WDW resort going forward

[beer dave]

Per that logic, I guess Disney's going to turn every hotel property on site into a time share.......

No---- just the good ones.

 

[lockedoutlogic]

No---- just the good ones.

Agree...

Honestly, I don't know how anyone can be surprised if that turns out to be the ultimate end game.
It was very predictable - especially since bay lake and the animal kingdom projects.

The rumored conversion plans at wilderness lodge - as opposed to new construction at ft wilderness - is something very telling to watch.

It would prove they are not interested in growing their overall inventory, and therefore are at the limit of expansion and moving away from rack rate business...

It also opens the door for more retrofit.
Beach club, I'm talking about you...

And poly, grand Floridian, contemporary, boardwalk, and yacht club...you're on deck as well.

 

[Josh Hendy]

There is the question of personal leadership style at the top, e.g. this guy was a creative type, that guy is a beancounter, etc.

But another huge factor that is underrated is the relentless program of monetary expansion being undertaken by the US federal reserve and US government at the behest of, and for the profitability of the major banks. In other words, massive money printing.

An inflationary environment (an increase in the money supply not necessarily reflected in price increases) always distorts the way that money is invested, loaned, borrowed and spent. Certain types of projects are abandoned which would be sensible and profitable in an environment of stable money supply, and certain other types of project are amped-up because the easy availability of cheap credit makes them far more profitable.

You may say, "Ah but wise corporate leaders will resist the trap of easy credit because they know that their company will be wrecked in the inevitable crash that always follows every period of significant monetary expansion." But this is not true at all. I saw it with my own eyes during the tech bubble of the late 1990s. My company CEO tried to say "we're not a bank" and resisted the financial shenanigans such as borrowing lots of money, then lending it to our customers so they could buy our products. His prudence didn't do him a darn bit of good. We had competitors who were playing financial games up the ying-yang and we had shareholders who looked at their larger (and rather fictitious) paper profits and then beat up our management to get better results. The CEO and executives had NO CHOICE but to participate in the financial nonsense because otherwise they would lose their jobs. Eventually of course they DID lose their company and their jobs, but in the short term they had only one possible choice. They did make a ton of money in the short term on stock options and bonuses, as did the shareholders through the magic of "pump and dump".

I think that Disney's relatively strong emphasis on projects that are decidedly in the "financial shenanigans" category because they involve easy credit and sophisticated beancounter-inspired justifications (DVC and Magic Bands) is because of this inflationary environment.

Universal on the other hand has no choice but to build really satisfying (to the customer) bricks-and-mortar attractions because they do not have a large enough footprint or customer base to enable them to launch into the world of high-finance trickery. They do it at a higher level I have no doubt, but on the ground in theme parks and hotels they do not have enough couches lying around such that they could survive for several years searching them for nickels and dimes - the way that Disney can by shoe-horning DVC timeshares onto existing properties and issuing customers with revenue-enhancing, pre-made daily schedules and tracking bracelets.

 

[uriko]

ABSOLUTELY!!
I hate the new corporate business environment. I work for a large chemical company. They are no longer interested in innovations and research, that want us to magically pull fabulous ideas out of our you know what in 2 weeks.
We've got chemist, researchers and biologist leaving in droves because the company is only interested in the bottom line

I think in an economy which is still struggling, this becomes the go to. I'm in education and it's the same for us. How can we improve for the short term and look great with our numbers regardless of the impact it has on their education in the long term. Poor planning and these policies are not what made us a powerhouse in the past. A a nation, we are looking like a target ourselves for a take over.

 

[JeanfromBNA]

It's also on the most expensive islands in the world, in the middle of the largest body of water on the planet and...
Airfare ain't cheap.

In Disney's mind, vacation club is an "exclusive" group of $500,000 and up income earners...
Reality is for the majority it's a luxury that is a "significant" investment to most and therefore requires some measure of financial sensibility.

Aulani always has the potential to be too out of line with those sensibility..

Especially with that fool joe rohde spending like a sailor on it

Re: the bolded: I doubt that's the way Disney looks at DVC at all. If it was, they wouldn't have built nearly the number of DVC units that they have so far, much less plan for more. I also doubt that describes the average income of DVC owners. I would guess that most have to be creditworthy, and therefore, have a stable income.

Full disclosure: We're DVC owners, and we've been to Aulani. IMO, it is the best of the Disney resorts, hands down. You're right that it's too far away to plan annual trips, but we're looking at going back in a couple of years.

 

[chapie1968]

Is any of this really surprising? Deluxes are not selling even with rampant discounts. !

Because you have to be an idiot to pay that price for a Disney "Deluxe" room. They are basically the same room as the values.

 

[chapie1968]

The earliest DVC contracts expire in 2042. (OKW I think, BC, BW ) The exception is that the OKW owners were offered an extension at some point . Not sure if that extended them to 42 or from 42?. I'm not sure about VB and HHI.

Wait a minute. You pay all that money for DVC and it's not lifetime or able to be passed on?

 

[chapie1968]

I agree, and I also would love to stay in a tee pee out on bay lake. Hear that? It's the sound of my DVC ownership becoming more valuable.

I'm sorry to tell you, your DVC ownership will NEVER become more valuable. It will continue to be less and less valuable, especially with each and every DVC room they add.

 

[rteetz]

Agree...

Honestly, I don't know how anyone can be surprised if that turns out to be the ultimate end game.
It was very predictable - especially since bay lake and the animal kingdom projects.

The rumored conversion plans at wilderness lodge - as opposed to new construction at ft wilderness - is something very telling to watch.

It would prove they are not interested in growing their overall inventory, and therefore are at the limit of expansion and moving away from rack rate business...

It also opens the door for more retrofit.
Beach club, I'm talking about you...

And poly, grand Floridian, contemporary, boardwalk, and yacht club...you're on deck as well.

The whole point Disney isn't doing DVC at Ft. Wilderness is because of money. Disney does want to and has plans for the River Country site but it would cost a heck of a lot more than converting more rooms at the Wilderness Lodge. Beach Club is also rumored to get more DVC converted rooms. The spirit who started these rumors says Disney will not add DVC to Yacht club because its a convention hotel and they don't want to mess with that. As for the rest of those resorts they are fair game.

 

[tjkraz]

Because you have to be an idiot to pay that price for a Disney "Deluxe" room. They are basically the same room as the values.

And yet thousands of people do it every day. Go figure.

Wait a minute. You pay all that money for DVC and it's not lifetime or able to be passed on?

With other timeshares suing the heirs / descendants of former owners to try and compel them to continue paying for the unwanted property, a built-in ending date may someday prove to be the best aspect of DVC. Maintenance doesn't tend to decrease on properties that are 50..75...100 years old.

I'm sorry to tell you, your DVC ownership will NEVER become more valuable. It will continue to be less and less valuable, especially with each and every DVC room they add.

Depends on the circumstances. There are many, MANY people who have seen their DVC purchase increase in value. Some of the early buyers at Bay Lake Tower paid less than $95 per point. Today they could sell for over $100...after having enjoyed 4-5 years of discounted vacations.

And that's just one example.

The whole point Disney isn't doing DVC at Ft. Wilderness is because of money. Disney does want to and has plans for the River Country site but it would cost a heck of a lot more than converting more rooms at the Wilderness Lodge. Beach Club is also rumored to get more DVC converted rooms. The spirit who started these rumors says Disney will not add DVC to Yacht club because its a convention hotel and they don't want to mess with that. As for the rest of those resorts they are fair game.

Of course overall cost is going to play a role in any decision. But let's not pretend that the Ft. Wilderness project is permanently off the table.

When it comes time to move forward on the next DVC project, they have several options on the table from which to choose. The decision will be based upon a variety of factors...of which cost is only one.

 

[dinolounger]

I'm actually very surprised aulani had a tough time selling because everything give heard is it's the best Disney resort anywhere in the world.

Tough doesn't even describe it.

Disney is so desperate to try and get warm bodies to purchase Aulani that is now offering a bonus of 15 extra points for every 100 purchased. They just sent a mailing out to existing members hyping that. Interestingly, the piece also ballyhoos resort and month specific special bonus upgrades at other DVC properties if you plunk down your money by this October.

 

[tjkraz]

Tough doesn't even describe it.

Disney is so desperate to try and get warm bodies to purchase Aulani that is now offering a bonus of 15 extra points for every 100 purchased.

lol. I wouldn't read too much into that. It's just DVC's typical modus operandi of dangling a carrot to encourage sales.

Current base price is $160 per point. Taking into account the extra 15 points received, you're still paying a healthy $139 per point ($16000 / 115 points = $139 per point.)

Incentives as of January 2014 featured base price of $150 per point with incentives of $12 off for a 100-pt add-on....for a net of $138 each.

Going back 4 years to when Aulani went on sale, the initial offering price was $114 per point with a discount of $8 per point for 100+. So net of $106 per point. I'd say going from $106 to $139 per point in 4 years is some healthy inflation.

Aulani has become a convenient punching bag and chances are sales have not been as good as Disney projected when the project was originally approved. (Those annual dues miscalculations cast a shadow over the entire project.)

But unless someone has numbers they wish to share, we really don't know how far off projections they really are.

With nearly 500 timeshare villas, Aulani was always going to be a long-term sales project. That's bigger than Bay Lake Tower and Grand Floridian DVCs combined...two park-based properties which will take over 5 years to sell.

Even Jim Lewis wouldn't have projected Aulani to sell out in 3 or 4 years. When all is said and done, 10 years to sell-out wouldn't surprise me a bit for an off-site DVC of that size.

 

[lockedoutlogic]

Tough doesn't even describe it.

Disney is so desperate to try and get warm bodies to purchase Aulani that is now offering a bonus of 15 extra points for every 100 purchased. They just sent a mailing out to existing members hyping that. Interestingly, the piece also ballyhoos resort and month specific special bonus upgrades at other DVC properties if you plunk down your money by this October.

i shred all such mailings without even opening...

i wished they'd stop and save the trees

 

[rteetz]

i shred all such mailings without even opening...

i wished they'd stop and save the trees

Why don't they just send more emails?

 

[lockedoutlogic]

Why don't they just send more emails?

my guess is that alot of their target demographic - those with cash to blow and no mortgages or $300,000 college bills - are of the more "seasoned" age group

just a hunch

 

[lockedoutlogic]

I'm sorry to tell you, your DVC ownership will NEVER become more valuable. It will continue to be less and less valuable, especially with each and every DVC room they add.

hmmm...why is this angle giving me deja vu all over again?

 

[rteetz]

Just thought I'd post that Jim Hill another source has come along and said Disney is expanding DVC by converting rooms at the wilderness lodge and more resorts will follow suit after that is done.

 

[lockedoutlogic]

Just thought I'd post that Jim Hill another source has come along and said Disney is expanding DVC by converting rooms at the wilderness lodge and more resorts will follow suit after that is done.

I saw the same idea floated somewhere else...it definitely wasnt jim hill though the original rumor could have had the same origin...

I'm just now starting to look at this "deluxe" room glut that is being widely report

This was much easier when I had daily access to the occupancy rates and long term forecasts...guess we all have to "grow up" at some point, huh

But if true - and I don't have a reason to doubt it - and they just can't move the "deluxe" world class rooms (insert laugh here)...the retrofit of existing sites with existing DVC add ons make complete cost cutting sense.

That is wilderness and beach club to a T

But again, if they hadnt consistently jacked the rates through the roof after the 9/11 drawback and through the housing crash...wouldn't be a problem...

Should have let Income Levels close the gap on the cost of moderates and deluxes...
But no, had to outrun it and force what could have been deluxe customers into moderates and nobody into deluxes.

Atta boy, Bob

 

[lockedoutlogic]

Wait a minute. You pay all that money for DVC and it's not lifetime or able to be passed on?

Ok...looked at the 3 "points" again and I have got to call shenanigans...

Where you been, pal?

 

[Disneychick75]

Is any of this really surprising? Deluxes are not selling even with rampant discounts. As long as DVC sells a conversion is cheaper than starting from scratch. The tee pees over the water sound strange!

Deluxes probably aren't selling as well with discounts because the rack rate is outrageous. Not that many years ago, a deluxe was 350-400/night. With a discount, they could be had for a couple of hundred dollars/night. Now, those same rooms can get up to 600-650/night. With the discount, the rooms sell for what their rack rate was 2-3 years ago. People are not stupid. I saw the WL going for well over $300- that's insane.