Hilton Head Long Term Viability

[gscott8075]

Well, we are into our third day. I have to tell you, I have never been to HH before and all of us enjoying the relaxation and the peace and quiet.

I won a green DVC HH golf towel for correctly answering the question....name the slide at the Boardwalk Villas. I won a beach towel on the cruise we just went on for the same question. both times I was the only one who knew the answer ..(here's the answer so you can win, too! - Keister Coaster)

We rented bikes and are biking between the Beach House and the resort. It gives us another place to go..... My wife likes the fact that the beach house and the resort are separate.

We are discussing an add on.

My concern might seem rather vague and unusual...but here it goes....

This resort has 102 or so villas. The area, and thus the resort, are very seasonal. There is no restaurant and the fast food places are only open during the day. The store is small (and I think they could do a lot more with the space they have!) The activities are limited and very few generate cost significnant $$ to participate.

My concern? HH maxes out at 100-120 families during the summer. I imagine it much much lower for most of the rest of the year.

Where is the income generation? At OKW, VWL, and BWV, there are restaurants, and ticket income for the parks, and the "captive audience" of all of the DVC members pouring their money into all things Disney. It just ain't so here.

DVC has stopped building off-site resorts and they sold off the rest of the VB property.

The question: Is the income stream sufficient here for Disney to keep it 3, 5, or 10 years from now.

Again, I love it here - the cast is terrific and my family is having a terrific time.

Thoughts, please ... I am returning to the porch to finish my beer and my book.

 

[GCM13]

hi gscott. I can't answer you question, although it is a good one which I'd like to here opinions on since we are considering an add on at HH. I just wanted to say that I was the only one at the DVC social on our 7 day cruise that knew the name of BWV's slide. I was surprised that no one else did! Congrats on winning your towel. Sounds like your having a great time.

 

[RobDoc]

The HH resort, just like all other DVC resorts- is self sustaining with the annual maintenance fee. The lack of restaurants just means that there will be no loss to overcome during those very slow winter months. (The snack bars can easily be closed if they don't pay for themselves).

The income generated at onsite resorts for things like tickets and restaurants- does not go into the resort costs anyway- so there is no real benefit for members with those revenues.

The costs of running and maintaining the resorts are very similar to other DVC resorts and many of the maintenance costs are outsourced on an as needed basis (like landscaping and heating/cooling)- so no staff has to be maintained year round for those items.

The activites ( actually HH and VB have more activities than onsite DVC resorts) are pretty cost effective- other than the CM's there is little extra cost and the fees will more than cover that expense.
Again, many of the activities are outsourced also. The activities staff is trimmed back after the summer ends also- reducing the staff needed to accommodate the resort.

The biggest challenge I see at HH is that some owners will be disappointed to NOT be able to get those cherished summer reservations. It is impossible to fit 12 months of reservations into June, July and August! Most of us have purchased or added on there to have that 11 month advantage during the popular summer time. Some of us won't be able to get that reservation and will have to "settle" for an onsite resort during that same time period!

 

[BWVDenise]

Wow, I was having some of these very same thoughts. I, too, am considering HH as an add on. gscott8075 has made some really good points here. Oh, what to do, what to do...

 

[drusba]

When Disney Vacation Development Co. (DVD, the main Disney subsidiary that builds and controls the DVC resorts) built HH, it obviously knew it was not going to generate huge amounts of secondary income for the parent Disney company as the WDW resorts do. Thus, I am fairly sure they eliminated that consideration when built. As long as the units get sold, even if it takes a while, DVD will continue to get sale income. Once everything is sold, the resort becomes nothing but a profit generator for DVD and its sister company the Disney Vacation Club Management Co. (DVCMC) which manages the operations of the resorts. DVD retains 4% of the resort and thus can rent out for profit 4% of the units at any given time. The costs of running and maintaining the resort, property taxes, insurance, etc. are covered by dues charged to members. Included in the dues is an about 11% management fee that goes to DVCMC (i.e, 11% of the total operating dues; the percentage cannot change). That is basically a profit to DVCMC for running the resort. In other words, they are not looking at this as a money losing proposition. Also, it is not very easy for DVD to just eliminate the resort from the system (by transfer or otherwise) as the reasons a DVC resort can be eliminated from the DVC system are limited (e.g., causalty destroying the resort and not able to rebuild, the goverment takes the property in an eminent domain action, the members as a whole vote to eliminate the resort from Disney control, the Disney companies go bankrupt). Thus, I would not be overly concerned about HH suddenly becoming independent from the DVC system. I would be more concerned with being able to get those precious summertime ressies.

 

[Diznut84]

Hilton Head is one of the top timeshare locations in the United States. Marriott has 10 timeshares on Hilton Head Island alone. It is a very strong trader with both exchange companies. I would agree with the others who have posted. I would worry more about getting prime summer weeks than if the resort is viable...