Westin St. John [Master Thread]

[DavidnRobin]

Very interesting discussion on subsidies.

So - to look at it another way (which could be misguided) - there are 3 types of SVO-controlled VOIs:
1) Being built - but not ready for occupancy
2) Unsold by SVO - ready for occupancy, but SVO gets value by SVN/II exchanges, rentals, or Sales usage.
3) SVO owned

Type 1 make sense to have a SVO subsidy - but it would be interesting to know more about Types 2 and 3.

Type 2 is able to be used by SVO for SVN exchanges, II exchanges, Renting and Sales usage - why would it be subsidized?

...and why would Type 3 get subsidized at all? (~10% of WSJ-VG is this type)

So... why would there be any SVO subsidy for WSJ-VG for the past 5+ years since all villas have essentially been owned by Owners or by SVO (except for a few in inventory) during this time - yet the subsidy just ended?

interesting - comments?

I still need to dig out the past 5 years of WSJ MF bills to look at the %subsidy per VOI MF.

 

[Fredm]

I would think that your type 1 would not receive any subsidy.

Type 2 would.

I don't know about type 3. Depends on how the subsidy was amortized. Shared facilities that overlap HOA's may be a reason, but I don't know enough about St John to make a good guess.

 

[jarta]

Fredm, ... The maintenance fees are designated separately and the notes talk about Starwood having paid all but $100 of the MF on the 10% still owned by Starwood.

The developer subsidy is something completely separate. It was almost $2.9M for 2008 and 2009. I asked if anyone knew if this subsidy was contributed by Starwood because there was no money in the reserve fund to do the rehab. That is what I was told when I was at WSJ.

If Starwood fronted the money for the rehab and the rehab is nearing completion, that would be a good reason for the developer subsidy to end. What could be happening is that the extra 3-yr special assessment that ends in 2011 is being collected to repay the developer subsidy and, after 2011, the MF will have to include money for the next rehab which will be deposited in the reserve fund.

I asked if anyone knew. Despite all the heat about MF at WSJ, apparently nobody knows.

It makes a difference for 2 reasons. First, Starwood fronting the repairs would show that Starwood bailed out the association in a time of dire need. And, second, if the association cannot survive without a developer subsidy, why would I (or anyone) buy at WSJ Hillside (AKA VG)? ... eom

 

[Fredm]

Fredm, ... The maintenance fees are designated separately and the notes talk about Starwood having paid all but $100 of the MF on the 10% still owned by Starwood.

The developer subsidy is something completely separate. It was almost $2.9M for 2008 and 2009. I asked if anyone knew if this subsidy was contributed by Starwood because there was no money in the reserve fund to do the rehab. That is what I was told when I was at WSJ.

If Starwood fronted the money for the rehab and the rehab is nearing completion, that would be a good reason for the developer subsidy to end. What could be happening is that the extra 3-yr special assessment that ends in 2011 is being collected to repay the developer subsidy and, after 2011, the MF will have to include money for the next rehab which will be deposited in the reserve fund.

I asked if anyone knew. Despite all the heat about MF at WSJ, apparently nobody knows.

It makes a difference for 2 reasons. First, Starwood fronting the repairs would show that Starwood bailed out the association in a time of dire need. And, second, if the association cannot survive without a developer subsidy, why would I (or anyone) buy at WSJ Hillside (AKA VG)? ... eom

Yes, I can read.

From my post:
"I do not know how this specifically applies to WSJ. Or, if it applies at all."

 

[jarta]

Although the post was addressed to you because you were the only one who replied, it appears nobody who owns at WSJ knows whats going on - or will let on that they know.

You were only providing general information. General information is always good.

I was not criticizing you personally. It was more frustration at the people who are complaining that MF at WSJ are too high but do not seem to know that there was a massive developer subsidy by Starwood in excess of MF paid on unsold units. I was told it was to front the cost of the repairs because the reserve fund was nearly broke.

If it was and, therefore, was a temporary thing, the developer subsidy ending is a wash and will be covered by the 3-year special assessment. If the resort was surviving on permanent developer subsidies and they are now gone, that is quite a different thing - an indication that the resort is in real trouble and probably cannot survive without a developer subsidy.

Anyone who has specific knowledge about what the total $2.9M 2008 and 2009 developer subsidy in addition to MF was used for, feel free to add information. ... eom

 

[DavidnRobin]

I do know one thing (well... two things , but the 2nd is against TUG rules to say aloud) - the subsidy had nothing to do with the refurbish. The subsidy has been around longer than the refurbish plans - even the 1st one. btw - the 1st one was paid for with a doubling of the replacement reserves one year.

...as always stated - transparency (and lack of) is the one thing I would like to see change at all my VOIs, but I refuse to harp on the past (as it is a waste of time/energy) and look forward to having improved transparency in the future. If not, Bob and Phil will hear from me the same as the SVO-puppets that we recently voted off the WSJ-VG board (in effect).

 

[DavidnRobin]

I would think that your type 1 would not receive any subsidy.

Type 2 would.

I don't know about type 3. Depends on how the subsidy was amortized. Shared facilities that overlap HOA's may be a reason, but I don't know enough about St John to make a good guess.

As always - thanks for the response Fred - curious to know why Type 1 would not be a subsidy - to me that would be exactly what the subsidy would justify (in building phase, but not ready to occupy - therefore carry the HOA until the VOIs could be used).

For type 2 - interesting that the HOA gets a subsidy. The amortization reasoning is an interesting one.

I would put little trust in what a salesperson's explanation on this topic (other than try to gleen what is the truth and what is the misinfo). I did just email the wife (aka Robin) to get out the MFs bills for WSJ out of storage - it would be interesting to see the subsidy level over the years. I am more interested in the $subsidy per VOI rather than the overall (since the overall means little to me)

 

[Fredm]

As always - thanks for the response Fred - curious to know why Type 1 would not be a subsidy - to me that would be exactly what the subsidy would justify (in building phase, but not ready to occupy - therefore carry the HOA until the VOIs could be used).

For type 2 - interesting that the HOA gets a subsidy. The amortization reasoning is an interesting one.

I would put little trust in what a salesperson's explanation on this topic (other than try to gleen what is the truth and what is the misinfo). I did just email the wife (aka Robin) to get out the MFs bills for WSJ out of storage - it would be interesting to see the subsidy level over the years. I am more interested in the $subsidy per VOI rather than the overall (since the overall means little to me)

A "Subsidy Contract" exists between the developer and the HOA.

Called the "Developer's Duty to Pay"

I quote:

" The Developer also promises to pay the Assessment and Personal Charges for each Vacation Ownership Interest while the Developer is the Owner of it.
Instead of doing so, however, the Developer may enter into a 'Subsidy Contract' with the Association in which the Developer agrees to pay the Association the difference between the actual cost incurred by the Association and the Assessments charged to other Owners."

OK, so per my earlier explanation, the developer pays fees for built but unsold units. However the fee is only the difference that represents non-impact use.

The above language was lifted from the WKORV Governing Documents.
I can only assume (as I do not have the WSJ docs) that similar language exists. I do not know how the Subsidy Contract itself reads. Like all contracts between the developer and the HOA, it would have to be obtained from the HOA. Good luck with that one. But, you can bet that one exists.

Re; why not type 1, it is the development phase. No units yet exist. The developer is entirely responsible for the costs associated with construction, taxes, and legal formation. Once a building is released previously sold owners pay HOA fees on the sold intervals, and the Developer pays a subsidy to the HOA on remaining unsold units, per the Subsidy Contract formula.

The developer subsidy seems to always understate the impact the fees
theoretically mitigate. I draw that conclusion from my observation that HOA fees always seem to increase once the subsidy ends.
Again, I am not familiar enough with WSJ to make this a blanket statement applicable to WSJ. Just would not be the least surprised.

 

[jarta]

Here is what the WSJ (VG) audited calendar 2008 statement says:

"NOTE 10 - RELATED PARTY TRANSACTIONS
The Association has entered into an agreement with Starwood Vacation Exchange Company (“SVEC” f/k/a
Westin Vacation Exchange Company), an affiliate of the developer and the management company, in which SVEC
has established a mandatory exchange program and related services known as the Starwood Vacation Club (the
“Club”) for the purpose of providing a means by which several owners of record of ownership interest in the resort
and vacation ownership interests in any other resort that is affiliated or associated with the Club (“Affiliated Resorts”),
reserve the use of accommodations and related facilities of the resort and the other Affiliated Resorts, and have access
to any benefits which the Club may provide from time to time, all in accordance with, and as restricted by, the terms
of the Club as set forth in the Agreement and Disclosure Guide for the Club as it is promulgated, adopted, or amended from time to time. As of December 31, 2008 and 2007, the amount due from SVN Operator for club dues over remitted by the Association was $763 and $69, respectively, and is netted against accrued expenses on the balance sheet.

In addition, the affiliation agreement noted above calls for the SVN Operator to allocate the total net rental proceeds, if any, 50% each to the SVN Operator and Association until the Association receives an amount of rental proceeds equal to 2.5% of the Association’s annual budget for each fiscal year. During the years ended December 31, 2008 ad 2007, the total proceeds allocated to the Association were $31,619 and $92,070, respectively. As of December 31, 2008 and 2007, the amount of proceeds not yet remitted by the SVN Operator to the Association was $4,469 and $36,589, respectively, and is shown as accounts receivable - other on the balance sheet."

However, under NOTE 4, the following is included:

"During the years ended December 31, 2008 and 2007, the amount of maintenance fees assessed to the developer for operations and replacements were $580,994 and $75,079, and $538,846 and $64,231, respectively. Total cash payments made to the Association by the developer, for these assessments were $656,073 and $603,077 in 2008
and 2007, respectively. In addition, the developer elected to voluntarily subsidize specified line items in the budget
resulting in developer subsidy revenue of $1,978,206 and $892,090 for the years ended December 31, 2008 and 2007, respectively. The Association derived approximately 31% and 22% of its revenue from the developer during the years
ended December 31, 2008 and 2007, respectively."

The developer subsidy is clearly not MF, or MF-related. ... eom

 

[Fredm]

Here is what the WSJ (VG) audited calendar 2008 statement says:


However, under NOTE 4, the following is included:

"During the years ended December 31, 2008 and 2007, the amount of maintenance fees assessed to the developer for operations and replacements were $580,994 and $75,079, and $538,846 and $64,231, respectively. Total cash payments made to the Association by the developer, for these assessments were $656,073 and $603,077 in 2008
and 2007, respectively. In addition, the developer elected to voluntarily subsidize specified line items in the budget
resulting in developer subsidy revenue of $1,978,206 and $892,090 for the years ended December 31, 2008 and 2007, respectively. The Association derived approximately 31% and 22% of its revenue from the developer during the years
ended December 31, 2008 and 2007, respectively."

The developer subsidy is clearly not MF, or MF-related. ... eom

Seems to be the case. Actually, 'voluntarily subsidize" takes my breath away. A fee increase is a sure thing when that ends, unless it was a transient shortfall related to how the subsidy contract was originally constructed.

 

[jarta]

Fredm, ... "A fee increase is a sure thing when that ends, unless it was a transient shortfall related to how the subsidy contract was originally constructed."

That's why I said I was told that the subsidy was to front the renovation at VG because there was a depleted reserve fund. I asked if that was true. No WSJ owner has answered (go figure).

If, as David implies, it is an ongoing, every year developer subsidy, Starwood has been carrying the resort for some time now. And, if the developer subsidy ends (maybe because all the owners are making so much noise about high MF) they surely will be facing increases in the MF they now think are so high.

However, if the developer subsidies were to front the renovations, things may not be so bad. I'm just trying to find out what the heck is going on with the developer subsidy and I find it odd that nobody who owns at WSJ (VG) will say what's going on.

Thank you for the general information. Most people refer to what you are talking about as a developer contribution in lieu of assessment. Most State law requires the developer to pay the proportionate share of expenses on unsold units (condo or timeshare). ... eom

 

[Ken555]

Thanks for posting that, Jarta. I'm going back to my original view of subsidies in post 492...

 

[DavidnRobin]

2006 Property Tax Bills Sent

2006 Property Tax bills have been sent (at 1998 rate) - our week 23 2Bd TH bill is $137.25.
{added: the previous 2006 tax bill for week 24 - that was pulled - was $288.44}

Of course - ours was sent to previous owners... arg.

 

[DavidnRobin]

WSJ SVO Subsidy info

WSJ SVO Subsidy info
Note: bottom of the MF bills states -
"The amount of the Developer contributed subsidy as set forth in the Total Annual Budget is an estimate amount only. The Developer is under no obligation to offer any subsidy for the current or for future budget years."

and also...

"In estimating the expenses associated with the annual budget - certain common expenses of the Condo have been determined thru allocations of costs related to Admin, Front Desk, Maintenance, Housekeeping, Security, and other services that are shared between the Condo and Hotel. These allocations have been determined pursuant to an arrangement between the Condo and the Hotel. Certain of these costs may be lower than they otherwise would be if such services were being provided by independent 3rd parties instead of the Hotel. There is no guaranty that this arrangement will continue in subsequent budget years."

For a 2Bd TH - WSJ VG phase - per week:
[92 units in VG phase with a total of 4692 unit weeks]
note: I only list our villa type - but they are proportional (%-wise) to other types

Operational Budget
Year 2006: Subsidy = $103.98; TTL MF = $1203.83 (incl. RR = $140.51)
Year 2007: Subsidy = $210.24; TTL MF = $1322.98 (incl. RR = $140.90)
Year 2008: Subsidy = $517.23; TTL MF = $1521.17 (incl. RR = $174.08)
Year 2009: Subsidy = $291.10; TTL MF = $2465.82 (incl. RR = $865.17) - 1st SA year (of 3)
Year 2010: No subsidy; TTL MF = $2866.05 (incl. RR $865.17) - 2nd SA year (of 3)

so... unless SVO/WSJ had a crystal ball - accusations that the lack of subsidy was due to SVO/WSJ payback because of Owners revolt is without validity (as well as the claim that there were no Replacement Reserves collected over the years)

 

[jarta]

David, ... "as well as the claim that there were no Replacement Reserves collected over the years"

Thank you for the information. However, as I said in posts 503 and 505, the claim was not that no money was collected; the claim was that insufficient money was left in the reserve fund.

The annual budget is where SVO/WSJ is supposed to look into that crystal ball and come up with numbers to balance the budget.

What happens now that the subsidy has ended? Are there any attempts to have it reinstated? And, in return for what, if anything? ... eom

 

[DavidnRobin]

ask Phil and Bob - I am just reporting info...
why would the subsidy continue?

the argument about sufficiency of previous RR is not worth my time - nor enjoy having it twisted
2010 Budget is put together in 2009

IMO - based on previous history - and lack of subsidy and rate of increase - i would guessimate the 2012 MF bill for our 2Bd TH to be around $2400 - but purely a guess - IMO

 

[jarta]

"ask Phil and Bob - I am just reporting info...
why would the subsidy continue?"

First, they (Phil and Bob) haven't posted here and, if they watch, they can/could join in any time.

Second, you are the TUG resident expert on WSJ. You set up this thread. I thought you would know and share information.

Third, as to your question, if the $1M annual subsidiary was necessary to balance the budget in past years, wouldn't it be necessary to balance the budget in future years? I was asking if it was necessary to balance the budget generally or to fund the renovations because those are the only two reasons I can come up with. If there is a third, please let me know what it is. ... eom

 

[mishpat]

Is it really worth the effort?

Reading all the posts ,am wondering if the trip to WSJ is worth effort, as opposed to staying on St Thomas or just non stop to Puerto Rico. My sense is that the actual Westin hotel, as opposed to the timeshare, is great for location but a run of the mill overpriced property. Am I wrong?

Also, getting to the WSJ from the mainland can be a time consuming adventure if you literally miss the boat. Can someone give me an estimate of the time to go from the airport until you reach WSJ. I am guessing ninety minutes or more.

 

[LisaRex]

I cannot speak to whether it's worth it to you but it was worth it to me to travel from St. Thomas to St. John because my husband and friends love to snorkel.

Travel time is several hours if you take the Westin ferry because just the ferry ride is an hour.

 

[jarta]

It is worth the trouble to get to WSJ. After you visit, you will realize why. ... eom

 

[GeneNWendy]

Travel time to St John

Regarding travel time to St. John, I recommend you read my post #480 Without repeating what I said entirely, renting a car on St. Thomas is significantly less expensive than doing so on St. John. From Red Hook, you can catch a car ferry just about every 30 minutes between 7:00am and 7:00pm. It takes about 20 minutes to get over to St. John. You are then only about a 5 minute drive from the Westin.

 

[DavidnRobin]

Reading all the posts ,am wondering if the trip to WSJ is worth effort, as opposed to staying on St Thomas or just non stop to Puerto Rico. My sense is that the actual Westin hotel, as opposed to the timeshare, is great for location but a run of the mill overpriced property. Am I wrong?

Also, getting to the WSJ from the mainland can be a time consuming adventure if you literally miss the boat. Can someone give me an estimate of the time to go from the airport until you reach WSJ. I am guessing ninety minutes or more.

It is for some - for others it is not. Not sure how you interpret from posts that a trip to WSJ/STJ is not worth it? Most issues are with SVO/HOA - are these issues going to make your stay more unpleasant?

This was our 5th year in row, and cannot wait to get back next year. We stay at the timeshare portion - some villa and hotel visitors seem to have issues, but generally based on their expectations (same goes for the resort and STJ).

90 mins form STT-STJ is probably a reasonable estimate but will be dependent on the method for transportation (Westin ferry, public ferry, car-rental on STT and car-barge...) and traffic and ferry schedule. We travel from SFO...

When we are on STT - we just want to get off STT and over to STJ as quickly as possible. I am not sure what anyone would see in staying on STT, but again all based on what one's expectations are.

 

[DavidnRobin]

Rainy STJ

From STJ Tradewinds:

Record-breaking Rainfall Sends Guts Overflowing, Rocks Sliding

With waterfalls gushing, guts overflowing and rockslides wiping out entire lanes on several St. John roadways, Love City looked more like Soggy City last week.

As of Friday morning, July 23, 12.46 inches of rain had accumulated at Trunk Bay during the month of July alone, according to Rafe Boulon’s rain data.

Boulon, the chief of resource management at V.I. National Park, has been collecting rain data at his North Shore home since 1983 and this month was the wettest July he has ever recorded.

On Tuesday, July 20, alone Boulon netted two inches between 3 and 4 p.m., which sent rocks and mud cascading down already saturated hillsides.

“Hawksnest Gut was four feet deep during the heaviest rainfall,” said Boulon. “It usually recedes pretty quickly, but when I got there around 4 p.m. it was down to about three feet.”

Before this July’s more than 12 inches of rain, the most rain to fall during the month of July was a measly 6.68 inches, which Boulon recorded in 2005.

As anyone who has spent time on St. John over the past few months can attest, the rains didn’t start in July. Even back in May, Boulon was collecting near-record amounts of rain.

May 2010, with 10.6 inches of rain, was the second wettest May Boulon has ever recorded. June’s accumulated 7.48 inches of rain was the wettest June Boulon has seen since he started collecting precipitation data.

Going into the month of July, St. John had already seen almost 10 inches more than usual for that time of year. As of Friday, July 23, a total of 41.89 inches of rain had fallen during 2010 so far and the average yearly rainfall for St. John is only 43 inches.

“It’s just been a wet year,” said Boulon. “May was the second wettest May since I started collecting data in 1983, June was the wettest June and we’re already well past our average for July.”

The rainfall set back North Shore road repairs, hampered the work of V.I. Water and Power Authority’s Estate Grunwald power line crew and closed one lane near the Cruz Bay tennis courts for most of the early part of the week.

Along with the lush green hillsides, so much rain accumulation also often means lots of mosquitoes and a greater danger of contracting dengue fever. There have already been two reported cases of dengue fever on St. John, with more possible.

While standing water, where the dengue fever carrying Aedes egypti mosquitoes often breed, can pose dangers, such a heavy amount of rain usually bring less mosquitoes, according to Boulon.

“Sometimes when we have these big gut washes, like this, it flushes everything out,” said Boulon. “The mosquitoes that have already laid their eggs will be washed out, which we saw in May and June. During those months we didn’t really have any mosquitoes.”

“And I think that was because there was a continual flushing of the eggs and larvae,” Boulon said. “When it stopped raining a bit at the end of June and early July, when it tapered off for the a week, that is when we started getting more mosquitoes.”

The Department of Health has already started fogging for mosquitoes on St. Croix and St. Thomas and plan to start soon on St. John. DOH, however, had not set a date for fogging as of press time.

 

[DavidnRobin]

St. John Restaurant Closings

For those travelling to STJ in the 'off-season':

St. John Restaurant Closings
According to the St. John Sun Times, these eateries will be cooling their stoves for a while.

Cafe Roma: Closed for September
Caneel: Closed Sept. 7 to Oct. 27
Fish Trap: Closed for September
La Tapa: Closed for August
Miss Lucy's: Closed now through August (they think)
Ocean Grill: Closed Sept. 7-Oct. 11
Ronnie's Pizza: Closed last week of August and September
Shipwreck Landing: Closed 6 weeks, starting September
Sweet Plantains: Closed until further notice (this sounds ominous)
Waterfront Bistro: Closed Sept. 7 to mid-October

St. John Spice also keeps tabs on restaurant vacations.
http://stjohnspice.com/stjohnrestaurants.htm

 

[olivias dad]

Sweet Plantains is closed? Thats news to me, where did you hear this DavenRobin? We will be there in 2 weeks and was possibly looking to eat there one night