“Never look a gift horse in the mouth” …or so the saying goes.
It’s a shorthand way of saying… you were fortunate to have received a gift, so you shouldn’t insult the giver by examining the gift too closely.
But if you’ve been around horses at all, you know. You can tell a lot about a horse’s value by looking at its teeth – its age, its overall health and how much it will cost to take care of.
In our last update, we told you about a $348,000 Trojan horse “contribution” Capital Vacations made to the Causeway on Gull association.
This “gift” was part of a management contract designed to drive owners to turn over their interests in the association to Capital Vacations and sign up for a more expensive membership in Capital Vacations’ points program.
Fortunately, the Concerned Owners Group at Causeway on Gull took the time to look the Capital Vacations Trojan gift horse in the mouth.
Causeway on Gull discovered this Capital Vacations “gift” was anything but!!
As the Concerned Owners Group explained to the rest of the development’s owners, “This $348,000 is not a ‘Contribution” and is Definitely not ‘Free’.”
“We understand this ‘Key Money’ is a loan bearing interest at a rate of between 8% and 13% per annum, secured by all of Causeway’s assets.”
A high-priced loan from Capital Vacations, not a gift.
Now THAT’S a horse of an entirely different color.
“We understand that this loan, plus interest, is payable if Causeway terminates, or does not renew, the Management Agreement or the Sales and Marketing Agreement for a total of 10 years.”
So, even if the Causeway on Gull Association isn’t satisfied with how Capital Vacations is managing things, it can’t change management horses mid-ride without risking having the whole loan come due or, if it can’t pay, having Capital Vacations foreclose on the whole property.
“We understand that the loan, plus interest is also payable in the event of a ‘Change in Control’, meaning the sale of more than 50% of the equity interest in the Association.”
“The implication of this provision seems to be that if Capital obtains more than 50% Ownership, it can demand the immediate repayment of the loan and/or foreclose on all of Causeway’s assets.”
And we already know that Capital Vacations agents told owners in sales presentations that securing 51% of the ownership is EXACTLY what Capital Vacations is jockeying to do!
We wish the Concerned Owners Group luck in their effort to get Capital Vacations to pull up short on their dash to take over Causeway on Gull against the wishes of Association members.
Maybe we can help rein in Travis Bary, the co-president of Capital Vacations. Let’s email him at tbary@capitalvacations.com and ask him to scratch his plans to deceive his way into control of Causeway on Gull.
And we should tell Jason Gamel, the President and CEO of American Resort Development Association (ARDA), the trade association for the timeshare industry, it’s time to take off the blinders to what Capital Vacations is doing. Jason’s email is jgamel@arda.org.
Does the sneaky behavior of your timeshare company cause you to bridle? Use this list of ARDA VIPs to contact your company’s leader and tell them why.
Have you had to go the distance to fight a timeshare company’s trickery? Share your experience with us at info@timesharefacts.com.
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