Is 2019 the 'Year of the Timeshare'? [Marriott/Vistana/Hyatt in the DC speculation]

[kds4]

I agree with the sticker shock since a hybrid bundle usually costs over $20K, but that sticker shock is mainly due to the price of the Trust points that are in the bundles. While Marriott Resales does charge higher prices for their resale weeks than the aftermarket, it's nowhere near typical developer pricing for resales, at least at US resorts. Our original entree into MVC in 2014 was via a hybrid bundle built around a Silver Barony week, and that week only cost $3300. The matching points added about $19K. When MVC Resales once listed their prices online, I believe you could buy a 3BR Platinum Grande Vista for about $12K, Maui Ocean Club 2BR OV weeks were around $20K (versus $16K on the third-party market), and I think I recall Grande Ocean 2BR OF Gold could be had for $18K or so.

Back when MVC was still selling developer weeks, resale pricing was virtually the same as developer, but after the advent of the DC, their resale pricing dropped dramatically, just not all the way to aftermarket levels.

Definite post DC price-drop. That 3BR Platinum Grande Vista that became about $12k was pitched to us during our very first presentation in 2009 for $36k. We went external resale that same year and bought our first week (a 3BR Platinum at MGV for $11k). Since then, we have picked up other 3BR Gold and even Platinum MGV/MGR for under $4k each over the years. Not sure what 3BR Platinum MGV/MGR is currently going for external resale as we haven't bought any weeks in a few years.

 

[SueDonJ]

I read they can make many changes. Essentially the POS means nothing when they put a line in that anything in the POS can be changed for any reason basically. I wasn’t questioning if they can do the spin off. I was questioning in what capacity? Where would it go? For what reason? Say Sheraton Vistana villages has XX amount of owners, why would they want to get rid of XX amount of owners that they have the potential to sell to each year?

If i owned at a resort that Marriott sold because they didn’t want to deal with a mandatory deed, I would never spend a dime with Marriott again. Last thing I would do is buy points from them. As far as Orlando is concerned. There are only two phases in Vistana villages that are mandatory and all of Sheraton resorts is voluntary. So they actually have a lot of owners to sell DC too, that own voluntary deeds. But geez, now you have me thinking they are going to sell Vistana villages haha thanks a lot lol

I'm not sure this makes sense? Vistana sold its control of your timeshares to a competitor yet you still talk about considering new purchases of Vistana-branded products?

As proven by TUG, savvy timeshare owners will buy into whatever system gives them the usage they want at whatever price they're willing to pay, whether that's the least expensive Week interval available on the external market or a unique developer product that comes at a heavy price, all the while knowing that change is inevitable. And many do not have a preference for one brand that keeps us from at least looking at the others.

 

[CPNY]

I'm not sure this makes sense? Vistana sold its control of your timeshares to a competitor yet you still talk about considering new purchases of Vistana-branded products?

As proven by TUG, savvy timeshare owners will buy into whatever system gives them the usage they want at whatever price they're willing to pay, whether that's the least expensive Week interval available on the external market or a unique developer product that comes at a heavy price, all the while knowing that change is inevitable. And many do not have a preference for one brand that keeps us from at least looking at the others.

I’m not talking about purchasing a new product from Vistana, I’m saying to the point that was made, that Marriott can sell off my resort. If they did I wouldn’t go back to Marriott and buy, say DC points. It’s all hypothetical right, so if my resort was spun off or sold, I still own what i own. I wouldn’t turn around and buy a Marriott DC points at that time. I wouldn’t drop the amount of new purchase money they would be asking. I’d spend some time renting and looking to see if I wanted to get back in the game. Or to many points that have been made, pick up a good deeded week and play the interval exchange game.

But My question was, why would Marriott want to sell off a resort they acquired? Why annex a base of customers that you can continually make money off of in the future? To your point, no I would never buy back into Vistana right now (the flex plan) not with the uncertainty on what’s coming on the horizon.

 

[TheTimeTraveler]

Definite post DC price-drop. That 3BR Platinum Grande Vista that became about $12k was pitched to us during our very first presentation in 2009 for $36k. We went external resale that same year and bought our first week (a 3BR Platinum at MGV for $11k). Since then, we have picked up other 3BR Gold and even Platinum MGV/MGR for under $4k each over the years. Not sure what 3BR Platinum MGV/MGR is currently going for external resale as we haven't bought any weeks in a few years.

I think the price drops came about as a result of the bottoming out of the economy from 2008 to 2015 or so. These lower prices were basically at every Marriott Resort, not just Grande Vista.




.

 

[pchung6]

But My question was, why would Marriott want to sell off a resort they acquired? Why annex a base of customers that you can continually make money off of in the future? To your point, no I would never buy back into Vistana right now (the flex plan) not with the uncertainty on what’s coming on the horizon.

No, I don't think Marriott will spin off any Vistana resort. Even with mandatory resorts, that are a lot mid class customers Marriott want to keep and making steady income with potential sale: DC products, retro resale, exchange fees, membership fee, yearly MF, travel spend at resorts, etc... Marriott will keep you and find ways to make more from your pocket.

 

[dioxide45]

You're probably right. I'm not sure how they would differentiate valuations between different resorts, but Lakeshore Reserve has standard 2BR LOs and deluxe 2BR LOs. The deluxe lock off into a standard 1BR and a smaller 1BR with everything but an oven. The deluxe units are assigned a higher point value than the standard.

Lakeshore Reserve is the best example in the Marriott system as it would compare to the 2BR units within the Vistana system and most of the 2BR units in Marriott. I definitely expect them to allocate higher point allocations to Westin 2BR units than they did for Marriotts in the same areas (like Scottsdale).

 

[dioxide45]

I think the past is in the past and actual sales prices for weeks played very little into how DC point values were set at launch....

I can assure you that is most certainly did. THis was well discussed back when they rolled out the DC program. It probably wasn't the only factor, but for many of the weeks if you simply multiplied the DC points by 10, you got close to what the last sales price was for that week. They used that as a general guide and probably then moved certain resorts/seasons up or down a little to adjust. This is why Aruba ended up with a poor allocation compared to places like Hawaii.

However now when brining in Vistana weeks, they simply can't do that because a prime WKV week likely isn't worth 6,000 DC points when you compare it to the Marriott Resort in the area. The same is true in the Desert.

 

[SueDonJ]

I’m not talking about purchasing a new product from Vistana, I’m saying to the point that was made, that Marriott can sell off my resort. If they did I wouldn’t go back to Marriott and buy, say DC points. It’s all hypothetical right, so if my resort was spun off or sold, I still own what i own. I wouldn’t turn around and buy a Marriott DC points at that time. I wouldn’t drop the amount of new purchase money they would be asking. I’d spend some time renting and looking to see if I wanted to get back in the game. Or to many points that have been made, pick up a good deeded week and play the interval exchange game.

But My question was, why would Marriott want to sell off a resort they acquired? Why annex a base of customers that you can continually make money off of in the future? To your point, no I would never buy back into Vistana right now (the flex plan) not with the uncertainty on what’s coming on the horizon.

Whole segments could get spun or sold off any time for a number of reasons, for example in these discussions people have mentioned that Marriott could let the Hyatt segment go if they can't resolve whatever issues appear to be insurmountable due to licensing. Under the Marriott umbrella, there have been resorts at which MVC failed to renew the management contract, and took the name off the properties, due to disputes between a large segment of the owners and Marriott as Manager. That hasn't stopped people who owned at those resorts at the time from keeping the other Marriott-branded timeshares in their portfolios, or even purchasing other Marriotts after the split. There've also been other resorts where issues came close to the point of Marriott separating itself as Manager but those issues were ultimately resolved without separation. It's business, you have to at least be aware that changes out of your control may happen.

I don't see anything right now that appears to be a predictor of Marriott selling off any Vistana-branded resorts. I get what you're saying, that if yours is and the new company doesn't change any of your usage options, you'll keep it, and I understand that a pure DC Trust Points purchase isn't what you want from Marriott. I just don't understand saying that Marriott would effectively be dead to you as a result of them selling off your resort because they're unable to keep it as is within their system. Again, it's business, and you just never know what your future needs will be or which company may best provide them.

 

[CPNY]

Whole segments could get spun or sold off any time for a number of reasons, for example in these discussions people have mentioned that Marriott could let the Hyatt segment go if they can't resolve whatever issues appear to be insurmountable due to licensing. Under the Marriott umbrella, there have been resorts at which MVC failed to renew the management contract, and took the name off the properties, due to disputes between a large segment of the owners and Marriott as Manager. That hasn't stopped people who owned at those resorts at the time from keeping the other Marriott-branded timeshares in their portfolios, or even purchasing other Marriotts after the split. There've also been other resorts where issues came close to the point of Marriott separating itself as Manager but those issues were ultimately resolved without separation. It's business, you have to at least be aware that changes out of your control may happen.

I don't see anything right now that appears to be a predictor of Marriott selling off any Vistana-branded resorts. I get what you're saying, that if yours is and the new company doesn't change any of your usage options, you'll keep it, and I understand that a pure DC Trust Points purchase isn't what you want from Marriott. I just don't understand saying that Marriott would effectively be dead to you as a result of them selling off your resort because they're unable to keep it as is within their system. Again, it's business, and you just never know what your future needs will be or which company may best provide them.

I think that’s the beauty of being a consumer. I have the choice where my money goes. I’d purchase a resale deeded week in MVC Aruba and go through II Exchange for other resorts, or just rent and go where I want without the sticker shock price they are selling ownership for, that is all I’m saying. Marriott wouldn’t be dead to me from a usage stand point (renting)or resale ownership.

 

[CPNY]

No, I don't think Marriott will spin off any Vistana resort. Even with mandatory resorts, that are a lot mid class customers Marriott want to keep and making steady income with potential sale: DC products, retro resale, exchange fees, membership fee, yearly MF, travel spend at resorts, etc... Marriott will keep you and find ways to make more from your pocket.

That’s Exactly my point. Someone said they could spin off resorts in regards to mandatory properties, but that doesn’t make any sense

 

[dioxide45]

Amenities are a factor, sure, both contained within the individual units and expanded to the common areas within a property footprint. Increased unit size is a factor insofar as the number of bedrooms, but a larger unit size by square footage might not be the factor you think it could be among units that have the same bedroom/head count. Consider the non-lockoff 2BR units across the eight Marriott resorts on Hilton Head Island - they all decreased in unit sqft and increased in common area amenities as each came online, yet Weeks at the newer/smaller-unit resorts have been allocated more DC Points than the older/larger. Marriott generally uses its own suppliers for furnishings/appliances/electronics and similarly outfits each unit during routine scheduled refurbs, the common/exterior areas less so but they try subject to constraints of the overall footprints. I'd guess the more important factor when they established DC Points allotments is that the newer resorts are in higher demand. (Just to note that two of these eight resorts also offer non-lockoff 3BR units which are allocated more DC Points than same-property 2BR's, as reasonably expected.)

I don't know how all that might relate to the specific Vistana properties you're citing?

THe specific Vistana properties have 2BR units that lock of in to a large 1BR and a small 1BR unit. Not a 1BR unit and a studio like at most Marriott properties. In the cases of the Vistana properties, both units have in room laundry and much better kitchen facilities. The smaller 1BR will often have a full size fridge and cooktop. While square footage isn't a determining factor in the DC point allocation, the amenities in the unit are and two 1BR units are better than a 1BR and a studio. The 2BR deluxe units vs the 2BR standard at Lakeshore Reserve prove a higher point allocation for the 2BR units that lock off in to two 1BR units.

I think if you'll read the POS critically you'll see there are options that would allow a lot of changes. They could pick and chose what to spin off if they wanted or even sell of entire segments.

If i owned at a resort that Marriott sold because they didn’t want to deal with a mandatory deed, I would never spend a dime with Marriott again. Last thing I would do is buy points from them. As far as Orlando is concerned. There are only two phases in Vistana villages that are mandatory and all of Sheraton resorts is voluntary. So they actually have a lot of owners to sell DC too, that own voluntary deeds. But geez, now you have me thinking they are going to sell Vistana villages haha thanks a lot lol

I highly doubt they will spin anything off. Now that they have conveyed all of the Vistana properties to one of their trusts, would they really want someone else managing resorts that they also own inside of the trusts? It isn't going to happen. Current customers are always your best customers. They want to be able to market to all the owners at Vistana resorts to sell them on the new trust products.

 

[DannyTS]

why do we think that we are such thorns (mandatory resale owners) in their eyes? I think the average is 90% retail/10% resale, I just do not think the number of resale owners justifies any major effort on their part.

 

[DannyTS]

Orlando is overbuilt for a reason: it attracts cohorts of stressed and excited parents carrying 2-3 kids around their necks, exquisitely marinated and ready for a timeshare presentation. Why would Marriott not want those resorts in their portfolio?

 

[dioxide45]

why do we think that we are such thorns (mandatory resale owners) in their eyes? I think the average is 90% retail/10% resale, I just do not think the number of resale owners justifies any major effort on their part.

I don't think they see mandatory owners as thorns. THey see the mandatory weeks in general as thorns. If they wipe out VSN and make DC the new club, then perhaps they have opened up the DC program to allow resale weeks to get in on the cheap. The DC club could be considered the mandatory club that those mandatory weeks must be a part of. Marriott hates resales and I don't see them giving an in to the DC program through the mandatory resale weeks. Vistana shut down any new resorts being mandatory pretty early when they learned the error of their ways.

 

[JIMinNC]

I don't think they see mandatory owners as thorns. THey see the mandatory weeks in general as thorns. If they wipe out VSN and make DC the new club, then perhaps they have opened up the DC program to allow resale weeks to get in on the cheap. The DC club could be considered the mandatory club that those mandatory weeks must be a part of. Marriott hates resales and I don't see them giving an in to the DC program through the mandatory resale weeks. Vistana shut down any new resorts being mandatory pretty early when they learned the error of their ways.

Any idea/guess as to what percentage of Vistana owners are owners at the Mandatory resorts? In other words, how many people would be impacted by whatever decision MVW might make regarding the Mandatory weeks?

 

[SueDonJ]

THe specific Vistana properties have 2BR units that lock of in to a large 1BR and a small 1BR unit. Not a 1BR unit and a studio like at most Marriott properties. In the cases of the Vistana properties, both units have in room laundry and much better kitchen facilities. The smaller 1BR will often have a full size fridge and cooktop. While square footage isn't a determining factor in the DC point allocation, the amenities in the unit are and two 1BR units are better than a 1BR and a studio. The 2BR deluxe units vs the 2BR standard at Lakeshore Reserve prove a higher point allocation for the 2BR units that lock off in to two 1BR units.

Understood, it happens at the few Marriott resorts where lockoffs split to deluxe and standard 1BR units, as opposed to the Studio/1BR set-up that's prevalent in the Marriott system. If the DC Points Chart allows specific booking of standard v. deluxe 1BR's, as opposed to Studio v. 1BR, is that an indicator that the 1BR/1BR-type lockoff was originally sold at a premium above the Studio/1BR-type?

I'm sure you followed the train of thought but I wanted to make the case where a simple difference of square footage, all else being equal, wouldn't automatically translate to a higher DC Points allotment, and of course I'm not at all familiar with the Vistana properties so I didn't know how the ones mentioned were originally sold by Vistana.

 

[pchung6]

Any idea/guess as to what percentage of Vistana owners are owners at the Mandatory resorts? In other words, how many people would be impacted by whatever decision MVW might make regarding the Mandatory weeks?

Vistana and Marriott have been trying hard to get these mandatory weeks to deedback or buyback for Flex products these days. If I'm the management, I wouldn't worry too much as mandatory ownership will gradually fade away. Spend too much time on this is just penny wise pound foolish. Marriott should focus on getting the new consolidated DC/VSN product attractive to gain new customers or upgrade. Shutting down VSN will be the first misstep to piss off people.

 

[SueDonJ]

Orlando is overbuilt for a reason: it attracts cohorts of stressed and excited parents carrying 2-3 kids around their necks, exquisitely marinated and ready for a timeshare presentation. Why would Marriott not want those resorts in their portfolio?

What's the total count now of Orlando timeshares that come under the MVW umbrella? Between Marriott, Vistana and Hyatt they could probably incorporate their own little town!

 

[CPNY]

Any idea/guess as to what percentage of Vistana owners are owners at the Mandatory resorts? In other words, how many people would be impacted by whatever decision MVW might make regarding the Mandatory weeks?

You can add the designated units listed in the documents for each resort but, you can’t rely on that because many were now sold back for flex plans or foreclosed, unsold, etc.

Speaking of mandatory, Vistana sales were willing to sell me a deeded week In Westin St. John two weeks ago. I assume because it is not part of the Westin flex program but they were will to “get approval” and sell me a deed for a small price of 55K.

 

[SueDonJ]

I think that’s the beauty of being a consumer. I have the choice where my money goes. I’d purchase a resale deeded week in MVC Aruba and go through II Exchange for other resorts, or just rent and go where I want without the sticker shock price they are selling ownership for, that is all I’m saying. Marriott wouldn’t be dead to me from a usage stand point (renting)or resale ownership.

Marriott collects at least 10% of the annual MF's of every single Week across all segments as profit, and I think a little bit higher percentage from at least one of the non-US segments. Losing your direct buy-in profits wouldn't amount to much compared to the sustained profit you'd be supporting by renting from an owner, or, giving them via the purchase of an external resale.

 

[CPNY]

I highly doubt they will spin anything off. Now that they have conveyed all of the Vistana properties to one of their trusts, would they really want someone else managing resorts that they also own inside of the trusts? It isn't going to happen. Current customers are always your best customers. They want to be able to market to all the owners at Vistana resorts to sell them on the new trust products.

Nor do I, it was all just a scenario thrown out by someone earlier, I was questioning what the purpose of that would be. It didn’t make any sense to spin off or sell resorts just to keep mandatory deeds out of a DC program.

 

[dioxide45]

Any idea/guess as to what percentage of Vistana owners are owners at the Mandatory resorts? In other words, how many people would be impacted by whatever decision MVW might make regarding the Mandatory weeks?

I would say it is probably less than 5% own a mandatory resale. Owners at mandatory resorts are much higher since some of their big ones (Two Hawaii, Harborside, some St John Kierland and SVV). But I don't think they are concerned about impacting or disenfranchising mandatory resale owners, I think the issue is that they really can't do it. They can't remove them from the club if the club exists. So if VSN remains, there is no change for the mandatory owners. If they simply kill VSN and say DC is the new VSN, then they perhaps open up DC to the mandatory owners and any future resale buyers at those mandatory resorts. I don't think Marriott wants to do that. Of course it would probably help the resale value of my SVV weeks.

 

[CPNY]

Marriott collects at least 10% of the annual MF's of every single Week across all segments as profit, and I think a little bit higher percentage from at least one of the non-US segments. Losing your direct buy-in profits wouldn't amount to much compared to the sustained profit you'd be supporting by renting from an owner, or, giving them via the purchase of an external resale.

True! I’d much rather give a rental to an owner or a cheap resale and have 55K in my pocket . Then I’ll get to go to Aruba!! I already have deeds in my other favorite resort and I don’t see them getting rid of that one anytime soon so I’m ok lol...... for now

 

[CPNY]

So if VSN remains, there is no change for the mandatory owners. If they simply kill VSN and say DC is the new VSN, then they perhaps open up DC to the mandatory owners and any future resale buyers at those mandatory resorts. I don't think Marriott wants to do that. Of course it would probably help the resale value of my SVV weeks.

I’m all for that!

 

[bazzap]

Marriott collects at least 10% of the annual MF's of every single Week across all segments as profit, and I think a little bit higher percentage from at least one of the non-US segments. Losing your direct buy-in profits wouldn't amount to much compared to the sustained profit you'd be supporting by renting from an owner, or, giving them via the purchase of an external resale.

Correct, Marriott takes 15% in Management Fees at Phuket Beach Club.