The large number of new Aulani resale contracts??

[DanCali]

I’ve been following this discussion peripherally but what is driving the assumption that these contracts being sold are the result of DVD cracking down on renters?

I agree - it doesn't have to be "cracking down" per se.

It could just be that the economics from the rentals are just not there anymore. Perhaps the rise in dues outpacing the rise in rent? Perhaps more competition from owners trying to rent to offset dues? Perhaps too many unrented confirmed reservations listed at high prices go by the wayside or turn to unusable restricted points? Perhaps there are new DVC tools deployed preventing robo-booking of unicorn rooms?

Either way, if these were large commercial renters, their exit will impact the rental market.

 

[disneylandtour]

I’ve been following this discussion peripherally but what is driving the assumption that these contracts being sold are the result of DVD cracking down on renters? And are the contracts stripped because the points are being transferred out? I’m surprised there’s been no grumblings about cancelled rental reservations but maybe they are being allowed to keep anything that’s been made already.

My guess is that DVD/Disney is likely allowing a reasonable time for this operation to shut down. If there are suddenly hundreds, if not thousands, of cancelled reservations, anger from guests will like also be directed at Disney. Trust me--to them, Disney will look like the bad guy. That's probably what they want to avoid, especially as it's been going on for YEARS. Again, only a guess. And to expand that guess, if I was renting out points on a commercial basis I wouldn't want a gazillion individual contracts of 100 or 200 points each, I'd want a handful of master contracts to minimize work and to easily locate rentals if there was an issue So I'm guessing that there are a bunch (hundreds) of sub contracts that can easily be sold as the points have been transferred to a small set of master contracts, each of which probably holds many thousands of points.

 

[JackosinDIS]

I’ve been following this discussion peripherally but what is driving the assumption that these contracts being sold are the result of DVD cracking down on renters? And are the contracts stripped because the points are being transferred out? I’m surprised there’s been no grumblings about cancelled rental reservations but maybe they are being allowed to keep anything that’s been made already.

The vast majority have delayed closings I.e reservations (we are assuming rentals) in place… some as late September 2025. It seems that all of these contracts have been used for rentals and that they are now being sold en masse. The natural conclusion is that there is some external factor driving all these sales coming through at the same time.

 

[disneylandtour]

If that is the reason for such an uptick, it will be interesting to see what the rental market looks like in 6 months compared to today.

100% agree. Since I've been following all this--that is, since around 2005--there have only been two other times that Disney has struggled to reasonably fill rooms. Great recession. And Pandemic. Both of those were limited-time experiences, with a presumed end date. Disney is struggling to fill hotel rooms now, with no significant outside event--and with new universal hotels and Epic on the horizon. It may just be that Disney wants to limit competition that takes business away from its hotel rentals. That would make sense to me. I don't think the economics of the rentals are going south. These are probably contracts that the brokers bought years ago--likely as re-sale--and at a very good price. I bet their per-use price per-point is about $1.50 above MF presently. Earlier in the thread, I think many people have shown how, at scale, this is a pretty good business model in terms of profit. That probably means somewhere around gross revenue of about $10 per point per year, minus expenses. Also, maybe it's double that or more if they have Boardwalk Standard or Jambo Value as confirmed reservations. Anyway, I for one would be happy if commercial renters got out of the confirmed res business. If you have few reservations you can't use and need to rent, all is good. If your LLC has a couple thousands of confirmed reservations in key rooms, I think that's a problem--and likely means that's a couple thousand less reservations for Disney as well. And then multiply that out by X number of LLC renters.

 

[atthebeachclub]

Well…I am waiting for somebody to start lowballing on these so we can find out more!

 

[disneylandtour]

Well…I am waiting for somebody to start lowballing on these so we can find out more!

Hmmm, that's pretty much already happened. The contracts that we assume are ex-rental contracts aren't going for lowball offers. At least not yet. But this is starting to place pressure on other sellers who now see a gazillion contracts for sale and want to get out before MFs are due. So do with that info what you will.

 

[AstroBlasters]

I’ve been following this discussion peripherally but what is driving the assumption that these contracts being sold are the result of DVD cracking down on renters? And are the contracts stripped because the points are being transferred out? I’m surprised there’s been no grumblings about cancelled rental reservations but maybe they are being allowed to keep anything that’s been made already.

That 8000 points worth of AUL contracts showed up almost overnight, all stripped to the bone.

I then emailed contacts who let me know it was from a single large seller.

May not be commercial. Could be death or divorce or Hawaii law changes or another investment opportunity or just wanting to cash out.

 

[New Mouse]

If that is the reason for such an uptick, it will be interesting to see what the rental market looks like in 6 months compared to today.

Would have to think it puts upward pressure on the price per point for non commercial renters and then downward pressure on the contract price.

 

[AstroBlasters]

Would have to think it puts upward pressure on the price per point for non commercial renters and then downward pressure on the contract price.

Terrible time trying to sell AUL for a regular owner….

 

[disneylandtour]

Terrible time trying to sell AUL for a regular owner….

It would be far better for any regular owner to just sit on that contract for a year and maybe rent out points.