Speculation About Marriott's New Timeshare Structure [merged]

[AwayWeGo]

That Depends On What The Meaning Of Chain Brand Is.

Alan, Has any chain brand timeshare ever relinquished HOA to owners? I thought when you bought a chain brand resort the connection would always remain even after the resort sold out.

In truth, that question is way above my pay grade & I don't pretend to know.

The 1 case I am semi-familiar with is Cypress Pointe I & II (Orlando FL), where some long-forgotten timeshare company started construction & sales, then got taken over or bought out (etc.) by SunTerra, which later on got absorbed into DRI.

Was SunTerra a national chain brand ?

Is DRI ?

I am pretty sure they would like to be -- that they are doing what they can to add the sound of sizzle to the aroma of steak.

However that may be, in the case of Cypress Pointe I & II, management was taken over by 2 respective independent, owner-controlled HOAs well before DRI ever supplanted SunTerra. (That was before my time, but my impression is that the timeshare company did not gladly relinquish control.)

So are Cypress Pointe I & II no longer nationally chain branded (to the extent they ever were) ?

My impression as an owner at Cypress Pointe I & II (EEY at Phase One) is that we're getting resort management & operation that's better and cheaper than what we'd be getting if DRI were in the driver's seat.

Beyond that, it is my distinct impression from reading stuff right here at TUG-BBS that when the timeshare companies keep control & preserve national chain brand continuity, they do so much more for the health of their own profit-loss statements & much less for the benefit of their paid-in-full & annual-fee-paying owners.

As long as those owners perceive value in the premium they're paying for chain-brand management over professional independent resort management, then hats off to'm -- the owners & the company both.

And when the timeshare company keeps hanging on & on to the detriment of the owners' resort experience & at extra expense to the owners via higher fees, then shux upon'm -- the company, I mean, not the owners.

Whether that has any application to any current or former Marriott timeshares, I do not know & will not guess. Clearly, national chain brand timeshares are considered worth their cost to some people, and that's why there are plenty of those from which to choose. More power to'm -- the people, I mean, not the national chain brand timeshare companies.

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[kjd]

Alan

How can anyone buy a Marriott timeshare or anything else for that matter and not expect costs to go higher? Wouldn't one think that Marriott employees deserve a pay raise or that vendors will have increased operating costs to provide the same products or services to Marriott?

Competition may hold price increases down in most cases but the history of our economy tells us that most prices will rise. IMHO most price increases are necessary in order to provide the same level of services. As an owner I do not want a diminution of services because I'm relying on the Marriott brand to have a constant standard no matter where I happen to vacation. Reliance upon the Marriott brand is a better idea than reliance upon a timeshares board of directors.

 

[tlwmkw]

Allan,

Marriott has closed the sales office at Barony (they were using space in the garden view buildings and have converted them back to timeshare units), and they do not maintain sales offices at Monarch or Grande Ocean (that I have seen anyway). I also don't think they have sales offices at the other MVCI resorts on Hilton Head. The sales office at Surfwatch is also in garden view units and they say it will be turned back into villas once they sell out and no longer need the space- the resort is not yet sold out. So despite maintaining the rights to the space they don't alway keep the space for themselves. This is just how they do it and it doesn't really bother me.

On the discussion as to whether Marriott has left as the management company of any timeshares the answer is yes they have- as Suedonj says above. If you question the Marriott folk about this they will say that they've never left a timeshare that they built from the ground up (have to qualify it to make it true) and then add a big yet because I'm sure it could happen.

 

[AwayWeGo]

That's About The Size Of It.

Reliance upon the Marriott brand is a better idea than reliance upon a timeshares board of directors.

For the Marriott timeshare fans, I'd say that's pretty much nails it.

For the fans of the high-quality, independent, non-branded luxury timeshares, not so much.

Fortunately for us TUG-BBS types, there are plenty of both kinds to go round.

Is this a great country or what ?

Full Disclosure: We didn't seek out our high-quality, independent, non-branded luxury timeshares so much as luck into them. There is no doubt in my mind it was sheer, blind good fortune that we did so. By contrast, at our unbranded points timeshare out in the American heartland, the independent HOA plainly does not have a handle on cost containment, & I have no idea what the resort experience is like out there, because we've never gone to the resort & are unlikely ever to go. We just use the points for exchanges into other people's timeshares (including our own outstanding Orlando FL timeshares). All this is by way of saying that I suspect people's opinions of the relative values of independent luxury timeshares on the 1 hand & pricey chain brand timeshares on the other hand are apt to be colored by their own individual experiences. We didn't dope it all out in advance & then take the plunge. We took the plunge & then formed our views based on what actually happened. As a philosophical proposition, however, it is important to understand that what could have happened, did.

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[SueDonJ]

How can anyone buy a Marriott timeshare or anything else for that matter and not expect costs to go higher? Wouldn't one think that Marriott employees deserve a pay raise or that vendors will have increased operating costs to provide the same products or services to Marriott?

Competition may hold price increases down in most cases but the history of our economy tells us that most prices will rise. IMHO most price increases are necessary in order to provide the same level of services. As an owner I do not want a diminution of services because I'm relying on the Marriott brand to have a constant standard no matter where I happen to vacation. Reliance upon the Marriott brand is a better idea than reliance upon a timeshares board of directors.

I agree completely. I'd be very worried if my timeshares' BOD's primary concern was with keeping costs/MF down. It's one thing to shop around to get the best price for the services/supplies and to conservatively project future needs to fund reserves in order to keep a timeshare running at a certain standard. It's another thing altogether to skimp on or forego services/supplies/reserves in order to maintain a certain low MF threshhold.

 

[AwayWeGo]

Same Here.

I'd be very worried if my timeshares' BOD's primary concern was with keeping costs/MF down. It's one thing to shop around to get the best price for the services/supplies and to conservatively project future needs to fund reserves in order to keep a timeshare running at a certain standard. It's another thing altogether to skimp on or forego services/supplies/reserves in order to maintain a certain low MF threshhold.

Me too.

I like it when the timeshare HOA-BOD achieves a track record of steady improvement (renovations, upgrades, enhancements, modernization, etc.) and hard-core, nickel-squeezing, penny-pinching, tough-minded cost control, all at the same time.

It's a neat trick, & I wonder just how many timeshare HOAs are up to it -- independent & company controlled mox nix.

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[timeos2]

Tacking on 10-15% does nothing to help owners or quality

It's another thing altogether to skimp on or forego services/supplies/reserves in order to maintain a certain low MF threshhold.

Which history has shown to be likely to occur when a Developer is in charge as they protect their income vs the good of the resort. Then when things start to fall apart they simply assess the owners, with a 10%+/- overhead added, to make up for what they didn't collect.

I really find it hard to believe that there is any additional value added to furniture purchased from a "recommended" (read we get a kick back) vendor from a brand name management who then also charges their overhead on the project. What it sounds like is money wasted that could have bought better products or a lower overall cost for the project. There is no magic to making a resort top notch that requires a Hilton or Marriott name. Only a willingness by the owners to support a level of quality that meets or exceeds their expectations. And do it with the minimum expense possible rather than a percentage pay out to a national brand name.

 

[m61376]

Which history has shown to be likely to occur when a Developer is in charge as they protect their income vs the good of the resort. Then when things start to fall apart they simply assess the owners, with a 10%+/- overhead added, to make up for what they didn't collect.

I really find it hard to believe that there is any additional value added to furniture purchased from a "recommended" (read we get a kick back) vendor from a brand name management who then also charges their overhead on the project. What it sounds like is money wasted that could have bought better products or a lower overall cost for the project. There is no magic to making a resort top notch that requires a Hilton or Marriott name. Only a willingness by the owners to support a level of quality that meets or exceeds their expectations. And do it with the minimum expense possible rather than a percentage pay out to a national brand name.

While you are, of course, right in theory, it may be much harder to achieve consistently. It is very hard to get even full time residents of a co-op or condo to authorize expenditures, let alone owners who are spending a week or two a year, mixed in with owners who only use the property for trade so have no real interest in ensuring its upkeep.

Of course, buying the same product for cheaper and not having to pay a management fee is preferable, but having the brand name and their management does ensure a level of quality, albeit at a cost. Perhaps it comes down to whether you are willing to pay an extra hundred dollars or so a year in MF-s- really an extra $100 of vacation expense- to ensure that when you arrive you'll be getting the vacation you're anticipating.

 

[Transit]

If I spin the II wheel of fortune and it lands on a Marriott I know that it's a brand name with a good reputation it's an easy choice. I pull Joe's viilas on the beach I'd be concerned. Nothing wrong with nice independents but there is a comforting standard with brand names.

 

[AwayWeGo]

That's Why The HOA-BOD Members Get The Big Bux.

It is very hard to get even full time residents of a co-op or condo to authorize expenditures, let alone owners who are spending a week or two a year, mixed in with owners who only use the property for trade so have no real interest in ensuring its upkeep.

Fortunately, it's unnecessary to get the full-time residents or the 1- & 2-week interval owners to authorize expenditures for upkeep & improvements.

That's what the homeowner association Board Of Directors is for.

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[AwayWeGo]

It's All In Delivering Quality & Value For Money To The Owners.

There is no magic to making a resort top notch that requires a Hilton or Marriott name. Only a willingness by the owners to support a level of quality that meets or exceeds their expectations. And do it with the minimum expense possible rather than a percentage pay out to a national brand name.

Allowing for the perceived value in brand-name timeshares like Hilton, Marriott, etc., it's still got to be extremely tough to make every dollar collected from owners return value to the owners when the timeshare company is raking off 10-15%.

Plus, when the company-controlled management organization charges a percentage on top of actual expenses, they don't have much incentive to hold down costs.

Maybe I never fully appreciated as much as I should the rarity of those unbranded resorts that deliver quality all the way, thanks to value-minded & cost-conscious HOA-BODs, & fixed-fee contracts (i.e., not cost-plus deals) with independent resort management contractors.

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[ilene13]

no, the Royal Resorts has a desk at II. Marriott is not an owner of II. In fact II originally was in Buffalo, in the early 1980's when we bought our 1st timeshares.

 

[PerryM]

Viva La Resale!!!!

hipslo,

I do not have a definite answer to your question. However, Marriott has selectively resumed its ROFR activities. Specifically, they have exercised two Summit Watch week 52 transactions. One at $40,000, and one at $45,000, this past week.

BTW, Marriott has a published price of $85,000 (68k after the temporary 20% discount) for these units. So, they are selling what they choose to buy (as opposed to accumulating them for a points program).

As the recent credit market dislocations have abated somewhat, my guess is that Marriott's capital expenditure freeze that has been in place for the past 16 months is beginning to thaw.

Just saw this post - been busy lately.

$68,000 * 60% = $40,800.

$68,000 * 66% = $45,000.

The ROFR is still being executed at the 60% and 66% level of current sales price. I'm assuming Marriott instantly flipped those resales for a tidy profit with a few hours work by some grunt somewhere. Viva La Resale!!!

Who says resales are evil?

 

[Fredm]

Just saw this post - been busy lately.

$68,000 * 60% = $40,800.

$68,000 * 66% = $45,000.

The ROFR is still being executed at the 60% and 66% level of current sales price. I'm assuming Marriott instantly flipped those resales for a tidy profit with a few hours work by some grunt somewhere. Viva La Resale!!!

Who says resales are evil?

Yep, I also assume they were quickly flipped.
I do not anticipate Marriott exercising its preemption right on a broad scale anytime soon. They are still preserving capital. Nonetheless, it does appear that the freeze is beginning to thaw.

I posted the information not so much to advise of the ROFR's, as to offer a possible explanation for the newly announced sales desk at MountainSide.

 

[GaryDouglas]

I think they'll snag this one...

 

[dioxide45]

I think they'll snag this one...

I wouldn't be so sure. I am sure they have plenty of their own inventory yet to unload in Maui. They won't want to pick up something that they have to pay MF on until they can turn it over.

 

[taffy19]

First, it said that it was in the new tower but then they corrected it again because that number is not in the new towers as I double checked it. What a deal anyway for two floating ocean view units. Now is the time to buy if you are planning to keep it for many years. It is such a lovely spot.

 

[dougp26364]

Alan, Has any chain brand timeshare ever relinquished HOA to owners? I thought when you bought a chain brand resort the connection would always remain even after the resort sold out.

Marriott has released a couple of resorts in Hilton Head and a couple of the buildings in Vail. They sounded as if they were close to turning lose of Beachplace Towers when the HOA was at odds with Marriott over refurbishment.

 

[mas]

I think they'll snag this one...

Something doesn't add up here. They say that they are selling TWO weeks (annual--not EOY). Yet according to what is due for maint. fees on closing is $1538.81. Unless this is per unit week (which isn't indicated) that maint. fee is too low for two units.

 

[m61376]

Something doesn't add up here. They say that they are selling TWO weeks (annual--not EOY). Yet according to what is due for maint. fees on closing is $1538.81. Unless this is per unit week (which isn't indicated) that maint. fee is too low for two units.

If you look under the question part, they do note that it is for each week. The ad, as you mention, was confusing.

 

[GregT]

Something doesn't add up here. They say that they are selling TWO weeks (annual--not EOY). Yet according to what is due for maint. fees on closing is $1538.81. Unless this is per unit week (which isn't indicated) that maint. fee is too low for two units.

This was an interesting auction -- I corresponded a fair amount with the seller, who clearly did not know what they were selling.

They told me this was a Full kitchen (therefore not MOC), 1BR unit (therefore MOC), back-to-back TWO weeks (but not fixed weeks -- but they said it must be back to back), and that it was $1,538 in annual MFs.

My conversations suggested the agent had no idea what they were listing, and wasn't prepared for multiple questions from knowledgeable buyers.

I would love to know if this actually passes thru to the buyer....

 

[FlyerBobcat]

I can't say I'm impressed at all with this ebay seller: vaca4life2

In this recent auction, the ad listed

Float week:22-27 36-49 (red Season)

Those weeks are "white" season per Marriott's calendar.

Here is the Q & A from that auction, related to that inaccuracy:

Q: Is this not a white week? 22-27 and 36-49 float What is the special assessment of 373.25? Richard
A: the ad is as listed.. No answer on origin of sa. but its in the mf

I just don't like the smug attitude that I perceive. Personally I'd stay away from that seller.

On a related note to you DSV-II owners, is the Special Assessment information accurate?

 

[m61376]

Tom-
I think the whole red-white categorization is confusing. What Marriott considers an off-season white week may be a red week (albeit ever so slightly, so really pink) in II, because it is a high quality resort but an off season week. I find a lot of off season weeks are still advertised as red weeks on Ebay.

Not to give any credit to this reseller, but as a general warning buyers have to be really careful with Ebay descriptions. It is really important to check the resort calendar and verify the ownership information before bidding, because there are so many inaccuracies.

 

[FlyerBobcat]

M-
Agree with you all-the-way that in can be confusing -- and LOTS of time intentionally misleading, especially on sites such as Redweek. We are in sync.

I just strongly feel that since the seller is selling a Marriott week, not an II week (whatever that means ), that when presented with the question of it being a "white week", his given answer "... is as listed " is inappropriate -- and cause for me to blackball that seller. His responses to questions in other auctions sometimes indicates a lack of knowledge -- and/or time to give to help his potential buyers.

DSV calendar from Marriott

 

[Dean]

OK, so maybe the timeshare company reserves the exclusive right to sell timeshares on site without paying anything for the office space, sales rooms, freebies window, cubicles, utilities, etc., involved in the sales effort. That's not optimum for the owners, but it's understandable & maybe even tolerable.

But then if the timeshare company quits selling timeshares on site & instead starts selling club memberships or point-based exchange systems or something else instead of selling straight timeshares on site, then that's something else again.

By me, when the timeshare resort is sold out, then that ends the timeshare company's exclusive right to sell timeshares on site on an el freebo basis.

Once the resort is sold out, it's sold out. After that, if the timeshare company wants to keep on using the sales room, etc., on site for other kinds of selling (points, clubs, etc.), then they can jolly well pay for the privilege.

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

At least in Florida they would have to either pay dues on the commercial space they use OR indemnify the resort against dramatic overages for any applicable year as I understand it. Given that the resort could still recoup any overages the next year, this is a big benefit for the developer/management company. It essentially means that for almost no risk they can avoid paying maint on the commercial space they own. Assuming they jump through the correct hoops of course.