OKW Extended History

[luckyman_apd]

I don't think an extension is necessarily a bad plan for DVD, but it appears hindsight being 20/20 it was a bad plan. OKW is the original resort, and seeing the ages of original owners, I know I would not extend past age 91. End date was part of the equation when we purchased. We were looking at SSR or BLT because of the end dates. We will be in our 80's when BLT expires. 2042 I will only be 66, and I hope to get many trips in our 60's and hopefully 70's if our health is good enough. We just couldn't see purchasing something to end shortly after our retirement ages.

However, with hindsight and the current rate of DVC construction....Whose to say Disney hasn't crunched the numbers and decided that Refurbishing and reselling in 2042 or demolishing and rebuilding something new won't be more profitable? I do know that's a lot of resorts and members gone from the system come 2042. At that point (assuming no other resorts are built) our only options will be BLT, AKV, SSR, VGF, and Poly. And the point usage for BLT, VGF, and Poly are higher than the 2042 resorts.

 

[chalee94]

$15/point in my view is no doubt an attractive offer, however, I can understand why owners not interested in ownership after 2042 would pass. Also, I would have thought that it would have a larger impact on the resale cost, but people reselling would now would just be getting their money back if they had upgraded at $15.

i still don't see half that much as a premium on 2057 OKW resales.

I agree with this, has to have been viewed as a failure. I do think it will be attempted again in the future but perhaps in a different manor. They may start snapping up all of the BCV, BWV, and VWL contracts at ROFR and reselling those as new with extended expiration dates (past 2057) or just wait until 2042 and start selling with 2092 expirations.

1) there is also a legal issue with OKW at least, in which some owners have disputed that DVC has the right to extend OKW in the manner they chose, such that at least a few owners are holding out for a free extension.

also, DVC is apparently obligated to keep track of OKW2057 owners and OKW2042 owners separately for dues purposes at some point down the road, so owners who get out in 2042 aren't paying dues to support OKW past 2042. it sounds like a big hassle to me...

2) there is some question about what shape 50 year old resorts like BCV and VWL will be in when we get to 2042. i think they would be better off by taking a year to completely renovate the resorts at 2042 and reselling the points, maybe offering a small discount to previous owners...(especially since the new resort would likely have higher pt costs per night in line with VGF and such)...but there is no telling...

 

[twinsouvenirs]

Without understanding the lien, I'm not sure how much of a threat a lien would be. If it's not for $ payable, I'm wondering what the lien would say and how it would affect anyone, even at resale.

 

[DougEMG]

I wonder if they'll make the extension offer again once we are down to the 5-10 year mark of life remaining on the contracts or will it just be easier to let the resale price drop, buy them up in ROFR and then resell them as extended contracts.

 

[MountainMouse]

I think once we get to 5-10 years to go the resale prices are going to be on a pretty steep downward trend. We haven't hit the knee in the curve yet as the older properties are really hanging in there with price. In my opinion, I would guess they have a plan today and that chances are that plan will change over the years with changes to the economy, people's vacation habits, and other variables. The plan could range anywhere from extensions are being offered tomorrow to no more extensions ever. The only thing I am sure about is that they will do whatever it is they think will make their business stronger, which they should. I'm just happy that DVC exists as it does today and that resale is an option. They may do some rule changes to make direct sales more competitive but they like resale and they want to keep fresh money coming into the parks.

 

[Sur]

They will only go so low, though, as people would then just buy contracts to go to Disney, rather than a hotel room.

 

[MountainMouse]

They will only go so low, though, as people would then just buy contracts to go to Disney, rather than a hotel room.

True, but I think it's still a pretty low floor and there's a lot of hassle in buying a contract so there has to be a financial benefit to justify the purchase. Once you get 5 years out the cost will have to be much lower to get the same savings you do today. For example in today's dollars, BLT is about $100/point for 45 more years of ownership which is $2.22/point/year. If BLT were ending in 20 years and you were willing to pay the same $2.22/point/year that's $44/point. At 10 years it would be $22/point, at 5 years $11/point. Those I believe are low end numbers and people will likely be willing to pay more per point knowing that there are fewer years they have to commit to, but not so much more that they could just rent. Assuming rent is $15/point and people will want 40% off for the hassle of buying and owning the contract, then they'd be willing to outlay $9/point/year. Subtracting out maintenance at $5/point/year you could reasonably assume that the most a person would pay with 5 years to go would be $4/point/year. Over 5 years that's $20/point. Split the difference between the low and the high and a reasonable guess at price for BLT if it were ending 5 years from today would be $15.50/point.

 

[KingRichard]

Without understanding the lien, I'm not sure how much of a threat a lien would be. If it's not for $ payable, I'm wondering what the lien would say and how it would affect anyone, even at resale.

More then likely the seller would have to provide the doc.s at closing to sell.

Just one extra paper to get stamped.

 

[RobDoc]

Without understanding the lien, I'm not sure how much of a threat a lien would be. If it's not for $ payable, I'm wondering what the lien would say and how it would affect anyone, even at resale.

The lien was regarding either accepting the extension or returning signed/notarized documentation declining the extension. Those who did neither were threatened with not being allowed to use their membership (much the same as those who fail to pay annual fees).

To my knowledge no one has lost access to their account as a result of not returning the declination documents. The land lease legally extending the resort by DVD from Disney has been accomplished - so the extension is valid. The question is whether DVD can take ownership from someone who has not signed the quit claim deed. Technically, DVD may not own the deed for contracts after 1/31/42 (since the land lease has already been extended) and might not be able to sell those contracts without the quit claim. Regardless, it was a pretty heavy-handed method of "offering" something to the current owners.

We may not know until sometime after 1/31/42 .

 

[RobDoc]

OK, I just did a little digging through the "search" engine and found a few threads from 2007 pertinent to this discussion (and there are many more since then):

8/27/2007 - http://www.disboards.com/showthread.php?t=1562789

10/16/2007 at OKW - http://www.disboards.com/showthread.php?t=1611682

12/04/2007 Annual Meeting report (full thread) - http://www.disboards.com/showthread.php?t=1653544&highlight=okw+extension

12/04/2007 Annual Meeting report with specific OKW info - http://www.disboards.com/showthread.php?p=22043896#post22043896

My memory had faded as the amount provided to those declining the extension was $30 (I reported $10 earlier in the current thread) plus a "Commemorative OKW Lighthouse". Those who accepted the extension also received the lighthouse.

In reading through the report, there was a lot going on in DVC in 2007 (free internet, non-smoking policy, MS open 7 days instead of 5, renaming Disney-MGM Studios to DHS, etc.).

In doing the search, it is clear that this is an oft-repeated topic of discussion which I expect will continue for years to come.

Stay Tuned!

 

[carlbarry]

As someone who bought re-sale at OKW after this offer expired, and who will be 89 (God willing!) when my deeds expire, I find this very interesting.
An interesting point is that members were paying $15 for something that wouldn't come into effect for 34 years. That brings up another consideration: putting that $15 in the bank or in the stock market for 34 years, it could be $45 or more in 34 years.
There are just so many complications caused by this extension, I find it hard to believe that when the unextended deeds near expiration, DVD won't do something to "even up" the expiration of ALL deeds.

 

[MountainMouse]

OK, I just did a little digging through the "search" engine and found a few threads from 2007 pertinent to this discussion (and there are many more since then)

Thanks for the links. Haven't had a chance to look through them yet, but I know what you mean about it being a recurring topic. I think it was a 2012 thread that I originally found.

 

[MountainMouse]

As someone who bought re-sale at OKW after this offer expired, and who will be 89 (God willing!) when my deeds expire, I find this very interesting. An interesting point is that members were paying $15 for something that wouldn't come into effect for 34 years. That brings up another consideration: putting that $15 in the bank or in the stock market for 34 years, it could be $45 or more in 34 years. There are just so many complications caused by this extension, I find it hard to believe that when the unextended deeds near expiration, DVD won't do something to "even up" the expiration of ALL deeds.

DVD will definitely do something, that may be another offer to owners to buy an extension or it may be letting them expire and just renting the resort for cash for 15 years. The only way I think they could bring all the owners deeds to 2057 would be to extend them for free and they aren't doing that unless they lose a legal battle. And if that happens they've got another legal fight coming with the owners who paid for or formally declined the extension.

 

[mrsR123]

To my knowledge no one has lost access to their account as a result of not returning the declination documents.

I know of at least one member who has had no troubles after failing to ever act on the quit claim deed.

 

[CMOORE185]

It seems that both the extension and the quick claim deed were a bad deal for the owners. DVC tried to ram it through on the owners and that was not very nice of them.

I am glad I am not an owner of OKW because I probably would have felt I had to do one of the two options because of my blind trust for Disney.

If it happens again to one of my resorts there will be no trust and I will look into my options.

 

[DVC92]

OKW owners who declined the extension should not continue to pay into the Capital Reserve fund at some point prior to 2042 since they will not reap any benefit from that fund after 1/31/2042.

In a complaint I filed with the Timeshare Bureau, a subsidy for those who declined the extension was promised to be provided at the appropriate time. My feeling that time may be here now or in the near future since the reserves remaining years are beginning to cover periods beyond 2042. The current head of DVC probably has no knowledge of this promise.

 

[gmboy95]

I started looking into what happened with the OKW extended contracts. Originally my guess was that DVD expanded OKW and gave those units 2057 expiration dates. Turns out there wasn't an expansion but rather DVD extended every room in the resort to 2057 and offered owners the chance to purchase the additional ownership years. From what I read it was very fast moving and seemed almost reckless and not well thought out by DVD, though I can't imagine they did this on the fly. The price to upgrade was initially $15/pt but only for about a week, then raised to 20/pt, and soon 25/pt. Also, owners had to waive their right to purchase with a notarized letter and if they didn't DVD would supposedly be able to put a lien on their existing ownership.

For some reason the way this went down sort of fascinated me and raised some questions for the DVC vets on here that may have experienced this first hand. If you passed on the upgrade did the quickly raising price have anything to do with it? Myself, it probably would have annoyed me enough after the first very quick increase that I would have told them to keep it. Did anyone not send in the waiver and if so was a lien placed on the property and how did that go? Seems like this was some kind of an experiment by DVD. What do you think they learned or were attempting to learn with this? Think they'll try it with another resort? Seems like they did this with the oldest resort, wonder why they haven't tried it with the younger resorts. Anyways, if you've got any thoughts to share or first hand experience I would be interested in hearing it.

We turned it down because i will most likely be in a nursing home when my current membership expires...and frankly my kids can get a job and buy their own!!

 

[gmboy95]

I know of at least one member who has had no troubles after failing to ever act on the quit claim deed.

I never signed a thing...even though being prompted to do so numerous visits.....nothing happened

 

[WDWMom]

I don't remember signing the quit claim deed either. We received several phone calls and letters but I do not remember them being threatening.