OKW Extended History

[MountainMouse]

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.

 

[Deb & Bill]

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 we probably won't need the extra 15 years. I'll be 91 when OKW ends in 2042. I can use the money now. OKW owners were also given a credit on their dues to pay for any notary fees.

What they have now is an issue with maintenance at the end of the original date of Jan31, 2042. Owners with expiration dates of 2042 will not be providing funding for long term maintenance after that date. So that has to be taken into account with dues.

 

[Simba's Mom]

We turned it down because we probably won't need the extra 15 years. I'll be 91 when OKW ends in 2042.

Hey, Deb, you must be the same age as me. My guide called and I told him, "When OKW expires in 2042, I'll be 91 so I'm planning to go over to the Gurgling Suitcase for a Sultry Seahorse, then sitting on my balcony and expiring along with my points." Somehow that must have made him very uncomfortable, I think, because he just said "Thank You" and hung up. But honestly, I can't think of any better way to go!

 

[LisaS]

My guide called and I told him, "When OKW expires in 2042, I'll be 91 so I'm planning to go over to the Gurgling Suitcase for a Sultry Seahorse, then sitting on my balcony and expiring along with my points."

Brilliantly funny!!!

 

[JimMIA]

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.

I don't think it was "reckless," but it was kinda out of the blue, and I don't think it was well thought out at all. The result, I think, was a failure.

The "not well thought out" aspect of the offer didn't surprise me at all. Under various management teams, I've never thought DVC was particularly well-managed. Certainly, there has been little strategic thinking -- they just lurch from one thing to the next, with no apparent long-range plan.

The price to upgrade was initially $15/pt but only for about a week, then raised to 20/pt, and soon 25/pt.

I don't recall the exact timeline, but the decision period was MUCH longer than that. I don't think anyone felt pressured by whatever deadline there might have been.

If you passed on the upgrade did the quickly raising price have anything to do with it?

I assume you mean the timeframe between $15 per point and $25. If so, no -- I doubt if that was a factor for anyone. I'm not sure why you're so focused on that minor detail, but I think you're way off the mark. I think it was literally a nothing consideration for most.

My personal calculus was simply that the offer required paying $15 per point for points I would not have access to until 2042. That just made no sense to me. If I'd wanted to put additional money into DVC (which I didn't), I would have purchased additional points to use NOW.

Based on the failure of the OKW offer, I'd be very surprised if they offered anything similar again...but you never know.

 

[DebbieB]

I did a search on the OKW extension (yes, search does work) and found that it came out on 9-28-2007 for $15/point and increased to $25/point on 3-1-2008. So there was 5 months notice.

http://www.disboards.com/showthread.php?t=1595334

 

[MountainMouse]

I don't think it was "reckless," but it was kinda out of the blue, and I don't think it was well thought out at all. The result, I think, was a failure.

Reckless was probably too strong of a term, "not well thought out" is better.

The "not well thought out" aspect of the offer didn't surprise me at all. Under various management teams, I've never thought DVC was particularly well-managed. Certainly, there has been little strategic thinking -- they just lurch from one thing to the next, with no apparent long-range plan.I don't recall the exact timeline, but the decision period was MUCH longer than that. I don't think anyone felt pressured by whatever deadline there might have been.

I rechecked the source (old DIS posts) and it looks like it was a month before the first raise and several months to the final price.

I assume you mean the timeframe between $15 per point and $25. If so, no -- I doubt if that was a factor for anyone. I'm not sure why you're so focused on that minor detail, but I think you're way off the mark. I think it was literally a nothing consideration for most.

It would have influenced me, especially since I would have viewed the entire process as an overreach. I wouldn't have like being told I had to formally decline an offer. If I had been considering it and they raised the price w/o warning I would have just declined on principle at that point and been upset that I actually had to decline and threatened with a lien if I didn't.

My personal calculus was simply that the offer required paying $15 per point for points I would not have access to until 2042. That just made no sense to me. If I'd wanted to put additional money into DVC (which I didn't), I would have purchased additional points to use NOW.

I can't disagree with that logic, however, contract end date was a factor in my recent first purchase. We bought BLT, but if VWL would have been a 2057 expiration date it we would have given it more consideration. As we get closer to 2042 the date becomes more important to younger buyers and those who want to pass along to an heir. That said, if I received an e-mail tomorrow offering an extra 15 years onto BLT I can't say that I would jump right on it.

Based on the failure of the OKW offer, I'd be very surprised if they offered anything similar again...but you never know.

The poor response may have let them know that 35 years to go was too early to offer an extension. I would guess that if they are going to keep the resorts open after 2042 that an extension will be offered, however, they'll wait until it's more of a concern for more owners. Maybe 15 or 20 years to go.

 

[KAT4DISNEY]

Hey, Deb, you must be the same age as me. My guide called and I told him, "When OKW expires in 2042, I'll be 91 so I'm planning to go over to the Gurgling Suitcase for a Sultry Seahorse, then sitting on my balcony and expiring along with my points." Somehow that must have made him very uncomfortable, I think, because he just said "Thank You" and hung up. But honestly, I can't think of any better way to go!

Oh that made me laugh!

 

[RobDoc]

The "vote" by the DVD Board on 9/24/07 was to approve a $25 per point pricing for all points in any contract owned. For those who opted to jump at this great offer, the price would be subsidized by $10 per point until the end of February, 2008 when the cost rose to $20 per point and later to the current $25 which was approved at the 9/24/07.

At the Annual meeting in December, 2007 they had a special meeting for OKW owners where they tried to explain the offer (which included wording about liens placed on any extensions not extended or formally declined by the deadline. When that was brought up at the meeting, the response was glossed over without any explanation - but that was the wording in the documents sent to owners in late September. Those not extended were instructed in the documents that they had to formally sign and submit a notarized quit-claim deed or face the lien.

All contracts were automatically extended, whether an owner wanted to accept it or not. DVD even paid (with a dues credit) $10 to cover notary costs for the quit-claim.

While $15 per point might sound like an attractive price for 15 years of additional ownership, in 2007 this amounted to paying the $15 per point for something that could NOT be used for another 34 years. This was not additional points that could be used as soon as payment was made, it was for the number of points in any contract you wanted to extend for use 34 years in the future. If you owned multiple contracts, you could choose to extend all, none or individual contracts regardless of the number of points involved. All points would be extended (and paid for) for any contract an owner opted to extend.

Contracts not extended and later obtained by DVD via default or ROFR were subsequently sold (and continue to be sold) with the 1/31/57 expiration date. Since that vote, all OKW contracts sold by DVD have had the extended date.

The explanation offered at the Annual Meeting in 2008 was very inadequate and did little to explain anything, reassure any doubts or offer incentive to extend by those who had not yet made a decision. However, a box lunch was provided for those OKW owners who attended the meeting.

IMO, the fact that no other resorts have been extended to date is quite telling.

 

[poggs]

I was an OKW owner at the time of the offer. I live in the UK.

ITs simply put, almost impossible to get a USA approve notary here. What I had to do was make an appointment at the USA embassy for 10 weeks in the future. Then fly to London on that day and Spend a night in a hotel. Finally I got the notary appointment and she witnessed the quit claim signing etc. I was charged $140 for the notary. On top of that my expenses for the trip was £250. I invoiced disney and they paid the lot as dues credits.

This was replicated for all uk owners. Another example of not thought out processes!

 

[com_op_2000]

I agree with PP about age of members.
At the 2042 expiring date, I will be 83.
Good luck to me if I last another 15 after that.
DVC did not look into the ages of the people who bought in originally and "see" where people would be at, at that time of life. They thought the offer would be a good additional sales point for older resorts.

 

[beer dave]

I will be 77 in 2042. If I was offered to extend my BW and BC contracts to 57 for 15 per point, I would strongly consider it. Not only does it ensure my use requirements, but it boosts the resale if I decide to sell. If I become tired of DVC at say 65, there would still be 27 years left for someone to purchase. The prices of resale are going to drop at some point as the contracts get old. It will be interesting to see how it all plays out. If they offer low cost extensions, maybe my kids could pick them up--- helping in passing them on.... I bet they offer extensions again, but probably around the ten year mark.

 

[mac_tlc]

We bought OKW in 1992, and will be 82 in 2042. To us it was an easy decision --- Paying almost $6K for an asset we have no ability to use for 34 years was not going to happen.

We still go to Disney 4-6 times a year, and the kids , now 27 & 20 love it s much as when they were young.

We have since bought a house in Orlando -- and have kept our DVC points and will ride it out until they expire in 2042. If I had to, I could sell OKW for more than I paid for it in 1992.

mac_tlc

 

[MountainMouse]

I was an OKW owner at the time of the offer. I live in the UK.

ITs simply put, almost impossible to get a USA approve notary here. What I had to do was make an appointment at the USA embassy for 10 weeks in the future. Then fly to London on that day and Spend a night in a hotel. Finally I got the notary appointment and she witnessed the quit claim signing etc. I was charged $140 for the notary. On top of that my expenses for the trip was £250. I invoiced disney and they paid the lot as dues credits.

This was replicated for all uk owners. Another example of not thought out processes!

This is just ridiculous, bummer you had to do this.

 

[MountainMouse]

The "vote" by the DVD Board on 9/24/07 was to approve a $25 per point pricing for all points in any contract owned. For those who opted to jump at this great offer, the price would be subsidized by $10 per point until the end of February, 2008 when the cost rose to $20 per point and later to the current $25 which was approved at the 9/24/07.

At the Annual meeting in December, 2007 they had a special meeting for OKW owners where they tried to explain the offer (which included wording about liens placed on any extensions not extended or formally declined by the deadline. When that was brought up at the meeting, the response was glossed over without any explanation - but that was the wording in the documents sent to owners in late September. Those not extended were instructed in the documents that they had to formally sign and submit a notarized quit-claim deed or face the lien.

All contracts were automatically extended, whether an owner wanted to accept it or not. DVD even paid (with a dues credit) $10 to cover notary costs for the quit-claim.

Thanks for the additional detail on the events.

While $15 per point might sound like an attractive price for 15 years of additional ownership, in 2007 this amounted to paying the $15 per point for something that could NOT be used for another 34 years. This was not additional points that could be used as soon as payment was made, it was for the number of points in any contract you wanted to extend for use 34 years in the future. If you owned multiple contracts, you could choose to extend all, none or individual contracts regardless of the number of points involved. All points would be extended (and paid for) for any contract an owner opted to extend.

Contracts not extended and later obtained by DVD via default or ROFR were subsequently sold (and continue to be sold) with the 1/31/57 expiration date. Since that vote, all OKW contracts sold by DVD have had the extended date.

$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. Those that upgraded at the higher cost would actually be losing money. I think the impact would be larger at a more desirable resort, but unless DVD tries it we'll never know.

The explanation offered at the Annual Meeting in 2008 was very inadequate and did little to explain anything, reassure any doubts or offer incentive to extend by those who had not yet made a decision. However, a box lunch was provided for those OKW owners who attended the meeting.

Good to know you at least got a box lunch out of it.

IMO, the fact that no other resorts have been extended to date is quite telling.

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.

 

[MountainMouse]

I will be 77 in 2042. If I was offered to extend my BW and BC contracts to 57 for 15 per point, I would strongly consider it. Not only does it ensure my use requirements, but it boosts the resale if I decide to sell. If I become tired of DVC at say 65, there would still be 27 years left for someone to purchase. The prices of resale are going to drop at some point as the contracts get old. It will be interesting to see how it all plays out. If they offer low cost extensions, maybe my kids could pick them up--- helping in passing them on.... I bet they offer extensions again, but probably around the ten year mark.

Would be interesting to see the affect additional years would have on the BCV resale price. It hasn't had what I would call a great impact on the OKW contracts, but it's a less desirable resort. Give people a chance at extra years on BCV, BWV, or VWL and I think you would have many more owners taking advantage of it and a greater affect on the resale price. That said, I doubt the starting price for the upgrade would be $15/point today and the higher that is the less response/acceptance you would have from owners and obviously the more resale prices would have to rise to justify it.

 

[Simba's Mom]

At the Annual meeting in December, 2007 they had a special meeting for OKW owners where they tried to explain the offer (which included wording about liens placed on any extensions not extended or formally declined by the deadline. When that was brought up at the meeting, the response was glossed over without any explanation - but that was the wording in the documents sent to owners in late September. Those not extended were instructed in the documents that they had to formally sign and submit a notarized quit-claim deed or face the lien.

Doc, can you help my memory a little? We own at OKW, and I don't remember being invited to or attending any special meeting. I THINK I was at the Annual Meeting that year-wasn't it held in the big room at Coronado Springs? Was there an invitation to the OKW special meeting mailed out and I missed it or ignored it? Or was it sort of incorporated into the whole meeting? If I remember the year right, all I remember is the guy in the loincloth who came out and twirled a baton with fire, announcing Aulani. See, I remember the important stuff!

 

[RobDoc]

Doc, can you help my memory a little? We own at OKW, and I don't remember being invited to or attending any special meeting. I THINK I was at the Annual Meeting that year-wasn't it held in the big room at Coronado Springs? Was there an invitation to the OKW special meeting mailed out and I missed it or ignored it? Or was it sort of incorporated into the whole meeting? If I remember the year right, all I remember is the guy in the loincloth who came out and twirled a baton with fire, announcing Aulani. See, I remember the important stuff!

Yes, it was held at the Coronado Springs convention center but was a separate meeting - about 45 minutes - only for OKW owners. I don't recall whether there was a mailed notice about the OKW meeting (there was no legal reason for such a mailing, as this was only supposed to provide information about the extension to current owners - plus., at that point I suspect they had already had far more questions/confusion/irate owners than acceptances) but there was signage in the hallway outside the Board meeting with directions to the OKW owner meeting (also at CSR) as well as an announcement at the Board meeting. This was held between the DVC board meetings and the DVC Member meetings that year during the intermission between those meetings.

Recent meetings have all been held in the afternoons, but earlier meetings started in the morning. The first annual meeting I attended (back when there was just OKW and BWV as onsite resorts) was held at the BW Convention Center and included a continental breakfast. Meetings for VB and HH were held at those resorts.

 

[RobDoc]

...
$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. Those that upgraded at the higher cost would actually be losing money. ...

The immediate effect on OKW resale prices in 2008 was that those with the extension did not command prices more than a few $$ above those without (and not all extended resales saw a higher price). Many OKW owners who purchased the extension expecting it would make for a more desirable sale did not see any benefit (paying $15 for something and getting a return of $3-4 at best). Subsequent extended OKW resales have still not seen full benefit (think of those who sold between 2009 and early 2013) vs. un-extended OKW resales.

While it might be an attractive offer if made in 2040, it was not particularly attractive for something you had to pay up-front for in 2007 that could not be used for another 35 years.

 

[DVC-Don]

We did the extension at $15 per of one of our contracts as we intend on giving that contract to our daughter later. Since we bought a home not far from WDW we've sold all our other contracts but that one.