Maintenance fees

[disneynutz]

The list of "every possible" repair need isn't terribly extensive. The budget-setters know which items will need to be maintained over the years. We're talking about building interiors, building exteriors, grounds & common areas and parking lots. That's about it.

The issue with Hilton Head was siding that needed to be replaced several years earlier than anticipated. The money wasn't available, thus DVD/DVC leant it to the Condo Association. The loan was repaid over a period of 5 years.

The truly unexpected--damage from fire, flood or other natural disaster--is covered by insurance.

The HHI example appears to be the only blip over 22+ years and 10 resorts.

As good a Disney may be, they do make mistakes that we rarely hear about. They bought cheap refrigerators for the BWV refurb and according to several maintenance people and their supervisor, most failed within a few weeks. During our stay they replaced our refrigerator 3 times.

BLT according to their maintenance personal has a poorly designed HVAC system using undersized components. They started replacing systems a couple of years ago. When we first stayed there we could not get the room cool and we were told that there was nothing to be done.

Most will agree that BLT has had it's issues with the sinks, door locks, furnishings that aren't wearing well, dripping overhead shower heads and missing sheers. While these aren't major items, it is evidence that mistakes are made and sometimes keeping costs low can be a deciding factor in business.

Bill

 

[DizBub]

Most will agree that BLT has had it's issues with the sinks, door locks, furnishings that aren't wearing well, dripping overhead shower heads and missing sheers. While these aren't major items, it is evidence that mistakes are made and sometimes keeping costs low can be a deciding factor in business.

Bill

It's so funny you should mention BLT's issues with the sinks and door locks. We spent 2 nights there in Jan and had the repair guy to our room twice for both things.

 

[CMOORE185]

The list of "every possible" repair need isn't terribly extensive. The budget-setters know which items will need to be maintained over the years. We're talking about building interiors, building exteriors, grounds & common areas and parking lots. That's about it.

The issue with Hilton Head was siding that needed to be replaced several years earlier than anticipated. The money wasn't available, thus DVD/DVC leant it to the Condo Association. The loan was repaid over a period of 5 years.

The truly unexpected--damage from fire, flood or other natural disaster--is covered by insurance.

The HHI example appears to be the only blip over 22+ years and 10 resorts.

The HHI example proves that capital reserves cannot anticipate all contingencies. Plus as the resorts get older the more you can count on unanticipated capital expenditures.

 

[WebmasterDoc]

Not completely accurate. Take HHI for example. Dues were raised for a number of years due to unexpected needs of the resort. Reserves in no way can anticipate every possible capital needed.

The HH increase in 2007 was for items in the Capital Reserve budget that needed to be moved up by a few years. DVD loaned the owners the money and that added a few cents to the fees for 6 years. The loan was paid off in 2012 and is not part of the 2013 fees.

The loan was made to avoid draining the Capital Reserve beyond a safe level so it did not jeopardize any other schgeduled projects at the resort. It was NOT for an unexpected need at all. It was for maintenance on the exterior of the buildings that had deteriorated a little more rapidly that originally planned so the amount required for that anticipated expense was not sufficient when it needed to be done.

 

[CMOORE185]

The HH increase in 2007 was for items in the Capital Reserve budget that needed to be moved up by a few years. DVD loaned the owners the money and that added a few cents to the fees for 6 years. The loan was paid off in 2012 and is not part of the 2013 fees.

The loan was made to avoid draining the Capital Reserve beyond a safe level so it did not jeopardize any other schgeduled projects at the resort. It was NOT for an unexpected need at all. It was for maintenance on the exterior of the buildings that had deteriorated a little more rapidly that originally planned so the amount required for that anticipated expense was not sufficient when it needed to be done.

Your explanation of it indeed qualifies it as an unexpected expense. It happened before it was anticipated, and they didn't have the funds to fix it.

 

[tjkraz]

The HHI example proves that capital reserves cannot anticipate all contingencies. Plus as the resorts get older the more you can count on unanticipated capital expenditures.

22 years...10 resorts...one developer loan.

Are similar occurrences possible? Sure.

Does that track record suggest they will occur often?

 

[tgropp]

My plumbing post was meant as a "food for thought" example. We don't know what products were used during construction and when they may need to be replaced. Iron pipes tend to get plugged over time and millions of buildings have been re-plumed with copper. Other products have had design failures that have required re-plumbing. Replacing the HVAC systems will be expensive.

Are the reserves enough to cover all expenses?

Bill

Excellent point. If you build a house yourself, you dont cut costs ....you build it so that it will last your lifetime with minimal maintenance costs or if you resell, you will get top dollar because of your wise decisions.

In all honesty, I would presume that these units were built on the cheap. Lets face it, Disney is there to make money and may only expect them to last the 42 years before they tear down and rebuild, or they built them to last and can then resell them after our contracts run out and make more money on reselling. Hopefully, it's the latter.

 

[amcnj]

I always wondered what the maintenance will be like near the end of contract lives. If the units have only a year or two to go will things like roofs really still be replaced? If not, won't the reserves needed be much less and thus dues not go up as quickly near the end? Is this scenario possible?

 

[disneynutz]

22 years...10 resorts...one developer loan.

Are similar occurrences possible? Sure.

Does that track record suggest they will occur often?

No it doesn't but it makes the point that it could occur. I'm guessing that the loan wasn't interest free.

Bill

 

[tjkraz]

No it doesn't but it makes the point that it could occur.

And I have no problem discussing it as long as perspective is maintained.

One developer loan and zero special assessments in 22+ years. That track record does nothing to foreshadow a rash of future loans/assessments.

It's also worth nothing that the monies amounted to about $110 total for an owner of 200 HHI points ($.11 per point x 200 pts x 5 years.) And those are dollars that would have been spread over prior years if the replacement need had been more accurately gauged.

I'm guessing that the loan wasn't interest free.

Perhaps. But since owners deferred payment of those monies, they would have earned interest on the dollars NOT paid into the reserves in years leading up to the loan.