LL/Cabins Dues Logic

[Joroc0801]

Something I've been pondering lately: In almost all of the discussion around Lakeshore Lodge, there is an overwhelming certainty that combining LL with the Fort would significantly decrease the dues overall. I understand the concept of more points covering the overall fixed costs of both resorts, but who's to say that the new LL will not also have an average or even greater dues burden than say Riv. Have the starting cost of dues ever decreased as new resorts come online or have they only decreased when new buildings are added to the same association?

I feel like there was a soundbite from DVCFan (love the show) that combining would help out with the Fort dues and everyone ran with it. Does anyone have a more in depth study of why that would make sense?

 

[SugarSweetLee]

Tower-style builds tend to have lower dues than resorts with more spread out layouts + multiple buildings. Also, if the property remains mixed use between hotel side and DVC side as the original plans called for, I believe that spreads out the maintenance cost share a bit.

I can't see any scenario in which LSL has equal or higher dues than the tiny home Cabin community, so IF combined, the average would have to go down a bit.

 

[WinterSolider]

Pretend you open two identical resorts at the same time, but one resort is 16 points per night and the other is 12 points per night, maybe because the first resort is in a more premium location.

Both resorts require the exact same amount of upkeep, staffing, transportation, property taxes, etc.

Your 16 point resort dues are $9 per point.

In order to get the same amount of dues DOLLARS from your cheaper resort, you need to charge $12 dues per point because there are fewer overall dues-paying-points in the system.

The closest natural experiment we have to this is Old Key West and Saratoga Springs. They're not perfect analogues because of the difference in age, the anomaly of the Treehouse Villas, etc., but in broad strokes the resorts are very similar but Old Key West is "too cheap" in terms of points-per-night, so it has to be "too expensive" in terms of dues-per-point to make up for it.

A favorable points chart like at CFW means the owners get hit with higher dues-per-point.

 

[WinterSolider]

Tower-style builds tend to have lower dues than resorts with more spread out layouts + multiple buildings.

That is not the primary issue.

The spread-out resorts are not more expensive because they cost more to maintain, they're more expensive (per point) because there aren't as many dues-paying-points. Cheaper points charts translate directly to higher dues per point even if total maintenance costs are identical.

 

[Brian Noble]

there is an overwhelming certainty that combining LL with the Fort would significantly decrease the dues overall.

I think this is Hopium. It might happen, and if it hapens it might be true, but it might not happen and is not necessarily true.

 

[Joroc0801]

All points make sense. But let's say dues drop from 11.88 down to 9 (there's no way it drops ~$3 pp, right?), that is pretty much even with Riv. So what would be the benefit of the strategy mentioned of buying Cabin points and bet that the dues will drop significantly? There are currently available resorts with currently lower dues. It seems like quite a gamble for minimal gain.

 

[Sandisw]

I honestly don’t see the dues changing substantially even if they decide to put LSL and CFW in the same RTU plan.

But, I won’t be surprised to see the cabins go the same route as all newer resorts…the increase each year has tended to be smaller because they now have a better idea of operating costs.

And the difference between them and the other resorts shrinks.

 

[tidefan]

That is not the primary issue.

The spread-out resorts are not more expensive because they cost more to maintain, they're more expensive (per point) because there aren't as many dues-paying-points. Cheaper points charts translate directly to higher dues per point even if total maintenance costs are identical.

IMHO, the better solution to the CFW dues issue would be to put a minimum stay (perhaps 3 nights) in place. I suspect that a lot of the dues are driven by Housekeeping, which if you have a bunch of people only coming for 1-2 nights (which I noticed a lot of when I was down there earlier this month) is a whole lot of housekeeping work. If you have a minimum 3 night stay, you spread that out a bit more and may not need AS MUCH housekeeping.

You could always keep the cash side for the 1-2 night stays...

 

[Anthony1971]

That is not the primary issue.

The spread-out resorts are not more expensive because they cost more to maintain, they're more expensive (per point) because there aren't as many dues-paying-points. Cheaper points charts translate directly to higher dues per point even if total maintenance costs are identical.

This really is not true. I think it is hard to pin point a real reason as to what drives dues.
The closet examples are SSR (spread out low points) which is 19 years of dues current is for 2024 not 2025 yet the increase was 2.14 from start
BLT (tower high points) 15 years increased 2.07 I think it is easy to say the dues will surpass the increase % of SSR in 4 years.

Hard to use OKW as an example as it is 33 years old total is 3.93 since start I think it will be fairly easy for any resort to reach this % after 33 years.
BW has seeming done well however and also has a lower point chart I would suspect its more because of the lack of real common space at this resort as all the BW front is rentable and not exclusive to this resort.

 

[Brian Noble]

what would be the benefit of the strategy mentioned of buying Cabin points and bet that the dues will drop significantly?

I think the bet is that they are offering significantly better incentives on the Cabins, which would lower the buy-in cost, and if Dues normalize to RIV levels, the total cost of owenrship is lower.

That's a stretch, IMO, but I think that's the thinking.

 

[Mouseforward]

The treehouses are interesting point of reference in that they have more land around each of the 60 units, and are they are not new ( "to the studs" refurbished in 2009 but built in 1975). They have the same housekeeping issues and similar low cost pools.

Since it is only 600K points of over 11 million points for SSR you can see how when added they did not massively increase the MFs for SSR.

So now take 360 cabins, add to 400 plus DVC rooms at LSL. It is not close to the amount of points as SSR. Granted we do not know the point charts at LSL but we can position them below Poly and VGF, but probably higher than CCV. I can see a drop to $10.50 / $11 a point but not $9.

So while I think they can both be in palmetto, and it may make sense from a management and sales offering perspective. I do not see a huge MF drop.