DVC Club Level and Home Resort Survey

[Sandisw]

This means only new resorts (say Poly2 or FW) can be part of this new program, not existing resorts?

Correct. There are two types of multi site timeshare programs that are defined. One is being deeded to a specific resort..which is what DVC currently is…and one where you buy points into the system and have no specific home resort.

So, they can’t take a resort that exists and put it into some sort of trust that now changes the ownership rights. That would be a major change to the POS and that would require, at the very least, a vote of owners, if it could even be done at all.

 

[AnnaKristoff2013]

Except it changes the home resort priority, unless I am not understanding. If I own points at RIV, then I am deeded to RIV and must get home resort priority over anybody who is not deeded to RIV

If what you are suggesting is that the resorts go into a trust so you get advantage at all the trust resorts, it changes the program and the POS and it can’t happen.

I don’t want to be in a system that gives people who own at other resorts than me have the same rules as me. I bought specifically for the resorts I own, and not for the others I don’t.

I'm only basing this on how it was done with Wyndham, so I could certainly be wrong. With that said, the resorts themselves don't go into a trust. Nothing happens to the resorts, and nothing changes with the owners at those resorts having home resort priority. What happens is that a trust acquires points in some or all of the resorts. Those points are acquired either through ROFR, foreclosure, or through Disney buying/holding back points in new resorts it owns. The trust thus owns those specific points in those specific resorts. The trust has the ability to use those points (and only those points) that it owns, to make 11 month bookings at the resorts for the points that it opens.

People then buy points in the trust (at a 1:1 ratio corresponding to points that the trust owns). People then can use their points, to use the trust-owned points, to book at DVC. They only get availability for the points the trust owns, and once those points are used up for that resort, they can't book anymore . Thus, the 11 month availability rule is not breached. This also leads to the situation where there may still be 11 month availability generally, but there may not be for people who own trust points, if the points the trust have for that resort for that time period have already been exhausted.

Edit: To be clear, I don't think this is particularly likely given resale restrictions, since I don't see how you could resale-restrict trust points. But it is possible, and certainly seems to be something they are at least testing the waters for given the survey.

 

[Sandisw]

I'm only basing this on how it was done with Wyndham, so I could certainly be wrong. With that said, the resorts themselves don't go into a trust. Nothing happens to the resorts, and nothing changes with the owners at those resorts having home resort priority. What happens is that a trust acquires points in some or all of the resorts. Those points are acquired either through ROFR, foreclosure, or through Disney buying/holding back points in new resorts it owns. The trust thus owns those specific points in those specific resorts. The trust has the ability to use those points (and only those points) that it owns, to make 11 month bookings at the resorts for the points that it owns.

People then buy points in the trust (at a 1:1 ratio corresponding to points that the trust owns). People then can use their points, to use the trust-owned points, to book at DVC. They only get availability for the points the trust owns, and once those points are used up for that resort, they can't book anymore. Thus, the 11 month availability rule is not breached. This also leads to the situation where there may still be 11 month availability generally, but there may not be for people who own trust points, if the points the trust have for that resort for that time period have already been exhausted.

A trust can certainly be created to buy points…but if it buys points at SSR and RIV, the rules would still require those points to be used only at their home resorts until the exchange window, which must be at least one month later.

The reason this can’t happen with DVC though is that the POS limits the total number of points any one owner can own…and buying into the trust would exceed that. No one owner can own more than 8000 points across all resorts..

So, any attempt to make a membership function like this would be against the POS. IMO, the questions in a survey really mean nothing.

 

[dioxide45]

It was mentioned over on TUG that this could be a way for DVC to handle the 2042 resorts. Just convey all the units over to a large trust and sell those points out of the trust. Still might be messy for OKW given some contracts are 2057.

As for the 4000/8000 point limit, those same POS say the following in regard "may not aggregate Ownership Interests so as to compile more than 4,000 Home Resort Vacation Points per DVC Resort or an aggregate of 8,000 Home Resort VacationPoints at all DVC Resorts, unless it is approved by DVD in its sole, absolute, and unfettered discretion." So DVD could certainly grant themselves an exception to make a multisite trust possible.

 

[dioxide45]

So, they can’t take a resort that exists and put it into some sort of trust that now changes the ownership rights.

The ownership rights don't change for the points added to the trust. They are still bound to the same booking windows that all the other points at the resorts are tied to. Its really no different than a single owner owning multiple resorts. They can book each resort they own at 11 months up to the number of points they own at each resort.

 

[ljmiii]

As someone who has purchased at resorts I love, I will not like having this “non-home resort but with 11-month priority at all resorts”. Wouldn’t this create a situation where more points sold have 11-month priority than total points at that resort?

No...but the problem is that it is almost certain that *someone* who owns a trust point will want a reservation at that hard to get resort at 11 months. As it is now, an owner at VGC (like myself) may want to stay a few months later in the use year or somewhere else entirely. I would imagine that they would be priced somewhere in the middle of current direct prices so anyone buying intending to make and rent reservations would be keen to make 'high value' reservations at hard to get resorts.

And assuming that walking rules would be the same for the trust points, people desperately trying to get value out of them would be strongly incentivized to make reservations for Jan 1 (or the beginning of their trust point use year if trust points have one) and walk until their dates come up. Thus making reservations for current 'one resort' owners that much more annoying to obtain.

 

[AnnaKristoff2013]

The ownership rights don't change for the points added to the trust. They are still bound to the same booking windows that all the other points at the resorts are tied to. Its really no different than a single owner owning multiple resorts. They can book each resort they own at 11 months up to the number of points they own at each resort.

Yeah, this is what I was trying to post, but you explained it better.

 

[AnnaKristoff2013]

Still might be messy for OKW given some contracts are 2057.

On the other hand, this could literally be see how they “solve” their 2042 OKW problem. If they have this product they can just dump all their 2042 OKW points, in 2042, into the Trust. Those points would be very tough for them to sell direct otherwise, given that they’d only have 13 years left.

 

[AnnaKristoff2013]

Important to note that one of the survey questions also made it seem like they were thinking about a product with **no** home resort priority. I could see them considering a cheaper product, with only 7 month booking privileges, as a place to put all their less desireable stuff, especially the 2042 points that get foreclosed on closer to expiration date.

 

[Sandisw]

The ownership rights don't change for the points added to the trust. They are still bound to the same booking windows that all the other points at the resorts are tied to. Its really no different than a single owner owning multiple resorts. They can book each resort they own at 11 months up to the number of points they own at each resort.

It does though in the sense that you now have a huge membership…which is what the trust is…with multiple owners of several resorts all combining with each other to use each others points at 11 months. And how


The POS limits the memberships size. And it’s not the same as a single owner unless I am not getting this.

How does one remain an owner if things are now in a trust? Owners of the membership have to be the same.

And, it’s not the same as owning multiple resorts because people would be using points at 11 monts that they don’t own.

DVC changed the rules to one transfer per UY for this very reason. So people can’t just trade points all the time.

Now, DVD can start a whole new program with new resorts with this model…where you don’t buy a resort but into the system.

But, my reading of it is is that that can’t change the nature of the current program that gives any person who doesn’t own points at a resort access to that resort before the actual owners of that resort.

 

[TinkB278]

I’m not really interested in this 11 month trust idea, but I’d sure love more club level options!!

 

[Genie+]

Say a trust was developed with 100,000pts in each of 5 resorts (RIV, VDH, CFW, Poly2, AUL).

Altogether it owns 500,000pts. Maybe they have 200pt minimum buy-in to the trust. That owner’s contract would represent owning 20% at each of the 5 resorts, so 40pts RIV, 40pts VDH, 40pts CFW, 40pts Poly2, and 40pts AUL.

Owner can book at 11 months as long as the trust collectively hasn’t yet used up the 100k points it has for that specific resort for that date. Banking and borrowing? I’m just wondering how any of this could possibly work, assuming they have means to get around the 4000/8000pt limit.

 

[Sandisw]

Say a trust was developed with 100,000pts in each of 5 resorts (RIV, VDH, CFW, Poly2, AUL).

Altogether it owns 500,000pts. Maybe they have 200pt minimum buy-in to the trust. That owner’s contract would represent owning 20% at each of the 5 resorts, so 40pts RIV, 40pts VDH, 40pts CFW, 40pts Poly2, and 40pts AUL.

Owner can book at 11 months as long as the trust collectively hasn’t yet used up the 100k points it has for that specific resort for that date. Banking and borrowing? I’m just wondering how any of this could possibly work, assuming they have means to get around the 4000/8000pt limit.

This is why it can’t work with the way the current DVC is set up. If a trust owns the contracts, they are the owner of record. They can’t sell parts of those contracts to anyone because program is currently set to deed you a real estate interest in a specific unit in a specific resort.

In your example, if the trust owns 500K at those resorts, those points are deeded to specific units…so, there is no way for anyone to just buy 200 points that don’t deed to something specific without transferring ownership of those 200 points from the trust to the owner.

Could this work with people buying in as right to use…like a large rental situation? Maybe if DVD wanted to get rid of the limit.

Even DVD can’t set up something like this for the current resorts on their own because each resort is its own entity and all owners follow the same rules for home resort based on the DVC membership agreement.

It was mentioned over on TUG that this could be a way for DVC to handle the 2042 resorts. Just convey all the units over to a large trust and sell those points out of the trust. Still might be messy for OKW given some contracts are 2057.

As for the 4000/8000 point limit, those same POS say the following in regard "may not aggregate Ownership Interests so as to compile more than 4,000 Home Resort Vacation Points per DVC Resort or an aggregate of 8,000 Home Resort VacationPoints at all DVC Resorts, unless it is approved by DVD in its sole, absolute, and unfettered discretion." So DVD could certainly grant themselves an exception to make a multisite trust possible.

There is no question that DVD can set up a new program with new resorts that have different ownership options in the way that owners buy.

But, what DVC can’t do is change the nature of the current POS in such a way that some owners have specific deeded rights to a resort and units and others do not because it was not set up to be that way.

 

[Sandisw]

On the other hand, this could literally be see how they “solve” their 2042 OKW problem. If they have this product they can just dump all their 2042 OKW points, in 2042, into the Trust. Those points would be very tough for them to sell direct otherwise, given that they’d only have 13 years left.

Actually can’t they keep ownership and sell them to current owners as OTU points since nothing requires them that I know of to limit that to only 24 per UY?

Lots of ways for them to make use of the units at OKW in 2042.

And, maybe the survey is about the future of DVC when those initial resorts expire. That would be a perfect time to change this from a deeded to specific resort program to one that doesn’t.

 

[AnnaKristoff2013]

This is why it can’t work with the way the current DVC is set up. If a trust owns the contracts, they are the owner of record. They can’t sell parts of those contracts to anyone because program is currently set to deed you a real estate interest in a specific unit in a specific resort.

In your example, if the trust owns 500K at those resorts, those points are deeded to specific units…so, there is no way for anyone to just buy 200 points that don’t deed to something specific without transferring ownership of those 200 points from the trust to the owner.

Could this work with people buying in as right to use…like a large rental situation? Maybe if DVD wanted to get rid of the limit.

Even DVD can’t set up something like this for the current resorts on their own because each resort is its own entity and all owners follow the same rules for home resort based on the DVC membership agreement.



There is no question that DVD can set up a new program with new resorts that have different ownership options in the way that owners buy.

But, what DVC can’t do is change the nature of the current POS in such a way that some owners have specific deeded rights to a resort and units and others do not because it was not set up to be that way.

I think everyone is over complicating this. Disney probably wrote the contracts to give them enough leeway to do this, it sounds like the same kind of industry-standard language used by systems like Wyndham and Marriott that all figured out how to offer these products without violating the home resort rights of other owners.

To put it even more simply: Right now, Disney owns tons of points in each resort (I’m confident it’s more than 8,000). They rent those points for cash. There is really nothing stopping them from selling points in another product, and letting people use that product to “rent” Disney’s points. Instead of giving cash to Disney, you’d be using the points you bought from them. (This analogy is a little rough, and it wouldn’t work exactly like that based on existing timeshare laws, but Dioxide already pointed out that the 8,000 point limit doesn’t apply to Disney itself). The new product would not be a deeded points product, it would be a trust points product. It would not in any way change the ownership interests or rights of existing owners.

Edit: And to be clear, I still don’t think Disney will actually do this, because it seems to be in direct conflict t with their resale restrictions strategy. I think it would be great if they did do it, but I doubt they will. I guess the only reason they could be thinking about it is due to the popularity of this type of thing in other timeshare systems. It sells quite well.

 

[Sandisw]

I think everyone is over complicating this. I am sure Disney wrote the contracts to give them enough leeway to do this, it sounds like the same kind of industry-standard language used by systems like Wyndham and Marriott that all figured out how to offer these products without violating the home resort rights of other owners.

To put it even more simply: Right now, Disney owns tons of points in each resort (I’m confident it’s more than 8,000). They rent those points for cash. There is really nothing stopping them from selling points in another product, and letting people use that product to “rent” Disney’s points. Instead of giving cash to Disney, you’d be using the points you bought from them. (This analogy is a little rough, and it wouldn’t work exactly like that based on existing timeshare laws, but Dioxide already pointed out that the 8,000 point limit doesn’t apply to Disney itself). The new product would not be a deeded points product, it would be a trust points product. It would not in any way change the ownership interests or rights of existing owners.

Edit: And to be clear, I still don’t think Disney will actually do this, because it seems to be in direct conflict t with their resale restrictions strategy. I think it would be great if they did do it, but I doubt they will.

The point I think I am trying to make is that the FL statute defines things clearly and you either set things up as a non specific timeshare plan in which one doesn’t buy a right into any one resort or a specific timeshare plan that you do. And, those types of plans are not an exchange plan.

The current resorts were set up legally to be a specific timeshare plan, which is why we have the right to book a specific resort with our points. All units in the current resorts must be sold the same way. They can’t sell some units one way and some units another way.

The thing one can’t confuse is home resort and the trading into BVTC which is an exchange program. That is why we get to trade out to the other DVC resorts.

The reason there can be resale restrictions for trades is because our plan is a specific timeshare plan which deeds us to one resort. Everything else is an exchange which has different rules that don’t need to be the same.

Its why a resale and direct owner of RIV and VDH have the exact same rules when it comes to using points where they own…but don’t have the same rules to exchange points to the other DVc resorts.

DVD doesn’t have the authority to sell non specific ownership interests to anyone that are tied to the units in the current resorts. Future ones? Sure.

Now, DVD can certainly rent to whomever they want the points that they own and can set up a program in which people pay a fee to book a room via DVD…but DVD still remains an owner and has to follow the same booking rules as everyone else.

I guess I am just confused as to what product they would be selling to someone…to exchange…
If not ownership into a current resort.

Now, what they could certainly do is, like I mentioned above is allow owners to have more than one transfer per UY so they can get other home resort points into their account more often to use during a home resort booking, or let owners pay for OTU points owned by DVD with their own points instead of cash.

If that is what you are talking about, then yes, that can be done within the current situation, since it doesn’t mess with the whole one to one right to use rule that must balance at a resort.

 

[ziravan]

Except it changes the home resort priority, unless I am not understanding. If I own points at RIV, then I am deeded to RIV and must get home resort priority over anybody who is not deeded to RIV

If what you are suggesting is that the resorts go into a trust so you get advantage at all the trust resorts, it changes the program and the POS and it can’t happen.

I don’t want to be in a system that gives people who own at other resorts than me have the same rules as me. I bought specifically for the resorts I own, and not for the others I don’t.

I have Wyndham points and they do this with their access points. You have to think about this as two pools of points.

At any of the given resorts in the trust, the trust would own a certain percentage of the resort and so would individual owners. The Trust members could only book at their level of ownership at each resort at 11 months. It really is the same as individual owners owning at multiple resorts writ large.

It doesn’t affect your ownership at Riviera at all that I have home resort advantage at THREE different resorts with Riviera being just one of them. Maybe I’ll book at AKV instead next trip at 11 months, maybe not. Either way, I have just as much home resort advantage to book Riviera as you do - up to the limit of the points I own. The resorts themselves wouldn’t go into a trust, just the points that the trust owns.

It would be just like 100s of owners pooling and sharing their home advantage - which they could do to the limit of their available points at each resort.

The real problem with this is that access. This isn’t like Wyndham where owning at 75 resorts could really spread the details out too wide to notice. Somebody is going to be routinely unhappy having to book SSR with their access points because that’s all that is left.

DVC would have to front load priority resorts to make this work.

There is a world of difference between an “ACCESS” system that owns, for simplicity:

30% VGF, 30% BCV, 20% BWV, 20% SSR —— or one that owns:

10% VGF, 10% BCV, 8% BWV, 73% SSR.

 

[Sandisw]

I have Wyndham points and they do this with their access points. You have to think about this as two pools of points.

At any of the given resorts in the trust, the trust would own a certain percentage of the resort and so would individual owners. The Trust members could only book at their level of ownership at each resort at 11 months. It really is the same as individual owners owning at multiple resorts writ large.

It doesn’t affect your ownership at Riviera at all that I have home resort advantage at THREE different resorts with Riviera being just one of them. Maybe I’ll book at AKV instead next trip at 11 months, maybe not. Either way, I have just as much home resort advantage to book Riviera as you do - up to the limit of the points I own. The resorts themselves wouldn’t go into a trust, just the points that the trust owns.

It would be just like 100s of owners pooling and sharing their home advantage - which they could do to the limit of their available points at each resort.

The real problem with this is that access. This isn’t like Wyndham where owning at 75 resorts could really spread the details out too wide to notice. Somebody is going to be routinely unhappy having to book SSR with their access points because that’s all that is left.

DVC would have to front load priority resorts to make this work.

There is a world of difference between an “ACCESS” system that owns, for simplicity:

30% VGF, 30% BCV, 20% BWV, 20% SSR —— or one that owns:

10% VGF, 10% BCV, 8% BWV, 73% SSR.

DVD setting up a program to give owners access to their points is definitely within the rules..even if the owner is a trust.

But, that isn’t what I thought was being discussed.

 

[AnnaKristoff2013]

So, do you own points at a specific resort? Or just bought into being able to access all resorts?

I’m a Wyndham owner as well. You do not own points at a specific resort if you have CWA. You own points in a trust. Many of these older timeshare systems include resorts with language just like Disney’s, some of which were bought and resold multiple times, some of which are converted weeks ownership. It is workable because you are not selling someone a deeded interest in a DVC resort. You are essentially selling them the ability to rent a certain number of your points each year to make reservations with.

Edit: As Ziravan pointed out, the people most likely to have availability issues are people who buy into the trust, not the owners of the legacy points at resorts, because of the way the trust will necessarily own a lot of points at resorts where 11 month priority doesn’t matter anyway.

The maintenance fees would also likely be rough. They’d have to set it up as a weighted average of all the points owned by the trust. The trust would likely own a lot of high maintenance fee properties. The maintenance fees would thus likely be on the higher end.

 

[Sandisw]

I’m a Wyndham owner as well. You do not own points at a specific resort. You own points in a trust. Many of these older timeshare systems include resorts with language just like Disney’s, some of which were bought and resold multiple times, some of which are converted weeks ownership. It is workable because you are not selling someone a deeded interest in a DVC resort. You are essentially selling them the ability to rent a certain number of your points each year to make reservations with.

Okay, so people are no longer really buying anything but paying DVD to use their points whether in the trust or not…

That’s not what I was referring to. . I took it to mean DVD could start a trust with points from lots of the current resorts and then sell people an ownership interest in the trust..

What you are really talking about is DVD moving from a specific timeshare plan to a non specific plan. And they can do that with new resorts, just do not think they can legally change it with with the current ones, without owners approval n