Dear Fellow Owners:
The Board of Directors held a meeting on April 7th for the purpose of conducting a count of proxies to remove Diamond Resorts as the management company for Polynesian Isles Resort Condominium Association. Unfortunately, we did not get the required number of proxies needed for a quorum. As a result, we have 90 days in which to solicit additional owners in order to receive the required number needed. Therefore, we are making one last appeal to you, our owners.
By now, you have received information from both us and Diamond Resort. You are most likely confused and unsure what is the right way to vote. This letter is an attempt to answer questions which you might still have. We are not going to lie to you. We are volunteer owners who serve at your pleasure and who have nothing to gain from all of this.
Diamond has made many statements, which are simply NOT TRUE. We would like to address these.
Yes, Diamond was paying the costs associated with foreclosures. What they didn’t tell you was that rather than working with owners, who find themselves in a financial bind during these difficult times, and allowing them to work out a payment plan, Diamond is actively foreclosing immediately upon missed payments and acquiring the inventory for its own personal gain. In the last year, Diamond has gone from owning less than 5% of the inventory to now owning 17% and it could rise to 21% once all the units have been completed that are still being processed. This is Diamond’s way of gaining total and complete control of your association. Your resort is owned by the owners. Let’s keep it that way! Your Board has allocated a line item budgeted for foreclosures. It costs the HOA less than $350 to complete a foreclosure and only $50 for an owner to complete a “deed in lieu” rather than us foreclosing. We have been very successful in this effort in the past of recovering the units and reselling them to our existing owners. The money acquired from these resells is automatically rolled back into the budget so that we might pursue other foreclosures. It is in Diamond’s best interest NOT to work with our owners, but rather foreclosure on them, because it allows Diamond to acquire more inventory at a VERY LOW RATE. They, in turn, can resell the inventory at a HUGE profit. We do not want to become one of their CASH COWS! We want a company who is going to work with our owners and aggressively collect on those who are clearly unable to get caught up. This will not happen under Diamond!
By Diamond having control over our inventory, they have access to use it as they please. Currently owners are being denied use of their weeks because they are being told nothing is available – Diamond has used it! Is this what you want as an owner?
Currently Diamond is paid a flat management fee regardless of their performance. The new management company will be paid strictly on commission, which means if they don’t bring in maintenance fees and rentals, they don’t get paid. This makes a win-win solution for everyone! Diamond has repeatedly attempted to raise its management fees, plus add additional administrative fees. Most recently, they requested a 10% increase. It was not until Diamond learned that we were looking at an outside management company that they came back and tried to negotiate a lower fee. Who is to say that once they get the contract, they wouldn’t try this many more times over the course of a three year contract.
Unlike our owners, who are locked out of their units, when they don’t pay their maintenance fees, Diamond has been delinquent in paying their maintenance fees for 2008 and 2009, yet they have paid no late fees or interest and have continued to use the weeks without any penalties. We believe they should be treated as any other owner. Currently, we have a case of “the fox watching over the hen house”! With an outside company, they will be treated the same as any other owner.
Diamond boasts all the wonderful things they have provided your resort with – new pool furniture, new mattresses, new linens, etc. Rest assured, Diamond has given you NOTHING! These items were bought and paid for by you through your maintenance fees. These purchases were subsidized in NO WAY by Diamond.
Since Diamond took over, you have seen a continual rise in maintenance fees partially due to their so called “branded items”, which the resorts are being made to purchase. An example…rather than purchasing a good quality coffee pot which would equate to a “Honda” automobile, resorts are forced to purchase the more expensive “Cadillac” model coffee pot instead. Another example is all the advertising for Diamond in their expensive “check-in” packets. One packet costs almost $5.00 per check-in, averaging more than $500 per week when something much less expensive would suffice and the additional money could be put to better use. We need to take control away from Diamond and put it back in the hands of the owners. We are Polynesian Isles and if any branding is to be done, it should be branded as Polynesian Isles, not Diamond.
Along with other timeshare companies, sales are way down for Diamond. Money is not as free flowing from banks as it has been in the past. Make no mistake, Diamond is going to get what it needs to function, sadly it’s attempting to get it at the hands of the resort associations and its owners. I beg you, DO NOT FALL FOR THEIR SCARE TACTICS. These are unfounded. Unlike Diamond, who is only acting in its best interest, your Board always has, and always will, act in the best interest of the owners. We are Board members have nothing to gain other than our desire of restoring our resort to one of unity and beauty without causing undue burden to its owners.
Your Board has done its “due diligence” and contacted Board members at every association managed by SPM Resorts (who we would like to use as our management company) and have continually been told that over the past several years their maintenance fees have either gone down or remained constant, yet they were still able to continue with major refurbishments, with no additional costs to the owners.
Polynesian Isles Resort Condominium IV Association has already signed a contract with SPM Resorts to manage its 78 units and have already recognized a savings in insurance alone. It is seeing additional savings on a daily basis, which is further reassurance that they have made a wise choice in bringing in an outside, independent company to oversee the day-to-day operation of its units. We would like to do that same!
If you voted to either keep Diamond or “abstained”, it’s not too late to change your vote. We simply need you to resubmit your blue proxy, appointing Carlos Costa, and date it. Under Florida Statute, the Board will use the most current blue proxy for counting purposes. If you already submitted a proxy, you do not need to submit a new proxy, unless you are changing your vote. Currently your resort is operating as two separate properties, managed by two separate companies. Let’s bring the resort back together and restore its identity as a family-owned and operated property (you, its owners), not the Diamond corporation!
Please contact us via e-mail if you have any questions or concerns. If you would like to speak with us personally, please e-mail us your telephone number and we will call you back.
Carlos Costa –xxxxxxx@xxxxxx.com
Gary Emken –
xxxxxxx@xxxxxx.com
Eddie Lofton –xxxxxxxxx@xxxxxxx.com
Board of Directors for Poly I
Fax your blue proxy to Tom Durkee, CPA at (407) xxx.xxxx
