The Spirited 8th Wonder (WDW's Future & You!)

[bhg469]

I wish TDO all the luck in the world with their toddler, princess, and timeshare business model.

Since I am not a toddler, Princesses aren't really my thing (us queens usually poison them), and I have no intentions of handing TDO tens of thousands of dollars to be "locked in" to decades of vacations to an obviously declining product, all I can think of is, *** is going on down there.

Let me know when TDO gets around to once again giving a **** about the parks.

Well, there is always something going on a little bit east.

 

[doctornick]

Granted I don't have specific experience with DVC rooms, but I would imagine operations might be similar to other 'time-share' type operations.
Specifically.... even though you are saving on man-power by not cleaning the room each day... there are additional operational costs for repair and replacement of room items. DVC's introduce small appliances, furnishings, etc... and most time-share places I have stayed at use relatively cheap cookware, and small appliances that are broken, break down, or are just plain missing upon check-in.

Well, that kind of stuff should be covered by the annual dues for the resort. I'm not really talking about that.

I'm talking about when the WL lobby or pool needs refurbishing that P&R would be willing to put more money into it because they made a boatload of DVC money years ago. Stuff that affects the whole resort.

 

[WDW1974]

I have similar memories of staying at CR and spending a few days at RC and FW and discovery island. Back when you could swim in the lake too if you wanted too. It was a more laid back time.

I'm not saying all DVC owners are taking more relaxed trips to WDW, but some do. @ParentsOf4 posted about a few trips where he spent most of his time at the resorts or water parks and didn't even visit the WDW parks much. When is the last time you heard of a cash guest saying they spent a week at AKL or CR and only visited the parks a few days and just enjoyed the resort amenities?

I realize that I am days behind (almost a week) in my own thread (one that has stayed very on-topic!), so we may have moved beyond this. But my feelings are that when Disney moved to the commando style of visiting, with all the trappings of doing everything in advance except for your bathroom breaks -- btw, I have no doubt at all that some crazy Mommies have these penciled into their OCD spreadsheet vacation planning, that the whole 'resort' aspect was willingly shoveled under a desire to have folks on the go from the minute they wake up until the minute they get into bed at night.

WDW wasn't Walmarted by society, it pushed for it as part of a business model.

Sure, you could water ski, but why would you when you have a FP to meet Anna and Elsa? Sure, you could spend a day at the spa, but that might take a day away from the MK, so why would you? Sure, you could rent bikes or boats at FW and explore the wild side of WDW, but wouldn't you rather ride PotC for the 186th time? And with the prices so obscene at WDW now, there is absolutely no incentive to do anything but run around theme parks and eat absurdly priced Disney meals for as long as you can. Disney is wringing every last penny out of you, so you want to wring out every last penny of what you perceive to be vacation value that you can.

Long gone are the days of playing tennis at WDW or horseback riding or wandering around Discovery Island. All left behind for a Walmarted run thru the seven ... oops, six now barely themed lands of the MK and trying to 'get your ride on' as the Aswad would say as many times as possible.

The Vacation Kingdom of the World? I'm sure you can buy repros of merchandise from back in the day when that existed at the Marketplace Co-op and then Tweet the pics to your pals (Scary Steven Miller will help you!) so they can desire the same crap you bought.

Now, DVC guests absolutely can take more time to 'smell the roses' so to speak because of how they pay. And we certainly did so when we stayed at DAK Lodge Villas last year for 12 days. I think we had two days where we didn't leave the resort and a few others where we may have gone to a park for 3-4 hours and that was the day.

But I think most DVC guests are conditioned to also try and get as much 'value' out of being at WDW and that tends to not include lazy walks from the WL to FW, playing with the horsies, renting a boat and then walking back for drinks at the Territory Lounge.

 

[hokielutz]

First off... it seems like I go offline for a couple weeks.... and now there is this monster thread of 80+ pages springs up and I don't have time to read everything to see if it was discussed.... so I will just come out and ask.

From the first five pages and in the last 5 pages... it appears the main take-away is that due solely to poor TDO & Corp WDW management decisions... The resorts in Disney have developed significant vacancies (over time?) to the point that now Management is shuttering some of its surplus inventory and then converting other inventory rooms to DVC villas.

I can't deny that Disney isn't experiencing vacancy issues.... because even far & away in Washington DC... reports of DISCOUNTED Rooms for the late summer and fall signal they aren't getting the plan ahead reservations they intended. (horray for me as a price conscious consumer!)

But has it been discussed as to what level of outside influences have affected on property stays?? I've observed that in the last 10-15 years, there has been a large growth of timeshare/vacation properties outside Disney's gates on I-Drive, etc. Mt wifey and I bought into one ten years ago.... and have watched many new places crop up around us and are still expanding today. In our opinion... the drive onto the property is not a bad experience and doesn't prevent us from experiencing everything we want to do on property. In some ways, a car is more convenient to go from Park to DTD to ADR's. From what I have seen.... Parking lots are still getting a lot of traffic.... even during value/normal seasons.

Could the growth of these kinds of deluxe accomodations and vacation properties be a significant factor that is eating away at Disney's home grown resorts?? or am I way off base?

 

[Stevek]

I don't think people are actually saying this.

No, but it's true ; )


Just kidding...

 

[hokielutz]

Well, that kind of stuff should be covered by the annual dues for the resort. I'm not really talking about that.

I'm talking about when the WL lobby or pool needs refurbishing that P&R would be willing to put more money into it because they made a boatload of DVC money years ago. Stuff that affects the whole resort.

I would think that a portion of the annual dues of the DVC will have a line item for Capital reserve/replacement. I haven't seen how the various DVC properties disclose the accounting of their operating income... but I know our Starwood Villas resort has a portion of our annual dues set aside for refurb & replacement to be used at certain intervals. This includes an issue that is very near and dear to most of the regular posters on this board.... Repainting exteriors and touch-up as needed.

 

[Stevek]

Since @ParentsOf4 and others have given the financial answers to the question, I would like to follow up with I believe to an example of the cosmetic, wal-mart style "dumb down" you get with DVC. Lets compare the original Grand Floridian with its DVC counterpart. Here is a picture of the original Grand Floridian. Its marvelous, exquisite, and extremely detail oriented. It is their "flagship resort", as they like to call it.


View attachment 60210


Now, lets take a look at the DVC version. I have placed arrows in areas that show the extreme LACK of detail when compared to the original GF design. Please keep in mind that this building is an addition to the most expensive and what Disney calls their "flagship resort". Also keep in mind the original was built decades ago when the compnay had less money to work with and technology and materials were not as advanced as today.


View attachment 60211

Lets go from top to bottom. Look at the spires on the DVC building. No windows, no layered roofing effect and much smaller. Also notice the roof is flat on DVC compared to the original which is layered. Now look at the covered windows on the roof (above the rooms) There isnt even a window on the DVC version, theyre not even sunk in and on the original building there is a window (on the roof) above EVERY room, on the DVC, there is just a few, and again, extremely less detailed. Next we move onto the side of buildings, IMO, the worst part. What were they thinking? Look at the sides of the original building, there are top to bottom bay window style towers with windows and coned rooftops. The side of DVC is just flat and white. They didnt even put faux windows in to create a decent look. Just a wall. It makes it look like a slightly upgraded
Red Roof Inn. Also notice the lack of trees. Theres very few compared to the original and the original has much better landscaping all around the resort, not just near the entrance. I will say that the rooms are excellent in both style and design, but that doesnt make up for the wal marting of the outside. Is this seriously the best they could do? Or is it the cheapest they could do while still maintaining somewhat of a resemblance to the original? I feel bad for all the people staying at the Poly who have to look at Disneys flagship pile of hot, steaming pooh (exterior wise).

Other than the color scheme, the lack of similar features make it look like 2 different places to some extent. Especially if they weren't right next to each other.

 

[Stevek]

Sorry, I could have gone with Jackie Smith and the Super Bowl but most people wouldn't get that.

As a Pittsburgh Steelers diehard, I get it! : )

 

[jlsHouston]

I know they say you shouldn't post when angry ... but I have a line that I'd so like to use here (nothing against you!) sometimes it just is very tiring having to fight 'da man every damn day.

I been feeling this alot lately in my business

 

[Stevek]

I realize that I am days behind (almost a week) in my own thread (one that has stayed very on-topic!), so we may have moved beyond this. But my feelings are that when Disney moved to the commando style of visiting, with all the trappings of doing everything in advance except for your bathroom breaks -- btw, I have no doubt at all that some crazy Mommies have these penciled into their OCD spreadsheet vacation planning, that the whole 'resort' aspect was willingly shoveled under a desire to have folks on the go from the minute they wake up until the minute they get into bed at night.

WDW wasn't Walmarted by society, it pushed for it as part of a business model.

Sure, you could water ski, but why would you when you have a FP to meet Anna and Elsa? Sure, you could spend a day at the spa, but that might take a day away from the MK, so why would you? Sure, you could rent bikes or boats at FW and explore the wild side of WDW, but wouldn't you rather ride PotC for the 186th time? And with the prices so obscene at WDW now, there is absolutely no incentive to do anything but run around theme parks and eat absurdly priced Disney meals for as long as you can. Disney is wringing every last penny out of you, so you want to wring out every last penny of what you perceive to be vacation value that you can.

Long gone are the days of playing tennis at WDW or horseback riding or wandering around Discovery Island. All left behind for a Walmarted run thru the seven ... oops, six now barely themed lands of the MK and trying to 'get your ride on' as the Aswad would say as many times as possible.

Though not DVC'ers (we will never be either), this is exactly the mentality we have had each of our 3 trips. We traveled from the West Coast and felt that every minute pretty much needed to be in a park, from open to close. So much that we were absolutely exhausted and had what you could scarcely call a real vacation. We were paying so much money that if we weren't maximizing park time, we felt were throwing away money. It's a real bummer (our fault to be honest) and recent vacations to Hawaii and the Bahamas have reminded me what a real "vacation" should feel like. Don't get me wrong, we have some amazing family memories but it's likely we would have had those same memories if we spent a few hours letting the kids swim while we had a few adult beverages.

Thankfully, as locals at DL (who have visited far too many times), we let the kids run around while we enjoy a drink or 6 at DCA.

 

[seascape]

Make it really easy for them...

I give you $100 today... and that's it.
Or I give you $5 today, and every day into the future for the life of the property.

Which plan makes you more money?

People seem to forget... what do real estate barons do? They LEASE and RENT... Why? Because there is more money in recurring.

The trade-off is garunteed vs future potential... but this is WDW. They should have the confidence in their product to believe they can fill the hotel rooms and don't need the immediate cash out.

You are missing the fact that starting in 2042 Disney gets full ownership back on the 2042 resorts. They cost Disney nothing. All the resorts were fully paid for and maintained. They should only need a rehab. Then they can sell them all over again for another 50 years and this time they will only cost about 10,000 a room. As for rates of return if a DVC costs Disney nothing up front then the rate of return on investment is infinite. From a sellers perspective a right to use timeshare is perfect. All the profits up front, guaranteed operating profits every year and the a free hotel to rent in the future or sell again. Please tell me where there are no long term profits. Right to use timeshares in a resort like WDW are a much better deal for the seller than the buyer. If you want a steal buy Wyndham Bonnet Creek on ebay. You will own it forever and the cost is much lower. But if you want to walk to Epcot and DHS then buy the boardwalk DVC but know in 2042 you will own nothing.

 

[hokielutz]

You are missing the fact that starting in 2042 Disney gets full ownership back on the 2042 resorts. They cost Disney nothing. All the resorts were fully paid for and maintained. They should only need a rehab. Then they can sell them all over again for another 50 years and this time they will only cost about 10,000 a room. As for rates of return if a DVC costs Disney nothing up front then the rate of return on investment is infinite. From a sellers perspective a right to use timeshare is perfect. All the profits up front, guaranteed operating profits every year and the a free hotel to rent in the future or sell again. Please tell me where there are no long term profits. Right to use timeshares in a resort like WDW are a much better deal for the seller than the buyer. If you want a steal buy Wyndham Bonnet Creek on ebay. You will own it forever and the cost is much lower. But if you want to walk to Epcot and DHS then buy the boardwalk DVC but know in 2042 you will own nothing.

So would the original owner get first right of refusal to repurchase??

 

[seascape]

Because that's how corporations keep track of the profitability of various units and ensure that good works pay off. Disney wants to know if WL is more popular than e.g. GF, and if it is, continue to invest to ensure continued growth. That's a fundamental of capitalism. And it's why groups providing "internal" work in corporations still "bill" the clients within the same corporation; you need to track where the money ends up.



Right, but the point is still that WL receives continuous income for whatever the DVC unit "rents" from it. And this ensures a continuous stream of money for WL resort upkeep, or at least those shared areas.

FYI, when I talk about the recurring costs, I did mean coming from the owners; none the less, part of that money surely goes to the resort that the DVC unit is connected to.

Of course, one argument for why DVC could dumb-down a resort is that it "locks in" in the customer; I don't know how hard it is to get rid of a DVC membership, but if it is hard, then Disney wouldn't need to care about resort maintenance to keep the money coming. But is that really the case?

It's real easy to sell DVC memberships and much more expensive to buy them resale vs other timeshares. But it's still better to buy resale like I did for my 350 points. I also bought a weeks worth of point at Wyndham Bonnet Creek for only $330. The dues are more than that a year but for a week stay it's cheaper that staying off site and will let me try Universal without paying them to stay their. Timeshares are a terrible investment for the buyer but great for the seller. A buyer should only buy resale unless you really want to stay at a specific resort. But there are lots of rich timeshare owners but most are either upper middle class or lower upper.

 

[crispy]

Another question about DVC for those in the know - how much money is Disney making when someone finances DVC at 15+%? Does an outside company handling these or is handled in house? Anybody have any idea of how many people are financing versus paying outright? I think that needs to figure into what people are actually paying and the actual revenue that Disney is earning. If someone is financing for years at a high interest rate, Disney is probably making bank from that.

 

[scout68]

I wish TDO all the luck in the world with their toddler, princess, and timeshare business model.

Since I am not a toddler, Princesses aren't really my thing (us queens usually poison them), and I have no intentions of handing TDO tens of thousands of dollars to be "locked in" to decades of vacations to an obviously declining product, all I can think of is, *** is going on down there.

Let me know when TDO gets around to once again giving a **** about the parks.

At the risk of veering off topic I feel response is warranted.

The term locked in is thrown around so easily and often I shake my head every time I read it.

We purchased Kidani direct in ''07.
Cost: (rough numbers here) 16500.00 for 170 points.
We have gone down an average of 1.5 to 2 times a year since. As the overall product has been declining we still have the option to:

1. rent out our points annually and scoop up a respectable profit.
Dues: around $1,020.00
Rental revenue: around $2,040.00 (average of $12.00 per point) On a side note potential point rentals don't last long at all after the initial postings.

2. An outright sale of our contract ($17,000.00 cost) would bring in 13 to 14 thousand dollars in a heartbeat.

While I realize this purchase was not an investment for profit per say we are certainly not "locked in" to decades of vacations.

I am aware that my numbers aren't exact but I think they are a sufficient estimation for point making purposes.

Edited to state I wasn't calling you (Disneyhead'71) out as an individual just decided to throw out a brief rebuttal in general.

 

[flynnibus]

You are missing the fact that starting in 2042 Disney gets full ownership back on the 2042 resorts.

I'm not missing anything. One is a easy way, one way makes more money.

 

[flynnibus]

But wouldn't it be sensible that while the 1998 money is revenue for that year, there is an expectation that Disney, as part of running WL as both a hotel and managing the DVC, will plan to use revenues at some indeterminate point in the future to help maintain/plus WL for both the DVC members and cash guests using it?

The hotel is going to be expected to pay it's way without any holdback from DVC sales revenue. The hotel is going to be expected to be cash positive without subsidizing it with held back dollars.

Profits are held to reinvest in the company, be it capital improvements in the future, etc. But it would make no sense to segment the profits and hold it specifically for this hotel years into the future. You throw the dollars into your piggy bank, and add/subtract to it as your initiative dictate.

The basic principle being that in 1998 they used that revenue to (say) help build DCA, so if DCA makes money in 2014 why can't some of that revenue be used to maintain WL? Not the exact same dollars, but shuffling of money within P&R (or company wide) in the future.

Of course they can - it's all dependent on what the company wants to fund. That's what the budget requests are for and about... asking for approval and funding to make projects happen. Just because I'm measured on my own P&L as a group or division - that doesn't mean I must fund everything from my own reserves. That wouldn't make sense over large scale to segment and stash your capital in dozens of little holes.

Sales of DVC units shouldn't be looked at as "all profit for right now".

But it has to be from an accounting point of view. But do not assume "profit means the money goes away". Profits go into the company's assets that they either reinvest into the company, keep as long term or short term assets, or return to the shareholders via dividends. The company is sitting on over 4billion in past profits it keeps to fund initiatives.

I'm not sure why people are so bent on trying to trace where a dollar came in.. and where that one dollar is going back out. It's like your home checking account.. you carry a balance and monitor the in rate and out rates... not track individual notes.

 

[flynnibus]

I would think that a portion of the annual dues of the DVC will have a line item for Capital reserve/replacement.

Yes, they are. Like all buildings and communities - you setup and fund reserves to pay for unexpected and scheduled maintenance and capital improvements. They don't operate on a zero sum budget - they must save over years to fund the big stuff.

 

[flynnibus]

So would the original owner get first right of refusal to repurchase??

There is no obligation at all. Disney would be wise to run programs to get their people to buy back in (even before the expiration date...) but they are not obligated to give previous owners anything.

 

[flynnibus]

At the risk of veering off topic I feel response is warranted.

The term locked in is thrown around so easily and often I shake my head every time I read it.

Are you responsible to pay for your points every year?
Do your points expire?

You're locked in. You just have options - but you don't participate on demand.. you are locked into an agreement for a long term commitment unless you opt to sell the commitment to some other willing buyer.