Sales Presentation - Oceana Palms

[Hindsite]

It's simply an intimidation tactic, an attempt to create a sense of urgency.

It wasn't presented that way the last time it happened, but that was shortly after COVID when there was practically a fire sale of inventory and the salesperson joined us in our unit. Signing was a way to ensure there was a record of us receiving the offer, as no appointment had been made for a sales meeting. It seemed odd, but not intimidating, but so much was odd during that time...........

 

[curitiba_tapley]

It is interesting, because I was recently in a Sales Presentation, where the Sales guy used the same approach with a twist - it wasn't the Trust Points MFs that would increase dramatically, but the MFs for our owned week - increasing nearly at 20% annually! So the pitch was to sell back the deeded week and buy more points.

While the Sales team loves to play off the maintenance fees, can you remind me. It is the HOA of each resort, and the Board of the Points Trust that sets the Maintenance budget and from there the MFs are assigned to each unit or point? As a result, what insight does the Sales team have in terms of year over year MF increase? From what I can tell, a Sales guy nothing more than owners who can look at historical, receive proposed annual budgets, and read TUG?

 

[daviator]

It is interesting, because I was recently in a Sales Presentation, where the Sales guy used the same approach with a twist - it wasn't the Trust Points MFs that would increase dramatically, but the MFs for our owned week - increasing nearly at 20% annually! So the pitch was to sell back the deeded week and buy more points.

While the Sales team loves to play off the maintenance fees, can you remind me. It is the HOA of each resort, and the Board of the Points Trust that sets the Maintenance budget and from there the MFs are assigned to each unit or point? As a result, what insight does the Sales team have in terms of year over year MF increase? From what I can tell, a Sales guy nothing more than owners who can look at historical, receive proposed annual budgets, and read TUG?

The MFs for trust points are simply the total MFs for all the weeks owned by the trust, divided by the number of trust points. So if the trust owns weeks at 10 resorts, representing 1 million Abound points, and the total MFs for the weeks they own at those resorts total $1 million, then $1 million divided by 1 million points = $1/point. If the maintenance fee for those weeks collectively increase by $100,000 in year two, then the trust MFs also go up 10%, to $1.10 per point. It's a complete fabrication to claim that trust points are a way to somehow escape increases in maintenance fees.

MVC can (and has) put a lot of low-quality weeks into the trust, some of those have lower MFs but that doesn't mean they won't go up in the future, they will. And a trust filled with low-quality weeks means that there aren't a lot of high-quality weeks (popular times of the year at the better/more popular resorts) available to book. Then you're depending on elected weeks to feed inventory, and the folks who own at the best properties and seasons may not want to turn them in for Abound points.

MVC is desperate to get people to trade in their valuable weeks (and then pay them more money for less-valuable points) and some sales people will tell all kinds of lies to accomplish that. I assume they are being heavily motivated, financially, to encourage owners to give up their weeks. Don't fall for it unless you don't like what you own and don't want to vacation there in the future.

 

[Fasttr]

The MFs for trust points are simply the total MFs for all the weeks owned by the trust, divided by the number of trust points.

Your overall point in your full post above still holds true, but technically, the Resort Component Expenses (Resort MFs) only represent 86% of the expenses driving the Trust Point MFs. The other 14% is Trust Administration fees, to manage the Trust activities themselves.

 

[daviator]

Your overall point in your full post above still holds true, but technically, the Resort Component Expenses (Resort MFs) only represent 86% of the expenses driving the Trust Point MFs. The other 14% is Trust Administration fees, to manage the Trust activities themselves.

Oh that’s true. So actually the trust MFs are HIGHER than the MFs of the VOIs it owns. MVC makes money at every level, so they’re making 10% of the property expenses for the underlying properties (as their management fee), and then presumably another 10% of that total for every week that goes into the trust, as a fee for administering the trust. So it’s no wonder they want people to trade in their weeks ownerships – MVC gets to essentially double their pro-rata revenues for every VOI that goes into the trust.

So in my example above, the $1 million in MFs for the weeks in the trust becomes $1.14 per Club Point which is assessed to Abound owners.

Somebody please correct me if I’m wrong in my analysis – isn’t MVC essentially getting compensated doubly for weeks in the Abound trust?