Poly Tower Speculation

[BeachClub2014]

I think same association benefits current owners and future resale purchasers, not Disney. New association restricts access to other resorts when resold and entices current owners to buy more points to access something steps away ultimately benefiting Disney.

I agree with you on this. Other than wishful thinking and some mythical "need" or desire on the part of DVC to add larger room options to PVB, there is no real advantage for DVC to roll the new tower into the existing association. Doing so runs counter to the strategy of adding restrictions to resale points. If you're DVC, why deviate from that plan now?

 

[Sandisw]

I want to pull on this thread a bit and contemplate the impact on and from resale a bit more. I understand the emotional 'we don't to lose sales to resale' aspect, but I'm not sure the numbers would actually back that up.

Loss of sales to resale, as a theory, requires more resale inventory/supply to hit the market than a normal year (for the duration of Poly2 sales). A baseline resale volume is going to happen no matter what and DVD needs to accept that (and likely has).

So it boils down to two questions:

1. Will an increase in PVB resale supply be larger if the associations are the same or different?
2. And even if resale supply would increase more due to same association, is that increase in resale supply significant enough to worry about? To offset from other potential sales benefits?

Longer winded version:
From what I can tell on the OC Comptroller site, there were no more than ~1k resale deeds for the Poly in 2022. I'm not going to read them all, but let's assume they average between 100 and 150pts per deed (most of the ones I did read appear to be on the smaller side). So 100k - 150k PVB points in resale per year as a baseline.

When Poly2 is a 'go', that will be a major event to PVB regardless of DVD's decision. Let's break out the push/pull on resale supply in both circumstances:

Same association

• Reasons resale supply could increase:
  • PVB owners would get access to Poly2 in addition to PVB rooms. But Poly2 buyers also get access to PVB. Depending on PVB owner travel habits, Poly2 buyers getting PVB access could have a negative impact to their ability to book at PVB and they could sell in response
    • I think only the savviest of owners will have this play into their decisioning, plus it will take a lot of time for this to show itself considering the nature of current PVB inventory (if it ends up being true at all)
  • PVB owners could be generally dissatisfied with Poly Resort after the addition of Poly2 and want to sell
  • PVB owners might think this is a great time to divest, financially (though this would necessitate a supply/demand shift that correlates with reduced supply).
    • This is inherently a secondary effect
• Reasons resale supply could decrease:
  • PVB owners like the Poly2 addition, fewer-than-baseline want to sell because their points now work at a 'new resort' at 11m

Separate/new association

• Reasons PVB resale supply could increase:
  • PVB owners sell PVB points to buy Poly2 because Poly2 meets their needs better than PVB
  • Poly2 is flawed in some way that drives demand for PVB up, which drives more owners to sell due to market conditions
    • This is inherently a secondary effect
• Reasons PVB resale supply could decrease:
  • Poly2 is so great that PVB loses popularity and drives down the market price, which scares potential sellers away
    • This is inherently a secondary effect

To me, these add up to be pretty close? If Poly2 is great, then I think this skews toward a decrease in PVB resale supply slightly for same association and an increase if separate/new. If Poly2 is middling or mediocre, it's closer, but I still struggle to see meaningful churn from PVB because it's the same association. I might be missing some points on why people would sell because of association configuration, though.

This isn't a VGF1 situation where a small resort with a full range of inventory gets flooded with points from a single room type, VGF2 Resort Studios.

All this to say that I don't think there's going to be much, if any, additional PVB resale supply (and therefore sales) if Poly2 is the same association.

There might be a slight increase in PVB resale supply if Poly2 is great and a separate association, which would itself be a risk to direct Poly2 sales if more potential Poly2 buyers pick up resale PVB instead (no restrictions, likely great price, etc.).

Anyway, I don't think a combined association would drive resale volumes up, I'm inclined to say it will actually slightly dry up the supply if anything. Yes, some buyers will get Poly2 via resale while it's on-sale direct, but if it's lower than a separate association (or even just similar to), who cares? Some volume of resale taking from Poly2 sales is gonna happen.

And regardless of directionality, I don't see it passing the 2nd test: that there's a significant change over baseline, to the point of impacting Poly2 sales. I would be fine calling the baseline itself significant, but if we're talking impact to sales, there needs to be a change from baseline.

I do get that the resale piece may not be a huge factor.

But, as I said, I don’t think it benefits Disney financially…meaning it helps sales..to combine it into one.

To me, the bigger aspect is it allows them to stay the course with the long game. It allows them to not have both the tower and the longhouses all expire at the same time and be left with all those rooms at once.

Not to mention restrictions which I still believe are a big driving factor to what they want.

Now, if they decide that they want to abandon them, then make it one.

The only other piece that did pop in my mind is they don’t care if it sells fast. They may figure they will be able to just sell for cash like they do for RIV and AUL.

I just don’t see where making it one actually increases the rate of sales and in the end that is what I would think matters most.

Look at BPK and what it has taken to get it to sell well..it had to become as good a deal as resale.

PVB resale is pretty low and the difference will be much greater to overcome. Sure, it may not be a ton of contracts that sell each year, but over time, it’s still lose revenue and might impact the pricing required., even if it’s only a small piece of the puzzle.

We are all guessing but as I said, IMO, I don’t see how combining is a financial win for DVD..

It just doesn’t make sense to have spent all this money on a brand new resort…with full amenities and not make it its own.

 

[BeachClub2014]

Lawyers.

Interesting. You're suggesting that current PVB owners will somehow have standing to bring suit against DVC if the new poly tower is not included in the current association?

 

[tom1944]

I agree with you on this. Other than wishful thinking and some mythical "need" or desire on the part of DVC to add larger room options to PVB, there is no real advantage for DVC to roll the new tower into the existing association. Doing so runs counter to the strategy of adding restrictions to resale points. If you're DVC, why deviate from that plan now?

This is my line of thinking also.

 

[CraigInPA]

PVB is the reverse. You have tons of studios and overpriced bungalows that sleep less than 2 studios. I don't think DVC cares about evening out the room accommodations in the association. It wants to sell points and there is no need to give Poly tower purchasers 11 month access to the original PVB studios and bungalows. If you own PVB and want the shiny new tower you need to buy a new contract. If you buy the new tower you will most likely have your own studios and grand villas or the option to swap at 7 months. PVB is pretty easy to secure outside of the home resort advantage.

That assumes the mix of accommodations in PVB2 is similar to RIV and other DVC resorts where they learned their lesson after VGF1 (with its notorious small number of studios). DVD added VGF2's "resort studios" to address this issue. If PVB2 was destined to become an add on to PVB1, we'll see it as soon as they release floor plans or quantify the number and type of rooms in the resort.

 

[Nursemanit]

That assumes the mix of accommodations in PVB2 is similar to RIV and other DVC resorts where they learned their lesson after VGF1 (with its notorious small number of studios). DVD added VGF2's "resort studios" to address this issue. If PVB2 was destined to become an add on to PVB1, we'll see it as soon as they release floor plans or quantify the number and type of rooms in the resort.

From a numbers perspective they would need 70% studios to be balanced. The resort would be better if it was one DVC at Poly and they added more 1/2/3 br units in the tower. If it is separate then 90 or so 1/2/3 br units would be all that could fit for balance. If combined, they could add 195 1/2/3 br units.

 

[Jwaire]

https://twitter.com/x/status/1691875675546804529

Looks small to me.

 

[aka Charles]

I don't know why the discussion has to be an "either/or" hypothesis?
Either direct or resale?
Really?
There are other possibilities.

How about direct or nothing?
(Just an example)

I have enough points for my 3-4 trips every year, but I would like to have one of those yearly trips to be at the new tower.
As it stands now, if it is a new association I will most likely be buying 200-300 direct points, depending on incentives.
If it is the same association, I won't be buying any poly points, at all, direct or resale.
I will just book at VGF like I normally do and then see whats available at the Poly tower at 7 months.
I will be at VGF or maybe the Poly Tower, I am just fine either way.
Hey, the tower will be a short walk from VGF, so I will have easy access to everything but the pool.


In the end, DVD will do what ever they think is best for DVD, at that time.
No reason I should have to stress over it.

Truth is, that with everything going on with Disney right now, whoever will be making the final decision on this could be let go by Disney and replaced once or twice between now and when sales start.
.

 

[Cheesehead13]

Huh? PVB owners have no right to tell DVD what it can and can not build on land owned by Disney.

I’m actually very surprised this isn’t discussed more. If I were DVD/Disney, I’d be concerned that a real estate lawyer puts together a class action suit or something of that nature, premised on the idea that every time a new association is made that is allowed to book at prior resorts, but the prior resort owners (at least resale) can’t book at the new association, it is effectively diminishing the ability of prior resort owners to use their points at all. At 7 months and less there are more points eligible to book at the original resorts than the total room inventory could support. I think of this like they are taking away real property rights from us lowly resale owners….

 

[KimMcGowan]

I agree with most of these arguments. However, if it was a slam dunk Disney would have just said right from the start. Plus, there has been at least one clue ( the presentation that said it was PVB) that it will be the same association.

 

[CraigInPA]

I agree with most of these arguments. However, if it was a slam dunk Disney would have just said right from the start. Plus, there has been at least one clue ( the presentation that said it was PVB) that it will be the same association.

Shortly after the initial announcement, I cornered a senior DVC executive during Moonlight Magic and asked specifically whether it was to be a separate association or combined with PVB (which we now refer to as PVB1). She replied, immediately, that it'll be part of PVB. Since then, there's been no public announcement one way or the other, although there are hints here and there of their direction in various other announcements. They're getting closer to the point where they'll have to file a declaration with the state if they're going to make it a new association. IIRC, that'll be about 6 months before they plan to announce a sales opening date, and will contain the exact number and type of units. So, sometime in 2024. I believe when CCV was created, we learned about the number of units and types by someone getting a look at the building plans.

 

[Sandisw]

I’m actually very surprised this isn’t discussed more. If I were DVD/Disney, I’d be concerned that a real estate lawyer puts together a class action suit or something of that nature, premised on the idea that every time a new association is made that is allowed to book at prior resorts, but the prior resort owners (at least resale) can’t book at the new association, it is effectively diminishing the ability of prior resort owners to use their points at all. At 7 months and less there are more points eligible to book at the original resorts than the total room inventory could support. I think of this like they are taking away real property rights from us lowly resale owners….

FL timeshare law only requires rules for home resort owners to have the same rights, no matter how they squire interest. It’s why a resale buyer at any resort can’t be treated differently than a direct owner at that resort since both have a deeded interest.

The ability to trade into other DVC resorts is part of an exchange agreement with BVTC and is guided by terms of the DVC resort agreement.

Prior to RIV, those agreements mentioned all be resorts being substantially similar. But, that langusge no longer exists

My guess is it is why resale contract prior to 2019 were grandfathered because they bought with different terms and DVD wanted to prevent those owners from being able to say that restricted resorts are not “substantially similar”.

Today's buyer buys with a DVC resort agreement that simply gives BVTC to associate a new resort under their guidance.

CA timeshare law even goes further that any exchange rules are up to the developer and can be whatever is part of that agreement.

Now, there are some who contend restricted resorts should not have happened.

I personally don’t share thst opinion because of how I interpret it all,,,but its just that..an opinion.

But, that has nothing to do with DVD being allowed to build a brand new DVC resort at the same hotel location and not tie it to the current one.

But, if discussing resale restrictions and the DVC resort agreement for trades is something people want to discuss, it would make a nice new thread!!

 

[Jwaire]

I agree with most of these arguments. However, if it was a slam dunk Disney would have just said right from the start. Plus, there has been at least one clue ( the presentation that said it was PVB) that it will be the same association.

D23? It only says "Disney Vacation Club at Disney's Polynesian Village Resort"

 

[Roughians_satchel]

To me, the bigger aspect is it allows them to stay the course with the long game. It allows them to not have both the tower and the longhouses all expire at the same time and be left with all those rooms at once.

You mean like the Boardwalk,Beach Club and Boulder Ridge (not to mention Vero, HH, and some OKW) combined inventory in 2042? If they can survive that, I'm sure a combined Poly in 2066 would be no biggie.

 

[KimMcGowan]

D23? It only says "Disney Vacation Club at Disney's Polynesian Village Resort"

View attachment 786036

No, I believe it was at the association meeting. It wasn’t the D23 meeting.

 

[Sandisw]

You mean like the Boardwalk,Beach Club and Boulder Ridge (not to mention Vero, HH, and some OKW) combined inventory in 2042? If they can survive that, I'm sure a combined Poly in 2066 would be no biggie.

That is the thing,,,we have no idea…and they probably don’t either…how they will handle that with the 2042 resorts.

So, why create that same situation again…which is why I see having both expire at the same time as a con for DVD financially.

It could be why they changed the model to 50 year contracts all those years ago to prevent that from happening any more.

ETA: VGF was small so adding the resort studios didn’t make it a massive resort in terms of points…I think it’s now pretty close to what just the long houses and bungalows have,

 

[Sandisw]

No, I believe it was at the association meeting. It wasn’t the D23 meeting.

If that slide ar DVC meeting was not a mistake, I guess we will find out in a few months at this years meeting.

But, as I have mentioned before, every mention since that slide has avoided the connection to PVB. If that was meant to be a clue, we’d have a few more on purpose slip ups.

 

[Nursemanit]

The lack of clear communication from DVD is really disappointing. There is a long history ( BLT) of not stating plans and leaving members in the dark. I am sure they know the answer by now.

 

[SPLzero]

If that slide ar DVC meeting was not a mistake, I guess we will find out in a few months at this years meeting.

But, as I have mentioned before, every mention since that slide has avoided the connection to PVB. If that was meant to be a clue, we’d have a few more on purpose slip ups.

How did DVC talk about VGF2 association prior to sale of points?

 

[aka Charles]

How did DVC talk about VGF2 association prior to sale of points?

VGF2 was very quick from initial announcement to start of sales. A matter of weeks, not months or years.

It was done as a quick and easy turnaround/refurbishment to fill a void and get an easy cash grab.
As of last month, they have sold over 70% of the VGF2 points and should be declared “Sold Out” by the end of the year.

Being as it was done so quickly, they stated that it would be a part of the original VGF association right from the start.
That was a very unique situation and I doubt we will see that again, at least not until 2042.
.