NEW VGF Building

[stwaldman]

Every DVC location over the last 20 years—except for Kidani and the first part of VGF—involved subtraction of cash rooms for the addition of DVC. Whether it’s conversion or tear down and rebuild is up to the bean counters to determine.

The single biggest factor that derailed Reflections was the hundreds of hotel rooms included in the design. Hotel rooms Disney felt confident it could fill back in 2018, but no longer needs in the foreseeable future.

The timing of this move is being forced on DVC to some extent. They don’t need the inventory for summer 2022. But 200 more studios will be good for the program.

yeah, and further to your point, AKV can't really be treated as a comparable to anything. Its proximity to parks is countered by "lol look at the live zoo outside your window" and the point charts are a relic of a different era at this point.

 

[CaptainAmerica]

They don’t need the inventory for summer 2022.

If they declare the units before they're sold, couldn't this be a way to relieve the points glut and get rid of the borrowing restriction?

 

[RoseGold]

The single biggest factor that derailed Reflections was the hundreds of hotel rooms included in the design. Hotel rooms Disney felt confident it could fill back in 2018, but no longer needs in the foreseeable future.

The timing of this move is being forced on DVC to some extent. They don’t need the inventory for summer 2022. But 200 more studios will be good for the program.

I agree. Reflections was supposed to be 900 rooms in a mediocre location. This made sense in 2018. Maybe it will make sense for 2025.

 

[Lorana]

Now the booking engine should just look at it as AKV. Your actual deed lists a unit, the percentage etc but the terms in both are the same because they comprise the AKV association. Depending on when the new VGF goes on sale there's going to be a bit of time where the current owners can be using their points for any dates but the new buyers will have to wait until the new units actually open but the POS covers that possibility and it doesn't make it separate from the association.

The booking engine does not treat them as one and the same. They are still distinct and different. You have to select Jambo vs Kidani. WITHIN the Jambo and Kidani contracts, they likewise indicate UNIT and BUILDING that you own within those contracts, but Kidani IS separate from Jambo from a deeded real estate perspective. They are in the same association, but they are two separate declarations and two separate Home Resorts. Thus, I could see the new VGF do the same, which could potentially give them the leeway to set up separate resale rules.

 

[zavandor]

If they declare the units before they're sold, couldn't this be a way to relieve the points glut and get rid of the borrowing restriction?

Why would they do that if owners can simply lose points? The answer "to look good" is not good enough. They get bad press about the resale restrictions all the time and is probably hurting (at least a bit) their sales and they don't care.

 

[CaptainAmerica]

Why would they do that if owners can simply lose points? The answer "to look good" is not good enough. They get bad press about the resale restrictions all the time and is probably hurting (at least a bit) their sales and they don't care.

Relieving the points glut now means more breakage income later.

 

[tjkraz]

If they declare the units before they're sold, couldn't this be a way to relieve the points glut and get rid of the borrowing restriction?

Yes, but if that happens, Disney would be sacrificing its own profit potential to benefit DVC members. As soon as they declare those rooms, they become available for points reservations. Before they are declared, rooms can be rented for cash with Disney as the beneficiary.

That said, DVC has a notable track record of declaring a lot more points than it has sold. And if they still have excess hotel inventory by next summer, there's not much point in keeping the rooms.

 

[RoseGold]

If they declare the units before they're sold, couldn't this be a way to relieve the points glut and get rid of the borrowing restriction?

DVC usually does declare a lot before they are sold, and it wouldn't surprise me to see them do that. But we are only talking about 1.5, maybe 2M points. A few months of that isn't going to change the huge Covid point glut.

 

[CaptainAmerica]

Yes, but if that happens, Disney would be sacrificing its own profit potential to benefit DVC members. As soon as they declare those rooms, they become available for points reservations. Before they are declared, rooms can be rented for cash with Disney as the beneficiary.

That said, DVC has a notable track record of declaring a lot more points than it has sold. And if they still have excess hotel inventory by next summer, there's not much point in keeping the rooms.

What better way to sell those 150 point add-on contracts than by allowing existing members to stay there using their banked COVID points?

 

[Bjaiken77]

Nope. This was all Covid. They want to convert new construction.

What they want is Jambo and VGF full of cash paying guests taking VIP tours, and freestanding DVC in some cheap location, like RIV or Reflections. But, the earnings calls have made it very clear that there is no money to build. This was a solution to get through the next 3-4 years with no DVC WDW construction.

It's a short term cash grab. But it's also far off enough to have something shiny to look forward to, and maybe by the end of 2022, they can have the plans together for Coronado 2 or whatever in a few years, so there's the next thing to look forward to.

This is 1.5, maybe 2M points, compared to 7M for Riviera. This is not the main event. Maybe they have to kick the can down the road with a Poly building, but this isn't the business model. The next DVC build will be a beast in some mediocre location with a chart higher than VGF. RIV almost hit VGF charts with nowhere near the location. The chart was doing the heavy lifting for RIV, and it will do it for the next build, and probably DL Tower.

I mean, to each their own, but if I were staying at POLY or VGF, I’d be taking the monorail. I would walk from BLT. So once you enter a Disney mode of transportation, what is the difference between VGF and RIV? I can see the argument if you are MK minded and want to stare at the castle. For those of us who see ourselves spending more time at Epcot (or HS), RIV is great.

 

[CaptainAmerica]

I mean, to each their own, but if I were staying at POLY or VGF, I’d be taking the monorail. I would walk from BLT. So once you enter a Disney mode of transportation, what is the difference between VGF and RIV? I can see the argument if you are MK minded and want to stare at the castle. For those of us who see ourselves spending more time at Epcot (or HS), RIV is great.

*whispers*
The Skyliner is way better than the monorail.
*runs and hides*

 

[CaptainAmerica]

well, the next beast is DLT, which will wipe some of the taste of riviera sales off of everybody's tongues because they are meeting a demand that will exceed almost any cost.

I do think there is a fair question of how far will they press the envelope on developing another property "far" away from a park. While Riviera is dragging in part because of restrictions, its also hard to ignore it was the first WDW resort sold in several years that (sorry skyliner) isn't within a 4 iron of a park entrance. I don't know how their finance decisions get made, but I think they will have to give *some* pause to developing a completely new resort if there is recent experience saying it might sit there on sale for an extended period of time.

The Skyliner is infinitely more convenient than the monorail (or boat). It's just that the majority of guests haven't experienced it and figured that out yet.

Riviera is sluggish because 1) the theme is generic, 2) the restrictions scare people, and 3) the points chart is insane.

 

[stwaldman]

I mean, to each their own, but if I were staying at POLY or VGF, I’d be taking the monorail. I would walk from BLT. So once you enter a Disney mode of transportation, what is the difference between VGF and RIV? I can see the argument if you are MK minded and want to stare at the castle. For those of us who see ourselves spending more time at Epcot (or HS), RIV is great.

The walk from GF right now is 10-15 minutes tops and was faster than the monorail when you factor out waiting and loading. Fair to say that the skyliner > monorail (to each there own, for real), but lets not act like the walk isn't a very serviceable option.

the walk from poly is a hike, yeah. but poly in non broken monorail times is right next to TTC and accordingly you're a monorail away from two parks, which yes is a real perk for it.

 

[CastAStone]

Here is why this happened, full stop:
Executive: It says here that Riviera will sell out before we can get a new WDW resort built. What are we gonna do about it?

Peon: Well we’ve been putting the sold out resorts on sale to try to sell less Riviera

Exec: Do we make good money on those?

Peon: no, at best 30-40% before paying everyone

Exec: (angry silence)

Peon: so we have this other idea which is that we could do a conversion of a Grand Floridian building after Riviera sells out to bridge us to the new building

E: will we make good money on that?

P: Almost 90%. It will cost perhaps $40M and sell for $350M or more

E: Are there any complications?

P: well if we added it to the existing association it would probably only have 39 or 40 years left, like Aulani does now

E: how fast would it sell out?

P: probably 9 months

E: you’re telling me I could make 300 million dollars and you want me to wait three years to do it?

P: uh

E: no, you’re going to do this now. The Grand Floridian needs a gut job anyway. And you’ll put it on sale alongside Riviera. That that way the owners are still buying 43 years. More than Beach Club when it was new!

P: but won’t that hurt Riviera sales?

E: The point is to give us more runway to the next resort!

P: oh yeah. Well there is this one other complication, it will get confusing that this doesn’t have resale restrictions and savvy buyers might notice the difference

E: so you want me to give up THREE HUNDRED MILLION DOLLARS because our guys will have to explain the difference in Resale restrictions to a few people? I think you can find a way to help them manage!

P: yes sir thank you sir.

E: All right, let’s go tell Bob. Villas at the Grand Floridian phase 2, coming summer 2022

 

[Bjaiken77]

*whispers*
The Skyliner is way better than the monorail.
*runs and hides*

I get it. There are preferences. But Riviera isn’t out in the middle of the Sahara desert. We were staying at BCV and made it to RIV for dinner in 10-15 minutes. I also stayed at VGF that trip. Lovely resort and I’d like to buy there.

However, sometimes silly stories encourage you to buy. We are at Topolino’s and wanted to sit on the deck. I was done drinking alcohol for the night but had my resort mug. I asked the bartender if she could refill it. Understandably, that’s not their style. So I jumped in the elevator, went down to Primo Piatto, filled my mug, and was back on the deck in 5 minutes. Leaving Topolino’s, we took the elevator down and walked right past Bar Riva and the pool before a couple minute walk to the skyliner. We also had coffee La Petite cafe before dinner and made it to dinner upstairs in 2 minutes.

To me, I like having everything close. I also really like the skyliner parks. That’s why I bought there.

 

[CaptainAmerica]

I get it. There are preferences. But Riviera isn’t out in the middle of the Sahara desert. We were staying at BCV and made it to RIV for dinner in 10-15 minutes. I also stayed at VGF that trip. Lovely resort and I’d like to buy there.

However, sometimes silly stories encourage you to buy. We are at Topolino’s and wanted to sit on the deck. I was done drinking alcohol for the night but had my resort mug. I asked the bartender if she could refill it. Understandably, that’s not their style. So I jumped in the elevator, went down to Primo Piatto, filled my mug, and was back on the deck in 5 minutes. Leaving Topolino’s, we took the elevator down and walked right past Bar Riva and the pool before a couple minute walk to the skyliner. We also had coffee La Petite cafe before dinner and made it to dinner upstairs in 2 minutes.

To me, I like having everything close. I also really like the skyliner parks. That’s why I bought there.

You seem to be disagreeing with me... I was making a pro-Riviera comment.

 

[emilymad]

I get it. There are preferences. But Riviera isn’t out in the middle of the Sahara desert. We were staying at BCV and made it to RIV for dinner in 10-15 minutes. I also stayed at VGF that trip. Lovely resort and I’d like to buy there.

However, sometimes silly stories encourage you to buy. We are at Topolino’s and wanted to sit on the deck. I was done drinking alcohol for the night but had my resort mug. I asked the bartender if she could refill it. Understandably, that’s not their style. So I jumped in the elevator, went down to Primo Piatto, filled my mug, and was back on the deck in 5 minutes. Leaving Topolino’s, we took the elevator down and walked right past Bar Riva and the pool before a couple minute walk to the skyliner. We also had coffee La Petite cafe before dinner and made it to dinner upstairs in 2 minutes.

To me, I like having everything close. I also really like the skyliner parks. That’s why I bought there.

And RIV is really close to DS which is nice. We would buy there if it wasn't for the insane point chart.

 

[Bjaiken77]

You seem to be disagreeing with me... I was making a pro-Riviera comment.

Right, I gotcha. I’m not disagreeing with you. I’m just saying I like the skyliner too, but I understand why it may not be for same people.

 

[Bjaiken77]

I’ll be staying in standard studios at RIV. I see them as less than POLY, VGF, and on par with BLT LV. The desire to get standard was all the more reason to buy there.

 

[tjkraz]

E: how fast would it sell out?

P: probably 9 months

The original VGF offering only averaged 102k points per month in sales. It didn't directly compete with another resort the entire time, and was priced $100 per point lower than today. So it may take longer than 9 months, even if they significantly discount off the current $255.

But the rest is pretty accurate. DVC always has multiple options available to them. It's just a matter of finding the best balance of a project that fits needs of the hotel unit and profitability for DVC. They're only making these decisions once every 2-3 years.