Marriott Vacations Worldwide 3Q Sales Decline; Stock Tanks

[Hindsite]

doubt it would be difficult or require any sort of significant "sleuthing" skills to easily identify a number of entities that fall into this category of megarenter.... should they actually start driving down that road.

One problem they might face is that they themselves are possibly the largest megarenter in the system, so they need to ensure that they don't shoot themselves in the foot in the process. There already questions about how MVC, Sheraton and Westin inventory for the points system is carved out from the total inventory vs what gets made available for their rentals, weeks reservations, VSN and II and we really don't know other than they do some forecasting (guessing) and allocate from there.

This all seems to be focussed on the points system, assuming its Abound inventory and not on weeks inventory or Flex.

 

[dougp26364]

But do they say you can run a commercial operation amounting to many, many weeks, for profit vs. usage? I've never heard them say that. And I am far from an MVC apologist.

Yes, at Oceana Palms approx 5 years ago. The salesman was trying to sell us a “quarter share” with the intention of renting for profit. At least enough profit to pay all our MF’s and maybe a little more. He even went as far as to show how he was doing this by using Vacation Candy

Of course the salesman also used some of that famous timeshare “magical math” to show how the purchase really wasn’t going to cost what it was going to cost. Plus we’ve seen the “rent to pay for what you own” presentation in the past, so I was mentally taking a nap while he was doing his mathematical gymnastics to get the numbers dance like a dancing bear at the circus.

 

[m61376]

I think there are several problems they need to contend with, and maybe this is a wake-up call. Sadly, we didn’t sell our stock
20-30 years ago there was the enticement of buying pre-construction, with below market pricing for something new and enticing. MFs were under 1k and purchases came with not only the illusion of fabulous trips, but with enough Marriott points to take that fabulous European vacation and many older owners traded for Marriott points and reaped great value from hotel and airline packages. The math really worked early on.
Today the value of trading for Bonvoy points has been decimated and MFs have gone way up.

Additionally, today’s market is a different generation. Their discretionary income is less in their early to mid 40s since many are first buying homes and even first having children. Also, when at least some of the new resorts started selling there were Tug and perhaps a few related sites, access was primarily limited to the more computer savvy. Today there’s already access to sites like FB and the vast majority of the pool of potential buyers have easy access to the good, the bad and the ugly. Sales have to counter all the complaints of dissatisfied owners, since social media has made that easily available.

Moreover, while many of us here get great value from our ownership, it’s time consuming to do so. This generation is busier. The target market is largely 2 income households and it’s not as easy for them to plan, let alone secure reservations at a precise time and date for high demand properties. And their expectations are higher for vacations, and many want more services when they go on vacation. Many resorts are starting to accommodate those needs, with some increase in poolside or beach service, but I think availability has lagged demand, and perhaps Marriott needs to up their game to appeal to today’s generation of buyers. And, yes, I know it’s a timeshare and personally am happy to bring down a cooler with drinks, snacks and lunch, but I think today’s parents want more services. In general, they work harder and have less free time, so have higher expectations. From my own observations and perspective of having “kids” in their early 40s, I think adding more hotel like amenities, especially those related to food and drinks, would increased the perceived value of timeshare vacations.

As for cracking down on commercial renters, in all deference to those on here who do so, I do think it would go a long way towards customer satisfaction. I’ll use Aruba as an example. I know Aruba Christmas and New Years weeks are one of the top, if not the top, of the rental market. They were sold as holiday weeks at the Surf Club, which is newer, but included as Platinum weeks at the Ocean Club. And there are mega week owners that own so many weeks they basically nab all the 13 month inventory since they’re using so many gold weeks to start reserving them months before. Marriott could easily impose restrictions on such reservations. For example, how it stands today, a mega owner can string 10 gold weeks and 10 Platinum weeks, allowing them to lock off and reserve 20 weeks before Christmas week and then reserve 10 Christmas and or New Years weeks. That’s a simplified example of what goes on. They could limit the number of weeks you can reserve at the end of a consecutive reservation. Perhaps another way to crack down would be to limit the number of name changes per year. The flip side is, of course, while the language excludes commercial renting, sales people touted profit from renting.

It’s a fine line, but clearly Marriott isn’t addressing these issues sufficiently, and as the original owners age it’s increasingly problematic. I’m not as concerned about the 500 shares of VAC we own as I am about the future value of my ownership. I’m concerned that a downward spiral in the stock value will ultimately be reflected in the properties.


Sent from my iPhone using Tapatalk

 

[dougp26364]

I am sure this is a common discussion item internally. One one hand, I imagine that statistically, those who have purchased before might have a higher likelihood of purchasing again than the average person off the street. And just using myself as an example, I purchased, then said "no" at many presentations before eventually buying something more... and later something more. So there is probably some benefit to them in chipping away at current owners.

But a lot of current owners are now in their 60s and 70s and I think that becomes a tougher and tougher pill to swallow, since for a purchase to make sense, you need to be able to amortize the purchase cost across a number of years of use. Even a completely healthy 70-year-old would be hard-pressed to assume that they were going to get 20 years of use out of a new timeshare purchase. So I do think they need to attract younger buyers. Part of that problem is that the value proposition that existed 20 years ago just doesn't exist today.

My interpretation of the highlighted phrase is that they're going to increase sales incentives, which will almost certainly lead to higher-pressure presentations and more deceptive claims. It's unfortunate that they focus on "selling harder" instead of on trying to deliver a better value that might be easier to sell.

In 2001 we purchased an ocean front 3 bedroom unit at Ocean Pointe for less than $20,000 PLUS we received a 7 night cruise (ocean view Alaskan cruise) and an exchange certificate with II (7 nights in Scotland) as incentives for the purchase. Even with the insane increase in MF’s we still can validate spending the money despite this being a developer purchase.

We took a presentation last month and used the exact logic you mention to not make another purchase. We don’t feel we will live long enough and/or remain healthy enough to travel long enough for the finances to work out.

 

[Hindsite]

Moreover, while many of us here get great value from our ownership, it’s time consuming to do so. This generation is busier. The target market is largely 2 income households and it’s not as easy for them to plan, let alone secure reservations at a precise time and date for high demand properties. And their expectations are higher for vacations, and many want more services when they go on vacation. Many resorts are starting to accommodate those needs, with some increase in poolside or beach service, but I think availability has lagged demand, and perhaps Marriott needs to up their game to appeal to today’s generation of buyers. And, yes, I know it’s a timeshare and personally am happy to bring down a cooler with drinks, snacks and lunch, but I think today’s parents want more services. In general, they work harder and have less free time, so have higher expectations. From my own observations and perspective of having “kids” in their early 40s, I think adding more hotel like amenities, especially those related to food and drinks, would increased the perceived value of timeshare vacations.

Those additional Amenities are not part of the "ownership" so they have to wash their face financially for them to be available at resorts. My experience is that back 20-10 years ago there were many more amenities at the resorts I go to. You could have your refrigerator pre-stocked prior to arrival, pool-side service and many other things. I suspect in the early days when resorts were in active sales there was some bleeding of cost across the HOA and non-HOA services, but as owners have demanded maint fees be kept low, those additional services have gone. Personally I don't want to pay in my maint fees to pick up people's trash from beside the pool from food and drink service when there is a restaurant making the money, even if there are pool attendants that I pay for that are around that "could" do that. The F&B outlets should pay for that so the customer pays the full cost.

As for cracking down on commercial renters, in all deference to those on here who do so, I do think it would go a long way towards customer satisfaction. I’ll use Aruba as an example. I know Aruba Christmas and New Years weeks are one of the top, if not the top, of the rental market. They were sold as holiday weeks at the Surf Club, which is newer, but included as Platinum weeks at the Ocean Club. And there are mega week owners that own so many weeks they basically nab all the 13 month inventory since they’re using so many gold weeks to start reserving them months before. Marriott could easily impose restrictions on such reservations. For example, how it stands today, a mega owner can string 10 gold weeks and 10 Platinum weeks, allowing them to lock off and reserve 20 weeks before Christmas week and then reserve 10 Christmas and or New Years weeks. That’s a simplified example of what goes on. They could limit the number of weeks you can reserve at the end of a consecutive reservation. Perhaps another way to crack down would be to limit the number of name changes per year. The flip side is, of course, while the language excludes commercial renting, sales people touted profit from renting.

What is notable is that the talk at the meeting only mentioned the points system and not the weeks system, so your example won't get addressed by the look of it. I also know of at least one travel company that has bought MVC weeks for commercial use, and I suspect there are more. It is likely that those companies have a separate contract that covers their usage, so the general terms and conditions that individual owners have may not be applied.

 

[JIMinNC]

I am not sure about how prevalent the abuses by commercial renters are or whether this is smoke to avoid the real topic of why there is a decline in sales. I highly doubt that new buyers showing up in their presentations are aware of inventory issues. I was enrolled in Abound and follow TUG and I was not aware of significant availability issues (but I didn't use Abound much.)

I also question how big of a contributor the commercial renters actually were to the poor sales. As an owner whose primary MVC usage is in one of the top mega renter targets (Maui), I am in 100% support of MVC's efforts to limit those commercial activities. I wish them great success. Since owners who can't book what they want are less likely to buy more product, I agree that eliminating third party commercial rental activity, should help with owner satisfaction and probably remove one impediment to improving sales. Having said that, I can't see it will move the needle that much, but they obviously know more than we do.

The real question is their customer strategy. Aside from the poor economy and increases in inflation for everyday goods, MVC doubled down on their existing high(er) end customer base and on their MVP Abound points system. As it was stated earlier, much of that base is aging (from go-go to slow-go) and with high MF on the Abound points, I don't see much incentive for this group to add points to their existing deeds; perhaps those that would have upgraded already did so or perhaps the existing base heard about lack of inventory- either way MVC may have gotten the juice out of those oranges and the opportunity may be saturated.

Given that the economy isn't poor, I don't agree that economic stress is a major factor. GDP was up at an annualized 3.8% rate in 2Q 2025. At 4.3%, unemployment is still very low on a historical basis, and inflation has abated significantly, and is now in the 2.5% to 3.0% range (depending on which inflation measure you prefer), only slightly above the Federal Reserves's 2% target. The stock market is within 2-3% of its all time high and is up about 14% for the year. This should be an environment where a discretionary semi-luxury product like MVC sells well. Rising stock values offer investors a psychological wealth effect, as well as real wealth that can be accessed to buy a product like MVC. Given the market segment MVC targets, I would expect stock ownership to be high in that segment. Yes, there is some economic stress on the lower end of the income spectrum, but those folks aren't the MVC target market.

I think the aging core market is likely the bigger factor, coupled with some MVC-specific marketing and product issues.

I think the baby boomers in my generation fueled MVC sales for the last couple of decades, and now that many of us are entering our late 60s and 70s, the payback equation on a timeshare purchase is tenuous at best. I would suspect that Generation X is still a decent target market for them, but I suspect getting Millennials and Gen Z to become MVC owners is going to be a heavy lift. They are delaying marriage, kids, and home ownership until later in life and have grown up using AirBnB for their travels. Our kids are a perfect example. They are 27 (daughter) and 30 (son). Neither is married, although they are both in what seem to be serious relationships. Both earn well into six figure salaries in their jobs, but they have both chosen to live in New York City, rent, and seem years away from having an interest in starting a family. They both take multiple international trips per year (our son is taking a 6-month work sabbatical and is currently in New Zealand after sailing a sailboat from Tonga). Their approach to life is very different from ours at the same age. They would never invest the time needed for planning to use a timeshare.

IMHO, timeshare maintenance fees, while much higher now than the past, still represent a good value proposition given the also much higher hotel rates. But if, like Gen Y and Z, you are used to AirBnB, both hotels and timeshares look really pricey.

While none of these trends tend to favor timeshare, IMHO, it doesn't yet seem to be impacting the other major publicly-owned timeshare company, Hilton Grand Vacations. In their 3Q, HGV achieved record contract sales that were up 17% year-over-year. They earned $25 million in the quarter compared to VAC's $2 million loss.

The problem seems to be mainly MVC-specific and would seem to dictate a significant strategy change is needed.

 

[jp10558]

The real question is their customer strategy. Aside from the poor economy and increases in inflation for everyday goods, MVC doubled down on their existing high(er) end customer base and on their MVP Abound points system. As it was stated earlier, much of that base is aging (from go-go to slow-go) and with high MF on the Abound points, I don't see much incentive for this group to add points to their existing deeds; perhaps those that would have upgraded already did so or perhaps the existing base heard about lack of inventory- either way MVC may have gotten the juice out of those oranges and the opportunity may be saturated.

100% - well, and that the existing customers might well be informed of availability issues so that would affect them wanting more points.

I am not sure the younger generation has the money to buy into the higher end MVC system given the average age of a first home buyer is now 40(!)

In a lot of ways this is a huge issue, but also just that the people who do have the money are the least likely to see the value proposition now. Upmarket may have worked well 30+ years ago, but we have AirB&B and VRBO etc now so it's way more open for renting resorts and way more accessible. They need to sell more than making upscale resorts available. I think this explains all the add ons but they're not integral and usually aren't enabling anything much special.

To compare, HGV went a down market with BlueGreen and DRI acquisitions to create lower price points and to incent those existing bases to upgrade to HGVC/Embarc or DRI with the addition of Honor points conversions and higher quality accommodations. They went after a lower end base that is already aware (locked in?) to timeshares and may be seeking upgrades.

This is also a tried and true strategy - offering different price point lines of product. I think at the lower price points it's more realistic to both sell being cheaper than other options and to people who might well afford $1500 for a week in a 2BR somewhere but would balk at $5,000 seen in various rental markets.

Although inflation will affect all providers as a discretionary product, it would be interesting to see how these companies compare financially given the differing customer strategies.

This is the big question - I think each can work, but I also think going luxury means a smaller company and really needing that cachet and spot on experiences. Existing luxury options are a price cap realistically, and with shorter amortization of the purchase price I think MVC may be hitting up against VRBO etc there already.

Going downmarket with tiers does risk inflation hitting the down market even harder and so as good a relative deal as it may be, I still think developer prices even at the low low end is too high. IDK Bluegreen prices, I guess someday I should check it out, but I also don't see them or DRI having low ongoing MFs which is an issue. To really be "downmarket" it all has to be cheaper IMO. But the lower you can make the purchase price, the easier it is to sell, whatever it is IMO. You just are risking additional bad debt loads instead of booked profits.

 

[JIMinNC]

One other interesting statistic...When Steve Weiss retired as CEO at the end of 2022, VAC stock was trading around $135 per share. It is now at $49 per share almost three years later. I can't imagine that John Geller is not feeling a good bit of heat from his board to right the ship. How long will they be willing to stick with John before they look to make a change at the top.

Looking at the chart for VAC, either Geller is not an effective CEO or Weiss saw the train coming and decided to exit before getting run over. The red line I drew on the chart is when Weiss retired.

 

[jp10558]

Those additional Amenities are not part of the "ownership" so they have to wash their face financially for them to be available at resorts. My experience is that back 20-10 years ago there were many more amenities at the resorts I go to. You could have your refrigerator pre-stocked prior to arrival, pool-side service and many other things. I suspect in the early days when resorts were in active sales there was some bleeding of cost across the HOA and non-HOA services, but as owners have demanded maint fees be kept low, those additional services have gone. Personally I don't want to pay in my maint fees to pick up people's trash from beside the pool from food and drink service when there is a restaurant making the money, even if there are pool attendants that I pay for that are around that "could" do that. The F&B outlets should pay for that so the customer pays the full cost.

I feel like the downside to stuff like that is you can feel like one the the negatives of places like Smugglers Notch - where it feels nickle and diming to pay as you go for all that, but I do think the tech is obviously there. But not having the option at all can make the resorts feel a lot less "special", and hence they start to lose appeal over VRBO. For instance, having paid childcare as an option I think might massively increase the appeal to some parents with small kids that would occasionally like a break to actually have a vacation. Having a paid water park available seems to up the specialness too. Even just having more than the pool + Hot Tub is a draw IMO.

The downside is - you kinda have to eat that till you get more of the customers who care. I get that not many are showing up to various activities but we already know that there is a need for different people - you've probably maxed out the current market...

 

[jp10558]

I also question how big of a contributor the commercial renters actually were to the poor sales. As an owner whose primary MVC usage is in one of the top mega renter targets (Maui), I am in 100% support of MVC's efforts to limit those commercial activities. I wish them great success. Since owners who can't book what they want are less likely to buy more product, I agree that eliminating third party commercial rental activity, should help with owner satisfaction and probably remove one impediment to improving sales. Having said that, I can't see it will move the needle that much, but they obviously know more than we do.


Given that the economy isn't poor, I don't agree that economic stress is a major factor. GDP was up at an annualized 3.8% rate in 2Q 2025. At 4.3%, unemployment is still very low on a historical basis, and inflation has abated significantly, and is now in the 2.5% to 3.0% range (depending on which inflation measure you prefer), only slightly above the Federal Reserves's 2% target. The stock market is within 2-3% of its all time high and is up about 14% for the year. This should be an environment where a discretionary semi-luxury product like MVC sells well. Rising stock values offer investors a psychological wealth effect, as well as real wealth that can be accessed to buy a product like MVC. Given the market segment MVC targets, I would expect stock ownership to be high in that segment. Yes, there is some economic stress on the lower end of the income spectrum, but those folks aren't the MVC target market.

IDK about the target market, but I will say that going that upmarket probably means shrinking the company which will look bad as they'll have less revenue cause less people. People with lots of stock and making well into 6 figures are in the top 2 percent of the country. They easily have whatever options.

I think the aging core market is likely the bigger factor, coupled with some MVC-specific marketing and product issues.

I think the baby boomers in my generation fueled MVC sales for the last couple of decades, and now that many of us are entering our late 60s and 70s, the payback equation on a timeshare purchase is tenuous at best. I would suspect that Generation X is still a decent target market for them, but I suspect getting Millennials and Gen Z to become MVC owners is going to be a heavy lift. They are delaying marriage, kids, and home ownership until later in life and have grown up using AirBnB for their travels. Our kids are a perfect example. They are 27 (daughter) and 30 (son). Neither is married, although they are both in what seem to be serious relationships. Both earn well into six figure salaries in their jobs, but they have both chosen to live in New York City, rent, and seem years away from having an interest in starting a family. They both take multiple international trips per year (our son is taking a 6-month work sabbatical and is currently in New Zealand after sailing a sailboat from Tonga). Their approach to life is very different from ours at the same age. They would never invest the time needed for planning to use a timeshare.

It seems pretty clear that international destinations are desired, but there must be reasons the various systems aren't growing them almost exclusively.

IMHO, timeshare maintenance fees, while much higher now than the past, still represent a good value proposition given the also much higher hotel rates. But if, like Gen Y and Z, you are used to AirBnB, both hotels and timeshares look really pricey.

I think AirB&B has matched or exceeded hotels for the last ~5 years. Of course, you do tend to stick with what you know and liked, even if it costs more. Like you said, IDK if top 2 percent is affected by inflation as much, or as price sensitive as people I know, but the main pitch for needing this level of planning has to be value. People who aren't that value sensitive won't be interested.

While none of these trends tend to favor timeshare, IMHO, it doesn't yet seem to be impacting the other major publicly-owned timeshare company, Hilton Grand Vacations. In their 3Q, HGV achieved record contract sales that were up 17% year-over-year. They earned $25 million in the quarter compared to VAC's $2 million loss.

The problem seems to be mainly MVC-specific and would seem to dictate a significant strategy change is needed.

I agree with this - I don't see why HGVC is beating MVC here in terms of what's offered at the high end - it's got to be growing sales to the top 20% - probably because I think TS is mainly a numbers game the way they're selling them. I think simply if you're trying to get the 13% of people you can sell to, picking from 20% is going to get you a lot more sales than picking from 2% of the population.

 

[JIMinNC]

IDK about the target market, but I will say that going that upmarket probably means shrinking the company which will look bad as they'll have less revenue cause less people. People with lots of stock and making well into 6 figures are in the top 2 percent of the country. They easily have whatever options.

Much, much more than the top 2% earns well into six figures. Marriott Vacations says the median income of their owner households is $150k. Based on a Google search and a ChatGPT inquiry it looks like $150k in household income would put a family in the top 25% or so of households. About 12% of all households earn over $200k. To be in the top 2%, you would need to earn somewhere in the $350k-$400k range. But for MVC, $150k is just the median - half of owner households are above that level and half are below. As a result, their target market is much larger than just the top 25%. As you can see from the chart below from their 3Q presentation, they see their addressable US market as 55 million households. Again, ChatGPT says there are about 131 million households in the US. If they say they are targeting 55 million of that 131 million, that would imply they are targeting about the top 40% or so, which would mean households with incomes over about $101,000.

Note also that MVC uses household income, not individual income. If you look at individual income, $150k puts you in the top 10% or so, but since they use household income, about 25% of households earn $150k or more.

 

[CalGalTraveler]

The problem with moving upscale with pricing is other than certain Hyatt and Ritz properties most MVC are a solid product but they are not luxury.

The younger generation that is making significant money e.g. SF Tech are staying at the Ws and/or going to festivals and paying a premium for hotels and AirBnBs.

 

[dougp26364]

They tried going upmarket or luxury when they were selling the Ritz product. If memory serves me correctly this idea wasn’t exactly successful with more than one planned projects (Kauai Lagoons, Jupiter FL) being converted to something else

 

[JIMinNC]

The problem with moving upscale with pricing is other than certain Hyatt and Ritz properties most MVC are a solid product but they are not luxury.

The younger generation that is making significant money e.g. SF Tech are staying at the Ws and/or going to festivals and paying a premium for hotels and AirBnBs.

I think it's possible to be more selective in how you target your market without going full-bore luxury. As you note, Marriott, Westin, and most Hyatt Vacation Clubs are "upmarket" but not truly "luxury" as it's defined today. But since a quarter of all households earn over $150k and around 40% earn over $100k, there should be enough potential in those markets to build an upmarket business, if you have the right product priced right. In Abound right now, assuming you need a minimum of 3000-4000 points to be reasonably useful, based on prices I've seen quoted here, that means roughly $54k to $71k at list price, or $43k to $57k with a typical 20% sales "discount". And that's for a minimally useful position. They may have finally reached the choke point for their core target market which tends to be upper-middle class/lower upper class. Many TUGgers have been predicting that would happen, so we may be seeing that play out in real time. Only time will tell if they can tweak things enough to get the ship moving in the other direction.

Since HGVC hasn't yet seen the same issues, and is still seeing growth, I wonder how HGVC pricing compares to Abound? We haven't done presentations with either company in over five years, and aren't even eligible for tours at HGVC since we own only resale. They flag resale owners and won't offer incentives to us, but that doesn't bother us at all!

 

[dioxide45]

They tried going upmarket or luxury when they were selling the Ritz product. If memory serves me correctly this idea wasn’t exactly successful with more than one planned projects (Kauai Lagoons, Jupiter FL) being converted to something else

Yeah, that along with Grand Residences. Both were a flop. The Grand Residences buildings that were beside Legends Edge are now something completely different. I also don't know if all of the buildings at Legends Edge were supposed to be Grand Residence and they ended up building two of them out as timeshare because Grand Residence wasn't working. Then the Grand Residences at Kauai Lagoons are only a few of units that are in the same buildings as Kauai Lagoons.

Jupiter was a Ritz and is now managed by Timbers and the Ritz that was supposed to happen on Kauai was left unfinished and then purchased and completed by Timbers.

 

[Dean]

Yeah, that along with Grand Residences. Both were a flop. The Grand Residences buildings that were beside Legends Edge are now something completely different. I also don't know if all of the buildings at Legends Edge were supposed to be Grand Residence and they ended up building two of them out as timeshare because Grand Residence wasn't working. Then the Grand Residences at Kauai Lagoons are only a few of units that are in the same buildings as Kauai Lagoons.

Jupiter was a Ritz and is now managed by Timbers and the Ritz that was supposed to happen on Kauai was left unfinished and then purchased and completed by Timbers.

Actually it was the reverse. LE was supposed to have 3 buildings but with sales being poor there that's when the Marriott Grande Residence came to be. Marriott is no longer management at that property. I believe if they have made LE with lock off's it would have been far more popular but the fact that the retail space there completely died makes it a challenging option. I would not be at all surprised to see it sold off at some point.

 

[Dean]

They tried going upmarket or luxury when they were selling the Ritz product. If memory serves me correctly this idea wasn’t exactly successful with more than one planned projects (Kauai Lagoons, Jupiter FL) being converted to something else

I think a large part of the issue of going more upscale and therefore, more expensive; is that once you hit a certain level of income/assets you are more likely to just go get what you want when you want it and don't fool with timeshares. IMO the Horizon's project made more sense and I think it would have been successful had they not been greedy and had priced it more reasonably.

 

[dioxide45]

Actually it was the reverse. LE was supposed to have 3 buildings but with sales being poor there that's when the Marriott Grande Residence came to be. Marriott is no longer management at that property. I believe if they have made LE with lock off's it would have been far more popular but the fact that the retail space there completely died makes it a challenging option. I would not be at all surprised to see it sold off at some point.

I remember that now. Where was the retail space supposed to be?

 

[dioxide45]

I think a large part of the issue of going more upscale and therefore, more expensive; is that once you hit a certain level of income/assets you are more likely to just go get what you want when you want it and don't fool with timeshares. IMO the Horizon's project made more sense and I think it would have been successful had they not been greedy and had priced it more reasonably.

I agree about Horizons. It didn't seem like that big of a price difference given the differing level of quality and target market.

 

[Dean]

I remember that now. Where was the retail space supposed to be?

There was a retail space at one time. It was across the street opposite side of the front desk from the units. Post office may still be there but all else is gone. There were a couple of restaurants, a few retail shops, and I believe a general store. It died a slow death over the years.

We actually looked at a condo there back around 1990. We were staying at the then Marriott hotel which was later the Wyndham hotel and now the Bluegreen timeshare the other side of the Grande Residence in question.

ETA: I look at LE when it was first announced and likely would have bought if they'd had lock off's. I also looked the the whole condo's with the Grande Residence initially.

 

[dioxide45]

There was a retail space at one time. It was across the street opposite side of the front desk from the units. Post office may still be there but all else is gone. There were a couple of restaurants, a few retail shops, and I believe a general store. It died a slow death over the years.

We actually looked at a condo there back around 1990. We were staying at the then Marriott hotel which was later the Wyndham hotel and now the Bluegreen timeshare the other side of the Grande Residence in question.

I recall seeing the post office when we were there back in March. We stayed at that Marriott hotel way back in the early 2000s. I think it was also a Holiday Inn at some point between then and it becoming a Bluegreen. It was under heavy construction when I walked through it to check it out in March. There was no main pool as it was all under construction.

 

[Dean]

I recall seeing the post office when we were there back in March. We stayed at that Marriott hotel way back in the early 2000s. I think it was also a Holiday Inn at some point between then and it becoming a Bluegreen. It was under heavy construction when I walked through it to check it out in March. There was no main pool as it was all under construction.

The BG resort has finished the mini golf and it's pretty impressive. I'm not sure if they've fished renovating the units across the street but I know that at least part of them are done. They have been renovating some in the main building.

 

[jp10558]

Much, much more than the top 2% earns well into six figures. Marriott Vacations says the median income of their owner households is $150k. Based on a Google search and a ChatGPT inquiry it looks like $150k in household income would put a family in the top 25% or so of households. About 12% of all households earn over $200k. To be in the top 2%, you would need to earn somewhere in the $350k-$400k range. But for MVC, $150k is just the median - half of owner households are above that level and half are below. As a result, their target market is much larger than just the top 25%. As you can see from the chart below from their 3Q presentation, they see their addressable US market as 55 million households. Again, ChatGPT says there are about 131 million households in the US. If they say they are targeting 55 million of that 131 million, that would imply they are targeting about the top 40% or so, which would mean households with incomes over about $101,000.

Well, it does really depend on what you mean by "well into the 6 figures". I was setting that at 350k, and yes, I was not thinking household which is a blindspot of mine, so I would adjust that. The reason was if you set it at 150k seems just starting in the 6 figure range to me, sort of like saying 20k would be "well into the 5 figures"... But yes, I was thinking individuals.

Note also that MVC uses household income, not individual income. If you look at individual income, $150k puts you in the top 10% or so, but since they use household income, about 25% of households earn $150k or more.

But isn't the point of the call that their current targeting isn't working for them? And if they're looking for higher FICO screens etc, that implies tightening up who they're trying to sell to. I don't know how the numbers work out if they drop everyone below the 150k say, to move their median sales targets upmarket.

 

[jp10558]

I think a large part of the issue of going more upscale and therefore, more expensive; is that once you hit a certain level of income/assets you are more likely to just go get what you want when you want it and don't fool with timeshares. IMO the Horizon's project made more sense and I think it would have been successful had they not been greedy and had priced it more reasonably.

This is what I've been thinking also - the people who would be interested in TS are the middle of the road people. You have to care about saving that money in an ongoing sense (and it needs to actually save money) AND be able to afford the purchase price and MFs. I think this is squeezing the market - the people on the upper end of that median 150k a year are likely part of a very small niche that's interested.

The analogy for those at the top 40% line and lower is likely how at IDK, the bottom 20% line you might well use a gas price app to go to the cheapest gas station around. I bet the people at the top 40% line though just don't care that much about saving a potential couple dollars on a tank, and so just go wherever's easiest to fill up.