*** NEW *** : Starwood is starting a new points program

[jw0]

Given starwood's history I understand why everyone is skeptical
But what if this is a good thing?
I know at my resort (sbp) there still are a lot of delinquent (non-mf-paying) owners. If this program is more appealing than single-timeshare ownership, and results in more happy, dues-paying owners, I'm all for it.
I know, that's a big if.
-J

 

[DeniseM]

It may be a good thing if:

-It sells off the foreclosed/non-paying inventory and stabilizes MF's.
-It doesn't interfere with the usage of current owners.

I own two of these resorts, so I'm interested to see how it turns out.

 

[blondietink]

We had a Speculation thread on the Marriott board that ran almost 3,000 posts before they introduced Points, then dozens of threads immediately after. You guys have some catching up to do.

So lets get going! Only 2900+ posts to go.

 

[dr.debs]

I remember when the Marriot program rolled out. As I am a resale owner it was pricy to join, and the points were significantly devalued, so the points for my week could not book a week at my home resort, or any other similarly graded resort. Call me a cynic, but isn't it a good bet that any "new" system will devalue our weeks?

 

[cubigbird]

I remember when the Marriot program rolled out. As I am a resale owner it was pricy to join, and the points were significantly devalued, so the points for my week could not book a week at my home resort, or any other similarly graded resort. Call me a cynic, but isn't it a good bet that any "new" system will devalue our weeks?

That would be a great way to chase away your existing owners and bite the hand that feeds you. That's why I like to own deeded fixed weeks at destinations we typically like to go to. With this "new system" my usage can't effectively be taken away from me via a points devaluation. I still have my week.

 

[clsmit]

Another Speculation Option

The Hubby and I were discussing this program and our speculation is this: you can't fundamentally change the system without HOA approval, but SVN can change what they do whenever they want. So, what is probably happening is that you get a deeded week someplace but you have 12 month privileges at any of the locations through SVN. This would be the easiest to implement from an IT perspective, and we all know how important that is.

This approach is also consistent with the themes we have heard for the past year at our owners' updates -- that it doesn't matter where you own -- options are fungible.

The other theme is that converting options to points for hotels is how you really want to use your options, but that's another thread.

 

[dsmrp]

This has been a very interesting thread.
I'm a little surprised to see SDO included in the group of 5 resorts.

My conjecture question about the Starwood's new trust marketing strategy is whether Starwood will later change their policy and dollar minimums for re-qualifying units into SVN. Based on trust buy-in price OP gave, of about 33 cent/star option, a 1bdrm 44000 options buy in would cost about $14.5 K.
Am I understanding that correctly? In comparison, re-qualifying at current $20K minimum is much more cost effective for a 2bdrm and larger unit, and give many more star options. We re'qualed last year at a cost of about 13 cents/star option, less than half as much as the purported trust price.

The trust strategy, also helps Starwood's desire to reduce the # of units deposited into II.

 

[LisaRex]

This isn't surprising. I've been suspecting that Starwood would follow Marriott's lead by selling points v. deeds.

I think the main reason that they are doing this is to skirt consumer protection laws that prohibit them from charging high season owners more MFs than low season owners, or OF owners more than IV owners, for obvious reasons. Wear and tear is the same whether you use a villa in October or June, whether it's IV or OV.

Since the economy tanked and they quit building new resorts, timeshare developers have been struggling to make a profit. According to the model, they were supposed to (and did!) make huge profits during the initial sales phase of their new resorts. Once that resort sold out, and they pocketed the premiums paid for people who wanted to get a "discounted" vacation in future years, the resort was to be passed over to the HOA, where it was to enter its "maintenance, non-profit" phase. (Did you know that Starwood HOAs are non-profit? Laughable but true, unless you truly believe that it costs $10k per month to maintain a 2 bdrm at WKORV, in which case I have some swamp land to sell you in Florida.)

Of course, that model blew up when the economy tanked. Since the developer had no new resorts to profit from, they had to turn to the only thing that they had control over, which was the HOAs. (How can they do this? Since they handpick who runs for the HOA, it's easy for them to rubber stamp anything put in front of their face, including hugely inflated contracts for housekeeping, landscaping, management services -- which with a little digging MAY reveal that they are actually Starwood owned subsidiaries... No matter who actually owns them, I can guarantee you that the HOAs are not acting in the interests of the OWNERS by accepting competitive bids or researching more cost effective alternatives. Their board meetings last maybe an hour, and there is no evidence that they do anything but approve what has been proposed to them.) Presumably, that has worked well for them...

Except for resorts with true "seasons." They learned that they can't realistically raise MFs higher than the going rental rate for the lowest season at any given resort. Why? Because low season owners would simply bail. I mean, would you pay $2500 a week in MFs for a 2 bdrm at SBP in early November when you could rent it outright (often from Starwood itself) for $1200 a week? No!

So what does a developer who has maxxed out its MFs at a resort do to profit, when they are legally prohibited from charging different MFs to seasonal and upgraded-view owners and they can't realistically raise them above low season rental rates? They institute a points system! Now they can charge x points for low season, x + y for mid-season, x + y + z for high season, not to mention extra points for view upgrades, and or "pool view" vs "parking lot" view. It's a creative way to squeeze more juice out of the lemon. Consumers are happy because they haven't paid the huge buy-in fee that deeded owners (who expect MFs to be stable) have paid, and the developer is happy because selling points is a lot easier than selling deeded weeks in silver season.

 

[cubigbird]

This isn't surprising. I've been suspecting that Starwood would follow Marriott's lead by selling points v. deeds.

I think the main reason that they are doing this is to skirt consumer protection laws that prohibit them from charging high season owners more MFs than low season owners, or OF owners more than IV owners, for obvious reasons. Wear and tear is the same whether you use a villa in October or June, whether it's IV or OV.

Since the economy tanked and they quit building new resorts, timeshare developers have been struggling to make a profit. According to the model, they were supposed to (and did!) make huge profits during the initial sales phase of their new resorts. Once that resort sold out, and they pocketed the premiums paid for people who wanted to get a "discounted" vacation in future years, the resort was to be passed over to the HOA, where it was to enter its "maintenance, non-profit" phase. (Did you know that Starwood HOAs are non-profit? Laughable but true, unless you truly believe that it costs $10k per month to maintain a 2 bdrm at WKORV, in which case I have some swamp land to sell you in Florida.)

Of course, that model blew up when the economy tanked. Since the developer had no new resorts to profit from, they had to turn to the only thing that they had control over, which was the HOAs. (How can they do this? Since they handpick who runs for the HOA, it's easy for them to rubber stamp anything put in front of their face, including hugely inflated contracts for housekeeping, landscaping, management services -- which with a little digging MAY reveal that they are actually Starwood owned subsidiaries... No matter who actually owns them, I can guarantee you that the HOAs are not acting in the interests of the OWNERS by accepting competitive bids or researching more cost effective alternatives. Their board meetings last maybe an hour, and there is no evidence that they do anything but approve what has been proposed to them.) Presumably, that has worked well for them...

Except for resorts with true "seasons." They learned that they can't realistically raise MFs higher than the going rental rate for the lowest season at any given resort. Why? Because low season owners would simply bail. I mean, would you pay $2500 a week in MFs for a 2 bdrm at SBP in early November when you could rent it outright (often from Starwood itself) for $1200 a week? No!

So what does a developer who has maxxed out its MFs at a resort do to profit, when they are legally prohibited from charging different MFs to seasonal and upgraded-view owners and they can't realistically raise them above low season rental rates? They institute a points system! Now they can charge x points for low season, x + y for mid-season, x + y + z for high season, not to mention extra points for view upgrades, and or "pool view" vs "parking lot" view. It's a creative way to squeeze more juice out of the lemon. Consumers are happy because they haven't paid the huge buy-in fee that deeded owners (who expect MFs to be stable) have paid, and the developer is happy because selling points is a lot easier than selling deeded weeks in silver season.

How will this change for those of us that own deeded fixed weeks and the Staroptions for those weeks? We bought our fixed weeks for a reason - because we actually use them for THAT week (school breaks, Christmas etc...) Also as mentioned in a prior post, I wonder how this will affect the requalifying option. Surely *Wood would want to receive that revenue by still doing that. I wonder if the spend requirement will subsequently go up.

This is just the nail in the coffin for those that are hoping for an expansion and new resort destinations to go online.

 

[VacationForever]

How will this change for those of us that own deeded fixed weeks and the Staroptions for those weeks? We bought our fixed weeks for a reason - because we actually use them for THAT week (school breaks, Christmas etc...) Also as mentioned in a prior post, I wonder how this will affect the requalifying option. Surely *Wood would want to receive that revenue by still doing that. I wonder if the spend requirement will subsequently go up.

This is just the nail in the coffin for those that are hoping for an expansion and new resort destinations to go online.

If Starwood follows the Marriott model, you can requal a resale week bought from Starwood by buying a matching number of points from their trust. Ebay weeks will not be able to be requal'ed into Starwood SVN system for full rights.

 

[DeniseM]

By "Ebay weeks" - do you mean "voluntary resales"?

Since you can already requalify a voluntary resale NOW with a developer purchase, I'm not sure why you wouldn't be able to in the future.

 

[tschwa2]

How will this change for those of us that own deeded fixed weeks and the Staroptions for those weeks? We bought our fixed weeks for a reason - because we actually use them for THAT week (school breaks, Christmas etc...) Also as mentioned in a prior post, I wonder how this will affect the requalifying option. Surely *Wood would want to receive that revenue by still doing that. I wonder if the spend requirement will subsequently go up.

This is just the nail in the coffin for those that are hoping for an expansion and new resort destinations to go online.

I don't agree that this means no new expansion ever. Starwood isn't going to build anything with a fair amount of unsold inventory. And that is where they are at now. If the trust is a way to sell less desirable unsold inventory then it could be a good thing. Hopefully they will at least go the way of Wyndham and Hilton that may not be building new resorts from the ground up but will take over failed full ownership options that are already built and manage the resorts and sell unsold inventory as part of the network.

 

[cubigbird]

If Starwood follows the Marriott model, you can requal a resale week bought from Starwood by buying a matching number of points from their trust. Ebay weeks will not be able to be requal'ed into Starwood SVN system for full rights.

I don't see the value then of a retro if that would be the case. Why would I pay [a premium] to Starwood for "points?" With that "purchase" I would then give up my guaranteed availability of my deeded fixed week and get less than guaranteed availability and now have points for a booking on an "availability" basis. Another way of putting it - I'd be paying them to essentially downgrade. Others can chime in but I feel a deeded fixed week is of higher value than a "points week."

I'd rather keep what I have, use Starwood-to-Starwood preference in II if I need flexability and keep the " buy in" dollars in my pocket.

 

[cubigbird]

If Starwood follows the Marriott model, you can requal a resale week bought from Starwood by buying a matching number of points from their trust. Ebay weeks will not be able to be requal'ed into Starwood SVN system for full rights.

It wouldn't matter where you bought your week from? A voluntary week is a voluntary week, no?

 

[cubigbird]

I don't agree that this means no new expansion ever. Starwood isn't going to build anything with a fair amount of unsold inventory. And that is where they are at now. If the trust is a way to sell less desirable unsold inventory then it could be a good thing. Hopefully they will at least go the way of Wyndham and Hilton that may not be building new resorts from the ground up but will take over failed full ownership options that are already built and manage the resorts and sell unsold inventory as part of the network.

If that's the case I wouln't mind seeing Sheraton Hacienda Del Mar and Westin DBC St. Maarten be bought and make it into SVN.

 

[tschwa2]

Retro-ing does not mean you are giving up anything with your current unit. It just means that you are eligible to use it in SVN with SO's at 8 months. Up until the 8 month mark your home resort reservation would be the same as it would be outside of SVN. Retro-ing a mandatory resort means you have the same options you had before but now can convert your unit to starpoints and the SO's you have are eligible to be counted toward elite levels. Those perks would also be available when retroing a voluntary unit.

You are confusing retro-ing with converting your week into deeded trust points. At this point I wouldn't assume that would be a requirement.

 

[tschwa2]

If that's the case I wouln't mind seeing Sheraton Hacienda Del Mar and Westin DBC St. Maarten be bought and make it into SVN.

I don't know if either of those properties are looking for someone to take them over.

 

[cubigbird]

Retro-ing does not mean you are giving up anything with your current unit. It just means that you are eligible to use it in SVN with SO's at 8 months. Up until the 8 month mark your home resort reservation would be the same as it would be outside of SVN. Retro-ing a mandatory resort means you have the same options you had before but now can convert your unit to starpoints and the SO's you have are eligible to be counted toward elite levels. Those perks would also be available when retroing a voluntary unit.

You are confusing retro-ing with converting your week into deeded trust points. At this point I wouldn't assume that would be a requirement.

If they are selling the resort as trust points I would assume that would mean any retro would have to be into trust points and giving up that fixed week.

 

[tschwa2]

If they are selling the resort as trust points I would assume that would mean any retro would have to be into trust points and giving up that fixed week.

I would think the new purchase would be in points from the trust if you are purchasing at a resort selling the trust points but I doubt they would take what you have and put it in the trust. That would be more of an equity "upgrade" . More like trading in a 1 br for a 2 br not a retro. A retro doesn't take back what you have and change it into something else, it just allows it to be enrolled in SVN and makes it eligible for VIP and SP's along with the new purchase.

 

[VacationForever]

It wouldn't matter where you bought your week from? A voluntary week is a voluntary week, no?

Marriott does not allow resales bought outside of their resales department to be eligible for enrollment into the Destination Club by buying matching trust points. If you buy a week from their resales dept, that week can be enrolled into DC by buying matching trust points.

 

[LisaRex]

How will this change for those of us that own deeded fixed weeks and the Staroptions for those weeks? We bought our fixed weeks for a reason - because we actually use them for THAT week (school breaks, Christmas etc...)

It won't change your ownership at all. Starwood cannot change what is written in your contract. Fixed week owners have contracts that say that they, exclusively, have use of a villa of x size during x week at x resort. As long as you follow the rules, and confirm by the date you're supposed to confirm, you will enjoy use of that villa for as long as you choose to (and as long as you pay MFs).

Starwood cannot just create points out of thin air because there are so many villas to go around. They have to acquire inventory first, and use those weeks as a basis for their points system.

 

[czar]

According to the direct sales person with whom I've worked in the past, this is called the Flex program. It is deeded into a trust, straight points product, no week's, the same thing as WSJ CV.

 

[dsmrp]

Marriott does not allow resales bought outside of their resales department to be eligible for enrollment into the Destination Club by buying matching trust points. If you buy a week from their resales dept, that week can be enrolled into DC by buying matching trust points.

By "Ebay weeks" - do you mean "voluntary resales"?

Since you can already requalify a voluntary resale NOW with a developer purchase, I'm not sure why you wouldn't be able to in the future.

I hadn't considered Starwood might require a voluntary resale to be re-qualified by only buying into the trust, IF you were interested in making a developer purchase at any 5 resorts in the trust. This is conjecture, but at SVV, SVR and SBP, which are the lower priced resorts, one couldn't buy then a regular timeshare unit to re-qualify, say an SDO 2bdrm platinum unit ?
But you could re-qualify buying a developer week at a mandatory resort.
Which all means more money for Starwood.

What this all comes down to is supply and demand, and who controls (Starwood) how reservations are made.
Playing devil's advocate: IF the trust strategy eventually changed to allow trust owners to make 12 month reservations at ALL of the resorts, then probably more and more owners will buy into the trust, for the "privilege" or opportunity to make reservations ahead of the non-trust SVN owners. Maybe SVN will morph into the trust.
I agree with several others; it's a pure marketing strategy,
Starwood is not creating net new capital assets.
Which all means more money for Starwood.

A few months ago, I read in more detail my SVN contract, and believe I saw specified, that membership in SVN was for a 5 year time period. I didn't think much at the time, but will go back and re-read it.
I wonder if the 5 year time period will be a factor moving forward ??
How long has SVN been in existence?
Your thoughts?

 

[DeniseM]

A few months ago, I read in more detail my SVN contract, and believe I saw specified, that membership in SVN was for a 5 year time period.

I don't think this is correct - SVN membership lasts as long as you own a mandatory deed. Or until Starwood eliminates the SVN.

 

[dsmrp]

oh btw, cugigbird, I have a fixed SVR week in SVN, and I still retain the right to reserve my fixed week. It's actually sort of pre-reserved for me until I release it. If I make an online star options reservation, the system warns me I won't be able to use my 201x fixed week.