Well, it was always out of our hands, so I'm not gonna get hard nipples over any of this stuff. It is however insightful that we finally see it out in the open that Marriott has been at odds with itself over what to do about timeshare in this new economic situation. This spin-off move simply demonstrates that they still don't quite know what to do, but a decision has at least been made, so I put it down as progress.
As to all of the other stuff? It really doesn't matter at this moment as we MVCI owners are all along for the ride. For all of us, it's about moving on in life and using your weeks. I'm not gonna buy into any blather or predictions as it is all
poppycock!
That said, some Barry reactions to what I read thus far:
. . .I'd hazard a pretty secure bet that it will NOT be good for owners no matter what direction it takes. It will almost certainly mean even higher fees as those become the sole source of income for the company. I'm glad we decided against owning Marriott.
Love the doomsday outlook followed by the "I told you so" foot-stomp which suggests that the rest of us made a big mistake. See ya!
The "new" company will be independent and could do whatever it wants to do in the long distance future.
Yep, we're all moving into uncharted territory here. "Independent" could also turn into "competitive" , "reliable" and "worthy" given that some of the key managment folks are coming over to the spin-off and I gotta assume that they believe in the product. That's why we owners must remain engaged with the new company and provide participation & feedback. And things could turn out not-so-good as well.
Marriott doesn't see timeshare as the growth business it once was. The hotel business on the other hand is a business that is seeing an uptick. Timeshare is forecast to remain flat for many years to come. Also, given their glut of inventory, it is an albatross to Marriott's other businesses.
Not only did the timeshare business slow down, it
evaporated! Marriott ( like the rest of us ) was unprepared
for what the recession had in store for us. We can now see that in terms of things timeshare, Marriott lost it's nerve and it's focus as they hurriedly roll out Destinations Club which confused and angered legacy owners and has had a tepid response from the non-MVCI public. "110,00 enrolled weeks" does not a success make. It simply tells you how many weeks are enrolled and not how many folks are throwing those enrolled weeks into the internal trading queues < hint: it remains safer to stay with Interval just like agreeing with your wife is easier than telling her what you really think
)
. . .I know I now regret my investment. I assume all of the investment have 0 resale value now. In 2 or so years, you will not get credit in the Mariott hotel program for stays at timeshares, I can almost guarantee that . . .
So what is 400,000 times zero? Let's get real. Our timeshare product still has a value. Whether it's the value we each subjectively desire is another matter. The present economy and recession has really knocked our nation for a loop. What I do know for certain is that neither individuals or corporate big shots ( ummm like Marriott
) know everything. Perhaps it is more accurate to say that at this particular point in time, it's extremely difficult for we owners to establish the true value of our weeks as the ecnomy remains dysfunctional and much more time is required for the murky waters to settle out ( I fear it will be several years ).
. . .Also, perhaps SpinCo will become aggressive and acquire Interval International since they will need a stable revenue base -- II generates $100M in revenue per quarter and is cash flow positive. We know that SpinCo will still earn reasonably strong management fees from the existing portfolio . . .SpinCo still has the Marriott and Ritz Carlton brands to protect and will figure out a way to generate the recurring cash flow that is needed. . . .
Too early to tell, but the idea behind a spin-off is to realize specific goals/value otherwise not achievable as a whole. So why not? At least this demonstrates how innovation might indeed benefit everyone . . . I think the key ingredient here is "time" as it seems like the economy is gonna need a lot of that.
If MVC does not provide a good product at a good price, what wold prevent an owners association from changing to another management company . . . I don't see that this announcement really changes anything in the short term, and in the long term the total package depends on whether and when the economy recovers.
I see the thought. BUT we MVC folks gotta figure the impact of the Trust upon who controls what at our resorts. Resorts that are not a part of the Trust are free and clear to empower their HOAs. However, resorts at which the Trust owns the majority of inventory at a resort means that we MVCI folk do not possess the power we think we do as we can be outvoted by the Trust's majority ownership. Not everything Marriott did with Destinations was benign. You hit the nail onthe head about the economy. If we want to gauge our ultimate timeshare destiny, it rests with an improving economy.
. . . in the end when the dust is settled, each resort HOA will be free to determine whether to continue with Marriott managing the resort. Perhaps it will become more competitive and not be uncommon for resorts to change brands with some frequency and just competitively bid it out like the cleaning service . . .
Like I mention above, the Trust relationship at each resort is going to dictate much of what happens. But absolutely true that some MVCS resorts may become more empowered. Likewise the door is open for the spinoff management to add other chains and companies.
. . .From a practical perspective Mr. Marriott is not going to piss away 21% of his wealth so I don't see any cataclysm in the near term. As mentioned they did the same thing with the HMT Reit and Senior Living.
Yes. There exists a management divide
which puts all of this into motion. I'm just hoping that Mr. Marriott who has now kicked us out of the Boca house continues to allow us to stay dry beneath the cover the spinoff back porch now affords us.
If you believe that the timeshare industry is dead, then this is another nail in the coffin. If you believe that the timeshare industry is morphing from the old model into the new "destination/experience" model that the DC points is selling then this is an exciting opportunity to break new ground, consolidate old dead companies and transform the business into something better
Well yes and no. We each have our beliefs, but what matters here are not beliefs but rather our ability as MVCI owners to find the true reality out of this fog into which our nation's rank economy has dumped all of us. TUG and opinions posted are not reality, they are subjective opinions ( just like my own words here
). But, there's a lot of engaged owners here who bring their collective perspectives and experiences into view. This can help us better focus on how to deal with this continuously changing destination travel situation we each find ourselves in. Our fate ultimately flows from a recovering economy. The timeline remains another unknown. Both we and the spinoff managment exist in this environment.
In the meantime, enjoy your vacation weeks at MVC or wherever you trade into.
That's one bottom line which is 100% true.
Hang in there folks. All we can do is go for the ride and see where it takes us.
We ourselves will be down in Florida for a couple of weeks. At least I now have something to talk to the GM about.
Barry
