Marriott Resorts Hospitality Corporation -- what does it do?

[RetirementPlans2028]

(from @Chucez 6790 attachment)
"Note 3 - Management Agreement
The Association has a management agreement with MRHC ending December 31, 2025, for an initial term of three years with automatic three-year renewals unless sooner terminated as provided therein. For the year ending December 31, 2023, the management fee is equal to 10% of the annual budget of the Association. For the year ending December 31, 2024, the management fee is equal to 12.5% of the annual budget of the Association. For the years ended December 31, 2024 and 2023, the management fee was $2,169,968 and 1,535,238, respectively, and is recorded in the Statements of Revenue, Expenses and Changes in Fund Balance - Operating Fund."

The HOA was established in 1995. Presumably (because it would conform to the other US resorts) the Management Fee was set then at 10% and remained that until the increase to 12.5% effective 1/1/24? The OP says, "... The contract automatically renews in Dec. 2025 with the fee increasing to 15%. ..."

I wonder if there were any detailed explanations in advance of either the 12.5% increase or the 15% increase that the OP says will be coming? It's a little odd that it doesn't appear to have been something on any TUGgers' radar until now.

This is one of the few U.S. resorts we are looking at. It looks like the audited financial statements are the only thing that put the issue on the radar of the TUGger who brought this to our attention. Our enquiries to individual owners in our circle have drawn surprise. Has anyone else had any luck in gaining any understanding of the increase?

 

[WBP]

In reviewing the Kaua'i Beach Club 2024 financial statement, I noticed a large budgetary increase from 2023 of $600K for management fee. The Marriott Resorts Hospitality Corporation is the management company. I search all the posted board minutes, bylaw and rules without finding any information on the exact functions. It was a statement in the 2024 Board minutes that the current fee is 12.5% of the annual budget. The contract automatically renews in Dec. 2025 with the fee increasing to 15%. Given that Sonesta manages the majority of the resort, this seems to be a large fee. I have searched online to find information on this Corp and haven't found anything.

I hope the great knowledge about Marriott in this group can educate me or point me in the right direction to understand this relationship. Thank you

Recent correspondence from Marriott’s Summit Watch (attached).

SEE: “Marriott Resorts Hospitality Corporation."

 

[cubigbird]

It's really hard to understand how such huge increases in the fee percentage can be justified, particularly since the fees themselves increase, generally at a rate that exceeds both inflation and the consumer price index. So not only are the maintenance fees themselves increasing, but over just two years the management fee increases by more than 50% (50% increase in the rate, multiplied by the maintenance fees which also increased.) No VOA board which is actually serving the interests of owners would have approved such an increase.

Of course, increasingly the resort owners are not weeks owners but the Abound trust, and the VOA boards don't need to operate in the interest of the trust owners, they only serve the developer. So as MVC acquires weeks and the number of weeks owners decreases, the various property VOA boards don't even have to pretend to serve owners, they no longer have any responsibility to act in any interest but MVC's.

Hence why sales is (still) so aggressive at talking owners into trading their deeds in for Abound points and basically pay for what they own all over again.

 

[pedro47]

Does Sonesta own the hotel? I know Marriott does not typically own the hotels they manage, but rather competes for management contracts of independently owned hotels.

Sonesta and Marriott’s are hooked up some kinds of way.i do not know how.

 

[ljmiii]

Sonesta and Marriott’s are hooked up some kinds of way.i do not know how.

Sonesta and Marriott International are actively at war over hotel owners (with Sonesta doing most of the poaching).

At KBC Sonesta has taken over the hotel side and so they maintain the grounds and other common areas of the MVC resort. But I’m not aware of any other hookup between Sonesta and MVC.

 

[Chucez]

Went on a “Update” at Marriott Shadow Ridge and was told Marriott builds the properties and the “HOA’s” manage the properties and I mentioned the Kauai Beach Club and was told “Marriot doesn’t want those weeks due to the high maintenance fee costs”

 

[Chucez]

In reviewing the Kaua'i Beach Club 2024 financial statement, I noticed a large budgetary increase from 2023 of $600K for management fee. The Marriott Resorts Hospitality Corporation is the management company. I search all the posted board minutes, bylaw and rules without finding any information on the exact functions. It was a statement in the 2024 Board minutes that the current fee is 12.5% of the annual budget. The contract automatically renews in Dec. 2025 with the fee increasing to 15%. Given that Sonesta manages the majority of the resort, this seems to be a large fee. I have searched online to find information on this Corp and haven't found anything.

I hope the great knowledge about Marriott in this group can educate me or point me in the right direction to understand this relationship. Thank you

Spoke to management on site. Fee was paid to Sonesta for the transfer of maintenance from Marriott. The employees of the Kaua’i Beach Club are now under the Kauai Beach Club HOA. The employees were let go from “Marriott’s” payroll and are now employees of the Kauai Beach Club.
…
You mentioned a possible Management Fee increase or "raise," and after discussing it further with our General Manager, I believe you may be referring to the significant support provided by Marriott Vacations Worldwide (MVW) to assist with transition costs Kaua'i Beach Club incurred as the Apartment Association portion moved under Royal Sonesta management. Our resort received a $750,000 contribution from MVW that positively impacted our financials and resulted in a temporary reduction to the standard 15% management fee:

• 2023: reduced to 10%
• 2024: adjusted to 12.5%
• 2025: returns to 15%

These management fees and the other costs of the Vacation Owners Association (which handles interior villa) and the Association of Apartment Owners (which maintains exterior and shared spaces) determine your overall Maintenance Fee. From 2024 to 2025, the maintenance fee increased by 4.1%. From 2023 to 2025 we are seeing a positive downward trend for our owners.
I hope this helps clarify the information you were hoping to learn. Also, regarding the Board meeting date: you mentioned October 5, 2025, but please note it is actually scheduled for October 9, 2025, and all Kaua'i Beach Club owners are welcome to attend in person here on property. …