Important Update Affecting Resale Purchasers

Lauramae, My thoughts exactly!!!! If you look at the proxy ballot they just sent us your right. For the most part all of the board members are doctors and lawyers whom make much more money then us (assuming) regular everyday middle classers. Its almost like the bailout plans in Washington DC right now. They don't want to spend there money so lets get the little guy to BAIL them out!!!!!!!!

I am of a similar view of many of the posters. I have a different appreciation of the alleged 'refurbishment fee'. Although termed by the Board as such, it appears to be misleading as a refurbishment is an expense incurred for maintenance or repair. What the Association Boards propose seems to be upgrades and enhancements and several of the expenditures could be seen as capital in nature. I, for one, did not purchase a timeshare in order to provide additional amounts of capital investment other than the purchase price paid to Vistana. The purpose of this extraordinary fee has been characterized as necessary to 'enhance' the vacation experience, but the question is who is to benefit from that expenditure? It seems that it should be the owners, but if the owners disagree with the benefit, or that the cost of that intangible benefit is excessive to them, then the Boards cannot be said to be acting in the interests of the association membership.

The question then is how did the Board determine that the interests of the association members is in agreement with the direction that they propose - that is, that the members agree to contribute a significant payment over and above their yearly maintenance and reserve fees. There are several thousands of members in the associations, and I have never been canvassed by any organization as to what my position is on this matter. That is what is required. The association membership should have a say in the matter.

The Boards should be and are accountable to their membership. The Boards should disclose the number of owners who oppose the proposals, or who attempted to contact the Boards to voice their disapproval. The Boards should also be required to advise the association membership of the fact that there is dissent with the proposal and allow those who oppose the refurbishment fee to contact one another. To that end, a mailer or any material sent out to the association membership with respect to this refurbishment fee should also contain a note stating that there is opposition and allowing a mechanism for those that do oppose it to do so in a meaningful way, especially since the Boards will not provide membership information due to privacy legislation. In any communication to your Board, advise them that you consent to them to distribute your personal information (name and an email address) for the limited purpose of allowing other members of like opinion to contact you, or to advise that you are against the proposal (sort of like adding you name to a petition). The members should insist that such a 'petition' be in existence, if it isn't already, and that the association at large should be advised of it. I feel that a refusal by the Board to act in such way could be seen as them acting in bad faith, which could be a ground for a court challenge. The Board of Directors are fiduciaries and as such are accountable to their beneficiaries.

The point is, there needs to be a gathering place where the members can meet and unite. This is merely one website where a handful of unhappy owners have voiced their upset with the Boards' decisions. More are needed. Unfortunately, I don't have the technical expertise or internet knowledge in order to do that. Perhaps someone else does? If not, just talking about it like we are doing here is a positive step as it lets others know that they are not alone.

I hope more will speak out. Please know that I have written to my Board of Directors and advised of my position against the refurbishment fee, for many reasons but especially the current financial situation. For me, the cost greatly outweighs any benefit that I may experience and to continue with this multi-million dollar 'investment' makes no fiscal sense whatsoever.

Feel free to comment or respond. E-mail can be sent to me at gawdelpme@hotmail.com.

I got the invoice from Vistana for over $500 for the first of 3 installments for the renovations that I did not authorize. This is in addition to the over $600 annual fee. I called and asked them to take back my timeshare at NO COST. I do not want it any more, cannot sell it and just want to give it back. Guess what they said? NO, they do NOT take back properties. I asked if they had lots of calls like mine and the guy said they did. Tells you a lot about this property.

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Same exact thing happened to me as I asked the same question. They'll get it back and ruin our credit all at the same time. I loved vistana for 20 yrs and now it feels like my first marriage. BAD!!!!!!! When sheraton took over the place went to hell!!! Sorry cookie3

Gee, I thought that was perhaps their ulterior motive to assessing us with such outlandish reburbishment fees. That would be an easy way for them to regain a lot of the inventory back that they had sold back in the early stages of Vistana Resort for very low prices. But I guess if you offered it back to them and they turned it down I must have been wrong. I guess our board members are just so oblivious to the wishes and situations of the average "timeshare owner" that they just used their own tastes and financial status to decide to approve such an "over the top" refurbishment project. You know it's always much easier to spend someone elses money. ( look at our government for a perfect example of that!!) I feel that they shoudl be looking for someone that can do a nice refurbishment with what we have already paid into our "replacement coffer . If this is how our "elected board members " are going "speak for us" perhaps we need to think about electing board members that are more in touch with the actual owners. I had been assessed a similar fee at another resort that I own and I reviewed my contract and NO Where did it say that that would be allowed . So I refused to pay it and told them why. After many attempts by them to make me pay they dropped the issue. I still own at that resort, but they realized that they didn't have a legal leg to stand on. I will have to dig out my Vistana contract from 1981 to see if there is anything in it that allows for such "overages" and billing of the owners. I know that the governor may not want to get involved with such issues,, but he was the attorney general before he was governor.. and seemed very interested in protecting the average guy against "big business" . So perhaps he might be willing and able to take a look at our situation. Or perhaps the now attorney general. But I am NOT going to just pay these bills without first seeing what "rights" I have NOT to. Just because I am not rich doesn't mean that I am so stupid that I will hand over $1700 just because someone tells me I need to. It's time to wake the board members up and introduce them to "John Q average timeshare owner."

Lauramae, I have looked at my contract from 1991 and it doesn't address the issue of our concern. Now, at Vistana's beach club (not dub) they had terrible hurricane go through there about 4yrs ago and had to refurbish and did charge everyone there a fee of I think $700.00. That is understandable and if you could see the beach club now they did a great job. Went there last year and was totally IMPRESSED. Alot of bang for there buck so to speak. There are many of us that have written letters to the attny gen and recieved nothing but a nice sort of form letter telling us of other people to write. Let us all know how you make out with the Governor. Good Luck!!!

I have been a member of vistana now for over 20 years and it has costed me more than its worth. If I could give it away I would. I've just written the board regarding theses excessive refurb fees and the attorney general. This is the worst investment I've made by far.

Hi Jeff et al, I own at the Courts and my assessment is $2500. My maintenance is over $800. Is there a lawyer out there who could look at our contracts?

I recently applied to the Board as was one of a few finalists. I obviously didn't get appointed although I am currently on a Board of Directors at a condominium complex in Florida and have a masters in management. I told them that the assessments were way too high.

I also own a week at Orange Lake Country Club where we went through a complete renovation at no cost to the owners. I guess that the Holiday Inn group are better managers than the Sheraton ones.

I'll be glad to help if anyone wants to get a group together. I own in both the Courts and the Palms and have owned for over 20 years.

askelly@massed.net

Hello fellow Vistana owners,

I am disappointed with the manner in which the Management Board is handling the entire matter. I feel that there has been no consultation with the people that are footing the bill for the privilege of having an enhanced vacation experience. I would think that a request for such a substantial amount of money, in a non-emergency situation, would have required special and extraordinary steps, including information and discussion with the association members via websites and forums created, communiques and circulars delivered, and any other communication other than simply being told that a decision was made to spend an amount of money for refurbishments.

Unlike a hurricane, this is not an act of God, which requires speed in order to mitigate the damage. I feel that this decision by the Board of Directors was more a matter of expedience rather than an executive decision made in the interests of the owners. This move, on the face of it, appears to be primarily for the benefit of the Sheraton corporation as I cannot see how any requirement to pay a levy regardless of how it is characterized be seen as favorable to the person who pays it. Given that this is a first impression of my view of this fee, I would have thought it incumbent upon the Directors to address all association members' concerns before such a charge is imposed.

I'm also concerned that my concerns are being filtered, or even intercepted perhaps, by the SVO Association Management. I don't know about you, but I would think that there is a slight possibility that the interests of the SVO Management and those of an association member's might conflict. You would think that, in order to at least present that this decision was determined in a fair and impartial manner, communciation would be between the Board and the members directly.

And that is what I would like to know from you. Of those that wrote to their Assocation's Board of Directors, how many actually received a response from a Board Director? I didn't. How many others didn't? Are our complaints actually reaching the ears of the people who we elected to represent us? The people who supposedly made this decision in the interest of their members? If not, why not?!

I, too, would be interested in being part of a group effort to see that our concerns are being properly addressed by our associations' executive. Perhaps a group may get the attention of the Board, when a solitary owner does not. At least I'd feel as if I am doing something other than just paying the fee grudgingly.

By the way, I am also a 20-year multi-unit owner, and I am both surprised and disappointed by this particular decision of the Board of Directors. Had they approached it in a different manner, perhaps I wouldn't have been so surprised and therefore, disappointed. But they did, and I am.

gawdelpme@hotmail.com

I also wrote the board by both the internet and a hand wriiten letter and the response I got was the same as yours. NONE!!!!!!!

I just sent this email to sparenovation@starwoodvo.com and I will let you know what response I receive:

Vistana Spa Board of Directors, We own two weeks in the Spa section of Vistana Resort. The breakdown of the cost per villa in the "Your Vistana Spa Makeover" mailing that you sent us is inadequate. I want a complete and detailed accounting of how the refurbishment money is going to be spent. Please send it to me immediately at: Eric Main ****private****** ********************** If the file is small enough, you may respond to this email with the information attached. I have spent seventeen years as a real estate appraiser, broker, investor and landlord, in addition to serving on the board of several organizations. The total cost of the refurbishment fee per unit is excessive. The only way you could spend that much money on the improvements you have described and showed in photographs is through waste or outright fraud. I understand that the units need to be renovated, but do you not realize that there is a worldwide recession right now? As a matter of fact, the front-page headline in my local newspaper last week read "Real Estate Depression". The middle class owners of timeshares are suffering financially right now. Many of them have slashed expenses and are still having trouble paying their bills. I am sure Vistana was going to have a good number of owners who could not pay their regular maintenance fees this year. Do you really think this is the time to hit them with huge assessments for an obscenely expensive makeover? What difference does it make how wonderful it might be if a big percentage of the owners default? Or is that the real reason for making it so expensive and forcing owners to prepay? SVO gets back a bunch of unit weeks and gets to sell them all over again at retail price. The federal reserve cut it's key lending rate to a record low of between zero and 0.25% (and indicated that it would stay there for a long time) prompting banks to lower their prime rates to 3.25%. Suppliers in the real estate building industry, along with construction companies, are in dire straits right now due to the real estate bust. SVO and affiliated companies have a tremendous amount of leverage due to their size. SVO's forcing owners at Vistana Resort to prepay for an overpriced renovation is going to cause a lot of defaults. Add everything in the previous paragraph together and what is the logical conclusion? 1. Use your size and the real estate collapse to negotiate hard with suppliers and construction companies to reduce the cost of renovations by half. 2. Start renovations now by borrowing at record low rates. You can finish the renovations before they were even scheduled to start in the old plan. 3. This will allow you to spread the cost of renovations out over several years instead of demanding it up front within one year. 4. This will cause fewer defaults and result in happy owners and good publicity instead of the headache you are creating for yourself now. If you don't believe you are creating a public relations nightmare, watch the news and search the internet. Keep in mind, it is only going to get worse. I look forward to a quick reply. Sincerely, Eric Main

Here is the response I received. I thought them getting my name wrong and then threatening me were nice touches. The numbers they attached were the exact same numbers that I said were inadequate in the original email. The fees include $15,500 "Demolition/Renovation" and $16,500 "Other/Contingency". So, fully 1/3 of the $96,200 renovation fee is included in these slush fund categories and there is little other detail. I have to assume these categories are for the money that the Vistana Spa board members and Sheraton are going to pocket. Alternately, they could be planning on giving the contracts to certain companies that will steer the excess money back to them later. Their threat to foreclose on me if I don't pay the fees may show their real intentions here: regain control of a large portion of the unit weeks on the cheap, then resell them at full retail price. Here is their email response:

Dear Erin Main,

Thank you for contacting Vistana Spa Condominium Association and expressing your concerns with us. Owner feedback is something we value and take very seriously.

The Board of Directors and Vistana Spa Condominium Association approved a refurbishment project to completely freshen the interior of the villas. Many of the changes that will take place are being planned to provide an upscale feel that you as an owner have come to expect. The design and the décor chosen will maximize living space while providing a more welcoming look. In this competitive market, we must maintain ourselves as one of the top vacation destinations in Orlando. This project will also be a great means of regaining the RCI Gold Crown rating we once had. A completely renovated villa will provide greater satisfaction and fulfillment to our guests and owners while improving the quality of your stay with us.

The Board of Directors is entrusted to ensure that each unit is maintained to offer World Class accommodations to all of our owners. In the past we have relied on the Replacement Reserves to replace items within the units. These fees were billed out over years and budgeted based on “useful life” assigned to each item within the unit. Items such as countertops, cabinets, and bathrooms were not included in the original replacement reserves. This is the first refurbishment for Vistana Spa that will utilize items not in the replacement reserves plan; however these will be included in the reserve plan going forward. A refurbishment takes into consideration the aesthetic life of the furnishings, while the replacement reserves consider the useful life.

The Board of Directors and your Association reviewed and analyzed all avenues available for a cost effective project. Using items of the highest quality will ensure a longer period of enjoyment and satisfaction for you and your family. Unfortunately the Board cannot control certain aspects of the construction process such as cost of labor, fuel, and materials. The refurbishment has been divided into 3 installments to allow owners more time to pay over a period of time; however should you require alternate arrangements please contact Association Management at 1-800-847-8262. Unfortunately failure to pay the fees may result in further collection action. Interest will be assessed based on the unpaid balance. In addition, a lien may be placed on your week which constitutes an encumbrance against title, which can be foreclosed upon.

Voting on this matter and most issues associated with the management and operations of the associations is solely at the discretion of the Vistana Spa Board of Directors, which is governed by the Articles of Incorporation and the Declaration of the Association.

This project will not only provide you with a completely renovated villa but will increase your comfort level and enjoyment at your resort. We are very pleased and excited with the changes to come. Once again, we appreciate the time you have taken to provide your feedback. We value you as an owner and we look forward to serving you in your future vacation plans for years to come.

Sincerely,

Aixa Garcia SVO Association Management

Look at these two articles written just six months apart. If Sheraton can make such a huge blunder in reading the market, do you really trust them to responsibly hold your money for two to three years?

Friday, April 11, 2008 Starwood Hotels and Timeshare Resorts Plan Aggressive Growth Author: Jason Tremblay

Earlier this week, I wrote in the Timeshare Owners Blog about a predicted future escalation in global tourism leading to a shortage of hotel and timeshare resorts. Starwood Hotels and Timeshare resorts is just one of several hoteliers and developers that seem to think such predictions are solid.

In a multi-year strategy to revitalize the brand name of Sheraton Hotels & Resorts, Starwood begins this week on an aggressive expansion plan calling for 54 hotels and 20,000 guest rooms to be added to the Sheraton brand by this time next year. According to Starwood Hotels & Resorts Inc, the company will be spending approximately $2 billion just on North American properties. The plans include $1.3 billion in renovations and $400 million in key brand initiatives and upgrades at 100 US hotels.

Starwood’s official news release says that Sheraton is already the company’s largest and most global brand, and that they plan to increase this by opening one hotel every 12 days during 2008. Target markets include Denver, Minneapolis, Dallas, Phoenix, and Washington, DC. Globally, expansion plans include Egypt, China, Ireland, and Argentina.

Hoyt Harper II, senior vice president for Sheraton Hotels and Timeshare Resorts says, “Over the next several years, Sheraton’s footprint will become even more prominent, and as we grow, we will leverage Starwoods’ proven history of building great lifestyle brands to enhance the entire guest experience.”

>>>Here's the next article:

Wednesday, October 29, 2008 Starwood Timeshares Reports Third Quarter Drop Author: Jason Tremblay

Starwood Hotels and Timeshare Resorts reported a 12 percent drop in profits for the third quarter, 2008. With this announcement, they joined the ranks of other hoteliers and timeshare developers, including Marriott, Hilton, and Westgate timeshare, who have all acknowledged that they are sharply feeling the credit crunch and the economic downturn.

Starwood (the parent company of Westin timeshare resorts and Sheraton timeshare resorts) reported revenue was flat at $1.5 billion, with international operations shoring up those in North America. Earnings for Starwood were $113 million or 62 cents a share, which is down from $129 million or 61 cents a share, in the third quarter 2007. Figuring all adjustments, and earnings from continuing operations, earnings should have been 71 cents per share.

According to Hotels Magazine, Starwood Chief Executive Frits van Paasschen stated that the company had begun streamlining and reducing costs earlier in the year. Yet, Starwood’s efforts don’t seem to be sufficient to quell concerns. Steve Kent of Goldman Sachs commented on Starwood specifically and the timeshare and hotel industry in general, saying, “… the industry will be hit with increasing supply at the same time demand is falling and [its] negative operating leverage and inability to cut costs quickly suggests margins are going to be under pressure for some time.”

Starwood Says Decline in Hawaii Timeshare and Florida Timeshare Sales is Major Contributor Pacific Business News reported that Starwood specifically blames a decline in Hawaii timeshares sales and Florida timeshares sales for its revenue shortfall. Compared to 2007, revenue in timeshare sales is down 27.4 percent. Contract sales of vacation ownership intervals decreased almost 30 percent at Starwood timeshares, due both to overall decline and to Starwood’s sellout of Westin Kaanapali Ocean Resort North on Maui.

Starwood timeshare says it expects operating income from its timeshare business to drop as much as $115 million this year as demand for Hawaii timeshares and Orlando timeshares decreases.

Ericm169 quotes various business sources that indicate "Starwood timeshare says it expects operating income from its timeshare business to drop as much as $115 million this year as demand for Hawaii timeshares and Orlando timeshares decreases."

I expect that Starwood's sales personnel will increase the sales pressure during sales presentations to make up for this shortfall. Recently I had a friend call me from Maui all excited about a sales presentation he had just attended concerning the Westin Kaanapali Ocean Resort on Maui. He had been offered all manner of inducements to buy "now" and called me for my opinion before he pulled the trigger. He was new to the timeshare industry and was unfamiliar with Redweek.com. I suggested he access Redweek and look at the large number of Westin Kaanapali Ocean timeshares for sale at a fraction of what he was thinking of paying. He did not buy and needlessly to say he is forever thankful for that fortuitous advice he received from me as well as the resale information on Redweek.com.

I just found this information, but I don't know if it is current. I figure it won't hurt to mail copies of my concerns to all of these addresses:

Vistana Spa Condominium Association, Inc. Mailing Address: PO Box 22197 Lake Buena Vista, FL 32830 Orange County

Vice President Director Robert C. Rosenberg 10 Vista Ln Melville, NY 11747 Suffolk County

President Director Herald Hughes 2200 Elm Ave Laurinburg, NC 28352 Scotland County

Stanley Chamberlin Treasurer Director 8915 Shore Rd Brooklyn, NY 11209 Kings County

Nancy Nish Secretary Director 130 Arbor Cir Council Bluffs, IA 51503 Pottawattamie County

J. Richard Boyes Vice President Director 65 Falling Brook Rd Fairport, NY 14450 Monroe County

Grace B. Ghezzi Treasurer 600 Bronson Rd Syracuse, NY 13219 Onondaga County

Registered Agent C T Corporation System 1200 S Pine Island Rd Plantation, FL 33324

Don't know much about real estate, but I thought after 20 years of owning value goes up. I know times are bad now, value of properties are down, DAMM!!! don't just go into "our" pockets and rob us. Hold off until the market improves. Please if I can do anything else (wrote and called AG) let me know. PS I'm selling

There is no way I 'm paying for refurbishing fees at my timeshare without having the pleasure of voting for this. Whoever voted yes to refurbish the condiminums in this recession can pay (board memebers) Sincerely Mrs. Kairelis

They have pictures of the refurbished rooms on at https://www.mystarcentral.com/news/portal_panoramas.jsp.

I thought the idea was to spend $ to make the facility more modern and attractive. Aside from the granite and kitchen cabinets, the rest of the decor looks horrid. Furniture and accessories all look dated. The sheets and the curtains look like left overs from the linens and things bankruptcy sale. How much did they spend per unit? All the lcd tvs look to be proscans or Toshibas. Hope they didnt pay too much for those b/c they are crap. Then again, Im sure they did.

Has anyone gone to the media with this problem? We just received the invoice this week - the first we have heard of the assessment. Yesterday, the brochure with the photos came in the mail. How are we supposed to come up with an extra $511 in a period of less than 2 months? Like many people, if we really see something we want for our home, we budget the amount needed to purchase it, and then save for it. It might take some time, but eventually we will have the money. As responsible aduts, we don't need the instant gratification like very young children who throw tantrums when they don't get what they want immediately. If I read the information correctly ( in the notice we received yesterday), the renovations to the Courts will not begin until 2010 at which time they will have collected a huge sum from the owners plus they will use reserve fees too.