Thursday, June 29, 2006
James Monroe Capital Timeshare Resort Inspection: 'Go'
James Monroe Capital Corporation (Pink Sheets:JMCP) has completed due diligence on a property in Guanacosta, Costa Rica, for a timeshare resort.
The effort in Guanacosta was subject to a property inspection, and after having inspected the property, JMCP execs say the project is a go. The company reports that some other oceanfront timeshare resorts in Guanacosta were sold out. One exec said, "We couldn't get a tour while we were there. This is good news for a company considering building a timeshare resort in the area. We also found that the frenzy of development on the West coast of Costa Rica is largely American, and the new international airport (LIR) already has more and more flights per day coming in to the growing area." The property is in an undisclosed location on the Pacific coastline.
JMCP also brought in independent timeshare experts from the Cayman Islands for an opinion. They said, "It is secluded and breathtaking, with hills, trees, sand, and big ocean views everywhere. This is the type of development that ought to have a helicopter to go with its elegant front gates and its high-end clientele. The fact that other timeshare resorts were sold out really impressed us."
Total costs for the project have not been finalized, but the attorney for the project commented that total costs to build may be in the neighborhood of $40,000,000, plus land. JMCP is presently slated to own 9% of the project, which it has conservatively projected to net the company $5,000,000 over a two year period. Low cost local labor help keep the costs down, and the deal is to be aggressively leveraged. According to collected data about comparable sales of condos in the area, the entire completed development would be worth around $90,000,000 if sold as condos--however, timeshare is preferred, which is more profitable and provides residual income from maintenance fees.
The effort in Guanacosta was subject to a property inspection, and after having inspected the property, JMCP execs say the project is a go. The company reports that some other oceanfront timeshare resorts in Guanacosta were sold out. One exec said, "We couldn't get a tour while we were there. This is good news for a company considering building a timeshare resort in the area. We also found that the frenzy of development on the West coast of Costa Rica is largely American, and the new international airport (LIR) already has more and more flights per day coming in to the growing area." The property is in an undisclosed location on the Pacific coastline.
JMCP also brought in independent timeshare experts from the Cayman Islands for an opinion. They said, "It is secluded and breathtaking, with hills, trees, sand, and big ocean views everywhere. This is the type of development that ought to have a helicopter to go with its elegant front gates and its high-end clientele. The fact that other timeshare resorts were sold out really impressed us."
Total costs for the project have not been finalized, but the attorney for the project commented that total costs to build may be in the neighborhood of $40,000,000, plus land. JMCP is presently slated to own 9% of the project, which it has conservatively projected to net the company $5,000,000 over a two year period. Low cost local labor help keep the costs down, and the deal is to be aggressively leveraged. According to collected data about comparable sales of condos in the area, the entire completed development would be worth around $90,000,000 if sold as condos--however, timeshare is preferred, which is more profitable and provides residual income from maintenance fees.
Wednesday, June 28, 2006
Starwood Enlarges Timeshare Portfolio Plan
Starwood Vacation Ownership, which has timeshare properties on Maui and Kauai, has finalized the acquisition of 29 acres in Palm Desert, Calif.
The Orlando, Fla.-based company is the vacation ownership and timeshare division of New York-based Starwood Hotels & Resorts Worldwide (NYSE: HOT), the parent company of the Sheraton and Westin hotel brands.
The land, in the established Desert Willow development, has been bought from Intrawest Corp. (NYSE: IDR) and will be developed as a Westin-branded timeshare resort. Construction is scheduled to begin on new villas in 2007.
This will be the eighth Westin timeshare resort either completed or in development including resorts on Maui and Kauai, and in California, Arizona, Cancun, St. John, U.S. Virgin Islands and Aruba.
The Orlando, Fla.-based company is the vacation ownership and timeshare division of New York-based Starwood Hotels & Resorts Worldwide (NYSE: HOT), the parent company of the Sheraton and Westin hotel brands.
The land, in the established Desert Willow development, has been bought from Intrawest Corp. (NYSE: IDR) and will be developed as a Westin-branded timeshare resort. Construction is scheduled to begin on new villas in 2007.
This will be the eighth Westin timeshare resort either completed or in development including resorts on Maui and Kauai, and in California, Arizona, Cancun, St. John, U.S. Virgin Islands and Aruba.
Tuesday, June 27, 2006
Timeshare Industry Answers Rising Demand
They pay up front, sometimes $500 to $50,000, for a piece of real estate shared with 51 other people throughout the year.
Instead of renting hotel rooms, nearly 4 million U.S. households opt to pay annual fees to a timeshare management company instead.
Undeterred by the price or concept of sharing, timeshare owners are members of a growing group fueling investments in an industry once characterized by hard sells and schemers, now dominated by familiar hotel brand names.
They also contribute hundreds of dollars in annual fees to the resort's timeshare owners association, and those fees increase each year.
They can trade weeks or sell them, but several hundred a year just stop paying for their Riverside County vacations. One such person is Isabel Long, of Gardena, who bought a Lawrence Welk's Desert Oasis timeshare in 1991 that foreclosed this year.
"They have a maintenance fee and then they had extra maintenance fees," she said. "You have the property all paid for, but the maintenance fees were higher than the property fees."
As her children grew up, she used it less and less and eventually opted to stop paying when the fees became unbearable.
Lawrence Welk's Desert Oasis bought back 173 time shares in foreclosure sales during just the past 10 months through April, county property records show. But the number didn't faze the Cathedral City resort.
"We're basically getting fresh blood," said General Manager Bill Palmer. "While (the foreclosures) may look like a large amount, as a percentage it's small," he said, referring to the 8,000 total owners at Lawrence Welk's Desert Oasis. He said maintenance fees are usually raised 3 percent to 5 percent annually.
Joe Takacs, president of Vacation Resorts International, which manages the Sands in Indian Wells, said the industry still faces misperceptions from buyers who expect their time share's value to appreciate. When it can't be resold for the owners' asking price, sometimes they give up, stop paying fees and let it foreclose, he said.
"You have a timeshare owner who wants $20,000 for a $10,000 timeshare ... the second they drove off the lot, it's worth half of what they bought it for," he said.
Despite regular foreclosures and the growing popularity of condo/hotels, where vacationers buy the whole unit the way they would a second home, the industry is growing faster and filling more rooms than hotels, the timeshare industry's main lobbying group said. Timeshares boast occupancy rates above 80 percent nationwide and $7.8 billion worth of sales, according to the American Resort Development Association.
It's difficult to compare the industry to hotels because the transaction involves buying real estate, not just renting a room for the night.
Hotels had a 63.1 percent occupancy rate nationwide last year, according to hospitality tracking firm Smith Travel Research, earning much more than timeshares, $22.6 billion in sheer profit and $122 billion in total revenue.
According to the American Resort Developers Association, 3.8 million U.S. households owned one or more timeshares in 2005. The number rose when 466,801 signed up in 2004.
Despite the industry's colorful past, characterized by promotional ploys involving free drinks or a vacation in return for listening to a pitch for a few hours, ownership has increased steadily since 1975. At least 20 timeshare companies still operate in the Coachella Valley and Inland Southern California, out of at least 126 statewide
Alan Reay, president of Costa Mesa-based hotel-brokerage firm Atlas Hospitality Group, said the timeshare industry is still going strong, thanks largely to famous hotel brand names.
"The people who are looking to buy these are going with companies they're familiar with: Hyatt, Marriott, Embassy Suites," Reay said.
Marriott, which built its largest timeshare, the 352-villa Shadow Ridge in Palm Desert, plans to eventually make it a 972-unit location.
Instead of renting hotel rooms, nearly 4 million U.S. households opt to pay annual fees to a timeshare management company instead.
Undeterred by the price or concept of sharing, timeshare owners are members of a growing group fueling investments in an industry once characterized by hard sells and schemers, now dominated by familiar hotel brand names.
They also contribute hundreds of dollars in annual fees to the resort's timeshare owners association, and those fees increase each year.
They can trade weeks or sell them, but several hundred a year just stop paying for their Riverside County vacations. One such person is Isabel Long, of Gardena, who bought a Lawrence Welk's Desert Oasis timeshare in 1991 that foreclosed this year.
"They have a maintenance fee and then they had extra maintenance fees," she said. "You have the property all paid for, but the maintenance fees were higher than the property fees."
As her children grew up, she used it less and less and eventually opted to stop paying when the fees became unbearable.
Lawrence Welk's Desert Oasis bought back 173 time shares in foreclosure sales during just the past 10 months through April, county property records show. But the number didn't faze the Cathedral City resort.
"We're basically getting fresh blood," said General Manager Bill Palmer. "While (the foreclosures) may look like a large amount, as a percentage it's small," he said, referring to the 8,000 total owners at Lawrence Welk's Desert Oasis. He said maintenance fees are usually raised 3 percent to 5 percent annually.
Joe Takacs, president of Vacation Resorts International, which manages the Sands in Indian Wells, said the industry still faces misperceptions from buyers who expect their time share's value to appreciate. When it can't be resold for the owners' asking price, sometimes they give up, stop paying fees and let it foreclose, he said.
"You have a timeshare owner who wants $20,000 for a $10,000 timeshare ... the second they drove off the lot, it's worth half of what they bought it for," he said.
Despite regular foreclosures and the growing popularity of condo/hotels, where vacationers buy the whole unit the way they would a second home, the industry is growing faster and filling more rooms than hotels, the timeshare industry's main lobbying group said. Timeshares boast occupancy rates above 80 percent nationwide and $7.8 billion worth of sales, according to the American Resort Development Association.
It's difficult to compare the industry to hotels because the transaction involves buying real estate, not just renting a room for the night.
Hotels had a 63.1 percent occupancy rate nationwide last year, according to hospitality tracking firm Smith Travel Research, earning much more than timeshares, $22.6 billion in sheer profit and $122 billion in total revenue.
According to the American Resort Developers Association, 3.8 million U.S. households owned one or more timeshares in 2005. The number rose when 466,801 signed up in 2004.
Despite the industry's colorful past, characterized by promotional ploys involving free drinks or a vacation in return for listening to a pitch for a few hours, ownership has increased steadily since 1975. At least 20 timeshare companies still operate in the Coachella Valley and Inland Southern California, out of at least 126 statewide
Alan Reay, president of Costa Mesa-based hotel-brokerage firm Atlas Hospitality Group, said the timeshare industry is still going strong, thanks largely to famous hotel brand names.
"The people who are looking to buy these are going with companies they're familiar with: Hyatt, Marriott, Embassy Suites," Reay said.
Marriott, which built its largest timeshare, the 352-villa Shadow Ridge in Palm Desert, plans to eventually make it a 972-unit location.
Monday, June 26, 2006
Hilton Timeshares Attract Japanese
Hilton Hawaiin Village, building a 274-unit timeshare tower, finds it is not attracting only the usual California buyers for such offerings.
More than 60 percent of buyers for the Waikiki product are from Japan, according to Mark Wang, senior vice president for the Asia-Pacific region of Hilton Grand Vacations.
"We made a decision to go after the Japanese market," Wang said. "It's been a great investment for us."
Hilton Grand Vacations has a sales office in Tokyo and is opening one this year in Osaka.
Since the international Hilton hotel chain was a separate company until it was acquired and reabsorbed by Hilton Hotels Corp. in March, the Japanese offices are selling timeshares in the United States.
Hilton already has timeshare units in the Lagoon and Kalia Towers at its Waikiki campus, the largest Hilton in the world. But its timeshare unit count will double with the completion of the 38-story Grand Waikikian Tower, which had its groundbreaking a week ago.
Wang said the Grand Waikikian will be the first "purpose-built" timeshare structure in Waikiki.
More than 60 percent of buyers for the Waikiki product are from Japan, according to Mark Wang, senior vice president for the Asia-Pacific region of Hilton Grand Vacations.
"We made a decision to go after the Japanese market," Wang said. "It's been a great investment for us."
Hilton Grand Vacations has a sales office in Tokyo and is opening one this year in Osaka.
Since the international Hilton hotel chain was a separate company until it was acquired and reabsorbed by Hilton Hotels Corp. in March, the Japanese offices are selling timeshares in the United States.
Hilton already has timeshare units in the Lagoon and Kalia Towers at its Waikiki campus, the largest Hilton in the world. But its timeshare unit count will double with the completion of the 38-story Grand Waikikian Tower, which had its groundbreaking a week ago.
Wang said the Grand Waikikian will be the first "purpose-built" timeshare structure in Waikiki.
Friday, June 23, 2006
For Hawaii Visitors: Almost 73,000 Timeshare And FRactional Units
The latest Hawaii visitor plant inventory by the state counts 72,889 visitor accommodation units, including hotel rooms, rentable condos, timeshares, bed-and-breakfasts and even hostels.
The share of units held by hotels has fallen below the two-thirds mark: 63 percent of visitor accommodations are hotel rooms and suites, followed by 20.7 percent for condo/hotel properties, 9.6 percent for timeshares, 3.3 percent for individual vacation units, and less than 1 percent apiece for B&Bs and hostels.
"There has been a shift in conventional hotel rooms to condo/hotel and timeshare real estate," said Marsha Wienert, tourism liaison to Gov. Lingle. "But for the most part the room inventory is stable."
There was also a shift toward better-appointed and more expensive accommodations: units classified as "luxury" increased 2.2 percent. "Standard" units decreased 3.5 percent.
The inventory, which covered the year 2005, was up 0.4 percent from 2004, the Hawaii Department of Business, Economic Development & Tourism reported Thursday.
There were 6,839 timeshare units in operation last year -- that figure will top 7,000 this year -- and there are more of them on Kauai, more than 2,000, than on any other island.
Around the islands:
Oahu: Inventory dropped 5.1 percent to 34,167 units, 46.9 percent of state inventory. Timeshare units increased about 26 percent and condo/hotel units increased 11 percent. Hotel units decreased 8.5 percent.
Maui: Inventory grew 4.4 percent, 25.3 percent of state inventory. Maui's condo/hotel inventory increased 6 percent and timeshare units rose 22.5 percent. Hotel units on Maui decreased 1.1 percent.
Kauai: Inventory dropped 0.3 percent, 11.1 percent of state inventory. Kauai condo/hotel units decreased 1.1 percent; timeshare units increased 4 percent; hotel units decreased 6.1 percent.
Big Island: Inventory grew 13.1 percent, 15.6 percent of state inventory. Big Island condo/hotel units increased 27.5 percent; timeshare units rose 19 percent; hotel units increased 7.1 percent.
The share of units held by hotels has fallen below the two-thirds mark: 63 percent of visitor accommodations are hotel rooms and suites, followed by 20.7 percent for condo/hotel properties, 9.6 percent for timeshares, 3.3 percent for individual vacation units, and less than 1 percent apiece for B&Bs and hostels.
"There has been a shift in conventional hotel rooms to condo/hotel and timeshare real estate," said Marsha Wienert, tourism liaison to Gov. Lingle. "But for the most part the room inventory is stable."
There was also a shift toward better-appointed and more expensive accommodations: units classified as "luxury" increased 2.2 percent. "Standard" units decreased 3.5 percent.
The inventory, which covered the year 2005, was up 0.4 percent from 2004, the Hawaii Department of Business, Economic Development & Tourism reported Thursday.
There were 6,839 timeshare units in operation last year -- that figure will top 7,000 this year -- and there are more of them on Kauai, more than 2,000, than on any other island.
Around the islands:
Oahu: Inventory dropped 5.1 percent to 34,167 units, 46.9 percent of state inventory. Timeshare units increased about 26 percent and condo/hotel units increased 11 percent. Hotel units decreased 8.5 percent.
Maui: Inventory grew 4.4 percent, 25.3 percent of state inventory. Maui's condo/hotel inventory increased 6 percent and timeshare units rose 22.5 percent. Hotel units on Maui decreased 1.1 percent.
Kauai: Inventory dropped 0.3 percent, 11.1 percent of state inventory. Kauai condo/hotel units decreased 1.1 percent; timeshare units increased 4 percent; hotel units decreased 6.1 percent.
Big Island: Inventory grew 13.1 percent, 15.6 percent of state inventory. Big Island condo/hotel units increased 27.5 percent; timeshare units rose 19 percent; hotel units increased 7.1 percent.
Wednesday, June 21, 2006
Developers To Present Plan For Resort, Timeshares And Villas At Botany Bay
Botany Bay Partners is once again seeking major Coastal Zone Permits to build a timeshare resort development on its 360-acre West End property.
Several years ago, the owners ignited public controversy over how such a development would affect the largely pristine environment.
The developer will present its latest plans at a St. Thomas Coastal Zone Management Committee public hearing at 6 p.m. Wednesday at the Palms Court Harborview Hotel.
Botany Bay Partners' timeshare resort plans comprise nine buildings that are two-stories tall. The buildings would have 48 rental units and 18 suites.
Since the suites can be divided in half so each becomes two units, there will be 84 total rooms available at the timeshare resort, according to the owner's CZM application.
Major permits also are needed for a reverse osmosis facility because of its intake and discharge lines into the bay.
Farther inland on the property, the owners plan to build 16 two-story buildings that would house 31 timeshare units. Five more two-story buildings would be divided into 40 villas. The villa units would have 80 parking spaces.
Other structures planned to support the development include a market, health club, clubhouse, swim-up bar, a reception building, manager's residence, 500,000-gallon potable water storage tank, two 1.5-megawatt emergency generators, a water treatment plant, a reverse osmosis facility, a restaurant and a 186-space parking lot.
St. John Real Estate is also marketing 42 estate lots, ranging between 3 and 15 acres in size, for the owners.
Botany Bay Partners' original plans submitted to CZM in 2002 called for a greater density of development on the property. It consisted of a 125-room hotel, 80 time share units, 80 vacation villas, a number of commercial buildings to support the project and 40 estate lots for private residences.
The owners first attempt to build a timeshare resort on the property ignited public outrage and triggered legal action from a local environmental group.
In 2000, the owners bought the property for $11 million.
In late 2001, both the V.I. Legislature and Gov. Charles Turnbull approved Botany Bay Partners' request to rezone 68 acres of its property to allow construction of the resort and timeshares.
The Environmental Association of St. Thomas-St. John then filed an unsuccessful lawsuit in Territorial Court seeking to overturn Turnbull's decision. EAST's concerns ranged from the project's erosion control mechanisms and sewage treatment plant to archaeological preservation.
In September 2002, the St. Thomas Coastal Zone Management Committee approved Botany Bay Partners' request for a major CZM permit to build the resort and timeshares part of the project. CZM staff had recommended that members reject the application, saying developers submitted inadequate analysis of the project's environmental impact.
In March 2003, EAST filed an appeal with Board of Land Use Appeals to override the committee's approval of the permit. The appeal was never heard because Botany Bay Partners voluntarily relinquished its major CZM permit last March.
In December of 2004, developers started installing infrastructure to the area, and they said at the time that their plans no longer involved a hotel or timeshare complex and would just sell residential lots and build light commercial services to support the new neighborhood.
Several years ago, the owners ignited public controversy over how such a development would affect the largely pristine environment.
The developer will present its latest plans at a St. Thomas Coastal Zone Management Committee public hearing at 6 p.m. Wednesday at the Palms Court Harborview Hotel.
Botany Bay Partners' timeshare resort plans comprise nine buildings that are two-stories tall. The buildings would have 48 rental units and 18 suites.
Since the suites can be divided in half so each becomes two units, there will be 84 total rooms available at the timeshare resort, according to the owner's CZM application.
Major permits also are needed for a reverse osmosis facility because of its intake and discharge lines into the bay.
Farther inland on the property, the owners plan to build 16 two-story buildings that would house 31 timeshare units. Five more two-story buildings would be divided into 40 villas. The villa units would have 80 parking spaces.
Other structures planned to support the development include a market, health club, clubhouse, swim-up bar, a reception building, manager's residence, 500,000-gallon potable water storage tank, two 1.5-megawatt emergency generators, a water treatment plant, a reverse osmosis facility, a restaurant and a 186-space parking lot.
St. John Real Estate is also marketing 42 estate lots, ranging between 3 and 15 acres in size, for the owners.
Botany Bay Partners' original plans submitted to CZM in 2002 called for a greater density of development on the property. It consisted of a 125-room hotel, 80 time share units, 80 vacation villas, a number of commercial buildings to support the project and 40 estate lots for private residences.
The owners first attempt to build a timeshare resort on the property ignited public outrage and triggered legal action from a local environmental group.
In 2000, the owners bought the property for $11 million.
In late 2001, both the V.I. Legislature and Gov. Charles Turnbull approved Botany Bay Partners' request to rezone 68 acres of its property to allow construction of the resort and timeshares.
The Environmental Association of St. Thomas-St. John then filed an unsuccessful lawsuit in Territorial Court seeking to overturn Turnbull's decision. EAST's concerns ranged from the project's erosion control mechanisms and sewage treatment plant to archaeological preservation.
In September 2002, the St. Thomas Coastal Zone Management Committee approved Botany Bay Partners' request for a major CZM permit to build the resort and timeshares part of the project. CZM staff had recommended that members reject the application, saying developers submitted inadequate analysis of the project's environmental impact.
In March 2003, EAST filed an appeal with Board of Land Use Appeals to override the committee's approval of the permit. The appeal was never heard because Botany Bay Partners voluntarily relinquished its major CZM permit last March.
In December of 2004, developers started installing infrastructure to the area, and they said at the time that their plans no longer involved a hotel or timeshare complex and would just sell residential lots and build light commercial services to support the new neighborhood.
Tuesday, June 20, 2006
Condo Hotels Are Not Your Parents’ Timeshare
As hybrid properties, condo hotels differ from timeshares in a number of ways. With timeshares, buyers pay only for the right to use the property for a set amount of time each year, usually a single week. They don’t own the title to the property, and they do not receive any rent revenue for the weeks they’re not in residence.
Condo hotel owners can use their condos when they want throughout the year, within the guidelines of the individual development timeshare owners cannot. They receive a percentage of any revenue their unit generates when they’re not there and the unit is rented out to hotel guests, not timeshare owners.
Timeshares traditionally diminish in value over time, rather than appreciate. While the history of condo hotel resales is rather limited, they are seen as an appreciating asset.
Timeshare is still more dominant in the real estate vacation world.
Condo hotel owners can use their condos when they want throughout the year, within the guidelines of the individual development timeshare owners cannot. They receive a percentage of any revenue their unit generates when they’re not there and the unit is rented out to hotel guests, not timeshare owners.
Timeshares traditionally diminish in value over time, rather than appreciate. While the history of condo hotel resales is rather limited, they are seen as an appreciating asset.
Timeshare is still more dominant in the real estate vacation world.
Monday, June 19, 2006
Exclusive Club Plans Luxury Timeshare Vacations
One might not necessarily imagine that multi-millionaires confront limited options in planning their vacations.
But a company chaired by former America Online co-founder Steve Case is growing rapidly by offering a menu of luxury timeshare vacation options as part of a club that requires members to pony up $200,000 US or more to access its $750-million portfolio of vacation properties throughout North America, the Caribbean and Europe.
The club, Exclusive Resorts, has just added its 2,000th member, which makes it by far the largest company in the fledgling destination club industry.
They will also announce a partnership with golfing legend Jack Nicklaus to expand their golf amenities, and a $72-million investment that will allow them to expand their current roster of nearly 300 vacation timeshare homes in 35 destinations.
Case, who bought the club in its infancy in 2003 when it had fewer than 50 members, said he knew the idea was a winner from the start. He bought the company over breakfast after an initial presentation.
"I thought it was brilliant. It was one of those why-didn't-I-think-of-that moments,'' Case said.
Here's how it works: members pay a one-time upfront free ranging from $195,000 to $395,000, which gets them between 15 and 45 days at any of the club's destinations, including the Virgin Islands, Costa Rica, Lake Tahoe, the French Alps and Tuscany. They also pay annual dues ranging from $9,500 to $25,000, again depending on how many vacation days they want.
When a member leaves the timeshare club, he gets back 80 per cent of his membership fee.
While the figures sound steep, Case says it's affordable when compared to buying a vacation home.
And the club allows people to vacation in different places every year, rather than being locked into one spot with a vacation home or a timeshare.
And for those who vacation with children or in large groups, the club's vacation homes offer size and more of a family atmosphere than you get at a hotel suite, Case said.
Jamie Cheng, co-founder of the Helium Report, which provides research and analysis for the wealthy on various products, including destination clubs, said Exclusive Resorts is the industry leader in a rapidly growing niche of the travel sector.
The industry as a whole has perhaps 4,000 or so members, Cheng said, but there are easily a million Americans or more who could afford a timeshare membership.
"As people get more comfortable with the idea, and as the clubs do a better job of explaining it, we think there's a lot of growth potential,'' he said.
Case said his own experiences convinced him of the market for such a product. He recalled renting a vacation home in his native Hawaii for his family, including his young children.
He was upset to find out on arrival that the bedrooms for the young children were essentially isolated from the rest of the house and required you to go outside and down a flight of steps -- a poor option for his five-year-old.
Case acknowledged that people often return to the same vacation spots year after year because they like familiarity.
But he also believes people sometimes lock themselves into the same timeshare location because they worry about the hassle of dealing with a new location.
Exclusive Resorts counters that by trying to offer some consistency at all of its sites. For instance, every home has the same model of plasma screen TV and the same remote control.
The company keeps a list of its members' preferred groceries and makes sure the refrigerator and pantry are stocked with the right variety of wine for the grown-ups and the right breakfast cereal for the kids.
Concierge service makes sure that ski lift tickets are waiting for families on arrival. Tee times are already made. Chefs and masseuses are available.
Perhaps the best indication of the timeshare club's success is that the average member books nearly seven separate reservations a year through the club, often taking vacations of only two or three days.
The timeshare club's chief executive, Donn Davis, said many members take more frequent vacations than they initially anticipated because the hassles of vacationing have been eliminated.
But a company chaired by former America Online co-founder Steve Case is growing rapidly by offering a menu of luxury timeshare vacation options as part of a club that requires members to pony up $200,000 US or more to access its $750-million portfolio of vacation properties throughout North America, the Caribbean and Europe.
The club, Exclusive Resorts, has just added its 2,000th member, which makes it by far the largest company in the fledgling destination club industry.
They will also announce a partnership with golfing legend Jack Nicklaus to expand their golf amenities, and a $72-million investment that will allow them to expand their current roster of nearly 300 vacation timeshare homes in 35 destinations.
Case, who bought the club in its infancy in 2003 when it had fewer than 50 members, said he knew the idea was a winner from the start. He bought the company over breakfast after an initial presentation.
"I thought it was brilliant. It was one of those why-didn't-I-think-of-that moments,'' Case said.
Here's how it works: members pay a one-time upfront free ranging from $195,000 to $395,000, which gets them between 15 and 45 days at any of the club's destinations, including the Virgin Islands, Costa Rica, Lake Tahoe, the French Alps and Tuscany. They also pay annual dues ranging from $9,500 to $25,000, again depending on how many vacation days they want.
When a member leaves the timeshare club, he gets back 80 per cent of his membership fee.
While the figures sound steep, Case says it's affordable when compared to buying a vacation home.
And the club allows people to vacation in different places every year, rather than being locked into one spot with a vacation home or a timeshare.
And for those who vacation with children or in large groups, the club's vacation homes offer size and more of a family atmosphere than you get at a hotel suite, Case said.
Jamie Cheng, co-founder of the Helium Report, which provides research and analysis for the wealthy on various products, including destination clubs, said Exclusive Resorts is the industry leader in a rapidly growing niche of the travel sector.
The industry as a whole has perhaps 4,000 or so members, Cheng said, but there are easily a million Americans or more who could afford a timeshare membership.
"As people get more comfortable with the idea, and as the clubs do a better job of explaining it, we think there's a lot of growth potential,'' he said.
Case said his own experiences convinced him of the market for such a product. He recalled renting a vacation home in his native Hawaii for his family, including his young children.
He was upset to find out on arrival that the bedrooms for the young children were essentially isolated from the rest of the house and required you to go outside and down a flight of steps -- a poor option for his five-year-old.
Case acknowledged that people often return to the same vacation spots year after year because they like familiarity.
But he also believes people sometimes lock themselves into the same timeshare location because they worry about the hassle of dealing with a new location.
Exclusive Resorts counters that by trying to offer some consistency at all of its sites. For instance, every home has the same model of plasma screen TV and the same remote control.
The company keeps a list of its members' preferred groceries and makes sure the refrigerator and pantry are stocked with the right variety of wine for the grown-ups and the right breakfast cereal for the kids.
Concierge service makes sure that ski lift tickets are waiting for families on arrival. Tee times are already made. Chefs and masseuses are available.
Perhaps the best indication of the timeshare club's success is that the average member books nearly seven separate reservations a year through the club, often taking vacations of only two or three days.
The timeshare club's chief executive, Donn Davis, said many members take more frequent vacations than they initially anticipated because the hassles of vacationing have been eliminated.
67 Defaults On Timeshare Mortgages Raise Questions
67 defaults on timeshare mortgages raise questions about Sunterra Villas de Santa Fe resort
After Barry Dunlevy became sick with cancer and back problems, his $100,000-a-year income in the aerospace industry dropped by half. He could no longer afford to make the $178.12-per-month payments on his timeshare at Sunterra Villas de Santa Fe. And he couldn't sell the investment.
In 2005, the company foreclosed on his property.
Dunlevy is one of 67 buyers who defaulted on their Sunterra mortgages in the past two years, according to state District Court documents in Santa Fe. Many of the defendants attributed failure to make the payments to bankruptcies, divorces or death, but some didn't cite a reason.
The high number raises questions about whether some buyers could afford the timeshares -- as well as whether they knew what they were getting into.
Sunterra, now one of the biggest timeshare companies in the world, was founded in 1996. It owns almost 100 resorts in Hawaii, Canada, Europe, Mexico and the continental United States, including Santa Fe. The Santa Fe resort, which has 105 suites, is located at 400 Griffin St., on the corner of Paseo de Peralta near downtown. It opened in 1998.
Customers who buy a timeshare from Sunterra are guaranteed a vacation, usually one week, each year. The cost ranges from $8,000 to $150,000, but most are about $15,000. The price depends on the location of the resort, amenities and the time of year. A summer week on Cape Cod, for example, costs more than an October respite.
Sunterra uses a points system. The owner has a certain number of points that can be used either at the "home resort" or traded for different accomodations at different times at one of the company's other resorts.
Most of the people who defaulted on their Sunterra loan payments owed between $6,000 and $12,000, according to court documents. Interest rates on the loans were commonly 14.9 percent.
The foreclosed timeshares are auctioned off on the steps of the state District Court in Santa Fe. In February, Sunterra was the only bidder for a timeshare owned by José and Mary Gonzales. The company agreed to pay $12,077.36 for the property.
Since 1999, the year after Sunterra came to Santa Fe, the state Attorney General's Office has received 10 complaints about the company, and complaints are also mentioned in the foreclosure files.
In legal documents filed in Sunterra's case against Lawrence and Wendy Fendall of Albuquerque, for example, the couple alleged Sunterra officials misrepresented their product, based the mortgage on a fraudulent purchase contract and made false and misleading statements to get them to attend a sales presentation.
"Our difficulties with the Sunterra purchase started almost immediately," Wendy Fendall wrote in a 2000 letter to the company. The couple told company representatives they wanted to use the timeshare for a particular week in 1999, and sales staff told them they could, but after the sale, they learned they couldn't.
"Three weeks later there was no record of our timeshare purchase in any systems associated with the 800 numbers given to us in our timeshare owner documents," Wendy Fendall wrote, "and our temporary membership card was useless."
The couple had hoped to go to Sedona, Ariz., or South Beach, Fla., but ended up having to come to Santa Fe, an hour up the road. "This experience left us anxious, upset and fearful that we had not only been bamboozled, but deceived and taken advantage of as well," Wendy Fendall wrote.
After a series of other problems, the couple decided not to make payments on the timeshare, Wendy Fendall's letter states. Eventually the company started foreclosure proceedings against them.
Sunterra and the Fendalls reached an agreement this spring, and the case is no longer set for foreclosure, but the couple experienced almost seven years of problems with the company, court records show.
Local Sunterra officials referred all questions to the company's headquarters in Las Vegas, Nev.
Amanda Deveaux, a public-relations official at PJ Inc., a New York City public-relations firm hired by Sunterra, said she was unable to get anyone from the company to comment for this story.
The company asks people a series of 11 questions that start with, "Do you want ... "
All of the questions mention positive aspects of owning a Sunterra timeshare, such as, "Do you want ... A guaranteed vacation every year," and "Do you want ... A spacious suite that is all yours -- every time and everywhere you travel."
Most people would reply "yes" to all of the company's questions, but the Federal Trade Commission recommends people ask themselves some tougher questions when buying a timeshare.
For example, an FTC fact sheet advises that people should add up all the costs, including mortgage payments and expenses, travel costs, maintenance fees and taxes, closing costs, broker commissions and finance charges before making a decision to buy.
It's also important to ask whether the company has a cap on maintenance fees, according to the FTC. Those fees -- which can add up to $500 to $600 a year at Sunterra -- can rise at rates that equal or exceed inflation, and you have to pay them even if you don't use the timeshare.
Prospective buyers should compare the cost of owning a timeshare to the cost of renting similar accommodations in the same location for the same period of time, the FTC suggests.
When comparison shopping, prospective buyers should talk to real-estate agents and people who own timeshare units at the resort, and check complaints with the state attorney general and the Better Business Bureau, according to the FTC.
In New Mexico, most of the complaints lodged against Sunterra were dated around the time the company filed for bankruptcy in May 2000. The company emerged from Chapter 11 bankruptcy in July 2002, according to news reports.
Larry and Catherine Werbelow complained that they drove from their home in Socorro to Santa Fe to attend a four-hour sales presentation in July 1999, but when they tried to redeem their travel coupon for a vacation in San Diego, they were told the company was going through bankruptcy and the coupon was worthless.
The most recent complaint was in 2003, from Julian and Gertrude Leyba of Los Lunas. They wrote the AG's office to say that Sunterra told them their timeshare had been paid off in 1999, then, out of the blue, they received a letter from the company saying they had defaulted.
The Better Business Bureau in New Mexico gives Sunterra a "B" rating, which means the nonprofit considers the company reputable. The rating also means the BBB believes company officials would respond to any complaints against it.
The BBB has a record of only one complaint against the company filed since 1998. But Sunterra did not respond to the complaint.
In May, Sunterra announced in a press release that it didn't file its first-quarter earnings with the federal Securities and Exchange Commission because it had not yet hired an accounting firm. As of last week, the company still hadn't filed the report.
Sunterra lost $34 million last year in net income and $70 million in 2004, according to the company's 2005 report.
Nationally, however, the timeshare industry is thriving, according to the American Resort Development Association.
The association cited an October 2005 PricewaterhouseCoopers study that focused on 47 companies that owned 280 timeshare resorts. The study showed sales of $5.6 billion in 2004, an increase of 15.4 percent over the year before.
"Timeshare continues its spectacular growth with no signs of slowing down," said Howard Nusbaum, president and chief executive officer of ARDA, in a press release. "The growth is occurring across the U.S. and around the globe with developments by public and private companies."
Most timeshares cost about $15,000, according to the organization.
Carol Rose, a former verification loan officer at Sunterra in Santa Fe, said timeshares are popular because owners can pass the investment on to their children. But it's important for people to do their homework, she stressed.
Salespeople tell potential buyers that all they have to do is put a few hundred dollars down and they can go to Hawaii, Mexico and other places they've always wanted to visit, according to Rose. "And then reality sets in. They find that space is very limited. They thought that six months was enough time to book in advance when they need to book a year in advance -- for a place like Hawaii."
"A lot of people are mad at themselves because they're spending all this money and they're not using the timeshare," she added.
Rose, who now owns Amanda's Flowers in Santa Fe, said she worked for Sunterra for more than four years and enjoyed her job.
Sunterra closed its Santa Fe sales office September 1, 2004, Rose said, but if the company ever reopened it, she'd love to go back. "It was a great company to work for," she said.
Now the nearest Sunterra sales office is in Sedona, Ariz., Rose said. Since Sunterra timeshare owners purchase points that can be used anywhere, it doesn't necessarily matter if someone's home resort is in Santa Fe or Sedona. The Sedona resort is also much larger, with 416 suites, according to the company's 2005 annual report.
Rose said she never knew of any dishonest sales practices at the company, and Sunterra officials did their best to educate customers about their purchase.
Customers who have claimed they were misled probably hadn't done enough research on timeshares, Rose said. Filing a complaint against Sunterra "was an easy way for them to (try to) get out of something they shouldn't have done in the first place," she said.
After Barry Dunlevy became sick with cancer and back problems, his $100,000-a-year income in the aerospace industry dropped by half. He could no longer afford to make the $178.12-per-month payments on his timeshare at Sunterra Villas de Santa Fe. And he couldn't sell the investment.
In 2005, the company foreclosed on his property.
Dunlevy is one of 67 buyers who defaulted on their Sunterra mortgages in the past two years, according to state District Court documents in Santa Fe. Many of the defendants attributed failure to make the payments to bankruptcies, divorces or death, but some didn't cite a reason.
The high number raises questions about whether some buyers could afford the timeshares -- as well as whether they knew what they were getting into.
Sunterra, now one of the biggest timeshare companies in the world, was founded in 1996. It owns almost 100 resorts in Hawaii, Canada, Europe, Mexico and the continental United States, including Santa Fe. The Santa Fe resort, which has 105 suites, is located at 400 Griffin St., on the corner of Paseo de Peralta near downtown. It opened in 1998.
Customers who buy a timeshare from Sunterra are guaranteed a vacation, usually one week, each year. The cost ranges from $8,000 to $150,000, but most are about $15,000. The price depends on the location of the resort, amenities and the time of year. A summer week on Cape Cod, for example, costs more than an October respite.
Sunterra uses a points system. The owner has a certain number of points that can be used either at the "home resort" or traded for different accomodations at different times at one of the company's other resorts.
Most of the people who defaulted on their Sunterra loan payments owed between $6,000 and $12,000, according to court documents. Interest rates on the loans were commonly 14.9 percent.
The foreclosed timeshares are auctioned off on the steps of the state District Court in Santa Fe. In February, Sunterra was the only bidder for a timeshare owned by José and Mary Gonzales. The company agreed to pay $12,077.36 for the property.
Since 1999, the year after Sunterra came to Santa Fe, the state Attorney General's Office has received 10 complaints about the company, and complaints are also mentioned in the foreclosure files.
In legal documents filed in Sunterra's case against Lawrence and Wendy Fendall of Albuquerque, for example, the couple alleged Sunterra officials misrepresented their product, based the mortgage on a fraudulent purchase contract and made false and misleading statements to get them to attend a sales presentation.
"Our difficulties with the Sunterra purchase started almost immediately," Wendy Fendall wrote in a 2000 letter to the company. The couple told company representatives they wanted to use the timeshare for a particular week in 1999, and sales staff told them they could, but after the sale, they learned they couldn't.
"Three weeks later there was no record of our timeshare purchase in any systems associated with the 800 numbers given to us in our timeshare owner documents," Wendy Fendall wrote, "and our temporary membership card was useless."
The couple had hoped to go to Sedona, Ariz., or South Beach, Fla., but ended up having to come to Santa Fe, an hour up the road. "This experience left us anxious, upset and fearful that we had not only been bamboozled, but deceived and taken advantage of as well," Wendy Fendall wrote.
After a series of other problems, the couple decided not to make payments on the timeshare, Wendy Fendall's letter states. Eventually the company started foreclosure proceedings against them.
Sunterra and the Fendalls reached an agreement this spring, and the case is no longer set for foreclosure, but the couple experienced almost seven years of problems with the company, court records show.
Local Sunterra officials referred all questions to the company's headquarters in Las Vegas, Nev.
Amanda Deveaux, a public-relations official at PJ Inc., a New York City public-relations firm hired by Sunterra, said she was unable to get anyone from the company to comment for this story.
The company asks people a series of 11 questions that start with, "Do you want ... "
All of the questions mention positive aspects of owning a Sunterra timeshare, such as, "Do you want ... A guaranteed vacation every year," and "Do you want ... A spacious suite that is all yours -- every time and everywhere you travel."
Most people would reply "yes" to all of the company's questions, but the Federal Trade Commission recommends people ask themselves some tougher questions when buying a timeshare.
For example, an FTC fact sheet advises that people should add up all the costs, including mortgage payments and expenses, travel costs, maintenance fees and taxes, closing costs, broker commissions and finance charges before making a decision to buy.
It's also important to ask whether the company has a cap on maintenance fees, according to the FTC. Those fees -- which can add up to $500 to $600 a year at Sunterra -- can rise at rates that equal or exceed inflation, and you have to pay them even if you don't use the timeshare.
Prospective buyers should compare the cost of owning a timeshare to the cost of renting similar accommodations in the same location for the same period of time, the FTC suggests.
When comparison shopping, prospective buyers should talk to real-estate agents and people who own timeshare units at the resort, and check complaints with the state attorney general and the Better Business Bureau, according to the FTC.
In New Mexico, most of the complaints lodged against Sunterra were dated around the time the company filed for bankruptcy in May 2000. The company emerged from Chapter 11 bankruptcy in July 2002, according to news reports.
Larry and Catherine Werbelow complained that they drove from their home in Socorro to Santa Fe to attend a four-hour sales presentation in July 1999, but when they tried to redeem their travel coupon for a vacation in San Diego, they were told the company was going through bankruptcy and the coupon was worthless.
The most recent complaint was in 2003, from Julian and Gertrude Leyba of Los Lunas. They wrote the AG's office to say that Sunterra told them their timeshare had been paid off in 1999, then, out of the blue, they received a letter from the company saying they had defaulted.
The Better Business Bureau in New Mexico gives Sunterra a "B" rating, which means the nonprofit considers the company reputable. The rating also means the BBB believes company officials would respond to any complaints against it.
The BBB has a record of only one complaint against the company filed since 1998. But Sunterra did not respond to the complaint.
In May, Sunterra announced in a press release that it didn't file its first-quarter earnings with the federal Securities and Exchange Commission because it had not yet hired an accounting firm. As of last week, the company still hadn't filed the report.
Sunterra lost $34 million last year in net income and $70 million in 2004, according to the company's 2005 report.
Nationally, however, the timeshare industry is thriving, according to the American Resort Development Association.
The association cited an October 2005 PricewaterhouseCoopers study that focused on 47 companies that owned 280 timeshare resorts. The study showed sales of $5.6 billion in 2004, an increase of 15.4 percent over the year before.
"Timeshare continues its spectacular growth with no signs of slowing down," said Howard Nusbaum, president and chief executive officer of ARDA, in a press release. "The growth is occurring across the U.S. and around the globe with developments by public and private companies."
Most timeshares cost about $15,000, according to the organization.
Carol Rose, a former verification loan officer at Sunterra in Santa Fe, said timeshares are popular because owners can pass the investment on to their children. But it's important for people to do their homework, she stressed.
Salespeople tell potential buyers that all they have to do is put a few hundred dollars down and they can go to Hawaii, Mexico and other places they've always wanted to visit, according to Rose. "And then reality sets in. They find that space is very limited. They thought that six months was enough time to book in advance when they need to book a year in advance -- for a place like Hawaii."
"A lot of people are mad at themselves because they're spending all this money and they're not using the timeshare," she added.
Rose, who now owns Amanda's Flowers in Santa Fe, said she worked for Sunterra for more than four years and enjoyed her job.
Sunterra closed its Santa Fe sales office September 1, 2004, Rose said, but if the company ever reopened it, she'd love to go back. "It was a great company to work for," she said.
Now the nearest Sunterra sales office is in Sedona, Ariz., Rose said. Since Sunterra timeshare owners purchase points that can be used anywhere, it doesn't necessarily matter if someone's home resort is in Santa Fe or Sedona. The Sedona resort is also much larger, with 416 suites, according to the company's 2005 annual report.
Rose said she never knew of any dishonest sales practices at the company, and Sunterra officials did their best to educate customers about their purchase.
Customers who have claimed they were misled probably hadn't done enough research on timeshares, Rose said. Filing a complaint against Sunterra "was an easy way for them to (try to) get out of something they shouldn't have done in the first place," she said.
Friday, June 16, 2006
North Carolina Experiencing Explosion In Coastal Condos And Timeshares.
Cruising up the Intra-coastal Waterway from Charleston to Baltimore this past week, I saw expanses of grassy wetlands intermingled with expanding clusters of high-rise condos and timeshares. I also saw multi-level multi-family complexes that weren’t there last year — timeshares built so close to the ocean that the waves seem to break at the foot of their garages. Both natural and man-made habitats glistened in the sun. Shorebirds waded in the shallows and rode the breeze. In view of this landscape, my thoughts turned, naturally enough, to my kitchen floor.
For those who don’t know about it, the Intracoastal Waterway is a network of connected rivers, creeks and canals that parallels the Atlantic coast from Maine to Florida. Like the Blue Ridge Parkway, the waterway was part of the federal government’s efforts in the 1930s to use plentiful labor to pump life into a depressed economy. Judging from what I saw last week, they overshot the mark. There were more pleasure craft than commercial fishing boats and plenty of economic activity along the waterway, most of it in timeshare real estate.
You can’t go far in this area without seeing evidence of the real estate boom. North Carolina ranks among the top states in housing construction, home sales and population growth. While Florida and Massachusetts experienced recent double-digit drops in home sales, North Carolina just keeps growing.
What’s the big attraction? In a word: waterfront. “If you can smell the water, you can command a pretty good price for the land,” states an editor of the North Carolina Coastal Federation’s annual State of the Coast report. This year’s report documents a continuing transition from cottages to McMansions, from fishing piers to condos, from long-established rural communities to timeshares and rentals.
Last year, when my husband and I traveled the Intracoastal Waterway, we stood on the dock at Oriental admiring the harbor. This year we met a man from New York there. He just bought property in the area, attracted, as we were, by the sense of community among local residents.
According to the local newspaper, those residents are now debating how to adapt their building regulations, written for single-family-dwellings in an age of slow growth, to accommodate an onslaught of timeshare. The minimalist approach that worked for a small, stable population is proving inadequate for the kinds of projects developers have in mind.
Some residents welcome developers. Others do not. The one thing residents agree on is they should have started thinking about the consequences of growth a lot sooner.
Likewise, during last year’s stop in Beaufort, S.C., across from Morehead City, I enjoyed seeing waterfront buildings dating back to the colonial era. This year I picked up a flyer in front of one of those buildings as workmen put in new interior walls: $1 million asking price for each apartment, boat slip included, flood insurance extra.
As much expansion as I observed on my trip, I missed the place in Brunswick County where the state wants to build a new $1 billion international port. I don’t know if that figure includes flood insurance or not.
Which brings me to my kitchen floor. Before retiring to Asheville, taking care of the kitchen floor was always last on my to-do list. I didn’t like doing it. It was such low priority I almost never got to it.
Like my kitchen floor, waterway maintenance is unappealing work.
There’s dredging, bridge repairs, equipment replacement, erosion prevention, rebuilding where erosion occurs. I sympathize with those who prefer to start a new highly-visible timeshare project rather than do repairs. I just hope someone is thinking about what maintenance is required to support growth along the waterway, not to mention the consequences of replacing wetlands with population centers.
Someone should have been thinking about those things in New Orleans before Katrina. Someone should be thinking about them now.
As for my kitchen floor, eventually I had to replace it at higher cost and more effort than taking care of it would have required. That’s the price of neglect.
On a beautiful June day, it’s hard to imagine neglect of the Waterway or overburdening it with expansion, but thinking about those things needs to be a priority. If not, we risk destroying the very landscape and communities that inspired growth in the first place. We are gambling that we will not face down the road — or in this case the waterway — tougher, costlier problems that might have been prevented if we had just started thinking about them sooner. Is a timeshare worth the hassles?
For those who don’t know about it, the Intracoastal Waterway is a network of connected rivers, creeks and canals that parallels the Atlantic coast from Maine to Florida. Like the Blue Ridge Parkway, the waterway was part of the federal government’s efforts in the 1930s to use plentiful labor to pump life into a depressed economy. Judging from what I saw last week, they overshot the mark. There were more pleasure craft than commercial fishing boats and plenty of economic activity along the waterway, most of it in timeshare real estate.
You can’t go far in this area without seeing evidence of the real estate boom. North Carolina ranks among the top states in housing construction, home sales and population growth. While Florida and Massachusetts experienced recent double-digit drops in home sales, North Carolina just keeps growing.
What’s the big attraction? In a word: waterfront. “If you can smell the water, you can command a pretty good price for the land,” states an editor of the North Carolina Coastal Federation’s annual State of the Coast report. This year’s report documents a continuing transition from cottages to McMansions, from fishing piers to condos, from long-established rural communities to timeshares and rentals.
Last year, when my husband and I traveled the Intracoastal Waterway, we stood on the dock at Oriental admiring the harbor. This year we met a man from New York there. He just bought property in the area, attracted, as we were, by the sense of community among local residents.
According to the local newspaper, those residents are now debating how to adapt their building regulations, written for single-family-dwellings in an age of slow growth, to accommodate an onslaught of timeshare. The minimalist approach that worked for a small, stable population is proving inadequate for the kinds of projects developers have in mind.
Some residents welcome developers. Others do not. The one thing residents agree on is they should have started thinking about the consequences of growth a lot sooner.
Likewise, during last year’s stop in Beaufort, S.C., across from Morehead City, I enjoyed seeing waterfront buildings dating back to the colonial era. This year I picked up a flyer in front of one of those buildings as workmen put in new interior walls: $1 million asking price for each apartment, boat slip included, flood insurance extra.
As much expansion as I observed on my trip, I missed the place in Brunswick County where the state wants to build a new $1 billion international port. I don’t know if that figure includes flood insurance or not.
Which brings me to my kitchen floor. Before retiring to Asheville, taking care of the kitchen floor was always last on my to-do list. I didn’t like doing it. It was such low priority I almost never got to it.
Like my kitchen floor, waterway maintenance is unappealing work.
There’s dredging, bridge repairs, equipment replacement, erosion prevention, rebuilding where erosion occurs. I sympathize with those who prefer to start a new highly-visible timeshare project rather than do repairs. I just hope someone is thinking about what maintenance is required to support growth along the waterway, not to mention the consequences of replacing wetlands with population centers.
Someone should have been thinking about those things in New Orleans before Katrina. Someone should be thinking about them now.
As for my kitchen floor, eventually I had to replace it at higher cost and more effort than taking care of it would have required. That’s the price of neglect.
On a beautiful June day, it’s hard to imagine neglect of the Waterway or overburdening it with expansion, but thinking about those things needs to be a priority. If not, we risk destroying the very landscape and communities that inspired growth in the first place. We are gambling that we will not face down the road — or in this case the waterway — tougher, costlier problems that might have been prevented if we had just started thinking about them sooner. Is a timeshare worth the hassles?
Thursday, June 15, 2006
New Timeshare Tower To Go Up At Hawaiian Village
The 38-story, 331-unit Grand Waikikian will be Hilton's fourth timeshare development in Hawaii and the third at the Hawaiian Village, which has the largest agglomeration of hotel rooms in Waikiki and is the largest Hilton campus in the world.
The tower will go up near the Kalia Tower, which has 72 timeshare units, and not far from the older Lagoon Tower, which has 236 timeshare units. The other Hilton timeshare operation, with 120 units, is at the Waikoloa Beach Resort.
"The Grand Waikikian will include a retail shopping arcade, beachside restaurant and super pool with three slides and a 'lazy river' theme designed especially for families," said Elena Norman, the senior spokeswoman for the Grand Vacations division, who flew in from division headquarters in Orlando for the timeshare groundbreaking.
The top five floors of The Grand Waikikian will be designed as exclusive penthouse timeshare units with a private check-in area, concierge and lounge.
The tower will go up near the Kalia Tower, which has 72 timeshare units, and not far from the older Lagoon Tower, which has 236 timeshare units. The other Hilton timeshare operation, with 120 units, is at the Waikoloa Beach Resort.
"The Grand Waikikian will include a retail shopping arcade, beachside restaurant and super pool with three slides and a 'lazy river' theme designed especially for families," said Elena Norman, the senior spokeswoman for the Grand Vacations division, who flew in from division headquarters in Orlando for the timeshare groundbreaking.
The top five floors of The Grand Waikikian will be designed as exclusive penthouse timeshare units with a private check-in area, concierge and lounge.
Tuesday, June 13, 2006
Ritz Says It Sold $106M In S.F. Timeshare Units
The company has not actually collected $106 million but instead accepted "sales reservations" totalling that amount. Such reservations typically involve a deposit of a fraction of the total cost of the timeshare.
San Francisco is the first urban location for the Ritz-Carlton Club. It is located in the former Chronicle building at 690 Market St. and developed by Jim Hunter's Hunter Group of Alameda. The $90 million timeshare renovation and expansion project will result in 49 shared fractional ownerships and timeshares, which have attracted initial commitments from 57 buyers so far, and 52 individual residences, which have attracted reservations from 45 buyers.
The individual timeshare units cost from $1.2 million to $5 million, while hee fractional ownership interests start at $200,000 for a one-twelveth share of one unit.
San Francisco is the first urban location for the Ritz-Carlton Club. It is located in the former Chronicle building at 690 Market St. and developed by Jim Hunter's Hunter Group of Alameda. The $90 million timeshare renovation and expansion project will result in 49 shared fractional ownerships and timeshares, which have attracted initial commitments from 57 buyers so far, and 52 individual residences, which have attracted reservations from 45 buyers.
The individual timeshare units cost from $1.2 million to $5 million, while hee fractional ownership interests start at $200,000 for a one-twelveth share of one unit.
Monday, June 12, 2006
Timeshare Owners Launch Petition
Several Pelican Resort timeshare owners have posted an on-line petition collecting signatures for a campaign intended to block the construction of a new high-rise marina at Pelican Timeshare Resort.
The timeshare owners contend that the new structure is going to block visibility from “many C and D units whose owners were told, when buying, that their views would never be blocked.”
According to the petition organisers, the on-line petition has been posted to stop the construction as it is now planned and to compel the developers to adhere to their commitment to timeshare owners.
The petition, which has been posted at petitiononline.com/MARINA/petition.html , is addressed to the Island Government of St. Maarten and Board of Directors, Tenants Association, Pelican Resort Club.
It reads: “We, the undersigned, hereby petition the Board of Directors of the Tenants Association Pelican Timeshare Resort Club to cease and desist the building of the new Marina Complex at Pelican Resort Club at Billy Folly Road, Simpson Bay, Sint Maarten, Netherlands Antilles, as it is currently planned.
“The design of this complex directly contradicts specific promises made to buyers of the C and D Buildings at Pelican, who were told that views from thier timeshares would never be compromised.
“On that basis thousands of timeshare owners bought in good faith, only to see their investments devalued in their view by the construction of a high-rise directly in front of their units.
“The undersigned also petition the Island Government of St. Maarten to intervene and stop this project or require its developers to fully respect and act upon the specific promises made to current timeshare owners by altering the building plans so new construction will not affect any views from any existing Pelican buildings.”
The timeshare owners contend that the new structure is going to block visibility from “many C and D units whose owners were told, when buying, that their views would never be blocked.”
According to the petition organisers, the on-line petition has been posted to stop the construction as it is now planned and to compel the developers to adhere to their commitment to timeshare owners.
The petition, which has been posted at petitiononline.com/MARINA/petition.html , is addressed to the Island Government of St. Maarten and Board of Directors, Tenants Association, Pelican Resort Club.
It reads: “We, the undersigned, hereby petition the Board of Directors of the Tenants Association Pelican Timeshare Resort Club to cease and desist the building of the new Marina Complex at Pelican Resort Club at Billy Folly Road, Simpson Bay, Sint Maarten, Netherlands Antilles, as it is currently planned.
“The design of this complex directly contradicts specific promises made to buyers of the C and D Buildings at Pelican, who were told that views from thier timeshares would never be compromised.
“On that basis thousands of timeshare owners bought in good faith, only to see their investments devalued in their view by the construction of a high-rise directly in front of their units.
“The undersigned also petition the Island Government of St. Maarten to intervene and stop this project or require its developers to fully respect and act upon the specific promises made to current timeshare owners by altering the building plans so new construction will not affect any views from any existing Pelican buildings.”
Friday, June 09, 2006
Fairmont Hotels To Run Timeshare Resort At Ghirardelli Square
Ghirardelli Square owner JMA Ventures has selected Fairmont Hotels & Resorts to run a luxury timeshare resort on the upper floors of the Fisherman's Wharf landmark in San Francisco.
JMA had been considering a timeshare development at Ghirardelli Square since acquiring it last year.
Fairmont is putting money into the cost of the timeshare development along with JMA and Pacific Coast Capital Partners of San Francisco.
The property is Fairmont's first urban timeshare.
JMA said in a statement that the timeshare development part is part of a "vision for renewing and reenergizing Ghirardelli Square," including adding spa facilities.
JMA had been considering a timeshare development at Ghirardelli Square since acquiring it last year.
Fairmont is putting money into the cost of the timeshare development along with JMA and Pacific Coast Capital Partners of San Francisco.
The property is Fairmont's first urban timeshare.
JMA said in a statement that the timeshare development part is part of a "vision for renewing and reenergizing Ghirardelli Square," including adding spa facilities.
Thursday, June 08, 2006
James Monroe Capital Announces New $5mm Timeshare Real Estate Project
James Monroe Capital Corporation (Pink Sheets:JMCP), has announced that they are working on a second timeshare real estate resort development in Costa Rica.
James Monroe Capital will be working on a timeshare resort, on the already popular West coast of Costa Rica, in Guanacoste. Dr. Vinton J. Lewis, independent deal maker, has commented, "Timeshare allows us to sell the same condo 50 times, one week at a time. The profits that can be obtained are substantially higher than a typical development."
Dr. Lewis has brought timeshare expert Bob Johnson to the team, who will head up the development as president of the subsidiary. Johnson said, "We have been approached by multiple land owners who would like us to develop their land. This places us in such a good position, with so many choices. I'm sending one of my guys, Richard Smith, another timeshare expert, down there in mid-June to do some final due diligence on the property which is by far our favorite. We have that property tied up for now."
James Monroe Capital CEO Chris McGovern commented, "The two resorts will be different from each other, but the timeshare resort will be a quicker profit center. We can also use the two of them to help add stability to the company. We also hope, in the future, to have the timeshare real estate profit from each other, sharing ideas for long-term success and earnings."
James Monroe Capital will be working on a timeshare resort, on the already popular West coast of Costa Rica, in Guanacoste. Dr. Vinton J. Lewis, independent deal maker, has commented, "Timeshare allows us to sell the same condo 50 times, one week at a time. The profits that can be obtained are substantially higher than a typical development."
Dr. Lewis has brought timeshare expert Bob Johnson to the team, who will head up the development as president of the subsidiary. Johnson said, "We have been approached by multiple land owners who would like us to develop their land. This places us in such a good position, with so many choices. I'm sending one of my guys, Richard Smith, another timeshare expert, down there in mid-June to do some final due diligence on the property which is by far our favorite. We have that property tied up for now."
James Monroe Capital CEO Chris McGovern commented, "The two resorts will be different from each other, but the timeshare resort will be a quicker profit center. We can also use the two of them to help add stability to the company. We also hope, in the future, to have the timeshare real estate profit from each other, sharing ideas for long-term success and earnings."
Tuesday, June 06, 2006
Ernst & Young Laptop Loss Exposes 243,000 Hotels.com Customers
Ernst & Young's laptop loss unit continues to be one of the company's more productive divisions. We learn this week that the accounting firm lost a system containing data on 243,000 Hotels.com customers. Hotels.com joins the likes of Sun Microsystems, IBM, Cisco, BP and Nokia, which have all had their employees' data exposed by Ernst & Young, as revealed here in a series of exclusive stories.
The Register can again exclusively confirm the loss of the Hotels.com customer information after having received a copy of a letter mailed out jointly by the web site and Ernst & Young. A Hotels.com spokesman also confirmed the data breach, saying Ernst & Young notified the company of the laptop loss on May 3. The laptop in question was stolen from an Ernst & Young worker's car in Texas and did have some basic data protection mechanisms such as, erm, the need for a password.
"Recently, Hotels.com was informed by its outside auditor, Ernst & Young, that one of Ernst & Young's employees had his laptop computer stolen," Hotels.com told its customers in the letter. "Unfortunately, the computer contained certain information about customer transactions with Hotels.com, and other sites through which we provide booking services directly to customers, from 2002 through 2004.
"This information may have included your name, address and some credit or debit card information you provided at that time."
Ernst & Young in February lost one laptop that held information on what's believed to be tens of thousands of Sun, IBM, Cisco, BP and Nokia employees. It's not clear if this was the same system in the Hotels.com incident. Ernst & Young has not returned our calls seeking comment and has been reluctant to provide information on these incidents in the past.
Ernst & Young in February also lost four laptops in Miami when its workers decided to leave their systems in a hotel conference room while they went out for lunch.
Major media outlets have so far ignored the Ernst & Young laptop incidents, although they were quick to follow on our confirmation of a Fidelity data breach that saw 200,000 HP workers have their information exposed.
Ernst & Young offers a variety of security services to customers, and encourages clients to be transparent with their policies around customer data issues. The company, however, has not exactly been proactive with regard to its own issues.
The Register can again exclusively confirm the loss of the Hotels.com customer information after having received a copy of a letter mailed out jointly by the web site and Ernst & Young. A Hotels.com spokesman also confirmed the data breach, saying Ernst & Young notified the company of the laptop loss on May 3. The laptop in question was stolen from an Ernst & Young worker's car in Texas and did have some basic data protection mechanisms such as, erm, the need for a password.
"Recently, Hotels.com was informed by its outside auditor, Ernst & Young, that one of Ernst & Young's employees had his laptop computer stolen," Hotels.com told its customers in the letter. "Unfortunately, the computer contained certain information about customer transactions with Hotels.com, and other sites through which we provide booking services directly to customers, from 2002 through 2004.
"This information may have included your name, address and some credit or debit card information you provided at that time."
Ernst & Young in February lost one laptop that held information on what's believed to be tens of thousands of Sun, IBM, Cisco, BP and Nokia employees. It's not clear if this was the same system in the Hotels.com incident. Ernst & Young has not returned our calls seeking comment and has been reluctant to provide information on these incidents in the past.
Ernst & Young in February also lost four laptops in Miami when its workers decided to leave their systems in a hotel conference room while they went out for lunch.
Major media outlets have so far ignored the Ernst & Young laptop incidents, although they were quick to follow on our confirmation of a Fidelity data breach that saw 200,000 HP workers have their information exposed.
Ernst & Young offers a variety of security services to customers, and encourages clients to be transparent with their policies around customer data issues. The company, however, has not exactly been proactive with regard to its own issues.
Monday, June 05, 2006
Weighing The Pros And Cons Of The Booming Timeshare Trend
Mickey, Goofy and Cinderella are only 15 minutes away.
And when we undergo theme park overload, we can unwind on the screened-in porch of this timeshare, swim in one of three beach-motif pools, paddle around with our daughter on duck boats. Or we can tee off on a Nick Faldo golf course or wander onto a nearby bird sanctuary.
Here at the Marriott Cypress Harbour, life is easy. The hotel chain has dangled a bargain-basement deal -- a four-night/five-day stay for only $400 -- in hopes that we will bite on a $19,400 one-week timeshare, a booming form of vacationing.
The activity center of this "vacation club" serves up enough sand art games, ice cream socials and kiddie crafts to stave off the most dreaded words on a vacation ("I'm bored") and the most expensive words ("I want to go to Disney World another day"). An excellent Thai restaurant down the street feeds us on the nights when our cooking resolve melts.
Every day, a housekeeper makes up the two-bedroom furnished unit that sleeps six with the help of a fold-out couch. Even our active 4-year-old daughter, who bounces off the walls of most hotel rooms, has room to roam.
And we are handed $100 in Disney money.
So what's not to like?
There is one catch.
On the fourth day, just as my husband and I get into the rhythm of the vacation and our work-world defenses are dissolving, we attend a 1 1/2-hour sales presentation, where an earnest young man tells us why channeling money into this time share would create decades of wonderful family vacations. (Failure to show up means we will be charged the retail rate, which can be $300 or so a night, depending on the week.)
Such sales pitches by timeshare companies have helped build the national time share market into a $7.87 billion industry in 2004, up more than 40 percent from 2002, according to the American Resort Development Association. Marriott, the dominant time share company, posted sales of more than $1.5 billion last year, propelled by 10 consecutive years of growth of 20 percent or more.
But does it make good vacation sense to buy one? After all, we have heard from financial consultants that we would be better off investing in a mutual fund. They warn that a time share is not a good financial investment because you can lose money trying to sell it on the secondary market. Plus there are all those negative stereotypes of timeshares.
As if to dispel our worst fears, the salesman brings up the horror stories -- You get stuck going to the same place the same time every year. You can smell the stench of the cigar of the man there the previous week. The company that owns it goes bankrupt.
But this timeshare is different, he tells us. The Marriott name stands behind it. You can trade for different times and destinations, including about 50 Marriott vacation clubs and 2,800 motels worldwide. Or you pay a fee to the exchange company Interval International and trade for 1,900 properties worldwide.
And you don't have to keep returning to see Mickey. A time share in Orlando is in demand 52 weeks a year, he tells us, because of brilliant marketing, the very reason we are here. "If you don't bring your child to Disney World, you are a horrible parent," he quips.
He says this isn't a hard sell, which it isn't. But it is a seductive sell as he shows us photos of five-star resorts in Marbella, Spain and Park City, Utah, and despite our best don't-buy resolve, we start lusting for travel. After ascertaining that we are hikers who went to the Great Smoky Mountains last year, he whips out various mountain destinations, and we can just feel ourselves soaking in the hot tub after a long hike.
Every other year, time share owners can trade in their week of usage for Marriott rewards points to be used for hotels, air fares or cruises.
The salesman gives us a tour of the neighboring complex, Grande Vista, the unit that is up for sale. It has an elegant deep red and green decor, granite counter tops in the kitchen and a guest suite with a kitchenette, which can be partitioned off from the main unit with a wall and a separate entrance. This gives you the option of renting out half while you use half.
The sprawling grounds have a Nick Faldo golf course, five swimming pools, an 80-acre bird sanctuary, and an indoor play area with mazes, climbing ladders and obstacle courses.
Then he starts spitting out figures on how we could own a week for $19,400 -- a $1,940 down payment, $774 closing costs and monthly payments of $289 if you signed up for their 13.9 percent financing (but less if you secured a better rate). Plus there is an annual maintenance fee of $600, which could go up.
That doesn't sound like such an outrageous big stretch.
But financial consultants such as Bob Nusbaum, president of Middle America Planning in Mt. Lebanon, caution that you might do better earmarking a certain portion of your portfolio for vacations, and using the investment returns for a vacation of your choice.
A timeshare is a "long-term commitment. I don't see why you would want to do that." Your vacation needs, he says, may evolve as your children grow up. A vacation fund, he says, lets you take advantage of travel deals.
Ed Kinney, vice president of corporate affairs for Marriott Vacation Clubs International, counters that with a timeshare, "You are buying a lifetime of vacations in advance in today's dollars. It is committing you to a vacationing lifestyle that shifts from "if" and "when" to "when" and "where." Without a timeshare, he says, some people miss vacationing opportunities because it gets so complicated to plan a trip.
The Marriott salesman offers hefty incentives to sign up on the spot. You get 125,000 bonus Marriott points -- roughly equivalent to a one-week trip for two -- or free closing costs and free first-year-maintenance fee.
But Mr. Nusbaum advised people not to sign on the spot, and to let an attorney review a contract before they sign it.
"People get swept off their feet, wined and dined," he says. "They sign up for it when they are very vulnerable to a sales pitch."
One out of three people who attend these Marriott sales presentations buys a timeshare.
Among them are the young Pennsylvania couple next to us, Laura and Matt Brennan of Exeter, Luzerne County, who came to Orlando with their four boys ages 2 to 9.
"We never planned vacations," Mrs. Brennan says. "I was always pregnant. It was too much to plan it. Vacations were not on our radar."
The two-week timeshare will enable her family to take a nice trip to Florida or Ireland or Spain conveniently, she said. She said the family will save hundreds of dollars just eating breakfast in the timeshare, as opposed to going out to a restaurant.
Our salesman says we can pass on the timeshare, which comes with a deed, to our daughter.
Handing down a timeshare through the generations was part of the lure for Penny Costanzo of Toronto, who was vacationing in Orlando, having traded in her Bay Beach, Fla. timeshare. She has four grown children and can't wait to be a grandmother.
"All my grandchildren are going to see Mickey. I promised my son he would see Mickey when he was 5." But he's now 28 and has never been to Disney World.
Her friend, a hotel executive, told her a timeshare was a bad investment.
"I didn't make it as a financial investment," she said. "This is an investment in my health, my holiday and my happiness, the three H's." She makes it sound appealing.
Even if you sign a contract, you have three days to get out of it in the state of Florida.
For a second, I hesitate. Even though I am not a Disney-freak, I like the idea of trading it in for timeshares in Spain and Italy.
As a parting sales pitch, he says, "The worst thing that can happen is that you have a beautiful timeshare and you go on wonderful vacations and you can always sell it."
My husband shoots me THE LOOK. Remember, his eyes says, this was supposed to be a cheap vacation.
I decline to sign a piece of paper that day. Walking out, I feel the same sense of relief I feel when I resist an impulse buy on an expensive piece of clothing.
A flash of disappointment registers in the salesman's eyes before he gamely gives us his cell phone number. But he doesn't call and pester us to reconsider this timeshare -- the one that we let get away.
And when we undergo theme park overload, we can unwind on the screened-in porch of this timeshare, swim in one of three beach-motif pools, paddle around with our daughter on duck boats. Or we can tee off on a Nick Faldo golf course or wander onto a nearby bird sanctuary.
Here at the Marriott Cypress Harbour, life is easy. The hotel chain has dangled a bargain-basement deal -- a four-night/five-day stay for only $400 -- in hopes that we will bite on a $19,400 one-week timeshare, a booming form of vacationing.
The activity center of this "vacation club" serves up enough sand art games, ice cream socials and kiddie crafts to stave off the most dreaded words on a vacation ("I'm bored") and the most expensive words ("I want to go to Disney World another day"). An excellent Thai restaurant down the street feeds us on the nights when our cooking resolve melts.
Every day, a housekeeper makes up the two-bedroom furnished unit that sleeps six with the help of a fold-out couch. Even our active 4-year-old daughter, who bounces off the walls of most hotel rooms, has room to roam.
And we are handed $100 in Disney money.
So what's not to like?
There is one catch.
On the fourth day, just as my husband and I get into the rhythm of the vacation and our work-world defenses are dissolving, we attend a 1 1/2-hour sales presentation, where an earnest young man tells us why channeling money into this time share would create decades of wonderful family vacations. (Failure to show up means we will be charged the retail rate, which can be $300 or so a night, depending on the week.)
Such sales pitches by timeshare companies have helped build the national time share market into a $7.87 billion industry in 2004, up more than 40 percent from 2002, according to the American Resort Development Association. Marriott, the dominant time share company, posted sales of more than $1.5 billion last year, propelled by 10 consecutive years of growth of 20 percent or more.
But does it make good vacation sense to buy one? After all, we have heard from financial consultants that we would be better off investing in a mutual fund. They warn that a time share is not a good financial investment because you can lose money trying to sell it on the secondary market. Plus there are all those negative stereotypes of timeshares.
As if to dispel our worst fears, the salesman brings up the horror stories -- You get stuck going to the same place the same time every year. You can smell the stench of the cigar of the man there the previous week. The company that owns it goes bankrupt.
But this timeshare is different, he tells us. The Marriott name stands behind it. You can trade for different times and destinations, including about 50 Marriott vacation clubs and 2,800 motels worldwide. Or you pay a fee to the exchange company Interval International and trade for 1,900 properties worldwide.
And you don't have to keep returning to see Mickey. A time share in Orlando is in demand 52 weeks a year, he tells us, because of brilliant marketing, the very reason we are here. "If you don't bring your child to Disney World, you are a horrible parent," he quips.
He says this isn't a hard sell, which it isn't. But it is a seductive sell as he shows us photos of five-star resorts in Marbella, Spain and Park City, Utah, and despite our best don't-buy resolve, we start lusting for travel. After ascertaining that we are hikers who went to the Great Smoky Mountains last year, he whips out various mountain destinations, and we can just feel ourselves soaking in the hot tub after a long hike.
Every other year, time share owners can trade in their week of usage for Marriott rewards points to be used for hotels, air fares or cruises.
The salesman gives us a tour of the neighboring complex, Grande Vista, the unit that is up for sale. It has an elegant deep red and green decor, granite counter tops in the kitchen and a guest suite with a kitchenette, which can be partitioned off from the main unit with a wall and a separate entrance. This gives you the option of renting out half while you use half.
The sprawling grounds have a Nick Faldo golf course, five swimming pools, an 80-acre bird sanctuary, and an indoor play area with mazes, climbing ladders and obstacle courses.
Then he starts spitting out figures on how we could own a week for $19,400 -- a $1,940 down payment, $774 closing costs and monthly payments of $289 if you signed up for their 13.9 percent financing (but less if you secured a better rate). Plus there is an annual maintenance fee of $600, which could go up.
That doesn't sound like such an outrageous big stretch.
But financial consultants such as Bob Nusbaum, president of Middle America Planning in Mt. Lebanon, caution that you might do better earmarking a certain portion of your portfolio for vacations, and using the investment returns for a vacation of your choice.
A timeshare is a "long-term commitment. I don't see why you would want to do that." Your vacation needs, he says, may evolve as your children grow up. A vacation fund, he says, lets you take advantage of travel deals.
Ed Kinney, vice president of corporate affairs for Marriott Vacation Clubs International, counters that with a timeshare, "You are buying a lifetime of vacations in advance in today's dollars. It is committing you to a vacationing lifestyle that shifts from "if" and "when" to "when" and "where." Without a timeshare, he says, some people miss vacationing opportunities because it gets so complicated to plan a trip.
The Marriott salesman offers hefty incentives to sign up on the spot. You get 125,000 bonus Marriott points -- roughly equivalent to a one-week trip for two -- or free closing costs and free first-year-maintenance fee.
But Mr. Nusbaum advised people not to sign on the spot, and to let an attorney review a contract before they sign it.
"People get swept off their feet, wined and dined," he says. "They sign up for it when they are very vulnerable to a sales pitch."
One out of three people who attend these Marriott sales presentations buys a timeshare.
Among them are the young Pennsylvania couple next to us, Laura and Matt Brennan of Exeter, Luzerne County, who came to Orlando with their four boys ages 2 to 9.
"We never planned vacations," Mrs. Brennan says. "I was always pregnant. It was too much to plan it. Vacations were not on our radar."
The two-week timeshare will enable her family to take a nice trip to Florida or Ireland or Spain conveniently, she said. She said the family will save hundreds of dollars just eating breakfast in the timeshare, as opposed to going out to a restaurant.
Our salesman says we can pass on the timeshare, which comes with a deed, to our daughter.
Handing down a timeshare through the generations was part of the lure for Penny Costanzo of Toronto, who was vacationing in Orlando, having traded in her Bay Beach, Fla. timeshare. She has four grown children and can't wait to be a grandmother.
"All my grandchildren are going to see Mickey. I promised my son he would see Mickey when he was 5." But he's now 28 and has never been to Disney World.
Her friend, a hotel executive, told her a timeshare was a bad investment.
"I didn't make it as a financial investment," she said. "This is an investment in my health, my holiday and my happiness, the three H's." She makes it sound appealing.
Even if you sign a contract, you have three days to get out of it in the state of Florida.
For a second, I hesitate. Even though I am not a Disney-freak, I like the idea of trading it in for timeshares in Spain and Italy.
As a parting sales pitch, he says, "The worst thing that can happen is that you have a beautiful timeshare and you go on wonderful vacations and you can always sell it."
My husband shoots me THE LOOK. Remember, his eyes says, this was supposed to be a cheap vacation.
I decline to sign a piece of paper that day. Walking out, I feel the same sense of relief I feel when I resist an impulse buy on an expensive piece of clothing.
A flash of disappointment registers in the salesman's eyes before he gamely gives us his cell phone number. But he doesn't call and pester us to reconsider this timeshare -- the one that we let get away.
Weighing The Pros And Cons Of The Booming Timeshare Trend
Mickey, Goofy and Cinderella are only 15 minutes away.
And when we undergo theme park overload, we can unwind on the screened-in porch of this timeshare, swim in one of three beach-motif pools, paddle around with our daughter on duck boats. Or we can tee off on a Nick Faldo golf course or wander onto a nearby bird sanctuary.
Here at the Marriott Cypress Harbour, life is easy. The hotel chain has dangled a bargain-basement deal -- a four-night/five-day stay for only $400 -- in hopes that we will bite on a $19,400 one-week timeshare, a booming form of vacationing.
The activity center of this "vacation club" serves up enough sand art games, ice cream socials and kiddie crafts to stave off the most dreaded words on a vacation ("I'm bored") and the most expensive words ("I want to go to Disney World another day"). An excellent Thai restaurant down the street feeds us on the nights when our cooking resolve melts.
Every day, a housekeeper makes up the two-bedroom furnished unit that sleeps six with the help of a fold-out couch. Even our active 4-year-old daughter, who bounces off the walls of most hotel rooms, has room to roam.
And we are handed $100 in Disney money.
So what's not to like?
There is one catch.
On the fourth day, just as my husband and I get into the rhythm of the vacation and our work-world defenses are dissolving, we attend a 1 1/2-hour sales presentation, where an earnest young man tells us why channeling money into this time share would create decades of wonderful family vacations. (Failure to show up means we will be charged the retail rate, which can be $300 or so a night, depending on the week.)
Such sales pitches by timeshare companies have helped build the national time share market into a $7.87 billion industry in 2004, up more than 40 percent from 2002, according to the American Resort Development Association. Marriott, the dominant time share company, posted sales of more than $1.5 billion last year, propelled by 10 consecutive years of growth of 20 percent or more.
But does it make good vacation sense to buy one? After all, we have heard from financial consultants that we would be better off investing in a mutual fund. They warn that a time share is not a good financial investment because you can lose money trying to sell it on the secondary market. Plus there are all those negative stereotypes of timeshares.
As if to dispel our worst fears, the salesman brings up the horror stories -- You get stuck going to the same place the same time every year. You can smell the stench of the cigar of the man there the previous week. The company that owns it goes bankrupt.
But this timeshare is different, he tells us. The Marriott name stands behind it. You can trade for different times and destinations, including about 50 Marriott vacation clubs and 2,800 motels worldwide. Or you pay a fee to the exchange company Interval International and trade for 1,900 properties worldwide.
And you don't have to keep returning to see Mickey. A time share in Orlando is in demand 52 weeks a year, he tells us, because of brilliant marketing, the very reason we are here. "If you don't bring your child to Disney World, you are a horrible parent," he quips.
He says this isn't a hard sell, which it isn't. But it is a seductive sell as he shows us photos of five-star resorts in Marbella, Spain and Park City, Utah, and despite our best don't-buy resolve, we start lusting for travel. After ascertaining that we are hikers who went to the Great Smoky Mountains last year, he whips out various mountain destinations, and we can just feel ourselves soaking in the hot tub after a long hike.
Every other year, time share owners can trade in their week of usage for Marriott rewards points to be used for hotels, air fares or cruises.
The salesman gives us a tour of the neighboring complex, Grande Vista, the unit that is up for sale. It has an elegant deep red and green decor, granite counter tops in the kitchen and a guest suite with a kitchenette, which can be partitioned off from the main unit with a wall and a separate entrance. This gives you the option of renting out half while you use half.
The sprawling grounds have a Nick Faldo golf course, five swimming pools, an 80-acre bird sanctuary, and an indoor play area with mazes, climbing ladders and obstacle courses.
Then he starts spitting out figures on how we could own a week for $19,400 -- a $1,940 down payment, $774 closing costs and monthly payments of $289 if you signed up for their 13.9 percent financing (but less if you secured a better rate). Plus there is an annual maintenance fee of $600, which could go up.
That doesn't sound like such an outrageous big stretch.
But financial consultants such as Bob Nusbaum, president of Middle America Planning in Mt. Lebanon, caution that you might do better earmarking a certain portion of your portfolio for vacations, and using the investment returns for a vacation of your choice.
A timeshare is a "long-term commitment. I don't see why you would want to do that." Your vacation needs, he says, may evolve as your children grow up. A vacation fund, he says, lets you take advantage of travel deals.
Ed Kinney, vice president of corporate affairs for Marriott Vacation Clubs International, counters that with a timeshare, "You are buying a lifetime of vacations in advance in today's dollars. It is committing you to a vacationing lifestyle that shifts from "if" and "when" to "when" and "where." Without a timeshare, he says, some people miss vacationing opportunities because it gets so complicated to plan a trip.
The Marriott salesman offers hefty incentives to sign up on the spot. You get 125,000 bonus Marriott points -- roughly equivalent to a one-week trip for two -- or free closing costs and free first-year-maintenance fee.
But Mr. Nusbaum advised people not to sign on the spot, and to let an attorney review a contract before they sign it.
"People get swept off their feet, wined and dined," he says. "They sign up for it when they are very vulnerable to a sales pitch."
One out of three people who attend these Marriott sales presentations buys a timeshare.
Among them are the young Pennsylvania couple next to us, Laura and Matt Brennan of Exeter, Luzerne County, who came to Orlando with their four boys ages 2 to 9.
"We never planned vacations," Mrs. Brennan says. "I was always pregnant. It was too much to plan it. Vacations were not on our radar."
The two-week timeshare will enable her family to take a nice trip to Florida or Ireland or Spain conveniently, she said. She said the family will save hundreds of dollars just eating breakfast in the timeshare, as opposed to going out to a restaurant.
Our salesman says we can pass on the timeshare, which comes with a deed, to our daughter.
Handing down a timeshare through the generations was part of the lure for Penny Costanzo of Toronto, who was vacationing in Orlando, having traded in her Bay Beach, Fla. timeshare. She has four grown children and can't wait to be a grandmother.
"All my grandchildren are going to see Mickey. I promised my son he would see Mickey when he was 5." But he's now 28 and has never been to Disney World.
Her friend, a hotel executive, told her a timeshare was a bad investment.
"I didn't make it as a financial investment," she said. "This is an investment in my health, my holiday and my happiness, the three H's." She makes it sound appealing.
Even if you sign a contract, you have three days to get out of it in the state of Florida.
For a second, I hesitate. Even though I am not a Disney-freak, I like the idea of trading it in for timeshares in Spain and Italy.
As a parting sales pitch, he says, "The worst thing that can happen is that you have a beautiful timeshare and you go on wonderful vacations and you can always sell it."
My husband shoots me THE LOOK. Remember, his eyes says, this was supposed to be a cheap vacation.
I decline to sign a piece of paper that day. Walking out, I feel the same sense of relief I feel when I resist an impulse buy on an expensive piece of clothing.
A flash of disappointment registers in the salesman's eyes before he gamely gives us his cell phone number. But he doesn't call and pester us to reconsider this timeshare -- the one that we let get away.
And when we undergo theme park overload, we can unwind on the screened-in porch of this timeshare, swim in one of three beach-motif pools, paddle around with our daughter on duck boats. Or we can tee off on a Nick Faldo golf course or wander onto a nearby bird sanctuary.
Here at the Marriott Cypress Harbour, life is easy. The hotel chain has dangled a bargain-basement deal -- a four-night/five-day stay for only $400 -- in hopes that we will bite on a $19,400 one-week timeshare, a booming form of vacationing.
The activity center of this "vacation club" serves up enough sand art games, ice cream socials and kiddie crafts to stave off the most dreaded words on a vacation ("I'm bored") and the most expensive words ("I want to go to Disney World another day"). An excellent Thai restaurant down the street feeds us on the nights when our cooking resolve melts.
Every day, a housekeeper makes up the two-bedroom furnished unit that sleeps six with the help of a fold-out couch. Even our active 4-year-old daughter, who bounces off the walls of most hotel rooms, has room to roam.
And we are handed $100 in Disney money.
So what's not to like?
There is one catch.
On the fourth day, just as my husband and I get into the rhythm of the vacation and our work-world defenses are dissolving, we attend a 1 1/2-hour sales presentation, where an earnest young man tells us why channeling money into this time share would create decades of wonderful family vacations. (Failure to show up means we will be charged the retail rate, which can be $300 or so a night, depending on the week.)
Such sales pitches by timeshare companies have helped build the national time share market into a $7.87 billion industry in 2004, up more than 40 percent from 2002, according to the American Resort Development Association. Marriott, the dominant time share company, posted sales of more than $1.5 billion last year, propelled by 10 consecutive years of growth of 20 percent or more.
But does it make good vacation sense to buy one? After all, we have heard from financial consultants that we would be better off investing in a mutual fund. They warn that a time share is not a good financial investment because you can lose money trying to sell it on the secondary market. Plus there are all those negative stereotypes of timeshares.
As if to dispel our worst fears, the salesman brings up the horror stories -- You get stuck going to the same place the same time every year. You can smell the stench of the cigar of the man there the previous week. The company that owns it goes bankrupt.
But this timeshare is different, he tells us. The Marriott name stands behind it. You can trade for different times and destinations, including about 50 Marriott vacation clubs and 2,800 motels worldwide. Or you pay a fee to the exchange company Interval International and trade for 1,900 properties worldwide.
And you don't have to keep returning to see Mickey. A time share in Orlando is in demand 52 weeks a year, he tells us, because of brilliant marketing, the very reason we are here. "If you don't bring your child to Disney World, you are a horrible parent," he quips.
He says this isn't a hard sell, which it isn't. But it is a seductive sell as he shows us photos of five-star resorts in Marbella, Spain and Park City, Utah, and despite our best don't-buy resolve, we start lusting for travel. After ascertaining that we are hikers who went to the Great Smoky Mountains last year, he whips out various mountain destinations, and we can just feel ourselves soaking in the hot tub after a long hike.
Every other year, time share owners can trade in their week of usage for Marriott rewards points to be used for hotels, air fares or cruises.
The salesman gives us a tour of the neighboring complex, Grande Vista, the unit that is up for sale. It has an elegant deep red and green decor, granite counter tops in the kitchen and a guest suite with a kitchenette, which can be partitioned off from the main unit with a wall and a separate entrance. This gives you the option of renting out half while you use half.
The sprawling grounds have a Nick Faldo golf course, five swimming pools, an 80-acre bird sanctuary, and an indoor play area with mazes, climbing ladders and obstacle courses.
Then he starts spitting out figures on how we could own a week for $19,400 -- a $1,940 down payment, $774 closing costs and monthly payments of $289 if you signed up for their 13.9 percent financing (but less if you secured a better rate). Plus there is an annual maintenance fee of $600, which could go up.
That doesn't sound like such an outrageous big stretch.
But financial consultants such as Bob Nusbaum, president of Middle America Planning in Mt. Lebanon, caution that you might do better earmarking a certain portion of your portfolio for vacations, and using the investment returns for a vacation of your choice.
A timeshare is a "long-term commitment. I don't see why you would want to do that." Your vacation needs, he says, may evolve as your children grow up. A vacation fund, he says, lets you take advantage of travel deals.
Ed Kinney, vice president of corporate affairs for Marriott Vacation Clubs International, counters that with a timeshare, "You are buying a lifetime of vacations in advance in today's dollars. It is committing you to a vacationing lifestyle that shifts from "if" and "when" to "when" and "where." Without a timeshare, he says, some people miss vacationing opportunities because it gets so complicated to plan a trip.
The Marriott salesman offers hefty incentives to sign up on the spot. You get 125,000 bonus Marriott points -- roughly equivalent to a one-week trip for two -- or free closing costs and free first-year-maintenance fee.
But Mr. Nusbaum advised people not to sign on the spot, and to let an attorney review a contract before they sign it.
"People get swept off their feet, wined and dined," he says. "They sign up for it when they are very vulnerable to a sales pitch."
One out of three people who attend these Marriott sales presentations buys a timeshare.
Among them are the young Pennsylvania couple next to us, Laura and Matt Brennan of Exeter, Luzerne County, who came to Orlando with their four boys ages 2 to 9.
"We never planned vacations," Mrs. Brennan says. "I was always pregnant. It was too much to plan it. Vacations were not on our radar."
The two-week timeshare will enable her family to take a nice trip to Florida or Ireland or Spain conveniently, she said. She said the family will save hundreds of dollars just eating breakfast in the timeshare, as opposed to going out to a restaurant.
Our salesman says we can pass on the timeshare, which comes with a deed, to our daughter.
Handing down a timeshare through the generations was part of the lure for Penny Costanzo of Toronto, who was vacationing in Orlando, having traded in her Bay Beach, Fla. timeshare. She has four grown children and can't wait to be a grandmother.
"All my grandchildren are going to see Mickey. I promised my son he would see Mickey when he was 5." But he's now 28 and has never been to Disney World.
Her friend, a hotel executive, told her a timeshare was a bad investment.
"I didn't make it as a financial investment," she said. "This is an investment in my health, my holiday and my happiness, the three H's." She makes it sound appealing.
Even if you sign a contract, you have three days to get out of it in the state of Florida.
For a second, I hesitate. Even though I am not a Disney-freak, I like the idea of trading it in for timeshares in Spain and Italy.
As a parting sales pitch, he says, "The worst thing that can happen is that you have a beautiful timeshare and you go on wonderful vacations and you can always sell it."
My husband shoots me THE LOOK. Remember, his eyes says, this was supposed to be a cheap vacation.
I decline to sign a piece of paper that day. Walking out, I feel the same sense of relief I feel when I resist an impulse buy on an expensive piece of clothing.
A flash of disappointment registers in the salesman's eyes before he gamely gives us his cell phone number. But he doesn't call and pester us to reconsider this timeshare -- the one that we let get away.
Friday, June 02, 2006
Tea And Timeshare: Just £1.9m For 10 Weeks
Billionaires have been invited to buy some of the world's most expensive timeshares on the edge of St Andrews, the windswept home of golf on Scotland's east coast.
A US developer is set to restore the former Grand Hotel, a red sandstone Victorian building that overlooks the first tee and final hole of the legendary course. Until recently it was a student hall where youngsters paid just £4,000 a year for a single room. Next year, however, the building will be turned into 23 timeshare units with asking prices of up to £1.9m for 10 weeks a year - the yearly equivalent of £10m. Residents will also have to pay annual fees of £15,000 to £20,000.
Mike DiCarlo, of Wasserman Real Estate Capital, the Boston-based private developer, said: "There is only one St Andrews course."
The company hopes there will be enough golf and timeshare fanatics with deep pockets to sign up to its project despite the ambitious asking prices, which are on a par with central London, Hong Kong or New York. To put this into context, it is possible to pick up a three-bedroomed house in the town of St Andrews for less than £150,000. The proposed scheme marks the convergence of two distinct trends. On the one hand, tycoons are prepared to pay ever higher sums for luxury homes across the world. A handful of apartments in Mayfair and Manhattan have sold for more than £20m in the past year.
On the other, developers have been building ever more homes on the edge of golf clubs, mostly to appeal to retired executives.
The Royal Bank of Scotland and Guggenheim Partners have funded a roll-out of Jack Nicklaus-themed golf courses around the globe. The St Andrews Grand was built 100 years ago as a hotel where the likes of Rudyard Kipling and King Edward VII once stayed. In 1949 it was sold to St Andrews University, which converted it into Hamilton Hall, a residence for undergraduates. Wasserman bought the building last year for $40m and plans to finish the development by the summer of 2008. There will be 23 flats, each of three or four bedrooms, ranging from 1,400 sq ft to 1,930 sq ft. The most expensive, a timeshare penthouse, will have 360-degree views over the course and across to the North Sea beach.
Timeshare owners will have access to the golf course and a range of luxury facilities including a concierge service, gourmet chefs, spas, and the use of a helicopter.
A US developer is set to restore the former Grand Hotel, a red sandstone Victorian building that overlooks the first tee and final hole of the legendary course. Until recently it was a student hall where youngsters paid just £4,000 a year for a single room. Next year, however, the building will be turned into 23 timeshare units with asking prices of up to £1.9m for 10 weeks a year - the yearly equivalent of £10m. Residents will also have to pay annual fees of £15,000 to £20,000.
Mike DiCarlo, of Wasserman Real Estate Capital, the Boston-based private developer, said: "There is only one St Andrews course."
The company hopes there will be enough golf and timeshare fanatics with deep pockets to sign up to its project despite the ambitious asking prices, which are on a par with central London, Hong Kong or New York. To put this into context, it is possible to pick up a three-bedroomed house in the town of St Andrews for less than £150,000. The proposed scheme marks the convergence of two distinct trends. On the one hand, tycoons are prepared to pay ever higher sums for luxury homes across the world. A handful of apartments in Mayfair and Manhattan have sold for more than £20m in the past year.
On the other, developers have been building ever more homes on the edge of golf clubs, mostly to appeal to retired executives.
The Royal Bank of Scotland and Guggenheim Partners have funded a roll-out of Jack Nicklaus-themed golf courses around the globe. The St Andrews Grand was built 100 years ago as a hotel where the likes of Rudyard Kipling and King Edward VII once stayed. In 1949 it was sold to St Andrews University, which converted it into Hamilton Hall, a residence for undergraduates. Wasserman bought the building last year for $40m and plans to finish the development by the summer of 2008. There will be 23 flats, each of three or four bedrooms, ranging from 1,400 sq ft to 1,930 sq ft. The most expensive, a timeshare penthouse, will have 360-degree views over the course and across to the North Sea beach.
Timeshare owners will have access to the golf course and a range of luxury facilities including a concierge service, gourmet chefs, spas, and the use of a helicopter.
