I received my ballots/letter for the July 24th special election (RE: Remediation/Special Assessment)

[DeniseM]

There is a detailed 4 page single spaced letter included, which I believe is the clearest and most honest explanation we have gotten since this whole debacle began. Here are some high points:

1. Estimated funds needed for structural remediation: $56 million dollars. This doesn't include interior decor, furnishings, appliances, etc.

2. For each unit, a decision not to proceed with remediation must be approved by 75% of the owners of that unit.

3. In the event the IOA Board does not receive ballots indicating a majority of the votes of the intervals for a unit vote the same way, then the IOA Board shall cast the vote for such unit as it determines to be in the best interest of the IOA.

4 ...the AOAO KBV Board has decided that it is in the best interest of all owners to hold a special meeting of the AOAO KBV, at which the owners will vote to not proceed with Remediation.

5. In the event that at least 75% owner approval of the decision not to proceed with the Remediation is achieved, then the Project will be subject to partition action, and the proceeds of the sale shall be divided amongst the Project owners in proportion to their respective common interests.

6. This is a action where the entire property, including all units, is sold by a court-appointed Neutral to a third-party, and upon sale, the association "structure" no longer exists. Any and all interest in the Project would be transferred to this third-party buyer.

7. As of May 2nd, the board has only collected or "received commitments for" 42.27% of the $4.1 million needed for the first special assessment. In other words, Wyndham still hasn't paid their special assessment. IMNSHO, this makes them ineligible to participate in the final division of the proceeds.

*If you haven't paid your first special assessment, I suggest that you write to the BOD and tell them that you will make the same commitment to pay the special assessment as Wyndham has made.

 

[bnoble]

Thanks, Denise!

I haven’t gotten a copy yet, but except for the AOAO Board making a recommendation it sounds pretty much the same as the last vote.

 

[tango]

Done. I voted!

 

[pedro47]

Sound liked Wyndham is the majority holder that have not paid and will not pay the first special assessment .

A legal third party will purchase the resort for under ten millions dollars and will remodel the resort under a new name. IMHO.

 

[CO skier]

7. As of May 2nd, the board has only collected or "received commitments for" 42.27% of the $4.1 million needed for the first special assessment. In other words, Wyndham still hasn't paid their special assessment. IMNSHO, this makes them ineligible to participate in the final division of the proceeds.

There is much more baseless speculation than fact in this KBV forum.

IF the following linked post is true:

KBV AOAO Special Meeting / Vote scheduled for July 24, 2024

Aloha The next KBV board meeting is May 2. A number of us have received a meeting notice for virtual attendance. The following day is the IOA annual meeting. Log in instructions for that were included in the ballot letter (post card) That May 2nd meeting notice includes an attachment. Within...

tugbbs.com

"-For those who did pay [the special assessment], the funds are being held in escrow and would be refunded if the project does not occur."

then, IF the vote is to not proceed with Remediation, all the Special Assessment Funds paid will be refunded, and it will be as if NO ONE paid the special assessment, by the time the Project is sold and the proceeds divided.

This has been summed-up, nicely, before, but it must fall on deaf ears:

KBV AOAO Special Meeting / Vote scheduled for July 24, 2024

Aloha The next KBV board meeting is May 2. A number of us have received a meeting notice for virtual attendance. The following day is the IOA annual meeting. Log in instructions for that were included in the ballot letter (post card) That May 2nd meeting notice includes an attachment. Within...

tugbbs.com

 

[DeniseM]

Voting online is very easy - the info you received in the mail has the website url or a QR code that you can scan to vote online. This is what the online ballot looks like. I know the wording is counterintuitive, but look at it this way:

YES: If you want to close the resort and sell it off - vote YES.

NO: If you want to keep the resort open and pay millions of dollars in special assessments - vote NO.

 

[dioxide45]

Nothing like making the question and response confusing. Vote yes to say no.

 

[bnoble]

This is the same way it was worded the first time. I think the vote is structured this way in part because of the way the governing docs are written for this particular mechanism.

We got our ballot letters, and will be voting in favor of closure.

 

[TheHolleys87]

Voting online is very easy

Thanks for posting the ballot. I emailed a screen shot to my brother, who’s the owner of record in our family now but doesn’t do much on the internet. I expect him to vote Yes - which is sad, because my parents and siblings and even my DD have had lovely visits there over the years.

 

[schreff]

I got my ballot and voted, YES. Sure hope this is the end of the not knowing what's up syndrome. Thanks for posting the ballot with explanation Denise.

 

[Rick Henage]

Who owns the land for Kauai Beach Villas? If it is leased, how long is the lease and is it transferable? I saw an estimate of less than $10 million as a sales price. Is that accurate? Has anyone actually got an assessment on the value? I think this would be valuable information before voting. Also, is there an estimate of the value of the property once the $56 million for the remediation? If it takes five years, how is the property used during that period? I am assuming that only one or two buildings will be under construction at the same time. What is an estimate of the value of the resort after remediation? Just looking at the price of condos in Kauai, I would assume that the sale of the units might bring a much higher sales price? I think there are a lot of questions that should be answered before this meeting.

 

[jacknsara]

Aloha Rick,
My unreliable memory is the land is owned fee simple; it is not leased.
The rest of your questions are reasonable but do not include consideration of the funding risk to get through the putative 5 years of construction. My opinion of that risk is there is virtual certainty that funding would fail. The reasons for this are mentioned in various earlier posts in this forum not just this thread.
Jack

 

[tango]

This is all mere speculation, but based on some history in Kauai. Who ever purchases the resort will need to spend at least $59 million on top of what ever they pay for the property in order to get it back to the state it was previously. For that to happen many interval owners would need to spend almost $9000 and live through 5 years of reduced use and construction. I find that unlikely for the current interval owners. For the whole owners they might have to pay up to $500k on top of what they already have spent to buy their units. Recent estimates have been $450-500k. Which means to come out on top, the renovated units would need to be worth close to $1mil, to come out even. Due to the regulatory hurdles, it seems that it would be difficult to get a new resort of a significantly different footprint or enlarged resort to be approved. The path of least resistence would be a renovated resort along the same lines as what is there now, which in my mind is unlikely to generate a huge jump in valuation. So, while it is a lovely place for those of us who have stayed there, the future looks quite bleak.

 

[schreff]

Got a new newsletter from BOD today. I may be slowing down like most old folks but it opened many new questions along with the old ones my BOD refused to answer. Here is a copy of my email to them. I did not YES and cannot understand the nebulous state of question still outstanding unless I am missing something.
###########
Good day,
I was one of the owners who paid their special assessment and love KMV. I do have many questions but will limit them in this email. Please be prompt in answering because I will be going on an extended trip and plan to discuss this with Wyndham folks including some who own at KBV. In my opinion, the BOD has not supplied their owners with all the necessary facts to enable them to make prudent decisions. I may be wrong be the following questions will help clarify this.

1. The appraised tax value, as you know, means little or nothing as to the what the actual comparative market sales value of the resort is. The second paragraph states "the appraised tax value of the Kauai Beach Villas in its entirety is approximately $ 86M". Are you speculating that this is close to the NET value to be divided amongst the owners if the resort is sold? In my county the appraised tax value is 25% of market value and the last reassessment was over 30 years ago. I know this varies from state to state and county to county. Do you mean market sales value? Please explain fully.

2. Please address the following which also relates to remediation: It is stated in the newsletter that the current cost estimate to remediate all buildings is $ 56 million and then mentions no bids have been solicited because there has been no definition as to the work required???? Please explain. Will the $ 56 million include everything to make the resort a gold crown resort in the minds of owners or are special assessments needed to do additional work which will cost the owners more than the $ 56 million dollar amount? Also, are these current 2024 figures?

3. The newsletter states that only 42% of the owners have paid their share of the special assessment. If so, did Wyndham pay in full their share of the ownership? Can those who do not pay vote and if so, does their vote count?

4. Why haven't financial institutions shown an interest in funding the entire project? Does the loan to value ratio make it prohibitive? What explanation have the financial institutions given for not funding the full amount to restore Kauai Beach Villas?

I have asked these and other questions in the past but they have not been answered. I am voting YES but still have reservations along with knowing that I cannot afford the humongous special assessment proposed early on in the process.

Sincerely,
Ronald E Schreffler