Extensions on 2042 Contracts?

[chalee94]

Guides tend to push RCI trades lately. It is also a direct benefit, whereas Vero can be booked on filthy resale points.

Wait...RCI trades are not a direct benefit...

Only trades for the Concierge Collection or whatever.

 

[_auroraborealis_]

Wait...RCI trades are not a direct benefit...

Only trades for the Concierge Collection or whatever.

Well, yeah. But from what I've heard, the guides are suggesting that resale points can't be used that way. (They're also reviving the "will never be able to switch at 7 months!" rumor, which is obvious rubbish when you consider that would mean direct buyers couldn't switch TO those units.)

I suspect it would be easier to restrict RCI trades in the future, however. RCI and trade partnerships are NOT 50 year deals.

 

[CraigInPA]

There are too many 2042 resorts that would expire all at once. I bet there will be an extension offered on some, and no extension offered on others.
OKW has both 2042 and 2057 contracts. I would bet Disney will offer a 15 year extension for the 2042 group starting no later than 2027. Any un-extended contracts will be retained and the rooms offered through CRO.
BRV and CCV are somewhat intertwined. While Disney could convert BRV back to hotel rooms, I doubt they will. I'd say that 2042 BRV will likely be offered an extension no later than 2027. Any un-extended contracts will be retained and the rooms offered through CRO.
HHI and VB are, IMO, unlikely to be offered an extension. As marginal as these resorts are to the rest of DVC, they may be jettisoned from the DVC family when they expire.
BWV and BCV. I expect both of these will be easily resold by DVC with higher points per room, so there will likely be no extension offered.

 

[4luv2cdisney]

There are too many 2042 resorts that would expire all at once. I bet there will be an extension offered on some, and no extension offered on others.
OKW has both 2042 and 2057 contracts. I would bet Disney will offer a 15 year extension for the 2042 group starting no later than 2027. Any un-extended contracts will be retained and the rooms offered through CRO.

Yes and nobody really knows what percentage of OKW is 2042 vs 2057 already. ROFR's between now and 2027 could give them the majority of what they need by then anyway and then they can get a handful more from anyone taking any extension they offered.

I tried to look it up and all I could find was rumors that only about 30 percent took the extension. If so, you'd think they'd be at 40% or more by now and they've still got almost 40 years. I'm surprised they ever even take 2057s in ROFR. You'd think they'd only take 2042s. They must not be too worried about it.

Another approach could be to up the minimum buy in points for direct at the other resorts (which everyone assumes is going to happen anyway) but leave OKW low to reacquire some that way. I'm sure there's lots they can do to work it out.

 

[KAT4DISNEY]

I don't think that Disney knows about the 50 year end of life mark for buildings. After all they just took some 30+ year old buildings and sold them for 50 years at a pretty good price.

 

[chalee94]

OKW has both 2042 and 2057 contracts. I would bet Disney will offer a 15 year extension for the 2042 group starting no later than 2027. Any un-extended contracts will be retained and the rooms offered through CRO.

OKW has both 2042 and 2057 contracts because DVC has already offered an extension. I'm guessing you think they'll offer another one by 2027 (presumably at sweetheart pricing to get people to pony up this time)?

It's been mentioned before that some OKW owners are holding out for free extensions, so it may be interesting to see how that pans out...

 

[miTnosnhoJ]

OKW has both 2042 and 2057 contracts because DVC has already offered an extension. I'm guessing you think they'll offer another one by 2027 (presumably at sweetheart pricing to get people to pony up this time)?

It's been mentioned before that some OKW owners are holding out for free extensions, so it may be interesting to see how that pans out...

So few people took the extension, that it might be more advantageous to offer buyouts than to try to sell the remainder.

 

[MJB62676]

If one buys direct, can you get OKW 2057? I know you can do it Resale, but not terribly easily.

 

[KAT4DISNEY]

If one buys direct, can you get OKW 2057? I know you can do it Resale, but not terribly easily.

All OKW sold direct are now 2057.

 

[MJB62676]

All OKW sold direct are now 2057.

Thanks! I think that will be our next target, unless Riviera wows us. I've noted matching UY to 2057 expiration is a little more difficult resale...guess it would be a waitlist thing direct, however.

 

[4luv2cdisney]

Thanks! I think that will be our next target, unless Riviera wows us. I've noted matching UY to 2057 expiration is a little more difficult resale...guess it would be a waitlist thing direct, however.

They ROFR 2042 contracts and sell them all as 2057. I doubt there is a waitlist and if there is I don't think you'd be waiting long. When I was initially contemplating purchase, OKW was going to be my choice and I could have bought it just about every time I called my guide. Perhaps with resale being so high right now, they haven't taken much and/or there was a big rush to buy before the increase. So, it's possible inventory is low. But it sounds like you're not in a hurry anyway.

 

[ziravan]

My guess is that DVC will start looking at the 2042 resorts as the base for a perpetual inventory.

If they double into those resorts (like CCV/BRV) then every 25 years, they’re half away there.

They aren’t going to extend BRV at the halfway point; they’re going to renovate and resell.

I think ultimately they just give up and move OKW to 2057. Not to say they won’t try to milk more out to do so.

Dump Vero and HHI.

Now. You have BWV and BCV. I think they go into both over the next 6 yrs or so and take over some of the hotel side to make BWV2 and BCV2. Then they might extend both just enough to stagger end dates to 25 yrs apart.

So. Riviera in 2019. BCV2 in 2021 (end date 2072 halfway point 2047 so 5 yr extension), BWV2 In 2023 (extend current to 2049).

They’ll probably offer modest extensions to stagger sales dates. That’s it. I think the goal is to be into resorts twice and resell half the resort every 25 years. BRV is already set to be the 2042 resell. They’ll stagger offset BCV and BWV a few years down the road and bring up OKW last as a 2057 resort, dump off VB and HHI and their perpetual point generator only needs about 3 more properties to always have a resort coming due for rebuild and resale every 2-3 years.

(BLT new tower for that 25 yr redo, and add the new Poly building that was proposed but not built including 1-2 bedrooms in 22 or so years for THAT midway redo).

Over time, they can dump a property or two for a flashy new one. Eventually though, they’ll have 17 or so properties with one always coming due for rebuild/resell every 2-3 years.

 

[tjkraz]

There are too many 2042 resorts that would expire all at once. I bet there will be an extension offered on some, and no extension offered on others.

If we leave Vero and Hilton Head out of the discussion, there are only 3 resorts: BoardWalk, Beach Club and Wilderness Lodge. Combined they represent about 700 DVC villas. Not a huge number, and all very popular destinations.

Assuming Disney doesn't embark on any major plans involving demolition / reconstruction, they will start by offering new 50-year contracts to existing owners. Barring any legal hurdles, they could begin that process 12-18 months before the 2042 end date. IMO, they'd sell several million points to owners willing to extend with very little sales & marketing expenses involved.

Then they could open sales to the general public, also well before January 2042 when the new owners would be able to start using their points. DVC has pre-sold resorts in the past, giving the buyer developer points for use at a different location until their owned site is available for use.

They could also choose one or more of the resorts for an elaborate re-build. Beach Club would seem to be a prime candidate. Use the existing land and perhaps extend out into the parking lot for something larger than the current 200 villas. With BCV out of the picture, DVC is only re-selling the 500 or so rooms at BWV and VWL/BRV.

OKW has both 2042 and 2057 contracts. I would bet Disney will offer a 15 year extension for the 2042 group starting no later than 2027.

To the best of my knowledge, the 15 year extension is still available for OKW. It was initially offered at $15 per point for a limited time, with the price later increasing to $25 per point.

 

[_auroraborealis_]

With the expansion of the Epcot-area convention center, word that they plan to "retire" the Contemporary convention center, and the need to have non-villa units available for conference blocks, there is not really a lot of Beach Club/Yacht Club/Boardwalk Inn proper that can be taken over for DVC, save building high on a parking lot and maybe doing underground parking.

YC proper is 630 rooms, Boardwalk is 378, and BC is 583. While the Swan and Dolphin are there, they aren't Disney owned. A conference block for the sort of events common to the "big" center there will block out 500-700 rooms as a matter of course.

Management loves DVC, but conference business is also phat money, and has a higher return for catering and alcohol than DVC occupancy does.

 

[kboo]

What about rumors that they'd demolish the other CR garden wing to build a BLT2? If they retire the Contemporary convention center and expand the Epcot area convention facilities, then it makes sense that they'd make the MK resorts more DVC focused and trend the EP resorts to convention business.

 

[aoconnor]

What about rumors that they'd demolish the other CR garden wing to build a BLT2? If they retire the Contemporary convention center and expand the Epcot area convention facilities, then it makes sense that they'd make the MK resorts more DVC focused and trend the EP resorts to convention business.

The rumor is actually that BLT 2 would go on the site of the current convention center, hence why they are expanding the convention centers at YC and Coronado to compensate. If they put it back where the other garden wing is it wouldn't have those valuable park views.

 

[kboo]

The rumor is actually that BLT 2 would go on the site of the current convention center, hence why they are expanding the convention centers at YC and Coronado to compensate. If they put it back where the other garden wing is they wouldn't have those valuable park views.

ahhhh... this makes a lot more sense.

 

[Dean]

I think it's 50/50 on the possibility of extensions but it's very unlikely to make sense for most owners just like OKW wasn't reasonable at the time even at the $15 pp. If they do it'll be much later and much different. Possibly tied to a retail purchase.

 

[Jason@dvcstore]

Is there a guesstimate on about when contract extensions would be announced? What happens when they are announced? Are current owners required to pay to "claim" the extension?

TIA!

I agree with most of the others that at this time Disney won’t be offering an extension for the 2042 resorts anytime soon or not at all.

I also think it is too early for Disney to think about offering an extension. Who knows how people are going to be vacationing 20 years from now? What will be the most popular size villa at that time? Size of our TVs? What other technology will guests desire? I think around 2038 is when Disney will be seriously discussing this again.

Until then we will always get a chance to speculate. I’ve been guessing since 1999.

 

[DisDad-]

I think there is a possibility Disney offers extension much sooner than that. The company has always taken steps to ensure prices remain elevated by increasing direct sales or cash pricing at both the resort and DVC areas of the business. With prices rising well beyond the rate of inflation while the length of these contracts continue to shorten, prices will have nowhere to go but down, both direct or resale. This would go against all previous business practices. I think we'll see Disney offering an extension in the new few years. The only questions will only be how much and how long.