ownership resorts located primarily in highly sought-after West Coast U.S. vacation markets, with nearly 1,400 keys, 55,000 Owners and over three years of built inventory. MVW intends to rebrand all Welk resorts as Hyatt Residence Club resorts once obtaining all necessary approvals, dramatically increasing Hyatt Residence Club's footprint while providing the Company substantial future growth opportunities.

"Welk's premier resorts are in highly desirable vacation markets, including San Diego, Breckenridge, Lake Tahoe and Cabo San Lucas, Mexico, and will be a nice addition to our footprint," said Stephen P. Weisz, chief executive officer of MVW. "The acquisition will expand Hyatt Residence Club's geographic presence while providing substantial future growth opportunities. By leveraging our high-value marketing and sales channels and leveraging more efficient rental distribution channels, we expect to be able to drive higher contract sales and expand margins......."

 

[Pathways]

So for all those complaining (HRC) about the loss of Northstar Lodge, I guess you were heard! It's back!

 

[dioxide45]

More here;

https://ir.marriottvacationsworldwide.com/static-files/de500c27-bb83-4e4b-a0e9-96a776dd5689

 

[dmelcher13]

Where is a good place to learn more about the Welk system?

Is it points based or deeded ownership?

The vast majority of HRC ownership is deeded weeks.

I'm curious if the Welk system will be rolled into the HPC trust in an attempt to resuscitate Hyatt's attempt at a points system?

 

[ocdb8r]

...the plot thickens.

The most interesting aspect of all of this is why MVW chose to acquire this into the Hyatt Brand (which many have been speculating they are struggling to find a way to fold in with the Marriott/Vistana combo). Makes one wonder what their plans are for Hyatt.

I can't see how from a Hyatt perspective this can been seen as anything but good. It's an investment in the brand and system and adds some nice locations. I can only hope us regular Hyatt weeks owners will get some sort of internal access (given Welk also has a large amount of weeks based owners, I suspect something will be worked out). To me the combo makes sense as little to no overlap in the portfolio.

From the Welk perspective, I would also largely see as a positive, but I understand some consternation being swallowed by the MVW conglomerate. Welk's sales tactics leave a lot to be desired, but I believe their resort management has been pretty good and efficient. One would hope some benefit from scale, but MVW will likely skim that off for profit and owners will have to pray they keep maintenance fees reasonable.

#grabspopcorn

Is it points based or deeded ownership?

The vast majority of HRC ownership is deeded weeks.

I'm curious if the Welk system will be rolled into the HPC trust in an attempt to resuscitate Hyatt's attempt at a points system?

It's both like Hyatt. I don't have the numbers, but it evolved similar to Hyatt (started as pure weeks and then created a trust and started selling points). I think Welk got going on the "points" bandwagon sooner and I think has been more successful in converting their weeks owners over, so they likely have a different ratio than Hyatt (who's points product has bombed). Suspect they will "merge" (via some internal trading agreement) the two point systems and create some sort of overlay for weeks owners to access (contrary to the way Hyatt worked, I think MVW realizes there is a greater benefit (in potential sales/conversions) to co-opting weeks owners rather than marginalizing them. If anything, they must have realized that deeded weeks owners control many of the most prime weeks and the only way to get them into the larger "system" is to find a way to co-opt us.

 

[TBipp]

I think this also makes sense regarding locations to add to HRC. I'm pumped even though it may be awhile. I did find it puzzling that the press release mentions New Mexico; however, the Welk Resort Locations webpage does not show a New Mexico resort.

 

[dioxide45]

...the plot thickens.

The most interesting aspect of all of this is why MVW chose to acquire this into the Hyatt Brand (which many have been speculating they are struggling to find a way to fold in with the Marriott/Vistana combo). Makes one wonder what their plans are for Hyatt.

I can't see how from a Hyatt perspective this can been seen as anything but good. It's an investment in the brand and system and adds some nice locations. I can only hope us regular Hyatt weeks owners will get some sort of internal access (given Welk also has a large amount of weeks based owners, I suspect something will be worked out). To me the combo makes sense as little to no overlap in the portfolio.

From the Welk perspective, I would also largely see as a positive, but I understand some consternation being swallowed by the MVW conglomerate. Welk's sales tactics leave a lot to be desired, but I believe their resort management has been pretty good and efficient. One would hope some benefit from scale, but MVW will likely skim that off for profit and owners will have to pray they keep maintenance fees reasonable.

#grabspopcorn

MVW has previously indicated a desire to expand the Hyatt residence Club network. THey were looking to invest heavily into this before COVID hit. This seems to be a good move to increase the portfolio of resorts pretty quickly. They probably never considered trying to fold Welk into Vistana or Marriott.

 

[dioxide45]

I think this also makes sense regarding locations to add to HRC. I'm pumped even though it may be awhile. I did find it puzzling that the press release mentions New Mexico; however, the Welk Resort Locations webpage does not show a New Mexico resort.

Perhaps some kind of affiliation? Odd, it is listed as part of "Experiences Collection", which also include other non Welk properties and some Disney Vacation Club properties.

» El Corazon de Santa Fe

thecollection.welkresorts.com

El Corazon de Santa Fe | Luxury Resorts

1Floor plans are intended to give a general indication of the proposed layout only. The floor plans provided may not represent all of the various floor plans that may be available at the property. 2Features, furnishings and amenities are subject to change. 3Off site. Made available by a...

welkresorts.com

 

[Pathways]

I think this also makes sense regarding locations to add to HRC. I'm pumped even though it may be awhile. I did find it puzzling that the press release mentions New Mexico; however, the Welk Resort Locations webpage does not show a New Mexico resort.

Then in what State is Sante Fe?

 

[dioxide45]

 

[dioxide45]

I would suspect any unsold Welk inventory will be conveyed over to the Hyatt Points trust and sold as pure points and not weeks ownership?

 

[heathpack]

I got this email from Hyatt today too.

Im assuming mostly this is a vehicle to sell their truly awful points system. Which is something of a negative for weeks owners because anything that gives that system traction is not good for those of us who refuse to play. Unless Hyatt sees an opportunity to correct problems with HPP such that weeks owners would want to buy in.

If there’s access to the Welk weeks owners inventory, then great for everybody- it’s a win win. But the one thing I learned from the HPP rollout is that HRC does not seem to be interested in any kind of win-win scenario. So I’m honestly not optimistic that this Welk purchase will actually be of benefit to existing owners.

 

[ocdb8r]

I would suspect any unsold Welk inventory will be conveyed over to the Hyatt Points trust and sold as pure points and not weeks ownership.

Except that Welk has their own points system...no idea how much they have already conveyed into it, but would suspect most.

One other interesting wrinkle, Welk shifted to RCI in the last few years (maintaining II as an option, but all their points product inventory in RCI).

 

[dsmrp]

Where is a good place to learn more about the Welk system?

Is it points based or deeded ownership?

The vast majority of HRC ownership is deeded weeks.

I'm curious if the Welk system will be rolled into the HPC trust in an attempt to resuscitate Hyatt's attempt at a points system?

There was brief speculation in a Vistana thread, about a MVC DC points overlay to offer access to HRC properties. However discussion was mainly about cross access between MVC and Vistana owners .

 

[dioxide45]

I am sure that the Hyatt and Welk sales reps will already be telling people to buy today to guarantee you can book Hyatt or Welk resorts in the future. What you own now won't do any good unless you buy more!

 

[dioxide45]

There was brief speculation in a Vistana thread, about a MVC DC points overlay to offer access to HRC properties. However discussion was mainly about cross access between MVC and Vistana owners .

I think that speculation has been killed off by several calls and interviews made by Marriott Vacations Worldwide executives. They have pretty much said that any integration between Marriott and Vistana will exclude Hyatt and Hyatt will always stand alone. Likely one reason they are looking to expand it through this acquisition.

 

[rickandcindy23]

That means Welk will go back to II and that is a good thing. What happens to resorts like Eagle Point in Vail that are managed by Welk but not Welk quality? We have friends who own at Eagle Point, prime ski.

 

[lilliand]

We are Welk Owners. They have resorts in San Diego (3), Palm Springs, Lake Tahoe (2), Cabo San Lucas, Breckenridge and Branson. We love their resorts and have also stayed at Hyatt Residence Clubs and Marriotts. I would say they are at the same level as the HRC. They were mostly all Elite resorts with Interval but they switched to RCI a few years ago as RCI Platinum. They also have 16 other resorts that you can book using Welk points without an exchange fee that they call the Experiences Collection by Welk Resorts. Those are in Carlsbad, Kauai (2), Tahoe Vista, Santa Fe, Redmond OR, Olympic Valley, Scottsdale, Sedona, Beaver Creek, Cave Creek, Ko Olina, Lake Buena Vista (2), Blanchard ID and Avon. Not sure what will happen with those in the transition.

 

[heathpack]

We are Welk Owners. They have resorts in San Diego (3), Palm Springs, Lake Tahoe (2), Cabo San Lucas, Breckenridge and Branson. We love their resorts and have also stayed at Hyatt Residence Clubs and Marriotts. I would say they are at the same level as the HRC. They were mostly all Elite resorts with Interval but they switched to RCI a few years ago as RCI Platinum. They also have 16 other resorts that you can book using Welk points without an exchange fee that they call the Experiences Collection by Welk Resorts. Those are in Carlsbad, Kauai (2), Tahoe Vista, Santa Fe, Redmond OR, Olympic Valley, Scottsdale, Sedona, Beaver Creek, Cave Creek, Ko Olina, Lake Buena Vista (2), Blanchard ID and Avon. Not sure what will happen with those in the transition.

My email from Hyatt says the Welk purchase adds 8 properties to Hyatt. So it sounds like it’s the Welk-owned resorts (although you list nine). My email refers to “Western U.S. destinations like the desert oasis of California’s Coachella Valley and the hills of San Diego’s scenic Escondido region to the Sea of Cortez in Cabo San Lucas.”

So no mention of anything that sounds like the experiences collection in the email sent to HRC owners.

 

[dioxide45]

According to the investor call ( I missed all but the last few minutes), it seems Welk has about 75% of their owners in points and the rest are weeks. They have been in points for about 15 years, much longer than Hyatt.

 

[Shankilicious]

Where is a good place to learn more about the Welk system?

Is it points based or deeded ownership?

The vast majority of HRC ownership is deeded weeks.

I'm curious if the Welk system will be rolled into the HPC trust in an attempt to resuscitate Hyatt's attempt at a points system?

In the other timeshares forum. I made a huge post explaining as much about Welk as possible.
Welk is 99% points. Very few deeded/fixed weeks exist and they've been offering a premium to fixed week owners to convert them to points. MFs are similar so I'm curious/anxious/annoyed at this acquisition.....

 

[dioxide45]

So no mention of anything that sounds like the experiences collection in the email sent to HRC owners.

This may just be some special arrangement facilitated through RCI?

 

[dsmrp]

More here;

https://ir.marriottvacationsworldwide.com/static-files/de500c27-bb83-4e4b-a0e9-96a776dd5689

In this Marriott web page flyer, in the Welk overview section it says there's 3+ yrs of built inventory. What does that mean? 3 x 52 unsold unit weeks? Maybe to seed an HPP program?

Be interesting to see how Marriott will assign club points value to Welk properties.