Speculation About Marriott's New Timeshare Structure [merged]

[dougp26364]

Perry...

If MVCI gives the same point value for a 2 bedroom plat. Orlando and a 2 bedroom plat ski week at Park City, then you will see the lynch mob....

The owners at SW or Mountainside paid twice as much for the unit than their Orlando counterpart (retail). The difference is probably greater (resale) as the ski plat weeks have kept some value, while the Orlando resale values resale prices have really bottomed-out...

p.s. welcome back...

Maybe, but they don't lynch HGVC when they sell Hawaii weeks for 50% more than they sell Vegas and Orlando. The advantage of owning a more expensive week is to be able to have first shot at your home resort and get the pick of prime weeks.

With HGVC, I paid less upfront and pay less in MF's to own in Vegas. I can exchange into Hawaii at the 9 month mark. The thing is, I'm picking over the leftover weeks and not the prime weeks. I'm also only getting the what's left over as far as unit type and view.

When we exchanged our Vegas points for Hawaii, I wanted ocean front 2 bedroom. Reality was that I was able to reserve a 1 bedroom ocean view or, I could have had a 2 bedroom city view.

In Hilton, it's said that points are points and that's true. But, if you want a particular week, say a good ski week in Utah, you'd better own that resort.

Of course Fletch has stated that there will be no home resort advantage. Now that bothers me and, if that's the case, then I agree that you're correct. If the prime platinum ski weeks are worth the same as platinum Orlando weeks, there will be a lot of disgruntled owners. If that happens I also agree that you're more likely to see lower season weeks joining and less high season weeks.

But if the assumption is wrong and there is a home resort advantage, then I don't think that's likely to be the case.

Some of this will depend on how many use their weeks to exchange, how many use part of their weeks (lock-out) to stay at their home resort and exchange the other portion and how many strictly exchange. Those that exchange are more likely to buy into a points based system regardless IF (and it's a big if), they see it as an advantage to easily get what they want.

Somehow I bet Marriott has all these numbers and at least has a clue what they're doing. At least I hope they do.

 

[m61376]

Of course the big push was to buy a points trader, but our sales rep, who was actually quite personable and not pushy, knew nothing about the points program. When he realized we really would not consider anything without more info, he called in a supervisor. She could not tell us much "without the risk of being fired", and she had worked for Marriott for 16 years or so. She did tell us that they were closing down the sales area for a week this month to train in the new system, and that she was buying two more properties before June as she was excited about the program.

Ann- Doesn't that seem a bit ironic? IF she was so excited about the new program, why would she buy deeded weeks in the old system before the new system was rolled out; why not wait and buy in the points program without the expense of converting?

sorry- posted that before seeing the comments already made. But I still feel something doesn't make sense. IF she was truly buying now, I suspect that she doesn't have too much confidence in what might be rolled out.

 

[BocaBum99]

Dean,
I totally disagree with this statement aside from some of the HGVC Affiliates. The HGVC built resorts are consistently VERY nice and most quite new, and are highly ranked on trip adviser and Tug. Take a look at HGVC Kingsland on the Big Island, HGVC Waikoloa, Grand Waikikian, HGVC Parc Soleil, HGVC on International Drive, Breckenridge HGVC, Portugal HGVC, HGVC Flamingo or Strip location just to name a few great properties. I would say Kingsland is probably the 2'nd nicest timeshare I have stayed at (Residence at the Crane in Barbados #1 which cost me only a bit more than 50% worth of my HGVC week worth of points to trade for on RCI). I have stayed at the KoOlina Marriott, Grand Vista, Grand Chateau which are all very nice, but certainly not superior to HGVC! I have also stayed at several nice Westin Properties (Kierland in Scottsdale, Westin Princeville) and some Wyndom properties. My ranking as a whole in terms of the actual property (not system) is Westin = or >than HGVC = or > Marriott and ALL 3 are superior to Wyndom , Blue-Green, etc. Hilton's biggest problem is they are too focussed on Hawaii, Vegas, and Orlando, but any of the HGVC built resorts are every bit as nice, and in some cases nicer than Marriott.... Pete

How convenient of you to leave out the affiliates. I have been to most of the timeshares you have listed in your post and I would say they are about equal to the top end Marriotts.

I've also been to Club Regency on Marco Island. It was a dive. Not even up to par with the average Bluegreen resort which is a value oriented timeshare resort group. The Bay Club is quite average as well. If you look at the total Marriott vs. the total HGVC including affiliates, I'd have to say that Marriott is slightly better over all, but in the same class.

 

[PerryM]

It's alive......

What's the goal of an exchange system?
A service that matches similar reservations between owners.

What's the goal of a sales system?
Sell timeshares to new customers and existing owners.

The two have nothing to do with each other - yet Marriott is going to pound a square peg into a round hole and try to make this new system do both; sell Points to a timeshare exchange system.

I honestly don't know how this Frankenstein system will look and behave since it probably won't do either task well.

If Marriott wanted a real internal exchange system they could have contracted with Resort2Resort.com and had the system up and running 4 years ago when the rumors started. They could have charged $199 for each week deposited and less than that per exchange.

But noooo, instead they've been assembling a monster in the basement that might just doom them in this electrifying environment....

To me it just makes no sense at all.

 

[Dean]

The truth is, Marriott is a much bigger system than Hilton, and like some of the Hilton affiliates, has their share of older resorts, but like Hilton even these resorts are kept to a certain standard, and still have a lot of desirability because of location, or other attributes.

I believe there is more variability within Hilton than Marriott but certainly there is variability within Marriott as well.

What's the goal of an exchange system?
A service that matches similar reservations between owners.

What's the goal of a sales system?
Sell timeshares to new customers and existing owners.

The two have nothing to do with each other - yet Marriott is going to pound a square peg into a round hole and try to make this new system do both; sell Points to a timeshare exchange system.

Perry I don't think Marriott is unique in this area, EVERY timeshare system has multiple factors and directions. Every developer is trying to sell at almost any cost and get the most $$$ they can. Then there are usage and exchange features. The semi unique issue about most points systems is that they are a usage and exchange system tied together. To a degree, one portion will have to compromise in favor of the other. I favor the DVC system except with a minimum stay priority for a full week. That gives you home resort priority and a fair chance at other options at a later date. It assigns value to using larger units and lower seasons and higher points to higher demand times (higher seasons, Fri/Sat) and better view options. I use DVC, RCI points, Bluegreen and an individual resort that works on points. All are different and must be approached differently to get the best value but all are a good option overall for their niche. I am confident that if I chose to participate with any possible MVCI points system, I can make that one work to my advantage as well. Remember that to a large degree, timeshare usage is really about me vs the other members in many ways.

 

[jimf41]

Perry,
Exactly what is it that you know about the "new system" that doesn't make sense?

 

[davidvel]

Even if the systems run separate inventory, which they really should, the question of which units/weeks are included in the points vs weeks side is very critical and likely will be somewhat subjective. It's unrealistic to assume that the current members will be status quo from a reservation standpoint and also unrealistic that both systems will be 100% "fair" for every situation.

I am confident that any "separation of inventory" or priority on reservations for points members would be a breach of the covenants.

 

[PerryM]

Ghouls, ghosts, and goblins...

Perry,
Exactly what is it that you know about the "new system" that doesn't make sense?

Why would Marriott stop selling timeshares and start selling a timeshare exchange system; and after 20 years of selling timeshares? I don't get it.

The learning curve of 400,000+ Marriott owners to forget all they know about week based timeshares and exchanging in II to be replaced with a currency of Points and Point Calendars - just this feat will cost millions of dollars.

It's one thing to be a Point system, like Disney or WorldMark, and sell Points to either a master deed trust, like WM, or RTU like Disney. They built/bought the condos and sell points (credits) that become a currency which owners accumulate and spend on reservations.

But to suddenly decide one day to stop selling timeshares and get into the timeshare exchange business just baffles my imagination - it's insanity.

Other timeshare developers are doing something like this - like Wyndham and a Wyndham sells for 5 cents on the dollar on the resale market - is this Marriott's goal? I now think it is and I'm disgusted with that concept.

Wyndham at least has the courtesy to not ghoulishly recycle the remnants of timeshare units on the resale market that go for next to nothing. Marriott will recycle discarded units by owners impacted by the new system. Marriott will be gobbling at the bones of owners who gave up and never got the vacation they were lead to believe was theirs for the asking.

Resale prices will fall when resales must pay a premium to enroll in the new system and that membership won't transfer when the unit is sold and resales will reflect that fact with lower prices.

And when the new system turns out to be no better or worse than the existing II system what will be accomplished as far as the owners are concerned - just membership fees, two mutually exclusive inventory pools of reservations, and lower resale prices.

All this when real estate is on very shaky grounds, credit is tight, folks are worried about their jobs, and this is the time Marriott chucks 20 years of selling timeshares just to jump into the timeshare exchange business?

From the sales side Marriott just needs to sell exchange Points to the holiday weeks - forget the rest of the year. The salesreps will oversell New Year's weeks at ski resorts and Hawaiian islands - that's all their sales pitch will become. They no longer need to actually have those weeks in inventory to sell like now - just a ghostly image on their cubicle wall of a "print screen", of their PC monitor, when such a week was deposited into the system from the distant past.

It makes no sense to me at all - unless this was the hair brain idea of a Marriott and daddy was too busy with other matters - that makes sense.

 

[jin]

How convenient of you to leave out the affiliates. I have been to most of the timeshares you have listed in your post and I would say they are about equal to the top end Marriotts.

I've also been to Club Regency on Marco Island. It was a dive. Not even up to par with the average Bluegreen resort which is a value oriented timeshare resort group. The Bay Club is quite average as well. If you look at the total Marriott vs. the total HGVC including affiliates, I'd have to say that Marriott is slightly better over all, but in the same class.

I have not stayed at any of the affiliates, but don't believe there is that much inventory in the system as I never see them aside from the BAY Club. The Bay Club is supposed to have very large rooms and is actually supposed to be quite nice since their recent renovation. I won't have any hesitation staying at this resort. I like the fact that I can actually trade for this resort on shorter notice. Grand Pacific Palisades in Carlsbad also looks appealing. I agree the Florida affiliates are less appealing, but like I said, this is only a small part of total HGVC inventory, and most of HGVC inventory is top notch in my humble opinion. Marriott has a fair amount older resorts as well as they have been around a lot longer..... Pete

 

[Dean]

I am confident that any "separation of inventory" or priority on reservations for points members would be a breach of the covenants.

The inventory will have to be separate to a degree, the question really is how to decide how to divide it up. I am confident that it will not be "fair" in some people's eyes no matter how it's done.

Why would Marriott stop selling timeshares and start selling a timeshare exchange system; and after 20 years of selling timeshares? I don't get it.

The learning curve of 400,000+ Marriott owners to forget all they know about week based timeshares and exchanging in II to be replaced with a currency of Points and Point Calendars - just this feat will cost millions of dollars.

It's one thing to be a Point system, like Disney or WorldMark, and sell Points to either a master deed trust, like WM, or RTU like Disney. They built/bought the condos and sell points (credits) that become a currency which owners accumulate and spend on reservations.

But to suddenly decide one day to stop selling timeshares and get into the timeshare exchange business just baffles my imagination - it's insanity.

Other timeshare developers are doing something like this - like Wyndham and a Wyndham sells for 5 cents on the dollar on the resale market - is this Marriott's goal? I now think it is and I'm disgusted with that concept.

Wyndham at least has the courtesy to not ghoulishly recycle the remnants of timeshare units on the resale market that go for next to nothing. Marriott will recycle discarded units by owners impacted by the new system. Marriott will be gobbling at the bones of owners who gave up and never got the vacation they were lead to believe was theirs for the asking.

Resale prices will fall when resales must pay a premium to enroll in the new system and that membership won't transfer when the unit is sold and resales will reflect that fact with lower prices.

And when the new system turns out to be no better or worse than the existing II system what will be accomplished as far as the owners are concerned - just membership fees, two mutually exclusive inventory pools of reservations, and lower resale prices.

All this when real estate is on very shaky grounds, credit is tight, folks are worried about their jobs, and this is the time Marriott chucks 20 years of selling timeshares just to jump into the timeshare exchange business?

From the sales side Marriott just needs to sell exchange Points to the holiday weeks - forget the rest of the year. The salesreps will oversell New Year's weeks at ski resorts and Hawaiian islands - that's all their sales pitch will become. They no longer need to actually have those weeks in inventory to sell like now - just a ghostly image on their cubicle wall of a "print screen", of their PC monitor, when such a week was deposited into the system from the distant past.

It makes no sense to me at all - unless this was the hair brain idea of a Marriott and daddy was too busy with other matters - that makes sense.

Perry, I don't know if this is all going to happen or not but if they change to a points system there are reasons they would consider it. I would agree with you that this is a fundamental change of the product and they they should have done it a number of years ago. Points systems will appeal to a sightly different audience than will weeks but the main issue from Marriott's standpoint is that every single point is sold as a Platinum season but not every point can reserve a platinum season. Overall points systems are better received by the masses than weeks. It's not that Marriott doesn't care about existing owners but they also have to care about their bottom line, that can be quite a balancing act. Resale prices really won't mean much, what you or I can sell for really has never been their concern, nor should it. However, it brings ROFR into play in that they can take any weeks they deem of value and convert them to points.

As I noted above, I am confident that any program will be reasonable but not perfect. I am also confident that some will be upset if this happens. Not all points systems started that way including what's now Wyndham and Bluegreen. Converting does give them one other opportunity that I'm quite sure you won't like, that of being able to differentiate retail from resale much as some of those other points systems do.

 

[puckmanfl]

Dean...

Please help me out and explain to me why you would even remotely consider converting your "top shelf" HHI summer weeks!!!

If you plan to occupy, there is no reason to change. If you plan "like-like" exchanges, this system may add a little flexibility but will add so many more "players" that can snag these units that availability must inevitably decrease. I do believe that flexibility in "downtrading" will be dramatically increased. The good news is that a summer HHI week or Hawaii week might generate 10-14 days in Ocean Pointe/ Marco off season and that 3-4 day getaways in these off seasons will be plentiful. Visiting resorts off season within driving distance for 3-4 getaways will definitely be a plus...

I do forsee II "fighting back" and coming up with incentives to get MVCI weeks in their system!!! Perhaps increased availability of AC's and other perks!!!

I just need someone to convince me to participate. All I have really heard is that there is some increased flexibility and "ALL the other TS companies do it" so it must be good...

 

[m61376]

Converting does give them one other opportunity that I'm quite sure you won't like, that of being able to differentiate retail from resale much as some of those other points systems do.

Dean- While I agree with much of what you say, there are a few things I'd like to comment on. First, the inventory should and I think legally can only be separated according to ownership in the respective systems. In order to make systems equitable the reservations for every unit type and every reservation day should reflect the portion of ownership- so that if there are 25% point owners, then a quarter of the reservations should go to that group for each unit type and reservation day. Logistically, I am sure this will create a bit of a nightmare, and be especially hard for smaller resorts and more limited villa types (at many resorts there may be 20 OF or 3BR villas, spread out over 3,4 or 5 arrival dates each week).

Secondly, to address what I quoted above. I hope Marriott doesn't lose sight of the fact that the more successful points based systems, which most here tout as DVC and HGVC, either don't differentiate or make minimal distinction between how owners acquired their weeks. Not surprisingly, resale values are higher and so is owner satisfaction.

Even Starwood's program, which does distinguish buyers at many of their properties, has had any distinction built in from the onset; that is, at the point of purchase every buyer was aware of their rights and limitations, if any. I have said it before and I will reiterate it- it is one thing for Marriott to enact a new system that creates a distinction between future purchasers and a very different thing to create sub-classes of current owners. The only delineation which I would consider equitable would be to enhance the current distinction- that is, make the transfer of points to the Rewards Program the selling point it once was. That would increase value for current retail owners and would maintain what should currently be the real distinction, but has morphed into a program of limited value to many.

That said, while I would not like it I do not feel it would be unfair for them to create a larger distinction for future purchasers, since people will have the option to buy or not buy as they see fit. However, I do think they should look long and hard at how the voluntary program has decimated the value of many of the Starwood properties and the high rate of owner dissatisfaction and default. Marriott has the power to make the distinction between retail and resale something of real value without being punitive, simply by enhancing the reward point trade value.

Ten to fifteen years ago, when many of these values were set, MF's were considerably less, up front costs were considerably less, and the point cost for travel packages was a whole lot less. Many of those up front incentives practically paid the difference in purchase price. Today, prices of units are much higher, MF's doubled in some cases, travel packages require a lot more points and the only thing that has remained stagnant is the redemption value of the weeks. Even values assigned for current purchases don't reflect the full increases on the redemption side. In reality, since the trade value doesn't change but every other parameter increases, the value of this perk has decreased commensurate to the other increases. A fairer exchange value would be easy to implement, and building in a cost of living factor would help keep the program relevant ten years down the road. Marriott could easily take a positive approach to enhancing developer sales by making it truly a seamless program with owner access to the hundreds of hotels worldwide, with owners getting really good value for their money. After all, Marriott gets a nice timeshare to rent out for thousands of dollars for the week, so shouldn't owners be able to book equivalent accommodation value when trading? THAT would be a win-win program and something that might entice many, even resale owners, to participate in. Then we'd truly be buying pre-paid vacations world-wide- and, after all, isn't that what they are selling?

 

[m61376]

puckmanfl-
IF there is no home resort priority, as Fletch suggested and as the AP program was implemented, I think a lot of premium week owners will hesitate to participate. I think that a lot of Platinum week owners in perhaps less in demand locales might, but then again they may opt to continue using II for one to one trades if it will cost them 2 weeks of points for a single week in a top tier location. I think a lot will depend upon whether they adopt the wide differential in point allocation as in the AP program or something more akin to HGVC's program; that remains to be seen.

As for the benefit for lower season owners to join- I think a lot will depend on how the MF's are handled. IF they remain as they currently are, with every owner at every resort paying the same MF's according to unit size for their underlying week, then lower season owners might balk at their point allotments. After all, the opportunity to snag up-trades will be gone (or at least severely diminished) in a points system). If they get fewer points but pay lower MF's some may feel it is more equitable.

The problem is is that it is impossible for Marriott to satisfy everyone. No matter what they do one subset is going to be unhappy. Since they want to sell points and want to sell the prospect of everyone being able to reserve those prime Platinum weeks, I expect they will tilt the scales accordingly. But the one fact they cannot alter, no matter what spin they put on it, is that for many resorts the prime weeks are truly limited, and even for those few resorts with consistent weather and attraction appeal (like Hawaii, Aruba, Vegas and I think a few of the new resorts that they've delineated similarly), there are certainly more in demand weeks than others (school vacation weeks, etc., within the same season). Selling the idea of everyone simply being able to spend New Year's in Hawaii, in Aruba or skiing, which are all very high demand weeks, simply by buying enough points, is a scary thought.

 

[PerryM]

The Pro of Cons

The inventory will have to be separate to a degree, the question really is how to decide how to divide it up. I am confident that it will not be "fair" in some people's eyes no matter how it's done.

Perry, I don't know if this is all going to happen or not but if they change to a points system there are reasons they would consider it. I would agree with you that this is a fundamental change of the product and they they should have done it a number of years ago. Points systems will appeal to a sightly different audience than will weeks but the main issue from Marriott's standpoint is that every single point is sold as a Platinum season but not every point can reserve a platinum season. Overall points systems are better received by the masses than weeks. It's not that Marriott doesn't care about existing owners but they also have to care about their bottom line, that can be quite a balancing act. Resale prices really won't mean much, what you or I can sell for really has never been their concern, nor should it. However, it brings ROFR into play in that they can take any weeks they deem of value and convert them to points.

As I noted above, I am confident that any program will be reasonable but not perfect. I am also confident that some will be upset if this happens. Not all points systems started that way including what's now Wyndham and Bluegreen. Converting does give them one other opportunity that I'm quite sure you won't like, that of being able to differentiate retail from resale much as some of those other points systems do.

Here are the Pros to Marriott:

• No worries about selling doggy weeks - sell Points to access owners' reservations
• Resales crumble since Marriott sells Points and resales sell weeks - no compatibility and thus 5 cents on the dollar resales
• Exercise ROFR at the 5% level and recycle weeks to Points
• 400,000 owners with 2 weeks each, lest's say 1,000,000 weeks, times $2,500 per week is a goal of $2.5 Billion goal for this project

Here are the Cons to Marriott:

• Huge learning curve to explain to 400,000 owners
• Owners balking at paying the membership fee
• Ticked off owners with 2 reservation pools
• Ticked off owners realizing that there are many shades to Bronze, Silver, Gold, Platinum, and Platinum Plus
• Lawsuits that could challenge the very existence of the new system
• Wrong timing resulting in poor conversion and poor acceptance for new owners

For the 400,000 owners:

• Will the new system help or hurt our Marriotts now and 10 years from now?
• Will the resale market be impacted by the incompatibility of Points versus weeks?
• Will the new system be better than II?
• Can I afford to join?

I can't overstate that the new system, in my estimate, will kill the Marriott resale market - Marriott sells Points in an exchange club and resales are for deeded weeks not in Marriott's exchange club - the two are not compatible.; thus Wyndham type resales of 5 cents on the sales dollar.

But isn't this what the salesreps have said for years now?

"Better not buy resale or you'll be sorry"

Personally, I believe them.....

 

[PerryM]

Mommy, I hate math...

puckmanfl-
IF there is no home resort priority, as Fletch suggested and as the AP program was implemented, I think a lot of premium week owners will hesitate to participate. I think that a lot of Platinum week owners in perhaps less in demand locales might, but then again they may opt to continue using II for one to one trades if it will cost them 2 weeks of points for a single week in a top tier location. I think a lot will depend upon whether they adopt the wide differential in point allocation as in the AP program or something more akin to HGVC's program; that remains to be seen.

As for the benefit for lower season owners to join- I think a lot will depend on how the MF's are handled. IF they remain as they currently are, with every owner at every resort paying the same MF's according to unit size for their underlying week, then lower season owners might balk at their point allotments. After all, the opportunity to snag up-trades will be gone (or at least severely diminished) in a points system). If they get fewer points but pay lower MF's some may feel it is more equitable.

The problem is is that it is impossible for Marriott to satisfy everyone. No matter what they do one subset is going to be unhappy. Since they want to sell points and want to sell the prospect of everyone being able to reserve those prime Platinum weeks, I expect they will tilt the scales accordingly. But the one fact they cannot alter, no matter what spin they put on it, is that for many resorts the prime weeks are truly limited, and even for those few resorts with consistent weather and attraction appeal (like Hawaii, Aruba, Vegas and I think a few of the new resorts that they've delineated similarly), there are certainly more in demand weeks than others (school vacation weeks, etc., within the same season). Selling the idea of everyone simply being able to spend New Year's in Hawaii, in Aruba or skiing, which are all very high demand weeks, simply by buying enough points, is a scary thought.

Well that's the whole idea - at least to Marriott salesreps.

I've postulated that just 20 numbers, in the Points calendar/matrix, are all that is needed to make an internal exchange system work - just like Resort2Resort.

II doesn't care if you have ocean front or garden view - they all are the same if the goal is to have a workable exchange system.

On the day of release I'm going to count how many numbers are needed to make the new Marriott system work - I'm guessing a zillion more than 20 since ocean-view, garden view, different shades of Platinum are needed in a sales system.

Exchange system or sales system - count the numbers and find out yourself.

The bigger that number the more incompatible the two systems become.

 

[GregT]

I can't overstate that the new system, in my estimate, will kill the Marriott resale market

Perry, I just can't see this happening? I can see impacted values to the Silver weeks, and perhaps Gold, but I would believe that Platinum weeks will at least hold whatever their current value is (and frankly Gold/Silver are already crushed). We see this same phenomenon with HGVC points -- the Platinum points hold, Gold and Silver much less so.

If Ko Olina weeks go down to 10% of their retail price, that suggests a $5K or $6K up-front payment. I suspect many people would be willing to pay that -- two recent eBay transactions both sold Ko Olina 2BR OV at $15K - $16K each and those are low by historical standards.

I believe there's going to be demand from buyers for the Platinum weeks if they are disenchanted with the Points system and those owners either want control over booking their reservation (or want to Direct Exchange with other Platinum owners if they want to visit MFC/MOC/MSK, etc).

The only way to truly kill resale values if if Marriott differentiates between resale owners prior to June XX, 2010 versus resale owners after June XX, 2010 -- similar to what Worldmark did when they introduced TravelShare. If Marriott did differentiate and restricted the ability for new resale owners to book reservations until X months before check-in, that would be a problem for all resale values. But I would think that would lessen the value of their ROFR also, since anything they ROFR'd is now a resale week?

Lots to speculate about -- I personally don't believe Marriott is going to introduce a punitive clause for future resales, and that Platinum deeds will continue to hold their value.

Hopefully we will know soon!

Best to all,

Greg

 

[puckmanfl]

good morning....

The "horse" is already out of the barn with regards to point values. There is no way MVCI can just have 20 numbers. As Asia has pointed out the AP program has already pointed out values...

2 bedroom Ko-olina is 48K points, 2 bedroom Vegas Plat is 38K points. They can't just say "oops, just kiddin' " and make all Plat two bedrooms equal point value". The "CHART" will be quite interesting. Imagine the angst of all of the "owners" that were told their plat week at their "home" resort is the most valued in the system...

should be fun as the mother company is going to need to come up with some way to get "primo" weeks owners to opt in or it is doomed to failure. Without prime inventory in the system, the word will get out pretty quickly!!!

I really want to be an optimist, as I am still waiting for a TUGGER with foresight and vision to convince me to opt in... In other words, occupancy remains the same , How does this system improve "like-like" good exchanges with exchanges with MORE customers looking for fixed availability of limited inventory!!!

 

[GregT]

I really want to be an optimist, as I am still waiting for a TUGGER with foresight and vision to convince me to opt in... In other words, occupancy remains the same , How does this system improve "like-like" good exchanges with exchanges with MORE customers looking for fixed availability of limited inventory!!!

Puckman,

I've never been associated with the words foresight or vision but I'll try.

As with you, I'm skeptical that Marriott can offer me something to trade in one of my two MOC weeks into the points system. I like my fixed weeks and the size of my units and I'm reluctant to part with them, as I believe I will be able to get Direct Exchanges when desired and II will still be a good deposit location for my lock-off.

However, the following would make me look at the program:

1) I would definitely join IF it was not a permanent commitment, ie one year I can deposit the 3BR and get XXX points for use elsewhere (in Asia Pacific, that could be 85,000 points based upon TDI) -- that's enough for a 2BR and a 1BR in the Asia Pacific Program (a "trade-up" from my 2BR and Studio) and then the next year visit my unit as normal -- such that each year I have the flexibility to stay in my unit or deposit it into the pool. I don't know if there is any precedent for this type of system.
2) I would definitely join IF I could deposit just the lock-off and get points that I could pool and use EOY (or low TDI weeks annually) for a 1BR at Ko Olina/other. As with #1, I'm not sure if there is a precedent.
3) I would definitely NOT join if you had no ability to control the view of the property that you redeemed points at -- I'm surprised that Asia Pacific charges same points for both Mountain View and Ocean View units -- definitely a letdown for me. II has too much availability at Ko Olina (studios granted) to make it worth the loss of the MOC property
4) I would definitely NOT join if there was no home resort advantage, or at least some ability to ensure I could get a second MOC week contiguous to the MOC week that I kept (I can't imagine putting both weeks in)
5) I will be annoyed if they differentiate between existing resale and new resale owners -- and it would make me highly inclined to not join the system.

#1 and #2 above are key points of interest to me. One thing that intrigues me about other points system is the very little value additional points value that HGVC ascribes to a 3BR versus a 2BR in their newer properties. I think at KingsLand at 2BR is 12,700 points and a 3BR is 14,700 (I think) -- if Marriott retains such a minor difference in points, that will be a disincentive to participation as well.

We will see!

All the best,

Greg

 

[m61376]

The only way to truly kill resale values if if Marriott differentiates between resale owners prior to June XX, 2010 versus resale owners after June XX, 2010 -- similar to what Worldmark did when they introduced TravelShare. If Marriott did differentiate and restricted the ability for new resale owners to book reservations until X months before check-in, that would be a problem for all resale values. But I would think that would lessen the value of their ROFR also, since anything they ROFR'd is now a resale week?

Lots to speculate about -- I personally don't believe Marriott is going to introduce a punitive clause for future resales, and that Platinum deeds will continue to hold their value.

I don't think legally they can change the ability of any future resale owners to book what they are buying, because they are buying the original contract/deed. Where they can make punitive changes is to severely restrict future resale buyers from ever participating in a Marriott internal trading program (much like the Starwood voluntary resorts), although they could still trade through II.

Anything ROFR'd would revert back to a developer week, with all the benefits that infers, akin to what happens currently.

 

[GregT]

How does this system improve "like-like" good exchanges with exchanges with MORE customers looking for fixed availability of limited inventory!!!

Puckman,

It's me again -- the only ways that I could see the system improving the exchanges opportunities for the points customers would be as follows (all at the expense of the existing customer base, retail and resale):

1) Marriott uses its massive quantity of weeks (in a trust) to book multiple consecutive prime weeks that now limit the inventory even further for non-points customers (but to the benefit of the points purchaser)
2) Marriott limits the ability of resale owners to make reservations until X months before check-in (edited: less likely per previous post)
3) Marriott extends the reservation time line for points purchasers (they all get 13 month reservations, even if they only have points for a single week, since the Trust has multiple weeks)
4) They offer loads of points for your Platinum week that make you think you can get better or flexible reservations

These would be reasons to join the point system if you are a single week platinum owner -- but I dislike the first 3 because they purely take advantage of the captive existing ownership (like Wyndham likes to do).

Perry is warning that we are too trusting of Marriott that they won't use their ability to manipulate the system at existing owner expense, in order to increase their own ability to sell units. I don't believe they will need to institute #1-#3 because I believe the appeal of the points-system combined with the Marriott network will make it saleable product, therefore our decision will be based upon the merits of the system, versus a need to protect what we already have.

By the way, I think sales personnel may tell prospective buyers that Marriott reserves the best weeks for the points system, because its a great sales tool. I am skeptical that Marriott can and will be able to do that.

Good luck to all,

Greg

 

[GregT]

I don't think legally they can change the ability of any future resale owners to book what they are buying, because they are buying the original contract/deed. Where they can make punitive changes is to severely restrict future resale buyers from ever participating in a Marriott internal trading program (much like the Starwood voluntary resorts), although they could still trade through II.

Anything ROFR'd would revert back to a developer week, with all the benefits that infers, akin to what happens currently.

Good points, thanks very much

 

[bogey21]

I'm sure Marriott is on firm (or close to firm) legal ground with what they are doing. But they clearly are not being fair to those who bought based on the program as it was at the time of their purchase. At one time I owned 5 Marriott Weeks in Orlando and Hilton Head. The resale and rental programs that existed when I bought were major inducements. When Marriott started messing with these to their benefit (and my detriment) I sold all 5 of my Weeks. All I can say is that I'm glad I did.

George

 

[Fredm]

Since we are all speculating, try this one on.

Marriott's new points system will need lots of inventory.
So, every owner as of June 30 is grandfathered. No buy-in.

Rather than inventing a long table of point values for exchange, they adopt the Marriott Rewards point value (or a proportionate value) for each season or Plus week at every resort. They already have them.

Home resort reservation rules still apply.
So does the maintenance fee. As is currently the case, they are not tied to season value.

Exchanges via I.I. are still available for those who wish to not play.

 

[puckmanfl]

Fred

My 2 bedroom Koolina gets 85,000 MR points and my 3 bedroom GV gets 125,000 MR pts. Don't believe my 3 bedroom GV is 40% MORE valuable than 2 bedroom Koolina.

AS per Greg, the only way this can work is if MVCI uses their unsold and owner returned inventory in the "points" pool. This will be especially true in the beginning!!! They are going to want people shouting from the rooftops "looky here, just snagged week 52 at summitt watch"...

 

[Fredm]

Fred

My 2 bedroom Koolina gets 85,000 MR points and my 3 bedroom GV gets 125,000 MR pts. Don't believe my 3 bedroom GV is 40% MORE valuable than 2 bedroom Koolina.

True.

But your GV IS worth 40% more MR points. That did not stop you from buying KoOlina. The difference is that you have home resort advantage at KoOlina. That's why Marriott could offer less MR points to a KoOlina week. The principal value was in the reservation priority.

Same argument can be made under the new system. Except a resale buyer never had the MR points.
I understand that a KoOlina owner may not consider this "fair". But, nothing will be "fair" to everyone. Just guessing like everyone else.

As for shouting from the roof tops about a Summit Watch week 52, that will not happen under any circumstances. Salespeople may want to sell it that way. But, in actuality, they will not be available except by a fluke.

Point values aside, the key to success will be lots and lots of inventory available. The best way to insure this is to grandfather everybody at no buy-in cost.