What happens to Old Key West afterr 2042? I own a 2057 contract.

[jshadd]

What will happen to Old Key West between 2042 and 2057? I understand that 20-30% of the resort's members have contracts that expire in 2057, while the rest end in 2042. How will DVC manage the resort over the next 15 years? Will DVC make an attractive last-minute offer to encourage everyone to extend their contracts to 2057? Is that even legal? Could Disney automatically change the end date of all contracts to 2057? After the 2042 contracts expire, would Disney sell new contracts with a 15-year life at a reduced price? What will happen to maintenance costs during this period? We don't know what DVC will decide, but I would like to understand what Old Key West resort, looks like, My contact which expires in 2057.

 

[Brian Noble]

No one really knows. But, here are some bets I'm willing to make:

1: They will not automatically extend everyone for free. I will take any odds on this.
2: They might offer current owners an extension. It might be an okay deal. It won't be a great one.
3: They will be wiling to sell OKW with a 2057 expiration if someone wants to buy it; they are still selling 2042 resorts.

 

[Mouseforward]

The 2042 contracts expire, but the shares of the units of course still exist. The 2057 points at that date have to persist until Jan 31 2057.

Now that WDW has started trust based timeshares, they have the option to take all the shares of the units from the now expired 2042 contracts and resell them in a trust product ( not necessarily Palmetto trust like the cabins). Using a trust, it will not matter if the points are spread over different "units". The issue is will people accept a higher point chart for the trust than the 2057 contracts in the 15 gap years where both exist.

 

[muppets3d]

What's interesting is what if a unit has points that expire in 2042 and 2057, I'd imagine that is fairly common. How does Disney reconcile that when the time comes.

 

[Tatebeck]

The 2042 contracts expire, but the shares of the units of course still exist. The 2057 points at that date have to persist until Jan 31 2057.

Now that WDW has started trust based timeshares, they have the option to take all the shares of the units from the now expired 2042 contracts and resell them in a trust product ( not necessarily Palmetto trust like the cabins). Using a trust, it will not matter if the points are spread over different "units". The issue is will people accept a higher point chart for the trust than the 2057 contracts in the 15 gap years where both exist.

Even if they add it to the trust and resell the points there, I don't think they will (and I'm not sure if they even CAN) increase the point charts across the board, only shift them between room types.

The 2057 contracts already extended/sold will be spread throughout the various units and they each have a percentage of the unit and a point number associated with them.

If you change the point charts for all of OKW, the percentage ownership numbers will be incorrect on their contracts (and maybe the 2057 purchasers will be owed additional points to make up for it? I'm not sure what they would/could do to try and remedy this)

 

[muppets3d]

The 2042 contracts expire, but the shares of the units of course still exist. The 2057 points at that date have to persist until Jan 31 2057.

Now that WDW has started trust based timeshares, they have the option to take all the shares of the units from the now expired 2042 contracts and resell them in a trust product ( not necessarily Palmetto trust like the cabins). Using a trust, it will not matter if the points are spread over different "units". The issue is will people accept a higher point chart for the trust than the 2057 contracts in the 15 gap years where both exist.

I'm not convinced that higher points charts are a given, frankly.

 

[Sandisw]

The 2042 contracts expire, but the shares of the units of course still exist. The 2057 points at that date have to persist until Jan 31 2057.

Now that WDW has started trust based timeshares, they have the option to take all the shares of the units from the now expired 2042 contracts and resell them in a trust product ( not necessarily Palmetto trust like the cabins). Using a trust, it will not matter if the points are spread over different "units". The issue is will people accept a higher point chart for the trust than the 2057 contracts in the 15 gap years where both exist.

Actually, I don’t think they can move partial units into the trust.

They can only move whole units because the property has to be added and DVD has to be the owner of the unit.

Now, they can try to get owners of 2057 contract to sign new deeds to other units so that it frees up whole units.

But, as long as an owner other than DVD owns some of that unit, it can’t go into the trust because it then would need to be removed from the original declaration in the OKW association.

They can shutter building for use regardless of ownership, can offer for cash, use the points to trade into other resorts and keep them there as part of BVTC.

 

[Sandisw]

The multisire POS already gives insight that the current plan is that anyone who didn’t extend will have their contract end 2042.

So, unless someone actually bought a 2057 contract or they are an original owners who did, all those contracts dissolve and the ownership goes back to DVD.

I don’t see them offering extensions at all. DVD will be responsible for the dues on the points they own unless they offer a guarantee like they do now.

 

[Mouseforward]

They can only move whole units because the property has to be added and DVD has to be the owner of the unit.

DVD does not own the unit now , it has a 50 year lease on the unit. If for example 2% of the unit is 2057 contracts then they could renegotiate the lease to accommodate, and not change any use rights or points for the owners.

 

[Lumpy1106]

Wouldn't they do the reverse of what they do with a new DVC? That being; take Riviera for example. It is not sold out, but that does not mean that if you own RIV you get unlimited availability. They hold back a percentage of the units to rent out for cash stays until it is sold out, then it will be 100% DVC (assuming it was meant to be 100% DVC by design but you get what I'm saying). When the 2042 OKW contracts run out they will put in holding a percentage of units for cash stays equivalent to the percentage of points that are no longer owned (the 2042 contracts). If 20% of the contracts are 2057, then 20% of the resort will still be DVC and you will have the same availability in 2043 as you will in 2041.

That would be the simple thing. Beach Club and Boardwalk are already not 100% DVC so those resorts would just be fully cash stays in 2043. Question is, does Disney want a glut of hotels in 2042, or will they do something else to convert those to new DVC contracts? Guessing it will have a lot to do with the economy in 2040 or thereabouts.

Sorry if that's boring, but, LSS - I don't think you will really notice all that much when the contracts expire - that is unless Disney tore down the buildings and built something else, but why would they do that?

 

[Sandisw]

DVD does not own the unit now , it has a 50 year lease on the unit. If for example 2% of the unit is 2057 contracts then they could renegotiate the lease to accommodate, and not change any use rights or points for the owners.

But to move inventory to the trust, they have to own the entire unit.

So, if they want to move Unit 1, and they only own 50% of that unit and the other 50% is owned bt others, then that unit can not go to the trust.

They’d need to have those other owners to give up ownership in that specific unit in exchange for a different unit so DVD becomes sole owner.

It has nothing to do with use, but the inventory and where it is declared

You can’t have some of the same unit be in two different associations.

 

[Tatebeck]

DVD does not own the unit now , it has a 50 year lease on the unit. If for example 2% of the unit is 2057 contracts then they could renegotiate the lease to accommodate, and not change any use rights or points for the owners.

That's just like them trying to get every single owner who didn't extend to sign the quit claim deed. Spoiler; They never were able to.

It is just too hard to get every single owner to sign something away. They would not be required or forced to sign, so it leaves everything in the hands of the owners. I highly doubt DVC wants that. They have rights due to their contracts that DVC can't just take away because they feel like it. A few stubborn members could derail the whole plan.

But to move inventory to the trust, they have to own the entire unit.

So, if they want to move Unit 1, and they only own 50% of that unit and the other 50% is owned bt others, then that unit can not go to the trust.

They’d need to have those other owners to give up ownership in that specific unit in exchange for a different unit so DVD becomes sole owner.

It has nothing to do with use, but the inventory and where it is declared

You can’t have some of the same unit be in two different associations.

Exactly. Would be very hard to do.