July 17, 2010: WHAT’S ON THE MENU THIS WEEK? Well, the menu is limited this week but the eats are good!
CHEEZ IT! IT’S THE COPS! Florida’s timeshare fuzz (aka investigators with the Department of Agriculture and Consumer Services) made a surprise raid on an Ormond Beach timeshare resale call center on July 14, carrying off boxes of records and computers.
The raid at Buy Owner Resort Marketing was apparently spurred by complaints filed with the State Attorney General’s Office from all over the country. Alleged victims said the company promised to sell or rent out their timeshare properties, but never delivered. Gee, that’s a surprise…
The company was founded by Michael Boland and James Holmes. Mr. Holmes describes himself as a 26-year timeshare veteran who held a State of Florida, Real Estate Sales Associate License for 20 years and owned and operated several timeshare marketing and sales companies. I guess you could say that makes him an experienced operator?
Anyhow, the Department of Agriculture and Consumer Services shut down the company in March for being an unlicensed telemarketing company. One report says that this raid was instigated when the state reopened its investigation and learned the company was still operating. However, the company’s website indicates it is licensed, bonded and registered up the yingyang in the State of Florida, so maybe the raid is not related to the March cease and desist?
Complaints against the company allege that consumers paid thousands of dollars in upfront fees, appraisals and even closing costs, but got nothing in return. The local Better Business Bureau has given the company an “F” rating and said there are at least 20 unanswered complaints. That’s not a good record for a company as relatively new as Buy Owner Resort Marketing.
The investigation is ongoing, so officials are being tight-lipped with details, but a little investigation by yours truly has uncovered an associated appraisal scheme of the sort that has historically smelled of scam.
You see, Buy Owner Resort Marketing has a “network affiliate” called Buy Owner Resort Real Estate, Inc. (Joseph V. Ferry Jr., licensed real estate broker), and that company sends a form to the resale/rental “customers” requiring $495 for a Comparitive Market Analysis of their timeshare, to establish its value. As follows:
As discussed, the Comparative Market Analysis is becoming the “Car Fax” in the Timeshare industry. It is an important document when a potential interested party/buyer requests one, and so with these demanding times we like to have all of our ducks in row when we have such an interested party. In short it’s a request when we say we don’t have one, the customer seems to be a bit standoffish. Also, in a hard economy like the one we are in most buyers will need the help in financing and with the C.M.A. it makes perfect sense because most lenders will request one to show the value when lending. Depending on the lender some may or may not require one to close. [sic]
Please sign the form below authorizing Buy Owner Resort Marketing, Inc. to enlist a Title/Licensed Real Estate Broker Company, to prepare a Comparative Market Analysis for you’re Seller Resort [sic]
Please fill out the credit card information and sign the authorization form. Please scan and email or fax this form back to our office as soon as possible.
Resale companies in Florida got past a no-upfront-fee regulation for years by using the appraisal dodge but not only are appraisals rarely needed/used to sell a timeshare, such an “appraisal” is frankly something that could be easily done by anyone simply by searching eBay or other property transfer history. Unfortunately, most potential “victims” don’t know that.
And oh yeah, besides the outlandish price for the unnecessary CMA, another red flag is that the email address on the form is a Yahoo! address as opposed to a company address.
But I’m getting ahead of myself here. We’ll have to wait to see if the timeshare cops file any charges or arrest anybody before we’ll know if the company was really doing anything illegal (notice I didn’t say “wrong” or “unethical”). Stay tuned.
WHO’S ON FIRST? I’ve been thinking lately about the status of timeshare companies’ health as the economic situation slowly begins to revive. Who’s in Heaven, who’s in Hell, and who’s waiting in Purgatory? With tour flow down across the board, along with prices (and salaries/commission structures), and financing still a problem, who’s healthy? Real data is hard to come by for most privately owned companies, but here’s a tentative, incomplete list I’ve come up with based on a combination of public financial reports, observation, who’s hiring and who’s not and general buzz from within the industry. Feel free to correct me and/or add your own input…
- Wyndham Vacation Ownership– With their various brands, Wyndham is still expanding and hiring, but more slowly and very judiciously.
- Hilton Grand Vacations– Still selling well in Las Vegas and Hawaii, and firm with its plans for 2 new timeshare towers at the Hilton Hawaiian Village. The first of the towers is scheduled for groundbreaking in 2013.
- Mayan Resorts– One of Mexico’s largest timeshare companies, Mayan is actively building new product (especially in Puerto Vallarta) and selling upgrades to existing owners as well as selling to new customers in all of their resort locations. Definitely still on the move!
- Orange Lake Resorts– Largely due to its new association with the Holiday Inn Club Vacations, Orange Lake is growing, hiring, and doing fairly well.
- Berkley Group– Including Eldorado Resorts, Patriot Resorts, Williamsburg Plantation, Vacation Village Resorts, et al, is still actively selling, and is reportedly adding an additional 400 units to its Grandview property in Las Vegas this year.
- Diamond Resorts International– DRI makes it to this list mainly because it looks like they will soon become the new owners of bankrupt ILX‘s assests, and some of those assets are pretty good. Therefore, DRI is expanding. DRI has also been hiring in many locations, including Europe, so although it is a private company and no financial reports are made public, it seems the company is probably in good shape.
- Spinnaker Resorts– Spinnaker may have had to go ahead with the new $11 million South Tower at its Royal Floridian Resort due to obligations to customers who already paid for inventory there, but the important thing is they ARE building it. AND refurbishing the Royal Floridian as well. Getting BIGGER, making sales. Not a bad place to be in…
- Mahindra Holidays & Resorts Ltd– Mahindra plans to launch four new products in the 2010-2011 fiscal year to boost its product offering, adding 600 new units to its existing portfolio. The new products include a camping product (tented accommodation), a membership product for senior citizens, another for the high-income group and a deeded product. Definitely in a strong place as shared ownership continues to grow in India.
- Disney Vacation Club– Though sales and prices have dropped compared to high times, Disney is pushing forward with its new Hawaiian Resort and has even started presales for that resort. The company is still strong, and I suspect we can see more growth in future years.
- Sol Melia Vacation Club– Sol Melia continues to expand its brand, principally in Mexico and the Dominican Republic. They may have slowed down some, but not by much.
- Starwood Vacation Ownership– Starwood is doing some hiring at its existing resorts, but though sales and revenue are beginning to increase compared to 2009, the company is not expanding its properties at this time. They’re not growing, but they don’t seem to be in trouble, either.
- Marriott Vacation Club International– MVCI is also still selling at its current locations and has introduced a new points program that has promise, but they still don’t expect to build new properties in the near future.
- Shell Vacations Club– Shell seems to have pulled in its horns pretty strongly. They aren’t doing much hiring and aren’t growing their collection of resorts, but they are working hard at expanding their business model and look to be holding steady.
- Bluegreen Resorts– Bluegreen Corp. took a big hit but the company was nimble and quickly launched a fee-based services business in 2009 at resorts in Arizona, the Bahamas, Massachusetts, New Hampshire and Virginia. Management contracts with hotels and timeshare resorts have helped hold the company steady.
- Point to Point Destinations– Headed up by Johnny Saldat, PTPD is still selling and at least as of last April was still adding new affiliation destinations for its members.
- InnSeason Resorts– A small, independent company with 6 resorts, InnSeason is still actively selling and hasn’t shown any obvious signs of distress.
- Pacific Monarch Resorts– Headquartered in Carlsbad, CA, PMR is most actively marketing its Los Cabos resort, the Cabo Azul. Aside from that property, which was pretty much finished before the big bang happened, the company is not building anything new but they haven’t stopped hiring and seem to be steady eddies.
- Silverleaf Resorts– Silverleaf seems to shun publicity (odd, for a public company), but they’re still hiring, still selling, and they recently extended their revolving credit facility with Liberty Bank, so I have to give them a steady eddy, too.
- Festiva Hospitality Group– Festiva, which turned 10 years old this year, shut down sales and marketing at the Paradise Harbour Club & Marina in Nassau, the Bahamas just before Christmas 2009 due to poor sales. But they don’t otherwise seem to be in trouble and have in fact been hiring from time to time this year. Steady eddy?
- Gold Key Resorts– Gold Key (Ocean Beach Club, LLC) recently renewed its affiliation with Interval International, encompassing four resorts in Virginia Beach, Virginia, in a multi-year contract. Gold Key is commemorating its 20-year anniversary in timesharing, and though they don’t seem to be expanding they don’t seem to be in trouble, either.
- The Villa Group– The Villa Group (Villas del Palmar, et al) is selling existing inventory as well as going forward with their new resort in Loreto, Mexico, which they began before the big bang occurred. They’re holding steady, but not in a big enough way to make the Still Strong list.
- Hyatt Vacation Ownership– Hyatt has always been very quiet about its timeshare branch, but though I’ve seen no sign of current expansion they are still selling and I haven’t seen any indication of trouble there. Steady eddy.
- Island One Resorts– Industry scuttlebutt (unconfirmed) indicates that Island One is scrambling a bit. Hanging on, has a strong member base and strong leadership and will almost surely make it, but they’re anxious for this mess to be over.
- Westgate Resorts– No surprise here, if you’ve been paying attention. Westgate found itself seriously short of cash and has been struggling mightily to save itself, selling off properties and tightening its belt wherever it can. They are still selling, still hiring, but assuming the company survives it will definitely be much smaller than it currently is.
- Who else is hanging on for dear life?
- ILX Resorts– ILX just couldn’t hold on. The company filed for Chapter 11 bankruptcy (reorganization protection) in March, 2009, citing “Dramatic challenges in the economy and recent unanticipated reductions in our credit facilities caused by disruption and instability in the capital markets” as the cause. As mentioned above, Diamond Resorts is currently set to purchase the assets, so ILX will probably be folded into DRI.
- Consolidated Resorts- This company went bankrupt when Goldman Sachs decided it didn’t want to play anymore, pulled out of its partnership and wrote the whole thing off as a loss. It currently appears that founder Arthur Spector will be buying most of the assets back out of bankruptcy, so expect to see it ramp up again eventually.
- Celebrity Resorts– On Friday, March 5, 2010, Celebrity Resorts, LLC and 35 affiliates voluntarily filed for chapter 11 bankruptcy protection in the United States Bankruptcy Court in Orlando, Florida. I’m embarrassed to admit I haven’t been following this case, so I don’t know how far along they are in the process or what the probable outcome is. I’ll check it out and report back soon.
Sure, this list is by no means all inclusive and it’s just my opinion, but it’s a good start…
ODDS & ENDS: SellMyTimeshareNOW.com has garnered another coup. The company has been appointed as authorized reseller for The Crane Resort in Barbados, one of the most luxurious resort properties in the Caribbean. The company is now recognized as the exclusive authorized reseller for their active resales program. A pretty good gig!
RCI and II have announced some new affiliates. RCI has affiliated the Golden Parnassus Resort & Spa and Great Parnassus Resort & Spa, both located in Cancun, Mexico, as well as the Decameron Panaca, located in the heart of the Colombian coffee zone, one of the most popular destinations in Colombia.
Meanwhile, Interval International has added the Grand Miramar Club & Spa to its exchange network. The luxury resort is located in the Sierra Madre Mountains in Conchas Chinas, a neighborhood known as the “Beverly Hills of Puerto Vallarta, Mexico.” They have also added the Bali Palms Resort, a fractional resort just steps from the sand in the East Bali town of Candi Dasa.
And here’s one for bragging rights: Hanalei Bay Resort, professionally managed by Trading Places International, has been recognized by Fodor’s Travel as a “Best Hotel Pool in the U.S.” and has been named a Fodor’s Choice Gold 2010 award winner. This distinction represents a remarkable achievement and recognizes Hanalei Bay, a resort on the island of Kauai, Hawaii, as having one of the top pools located on a U.S. hotel property. See the press release if you’d like to see a photo of the pool!
And finally, a new warning is being issued to UK vacationers as they head overseas. It seems the NEW scheme for parting holiday makers from their wallets is the promise that if they buy more weeks, their investment can be converted to fractional ownership.
The consumer is persuaded to buy more weeks, completes the paperwork, but gets nothing to show for it in terms of the deeds, etc. They have simply found themselves signed up to more regular weeks of timeshare ownership. There are plenty of legitimate schemes of this type, but some are nothing more than a new way to sell extra timeshare. It can be hard for a consumer to tell the difference.
Just remember, good people, that under the new timeshare directive, consumers effectively have a 14-day cooling-off period…
THOUGHT FOR THE DAY: In these days of such a divided nation, has anyone besides me thought how incredibly ironic it is that, when the Pledge of Allegiance was changed in 1954, they actually put “under God” in between the words one nation and indivisible?
PEOPLE: It seems like most of the folks Diamond Resorts International hired to fill executive positions shortly before the big bang have since left the company. Some have formed new companies on their own, some seem to have quietly disappeared from the public view. Some of those all-stars: Jim Danz & Bill Tsao (who have formed Trident Business Management), Marty Kandel, Michael Finn, Hector Maldonado, Jerry Tracy, Sandy Knapp, Jim Gioiosa, Simon Crawford-Welch…
Did they quit? Were they fired? Where are they now? Enquiring minds want to know…
In other news, Orlando-based Planet Hollywood International Inc. has hired travel and hospitality industry veteran David Crabtree as President and Chief Executive Officer.
Before joining Planet Hollywood International, Crabtree spent twelve years as the Chief Operating Officer for Sales and Marketing at Westgate Resorts, where he oversaw the rapid expansion of the world’s largest privately owned vacation ownership company. Crabtree also spent six years as Executive Vice President of Debbie Reynolds Hotel and Casino in Las Vegas.
IN MEMORIAM: Inside the Gate is sorry to report that Joseph ‘Kenny’ Huneycutt, 50, of Avon, Colorado died Sunday, July 11.
Ken was born March 5, 1960, in Durham, N.C. He was raised and educated in Reno, Nev.
Ken enjoyed life in Vail Valley for 15 years, then 10 years in Kauai, Hawaii, where he met and married his wife, Terry. Ken and Terry also lived in Steamboat Springs for two years before returning home to the mountains of Vail. He achieved great success in real estate sales with Marriott and Starwood Vacation Ownership.
He is survived by his loving wife, Terry; father Dr. Harry C. Huneycutt and wife Rita; mother Christi Huneycutt; sister Sherry Huebner; brother David Huneycutt and wife Anella ; stepsisters Alyson and Carrie Huneycutt, Kimberly Luikart and husband Bill; uncle Glenn Teasley and wife Marilyn and daughter Nancy Kim; niece, Marissa and Erika Huebner and Lauren Huneycutt; and nephew Jake Huneycutt.
In addition to his love for family and friends, Ken loved the great outdoors, snow, water skiing, hiking, mountain biking and his adoring pets.
A memorial service was held at 10 a.m. Friday at the Vail Interfaith Chapel.
In lieu of flowers, Ken would have preferred donations to Vail Nature Center, 841 Vail Valley Drive, Vail, CO 81657, to care for the mountains he loved so much.
And that’s it for this week’s Roadkill. See ya next weekend, and keep your eyes on the road… Oh, and if you enjoyed this, tell a friend!
Published every Saturday.
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