Could DVC Ever Do This...

[bom_noite]

Send all current DVC Members and say:

"We are giving you the option to increase your contract expiration from 2042 to 2052 (or 2075 for that matter). Cost: $10 per point per year."

Think of the cash infustion for Disney! Certainly, Disney gets the sole rights to most of the propertys in 2042, but, as an investor I now very well that Wall Street does not look 30 years down the road - they look 30 minutes down the road.

This cash could be used to build a few new DVC resorts.

I am not an expert on the contract - nor accounting - but it seems to me like this would be a win/win for Disney.

And, the more I think about it - this could have to do with the Bonnett Creek Sigh (though I highly doubt it).

 

[Dean]

They could, and some have postulated they will. I used to think they might but now am convinced it's not workable. They'd need an overwhelming majority to extend to make it worthwhile and the cost would have to be low, in the $10 per point range you mentioned.

 

[First Wave]

It seems like an extremely large endeavor for Disney to extend the time period on the original memberships considering all of the Florida state condominium/timeshare laws and requirements, registration requirements is various states, administrative costs to contact existing (ie: "expiring" - literally) members, etc. Their profit is in the sale of new memberships at new resorts. Sometimes we members forget that DVC is in business to make money, not to be overly generous to existing members. That truly is the bottom line.

Wouldn't DVC make more money by owning the resorts after 2042 and renting the points out themselves? Right now they get at least $25 per point when they rent through CRO. The members all seem to be happy with $10. Imagine what those points will rent for in 2042!! The reality, at least to me, is that DVC will have absolutely beautiful, desirable resorts that are completely paid for and that have been kept up (in regard to maintenance) to the members' standards. Now they can rent them out themselves and no longer deal with the members.

They'll still have the new resorts...Saratoga Springs, Hawaii ??, Disney California ??. I really can't see why they'd have any need (or desire) to extend the current memberships that end in 2042.

Just one member's opinon.

Happy New Year from First Wave.

 

[Dean]

It seems like an extremely large endeavor for Disney to extend the time period on the original memberships considering all of the Florida state condominium/timeshare laws and requirements, registration requirements is various states, administrative costs to contact existing (ie: "expiring" - literally) members, etc. Their profit is in the sale of new memberships at new resorts. Sometimes we members forget that DVC is in business to make money, not to be overly generous to existing members. That truly is the bottom line.

Wouldn't DVC make more money by owning the resorts after 2042 and renting the points out themselves? Right now they get at least $25 per point when they rent through CRO. The members all seem to be happy with $10. Imagine what those points will rent for in 2042!! The reality, at least to me, is that DVC will have absolutely beautiful, desirable resorts that are completely paid for and that have been kept up (in regard to maintenance) to the members' standards. Now they can rent them out themselves and no longer deal with the members.

They'll still have the new resorts...Saratoga Springs, Hawaii ??, Disney California ??. I really can't see why they'd have any need (or desire) to extend the current memberships that end in 2042.

Just one member's opinon.

Happy New Year from First Wave.

I agree other than the $25 per point issue. DVC likely gets a return in the $5-6 per point arena based on the number of points they have to dispose of in that way, no more than $10 per point on the rooms that are actually rented. Remember that CRO, or someone that direction, takes a cut. Also that may times the rooms are discounted and not all rooms are rented that are reserved in this way. I was told a few years ago by a management type that they averaged renting out 75% of the rooms and they don't reserve high demand times. I doubt things have changed or may have even gotten worse. They also likely rent out more weekend days than otherwise further eating the points. The best way to justify a higher per point cost is for weekday night only.

 

[Dean]

Sorry for the duplicate post, I've been having problems with the BBS all weekend and got a server to busy message when it had apparently posted after all.

 

[DVCconvert]

Dean -- could you repeat that please?

 

[JimC]

It seems like an extremely large endeavor for Disney to extend the time period on the original memberships considering all of the Florida state condominium/timeshare laws and requirements, registration requirements is various states, administrative costs to contact existing (ie: "expiring" - literally) members, etc. Their profit is in the sale of new memberships at new resorts. Sometimes we members forget that DVC is in business to make money, not to be overly generous to existing members. That truly is the bottom line.

Wouldn't DVC make more money by owning the resorts after 2042 and renting the points out themselves? Right now they get at least $25 per point when they rent through CRO. The members all seem to be happy with $10. Imagine what those points will rent for in 2042!! The reality, at least to me, is that DVC will have absolutely beautiful, desirable resorts that are completely paid for and that have been kept up (in regard to maintenance) to the members' standards. Now they can rent them out themselves and no longer deal with the members.

They'll still have the new resorts...Saratoga Springs, Hawaii ??, Disney California ??. I really can't see why they'd have any need (or desire) to extend the current memberships that end in 2042.

Just one member's opinon.

Happy New Year from First Wave.

In 2042 a DVC resort that reverts to Disney is no different from any other 40 - 50 year old resort. Disney maintains its resorts, DVC and non-DVC alike to its standards. We members have no more say in how DVC properties are managed or operated than we have at any other WDW resort -- unless we want to vote out DVC as the manager. Not at all likely, if you all bought in for the same reason we did -- trust in the Disney brand.

What strikes me as a bit of a difficult issue is the massive amount of rooms that revert back all at the same time. I wonder if Disney would have been better off staggering contracts for a full 50 years at each resort so they could take them back in smaller bites.

My guess is that these kinds of issues will get serious attention about 2030-2032. Until then this is all a fun game of scenario planning. But what the heck, that makes these forums more interesting as well.