What do MVC owners think of Abound?

[TravelTime]

To characterize every rental on RedWeek as “commercial use” is (maybe) not an accurate characterization.

For example, I sometimes have a WKORV rental listing there, when I decide to lock off one of my units and use one side and rent the others to recoup all or part of my maintenance fees. Doing this was touted by sales people when I bought my units and indeed it can be a good strategy. But I wouldn’t call this ”commercial use.”

On the other hand, there are people who own a whole bunch of VOIs which are largely used as rentals. Some of them may have tens of listings on RedWeek and elsewhere. They’ve made a business out of their ownerships, and I’d indeed characterize that as commercial use.

I have no idea what percentage of RedWeek listings are onesy-twosey listings from owners who mostly use what they own themselves and occasionally rent something, vs. owners who have made a business out of it. And maybe the difference is unimportant – if Marriott bans all rentals, then all of these owners are in violation. But if they only ban “commercial use” then I think you need to figure out how to define that.

Vistana allows rental of bookings at your home resort (or resorts, in the case of Flex owners) but prohibits rental of weeks booked with StarOptions at other resorts. But once somebody elects Abound and makes a reservation that way, I actually don’t know what’s allowed. It sounds like you’re saying that MVC prohibits all rentals (or all “commercial use”, which isn’t necessarily the same.)

I agree with you 100%. I think the occasional rental of owner weeks or owner points is not a violation of the commercial use policy.

MVC points owners are allowed to rent their points and it is not a violation. I was going to ask if points owners are allowed to rent banked points. Maybe someone knows the answer.

I am not sure but I doubt people rent points out often. All most people is get a reimbursement of MFs. Points just rent for the same more or less as MFs. Not a very profitable business for most people, I suspect. Some people happen to have points that average half the MFs but I suspect that is rare. It is a great deal to rent points from owners since they rent at the price as MFs, more or less.

People who rent their weeks year after year are a different situation. I wish Marriott would come up with some kind of fair policy about this like some other timeshare companies. Just because sales touts rental as a benefit does not make it something people should buy for. We always say “if their lips move” so why should we do anything they say?

 

[TravelTime]

I don't think anyone is disputing that owners have a right to rent an owned week. The question is when do those rental activities rise to the level of being a commercial enterprise or practice. Here is what the Exchange Procedures say about that:

B. Residential Use and Prohibition on Commercial Use. Accommodations, Base Exchange Benefits, Base Plus Exchange Benefits, Special Benefits, and Use Periods may not be used for any commercial purpose. This prohibition on commercial use includes, but is not limited to, any illegal activity or a pattern of occupancy, rental, leasing, or use by a Program Member that Exchange Company, in its reasonable discretion, could conclude constitutes a commercial enterprise or practice. In the event a Program Member is determined to be reserving or using the Accommodations, Base Exchange Benefits, Base Plus Exchange Benefits, Special Benefits or Use Periods for any commercial purpose Exchange Company may immediately cancel any current reservation(s) made by such Program Member and may impose such additional penalties or restrictions as determined by Exchange Company, in its sole discretion, from time to time. The restrictions of this paragraph do not apply to Exchange Company or its affiliates or designees.

That is from the Points Exchange procedures, so is not directly applicable to a weeks owner renting a week. But the terms and conditions for weeks deeds contain substantially similar language. I just don't have a PDF handy of any of our weeks documents.

I think it's common knowledge on TUG that there are some owners who own many weeks, primarily for the purposes of rentals. Maui Ocean Club and the Aruba resorts are the ones I hear mentioned the most, with maybe Grande Ocean also sometimes mentioned. How many of the rentals that appear on Redweek are from these "mega-renters"? How much do these mega-renters actually reduce availability for regular owner use? No one knows the answer, but MVC doesn't seem to care to try to enforce that provision, as some other Developers apparently have.

Exactly what I mean. Marriott needs to enforce commercial use. Apparently, Marriott does have control over owner weeks given this policy. Vistana also has control over owner weeks since it just blatantly says no rental of StarOptions.

 

[dioxide45]

Until and unless Marriott and Vistana take a hard line like Wyndham has done, nothing will change. Most Marriott resort CC&R documents have provisions against commercial activity. The DC Exchange Procedures do also. The ability is there to transfer points and add guest names to reservations. The first step to curbing rentals is usually to charge a fee for adding a guest. This also helps fatten the company bottom line. Then they may limit the number of guest certificates for an account. Then they could take the step of Wyndham and not allow guest names to be added during certain reservation time periods. Then they could go further and start sending out certified letters to known mega renters and even small time renters.

 

[Retired2025 aka AlmostRetired]

That is from the Points Exchange procedures, so is not directly applicable to a weeks owner renting a week. But the terms and conditions for weeks deeds contain substantially similar language. I just don't have a PDF handy of any of our weeks documents.

I think it's common knowledge on TUG that there are some owners who own many weeks, primarily for the purposes of rentals. Maui Ocean Club and the Aruba resorts are the ones I hear mentioned the most, with maybe Grande Ocean also sometimes mentioned. How many of the rentals that appear on Redweek are from these "mega-renters"? How much do these mega-renters actually reduce availability for regular owner use? No one knows the answer, but MVC doesn't seem to care to try to enforce that provision, as some other Developers apparently have.

I am still not sure how it would apply to the weeks program given HOA's have the say at a resort and Marriott is the management company paid by the HOA. No need to show me the PDF, I now understand what was meant. .


It would be interesting to know where the line in the sand gets drawn for what is considered commercial use.

 

[dioxide45]

I am still not sure how it would apply to the weeks program given HOA's have the say at a resort and Marriott is the management company paid by the HOA. No need to show me the PDF, I now understand what was meant. .


It would be interesting to know where the line in the sand gets drawn for what is considered commercial use.

Commercial use could also be defined as something completely different than renting. It could be that you can't run a barber shop from your villa while you are staying at the resort.

 

[JIMinNC]

I am still not sure how it would apply to the weeks program given HOA's have the say at a resort and Marriott is the management company paid by the HOA. No need to show me the PDF, I now understand what was meant. .

As @dioxide45 notes above, the commercial prohibition is found in the resort CC&Rs, which were written by MVC. A resort HOA could de-affiliate with MVC of course, but that's a whole 'nother can of worms.

 

[timsi]

I'm positive because my experience as an owner has been largely positive. I have no reason to be suspicious, at least for now. If my experience changes, so will my perspective.

Some owners are very skeptical when they see asymmetric rules for different types of owners. Apparently regular owners can't rent for a profit, they have to stay in line to book their own units, they can't buy units at the best available price, the units they sell are stripped of features etc. Daily we hear from owners who are being lied to in the sales meetings. When I read the Abound rules I could see clear conflicts with the resort rules, particularly with the Bylaws at Westin Lagunamar (see the link below in case you did not read the new thread).

If what I see with the naked eye does not meet a minimum standard, why should I not be suspicious about everything else? With an inventory of 700 million dollars or so the developer manages to have around 2 billion dollars in rental and sales revenue. Good for them, that is quite an achievement I would say but I digress, the topic of the moment is about the Redweek listings. It seems that those who have to stay up at night to book few units are a threat to the other owners but the ones who rent for hundreds of millions of dollars a year, who can make the resale features magically reappear on the contracts and can buy and book their units wholesale are not. Based on Sue's comment earlier, many have little knowledge about how much the developer owns at their resort, and they assume that " It can't be that you (I) think Marriott Vacations Worldwide flat-out owns all that inventory because they'd be on the hook for all those MF's". Really?

How strong is the exclusive right of the Lagunamar owners to compete for the entire inventory during the Home Resort Reservation Period? | Timeshare Users Group Discussion Forums (tugbbs.com)

 

[frank808]

It sounds like you're looking at this more from a personal and emotional perspective while I'd look at it as more of a black and white reality perspective. The reality and legalities are that there are no guarantees or even promises of availability, any assumptions otherwise simply reflect the lack of knowledge of how a floating system works. I'd be surprised if 75% of the membership as a whole get their first choice and skeptical that 75% get anything in their top 3 choices for points Or floating weeks through it's likely better for weeks than points. Part of it is understanding realities. I'm sure TUG members do far better than the overall membership. I think you're reading too much into this. Their main goal is simply profit whether it be sales or management. If the issues you bring up affect profit sufficiently, they will address it as best they can weighing cost vs potential benefit. One of the benefits a developer has selling points is that every buyer has options and timing in mind, usually which the system can't handle and MVC knows that up front yet they will still sell to you even when they know your plans are not realistic. Statistically for example, a buyer may be looking at HHI 4th of July but most won't get it or even the week before or after. The ones that learn the system, play the game and are proactive will do better than most but at the expense of everyone else. As long as systems like Westgate, Wyndham and Bluegreen can continue to sell at retail prices for something you can get almost free privately, I don't expect MVC, DVC, Hilton or the like to be overly limited due to the concerns you raise. Remember most timeshare are bought not sold. Would any of us advise a single person off the street to buy retail, the answer is no with extremely limited and specific examples to the contrary. Once sold, MVC really cares even less as they're going to get their fees and they've already made their money on that item.
In reality this is a series of systems linked together. Basically it's a user who owns X and uses X specific to what they own (such as a floating week) and it's limitations and if not, they are an exchanger, wether it's the FL club, elected points or trust points, etc. One of the problems with trust points is there is no home resort so they're in permanent exchange status and in many ways, one doesn't actually own anything. I know people look at it like they own across the system and should be treated the same, or almost the same, as an owner at a given resort but that is not reality IMO. Every member that moves from one category to another will affect demand along with availability so in theory the demand for each resort and option will roughly be the same before and after that person moves from one group to another (say weeks to points). But there may be some minor differences in demand as one moves from an owner to an exchanger within MVC.
There has always been a disconnect between sales, usage and the actual legalities in place. Specific to this situation, if sales encourages purchases to rent and management labels that person a commercial rental, I would not be surprised and would feel the member should have better understood what they were getting into by reading the actual legal paperwork. I do not believe that anyone who gets to simply Chairman's club is going to be afoul of the commercial rental issue if they have any personal usage. But for those like myself, who own quite a bit more, we could easily get to that level if we routinely rented a significant portion of what we owned.

Does MVC define commercial use? I thought the language in MVC T&C states commercial use and not commercial renting. Commercial use could be stating that you cannot run a business out of the unit. Does the T&C specifically prohibit commercial renting?

Just wondering if I will get in trouble in the future when I might not use all my weeks and points in MVC. If I decide to use my Hilton or Disney timeshares, Maybe we will take 8 month cruises so will definitely have some weeks to rent out.

Then I will have 51.5 annual MVC weeks plus DC points to rent out. Right now it is fine as we are using everything annually. Have been enjoying my stays for over decade. Though it has only been the past 10 years we are averaging 40+ weeks a year at MKO. How does MVC define residential? MVC has not said anything to me about staying 30 continuous weeks at once. Then back again a week or two later for another 20+ week stay.



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[DRH90277]

Yes, the point values are the annual points assigned to the weeks in the Trust as of that date. Your math is basically correct process-wise, with the only caveat being the 2570 points you used as a denominator. That number will depend on the actual mix of weeks in the Trust. It looks like Gold weeks are worth 1950 and Platinum weeks are 2550 based on Steven Ting's spreadsheet he has online. There are also apparently Platinum Plus weeks that would raise the average, but Steven's list doesn't have that data. Based on all that, I would expect the average is less than 2570.

The number is close enough and far more accurate than your assertions about how great the MVC program is from the inside. Confidence in the MVC program is eroding for many of us. And, Abound is just a distraction.

What if we called the program "Mirage" while awaiting delivery of "Abound."

 

[Dean]

Does MVC define commercial use? I thought the language in MVC T&C states commercial use and not commercial renting. Commercial use could be stating that you cannot run a business out of the unit. Does the T&C specifically prohibit commercial renting?

Just wondering if I will get in trouble in the future when I might not use all my weeks and points in MVC. If I decide to use my Hilton or Disney timeshares, Maybe we will take 8 month cruises so will definitely have some weeks to rent out.

Then I will have 51.5 annual MVC weeks plus DC points to rent out. Right now it is fine as we are using everything annually. Have been enjoying my stays for over decade. Though it has only been the past 10 years we are averaging 40+ weeks a year at MKO. How does MVC define residential? MVC has not said anything to me about staying 30 continuous weeks at once. Then back again a week or two later for another 20+ week stay.



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Jim listed the information from the exchange procedures in post #125 and it does include renting. Normally timeshares make these things vague on purpose, DVC for example, included working that the definition could be generated later. Generally it's things like volume, repetitive activity, websites and the like. But they could easily decide an individual had stepped over the line renting multiple high demand weeks and shut them down. One's only recourse at that point would be to exit totally or in part, use personally or undertake a legal battle. The legal paperwork from all resorts I've seen also include a statement that the ownership is for personal use although that is more of an acknowledge by the buyer that they do not expect to profit by renting or selling rather than a ban and required by state law in many cases (inc FL), they can use it against the member when looking at this issue. Most systems have taken some measures to limit rental activity including DVC, Bluegreen and Wyndham. Personally I think they should have some limit that's out of bounds but it would likely only affect a handful of members. Bluegreen and DVC have approached this simply by relatively strict volume limits, in BG's case, simply by limiting volume completely regardless of rental or personal use. Realize they have multiple reasons to do so such as their own rental business and members complaining about availability. For most members it'd look like they've done something if they put up road blocks around this issue but in reality it wouldn't make much if any difference.

Specific to your and my situation, I think we could easily be afoul of this issue if we had several years where we were mostly renting.

 

[frank808]

Making them vague would be a problem for the entity that wrote the T&C. Courts would not look too kindly and rule in favor of MVC if it came before the courts. Now this is not legal advice, just my opinion.

Have discussed the DVC T&C regarding commercial use with a few Florida licensed lawyers. They have concurred that if push came to shove and a lawsuit was brought by an owner locked out for commercial renting clause (which there is none) DVC would have a very tough time to win. Akin to telling the court "Sorry your honor but the T&C we wrote does not state specifically commercial renting is not allowed but that was our intent." DVC also states in the T&C that buyers will be at a distinct disadvantage if renting out their ownership interests.

There are a couple cases, that I know of, where DVC sent cease and desist letters to mega renters. Even froze their accounts and started an investigation for commercial renting. End result was DVC unfroze the accounts and let it be when owners legal team got involved. DVC then went on a different attack and ended up freezing accounts by saying entities were over the 8000 point limit for one owner. DVC ended up linking all these entities controlled by one owner even though they were seperate legal entities. From what I know, one owner was so spooked that he is not renting and liquidated his points(resale prices where so high that it also made sense).

Will have to look into the T&C for some of my ownership weeks to see what it says specifically about commercial renting.

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[JIMinNC]

The number is close enough and far more accurate than your assertions about how great the MVC program is from the inside. Confidence in the MVC program is eroding for many of us. And, Abound is just a distraction.

What if we called the program "Mirage" while awaiting delivery of "Abound."

If you want to talk numbers, then let's use all of the numbers. Of course, we don't have all of the numbers, but we can at least make some educated guesses and get a better view than just looking at part of the numbers.

First, given that Gold is 1950 and Platinum is 2550 at Harbor Lake, the number you should use for the denominator in your calculation should be some weighted average between those two numbers. At Harbor Lake, 20 weeks are Gold and 32 are Platinum. If we assume the weeks in the Trust match that distribution (which it may not, but we don't know what the real number is) then the weighted average point value per week would be 2322. So using your same methodology from post #121, 8,506,500 points/2,322 points per week = 3,663 weeks. So, 3,663 weeks/52 = 70 yearly villas. Now 70 yearly villas/ 312 total annual villas at the resort = 22% in the Trust.

So, our starting point is 22% of Harbor Lake might be in the Trust, but that was in December 2016, almost six years ago when the Trust contained 378 million points. How many Harbor Lake weeks have been added to the Trust since then? MVW said during their Investor Day in June that they average repurchasing 10,000 to 12,000 weeks every year. How many of those were from Harbor Lake? If you look at the MVC Trust annual budget and look at total assessments and calculate the number of beneficial interests (250 points each) that represents, you come up with an estimated number of points in the Trust now of around 600 million. So, could 30% or more of Harbor Lake weeks now be in the Trust? That doesn't seem to be too much of a stretch, but who knows?

But to address total availability for Points use, we also need to add those weeks Harbor Lake owners elect for points that then become available for booking with points through the Exchange. Obviously we don't know that number either, but when you start adding up the likely additions since 2016, plus owner elections, the total number of Harbor Lake weeks available for Points reservations, could easily approach the 40-50% range. When you consider that MVW says that about 40% of their owners still don't use points, getting a lot more than 40% to 50% of the weeks of any resort in the Trust/Exchange might be tough.

Finally, back to one non-numerical point - you mentioned my "assertions about how great the MVC program is". Those assertions are based 100% on my direct, personal experience. But as I've stated, my experience may have been totally positive only because we don't have any need or desire to book high demand summer reservations. If we did need to use points to book summer in HHI, for example, maybe we wouldn't be as happy. I don't know. But the way I look at it, that's where deeded weeks come in. What I've learned most in my years on TUG is, if there is somewhere you must go during high demand season, buy a week there. Don't count on any exchange system - either weeks based or points based - to get you there. That's what we did with our two EOY Hawaii weeks. We didn't want to count on points or II trades to get February in Maui and Kauai every odd year, so we bought EOY resale weeks there. We bought the HHI condo I'm in right now because we want to come here anytime we want to. You also said that's what you did with your MVC weeks purchases in Myrtle Beach and Hilton Head - you bought legacy weeks in your favorite destinations. Points have their benefits for traveling to a variety of places, but it's hard to beat owning legacy weeks for those hard-to-get locations you just have to go to.

 

[JIMinNC]

Just wondering if I will get in trouble in the future when I might not use all my weeks and points in MVC. If I decide to use my Hilton or Disney timeshares, Maybe we will take 8 month cruises so will definitely have some weeks to rent out.

Specific to your and my situation, I think we could easily be afoul of this issue if we had several years where we were mostly renting.

I would think both of you guys should have a reasonable defense if Marriott were ever to challenge you on the commercial enterprise clause, because in many/most years my impression is that you both use many/most of your weeks. I would think the folks with the most to risk would be those who may own a bunch of weeks but who rarely use them themselves or only use a small number, always renting out the vast majority. I would also think that someone who always rents a couple of their weeks to offset their fees on the weeks they do use would not be viewed as a commercial enterprise either.

 

[Dean]

Making them vague would be a problem for the entity that wrote the T&C. Courts would not look too kindly and rule in favor of MVC if it came before the courts. Now this is not legal advice, just my opinion.

Have discussed the DVC T&C regarding commercial use with a few Florida licensed lawyers. They have concurred that if push came to shove and a lawsuit was brought by an owner locked out for commercial renting clause (which there is none) DVC would have a very tough time to win. Akin to telling the court "Sorry your honor but the T&C we wrote does not state specifically commercial renting is not allowed but that was our intent." DVC also states in the T&C that buyers will be at a distinct disadvantage if renting out their ownership interests.

There are a couple cases, that I know of, where DVC sent cease and desist letters to mega renters. Even froze their accounts and started an investigation for commercial renting. End result was DVC unfroze the accounts and let it be when owners legal team got involved. DVC then went on a different attack and ended up freezing accounts by saying entities were over the 8000 point limit for one owner. DVC ended up linking all these entities controlled by one owner even though they were seperate legal entities. From what I know, one owner was so spooked that he is not renting and liquidated his points(resale prices where so high that it also made sense).

Will have to look into the T&C for some of my ownership weeks to see what it says specifically about commercial renting.

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In DVC's case they reserved the right to define later and have since added more definition. Many of those initially caught by DVC bailed and did not challenge. In the absence of a legal verdict, it difficult to say anything else. I know what the DVC legal paperwork says and I think they could easily defend it for egregious situations, not so much for smaller fish. But they, like MVC, are the 600# gorilla rightly or wrongly.

I would think both of you guys should have a reasonable defense if Marriott were ever to challenge you on the commercial enterprise clause, because in many/most years my impression is that you both use many/most of your weeks. I would think the folks with the most to risk would be those who may own a bunch of weeks but who rarely use them themselves or only use a small number, always renting out the vast majority. I would also think that someone who always rents a couple of their weeks to offset their fees on the weeks they do use would not be viewed as a commercial enterprise either.

Maybe but inherently I'd prefer to avoid the situation both because I do feel that one is is running a rental business, by any REASONABLE standard, is being inappropriate and should be curtailed. But I also feel strongly that we should have options when the need arises. Ultimately it comes down to intent for the most part. I am always amused by those who feel any rental for a profit or a high demand week is commercial.

 

[SueDonJ]

... Based on Sue's comment earlier, many have little knowledge about how much the developer owns at their resort, and they assume that " It can't be that you (I) think Marriott Vacations Worldwide flat-out owns all that inventory because they'd be on the hook for all those MF's". Really?

Yes, really.

If you're so convinced that Marriott "owns" up to a quarter of the Weeks inventory at every resort, then show your work. Understand, though, that the inventory that's been conveyed to the DC/Abound Trust is not flat-out owned by Marriott in the same way that Weeks can be owned (either never sold or reacquired) by Marriott. DC/Abound conveyances are "owned" by the Trust and correlate to the DC/Abound Trust Points that are sold as well as to the usage rights of Trust Members. If you're assuming that DC/Abound conveyances are ALL eligible to be pulled out and rented by Marriott for the company's sole revenue benefit (or used in any other manner for Marriott's sole benefit,) you're wrong. You're also wrong if you're assuming that Marriott is on the hook for the MF's for all those conveyed Weeks - DC/Abound Trust Members pay per-point MF's which are based on the same Annual Budgets that determine the Weeks inventory MF's, collectively, along with the administration fees of the Trust.

Somewhere in all of your posts you made a comment that Marriott is not transparent about which Weeks intervals have been conveyed to the DC/Abound Trust. In fact, that information is available to the public via a review of the filings at the Orange County FL public records. @dioxide45 used to maintain this TUG thread - Recorded Trust Documents - and you're as free as anyone to pick up that mantle and run with it. Just use "Marriott Ownership Resorts, Inc*" as your search term and go one-by-one to pull out the trust conveyances.

* I think another of your questions in all these posts questioned what "Marriott Ownership Resorts, Inc" designated? It's referenced in most governing docs as "MORI" and defined as "The Developer" in most/all of the Weeks Time Sharing Plans.

You've also asked quite a few other questions for which the answers can be found in the individual resorts' Public Offering Statements. Just want to let you know that I'm not ignoring the questions you've asked me but I'm waiting to answer until I have the time to do a thorough search. It's easy to understand the delay once you know that each resort's POS can be hundreds of pages long - for example, Barony Beach Club's consists of 325+ pages.

 

[SueDonJ]

I am still not sure how it would apply to the weeks program given HOA's have the say at a resort and Marriott is the management company paid by the HOA. No need to show me the PDF, I now understand what was meant.

This is far too basic a claim, considering that the Management Agreement governing docs grant Marriott extensive rights - and responsibilities - as to how inventory and even the resorts themselves are managed.

... It would be interesting to know where the line in the sand gets drawn for what is considered commercial use.

I think if ever Marriott (MVW) decides to comprehensively limit owner rentals via the vague "commercial activity" language in the docs they'll do it the way Disney (DVC) does, by putting a number to how many owner reservations can have guests' names added to them. But until/unless they decide to implement wholesale limitations we won't hear anything related to rentals from them. I'm not totally convinced that they won't at some point selectively-but-rarely go after the largest owner rental businesses, but I don't believe that they'll make public their intent or determination to do so.

I'd be in favor of either mechanism to limit owner rentals - I don't believe my piddling rentals would be caught up by either but if it happens, c'est la vie. It's more important to me that owners have reservation (and unit placement) preference over renters.

 

[timsi]

Yes, really.

If you're so convinced that Marriott "owns" up to a quarter of the Weeks inventory at every resort, then show your work. Understand, though, that the inventory that's been conveyed to the DC/Abound Trust is not flat-out owned by Marriott in the same way that Weeks can be owned (either never sold or reacquired) by Marriott. DC/Abound conveyances are "owned" by the Trust and correlate to the DC/Abound Trust Points that are sold as well as to the usage rights of Trust Members. If you're assuming that DC/Abound conveyances are ALL eligible to be pulled out and rented by Marriott for the company's sole revenue benefit (or used in any other manner for Marriott's sole benefit,) you're wrong. You're also wrong if you're assuming that Marriott is on the hook for the MF's for all those conveyed Weeks - DC/Abound Trust Members pay per-point MF's which are based on the same Annual Budgets that determine the Weeks inventory MF's, collectively, along with the administration fees of the Trust.

Somewhere in all of your posts you made a comment that Marriott is not transparent about which Weeks intervals have been conveyed to the DC/Abound Trust. In fact, that information is available to the public via a review of the filings at the Orange County FL public records. @dioxide45 used to maintain this TUG thread - Recorded Trust Documents - and you're as free as anyone to pick up that mantle and run with it. Just use "Marriott Ownership Resorts, Inc*" as your search term and go one-by-one to pull out the trust conveyances.

* I think another of your questions in all these posts questioned what "Marriott Ownership Resorts, Inc" designated? It's referenced in most governing docs as "MORI" and defined as "The Developer" in most/all of the Weeks Time Sharing Plans.

You've also asked quite a few other questions for which the answers can be found in the individual resorts' Public Offering Statements. Just want to let you know that I'm not ignoring the questions you've asked me but I'm waiting to answer until I have the time to do a thorough search. It's easy to understand the delay once you know that each resort's POS can be hundreds of pages long - for example, Barony Beach Club's consists of 325+ pages.

I said “up to” because at the resort I can look at it is close to 25%. It seems many owners do not know the percentage owned by the developer. Sue, if you do not know (yet) the situation for Barony Beach (with the access you have), how could I know for all the +90 resorts? I think it is reasonable to assume it is not as low as some may believe, especially since Marriott disclosed an inventory of about 700 million dollars, and I assume it refers to the acquisition cost which is very low (ROFR, foreclosure etc) .

You are making several comments about the Trust inventory owned by the developer, I was referring more on a resort-by-resort basis. This is at Westin Lagunamar, the 2021 budget was about 22.8 million dollars. Don't you interpret that they own close to 25% of the resort?
"NOTE 9 - RELATED PARTY TRANSACTIONS
During the years ended December 31, 2021 and 2020, the amount of maintenance fees assessed to the Seller was $5,396,116 and $4,804,051, respectively. "

I actually do not think Marriott is interested in holding too many trust points at any given time, the MF are higher than the platinum weeks, it is much easier to make a rental profit by owning the platinum weeks directly. I think they will only want to hold the trust points that they can sell in the near to medium term.

I did not say that Marriott was not transparent about the deeds conveyed to the trust. I was replying to @JIMinNC who mentioned an aggregate number and I said it was not relevant in that context (the quality of the inventory) unless he knew the breakdown by season, which would be a lot more work, he would have to check every notice of conveyance for that resort.

What I did say instead was that we did not know a) the inventory acquired by the developer through ROFR, foreclosures and from the HOAs b) the inventory kept by the developer for its rental business; all we know is c) the inventory conveyed to the trust. If Marriott conveys to the trust 50 deeds low season and 25 deeds high season, you do not know if that is all they had or if they had acquired 50 high – 50 low, kept 25 high season deeds for their rental business and gave the rest to the trust (or whatever other combination you may prefer).

Going back to the commercial activities, I was only referring to Westin Lagunamar where the definition in the Bylaw is restrictive about who the Founder member is and who can perform commercial activities. I will not repeat the details, they are in one of my previous comments. I do not know about the Marriott resorts and I have no reason to doubt what you said about “MORI”. Even if the developer and all affiliates are able to make a case, they are indeed permitted to run a rental business (unlike the other owners), I find it odd if the ones dividing the inventory may have a chance to book their own units first.

 

[TravelTime]

Until and unless Marriott and Vistana take a hard line like Wyndham has done, nothing will change. Most Marriott resort CC&R documents have provisions against commercial activity. The DC Exchange Procedures do also. The ability is there to transfer points and add guest names to reservations. The first step to curbing rentals is usually to charge a fee for adding a guest. This also helps fatten the company bottom line. Then they may limit the number of guest certificates for an account. Then they could take the step of Wyndham and not allow guest names to be added during certain reservation time periods. Then they could go further and start sending out certified letters to known mega renters and even small time renters.

The hierarchy of how they manage rentals makes sense. I do not think they should eliminate occasional owner rentals. I think adding a fee for guest rentals is a great step. Maybe they can give a certain number of guest rental certificates per year. That would totally curb commercial rentals. I consider commercial rentals to be any time an owner repeatedly makes a profit on renting out their unit. Some people buy just to make a profit.

 

[TravelTime]

Commercial use could also be defined as something completely different than renting. It could be that you can't run a barber shop from your villa while you are staying at the resort.

Not sure this matters. Who cares what someone does inside the unit unless it bothers other people or is illegal. It does not hurt anyone. Unless you own many weeks, you would not be running a business from a timeshare unit.

 

[TravelTime]

Does MVC define commercial use? I thought the language in MVC T&C states commercial use and not commercial renting. Commercial use could be stating that you cannot run a business out of the unit. Does the T&C specifically prohibit commercial renting?

Just wondering if I will get in trouble in the future when I might not use all my weeks and points in MVC. If I decide to use my Hilton or Disney timeshares, Maybe we will take 8 month cruises so will definitely have some weeks to rent out.

Then I will have 51.5 annual MVC weeks plus DC points to rent out. Right now it is fine as we are using everything annually. Have been enjoying my stays for over decade. Though it has only been the past 10 years we are averaging 40+ weeks a year at MKO. How does MVC define residential? MVC has not said anything to me about staying 30 continuous weeks at once. Then back again a week or two later for another 20+ week stay.



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You are using your weeks as an owner so why would they say anything about that? I guess if you have 51 weeks at MVC that you do not use anymore it would be awfully hard to rent them out annually. That sounds like a full time job!

 

[Pamplemousse]

MVC points owners are allowed to rent their points and it is not a violation. I was going to ask if points owners are allowed to rent banked points. Maybe someone knows the answer.

You can only “move” points once- banking counts as a move so you can’t rent then and have them go into someone else’s account.
You could book a reservation for someone and rent that.

 

[SueDonJ]

Not sure this matters. Who cares what someone does inside the unit unless it bothers other people or is illegal. It does not hurt anyone. Unless you own many weeks, you would not be running a business from a timeshare unit.

I think it's far more risky for an owner to run a business *out of* timeshare units than a business of renting out their usage. Owners are granted the rights to rent out their usage in the governing docs but those same docs expressly state in a number of different places and using similar language that the units are for "residential purposes only." It's understandable because if Marriott allowed businesses to be run out of the units they'd effectively be a party to whatever the business might be *and* could potentially be held legally responsible if problems arise with such businesses.

 

[dioxide45]

Not sure this matters. Who cares what someone does inside the unit unless it bothers other people or is illegal. It does not hurt anyone. Unless you own many weeks, you would not be running a business from a timeshare unit.

My comment was more of a joke about how undefined "commercial use" is, Theoretically though, say someone was running a barber shop out of their unit. That would mean more traffic to the resort and more traffic in and out of the unit. Thus you also don't have any real knowledge of the people that are coming or going. Perhaps someone is running an import/export business. That too is a problem. The resort and HOA should care what someone does inside their unit, at least to a degree.

 

[timsi]

I can't argue with any of this, and customer satisfaction is key to any business's success. In their investor presentations, MVW regularly quotes customer satisfaction scores north of 95%.

As I've said repeatedly, I think acquiring attractive Trust inventory is one factor MVC considers when determining whether to reacquire inventory through ROFR, they just seem to have a maximum price they are willing to pay based on guidance from their finance people on Cost of Inventory targets.

If you look at the Trust conveyances that @dioxide45 kept track of in this thread (Recorded Trust Documents) from 2010 through 2016, you can see how one resort that is famously underrepresented in the Trust, Marriott's Grande Ocean in Hilton Head, grew in the Trust. In November 2010, there was almost none:

November 2010
Timberlodge...............11,022,750
Ko Olina......................9,208,750
Newport Coast Villas.....8,643,000
Crystal Shores.............8,021,250
Oceana Palms..............5,706,000
MOC-Sequel................4,352,070
Kalanipu'u...................3,529,500 (Kauai Lagoons)
Canyon Villas..............3,105,500
Willow Ridge................2,848,500
MOC..........................2,410,750
Shadow Ridge..............1,475,750
Grande Chateau...........1,378,250
Ocean Watch................992,000
Grand Vista...................774,750
DSV II..........................333,750
Harbour Lake.................238,000
Lakeshore Reserve..........153,750
Fairway Villas.................110,000
Cypress Harbour...............90,750
Ocean Point....................71,000
Barony Beach Club............69,750
Mountain Side..................68,500
Summit Watch.................45,000
Sunset Point...................44,250
Sabal Palms.....................39,000
Royal Palms.....................35,000
Manor Club Sequel............32,000
Manor Club.....................30,000
Harbour Club...................17,250
DSV I............................16,000
Doral.............................13,000
Grande Ocean.................. 9,000 (0.013%)
Heritage Club.................. 7,500

Grand Total....................64,892,320

Over the next six years, MVC obviously bought up a lot of Grande Ocean inventory, as you can see from how Grande Ocean rose in the rankings in this list from December 2016:

December 2016
Grand Chateau..........................52,703,750
Ko'Olina...............................30,045,750
Newport Coast..........................29,394,500
Oceana Palms...........................23,391,250
Grande Vista...........................19,272,750
Kalanipu'u.............................18,293,500
Timber Lodge...........................17,677,250
Shadow Ridge II........................13,429,500
Maui Ocean Club........................11,981,250
Ritz Carlton Club - Vail...............11,813,500
The Mayflower..........................10,748,750
Crystal Shores..........................9,598,250
Cypress Harbour.........................9,156,000
Maui Ocean Club Sequel..................8,773,500
Ocean Pointe............................8,588,000
Harbour Lake............................8,506,500
Shadow Ridge............................8,053,750
Desert Springs II.......................7,686,750
Canyon Villas...........................5,820,500
Kauai Beach Club........................5,204,250
Ocean Watch.............................4,656,250
Willow Ridge Lodge......................4,552,000
Waiohai.................................4,446,000
Grand Residence Lake Tahoe..............4,322,250
Desert Springs I........................4,299,000
BeachPlace Towers.......................3,734,000
Barony Beach Club.......................3,339,750
Grande Ocean............................3,159,250 (0.83%)
Fairway Villas..........................2,827,750
Ritz Carlton Club - San Francisco.......2,678,000
Frenchman's Cove........................2,553,750
Surfwatch...............................2,532,500
Villas at Doral.........................2,423,750
Mountain Side...........................2,249,250
Royal Palms.............................2,134,750
Lakeshore Reserve.......................2,021,000
Summit Watch............................1,996,000
Ritz Carlton Club - St Thomas...........1,841,250
Legends Edge............................1,588,500
Manor Club..............................1,558,500
Sabal Palms.............................1,545,500
Ritz Carlton Club - Lake Tahoe..........1,462,750
Mountain Valley Lodge...................1,248,750
Manor Club Sequel.......................1,083,000
Streamside..............................1,007,500
Monarch at Sea Pines......................995,750
Imperial Palms............................714,500
Harbour Pointe............................665,000
Harbour Club..............................303,750
Heritage Club.............................267,500
Ritz Carlton Club - St Thomas Suites......243,250
Sunset Pointe.............................159,500

Grand Total...........................378,749,500

Grande Ocean is still probably under-represented in the Trust versus demand, but in the six years from late 2010 to late 2016, MVC reacquired MGO weeks worth over 3,150,000 points. I'm not sure what the average point value of those reacquired weeks were for GO, but let's say it was 3,500 to 4,000. That would mean over six years, MVC reacquired around 800 MGO weeks. Could they have reacquired even more if they had been more aggressive at matching higher offers? Sure. But, as I've said repeatedly, they have to meet their inventory cost targets and they don't have unlimited dollars for ROFR. Those dollars also have to be spread all around the network.

Since no one has kept track of the conveyances since 2016, we don't know what the picture looks like today, but I suspect MGO has continued to grow in the Trust.

As a trust owner, do you get in your annual report a detailed view of the inventory?

 

[timsi]

Making them vague would be a problem for the entity that wrote the T&C. Courts would not look too kindly and rule in favor of MVC if it came before the courts. Now this is not legal advice, just my opinion.

The prevailing view on Tugg seems to be that the developer can get away with almost anything when the rules are vague, can be easily changed and they often mention things like the interpretation is in their "sole discretion".