Following the same path of Wyndham Vacation Ownership timeshare and Westgate Resorts timeshares, Marriott Vacation Club has laid off (or is in the process of letting go) just over 170 workers.

The pink slips started showing up just before Christmas at the Orlando timeshare call center, marking the second recent round of employee layoffs at Marriott timeshare. In November, approximately 80 timeshare employees were let go by the company, which claims it is being hurt by the credit crunch less than other timeshare companies have been. At that time, The Orlando Business Journal reported that Marriott timeshares anticipates rehiring as many as 31 positions during the process of closing one timeshare sales operation (the Horizons project) and expanding at another location.

The Orlando Sentinel reported that Ed Kinney, Marriott’s vice president of corporate affairs, said that because Marriott does much of its own financing, they were not being squeezed as tightly by the tight international credit market and slowed consumer spending as are some timeshare developers.

Kinney says the current round of layoffs should be complete in January. Other timeshare companies cutting back and laying off in Orlando and elsewhere include: Wyndham Vacation Club, Westgate Resorts timeshare, and Bluegreen Resorts.

The Orlando Sentinel ran a story this week painting a grim picture for timeshare company employees nationwide, but especially in Central Florida. Workers in Orlando stand to be hit extra hard because the city’s 125 timeshare resorts, and approximately 28,000 timeshare units, qualify Orlando as the top timesharing city in the world.

Reductions at Wyndham Timeshare

According to the OrlandoSentinel.com (and other sources), Wyndham Vacation Ownership (Wyndham timeshare) is cutting a quarter of its companywide workforce, many of whom will be lost from the Orlando offices. Some 4,000 layoffs are anticipated for Wyndham timeshares overall.

Wyndham plans to gear down from annual sales of about $2 billion to approximately $1.2 billion in 2009. The Orlando Sentinel quoted Franz Hanning, chief executive officer of Wyndham timeshare, as saying, “We really don’t see those markets (the credit markets) reappearing for the foreseeable future … We want to take a proactive approach.”

Layoffs at Westgate Resorts Timeshare

At Orlando’s Westgate Resorts, rumors are circulating that the timeshare company stands on the brink of bankruptcy. David Siegel, founder and CEO of Westgate timeshares, insists there is no truth to the rumors, but does confirm that another 1,000 jobs will be cut at Westgate, following layoffs of more than 3,000 workers already this year.

Changes in timeshare sales will not necessarily hurt or help the timeshare resale market. While more people may be looking to resell their timeshare, putting more properties on the market, there may be equally as many people who recognize the value in timeshare resales over new timeshare, creating a strong demand in the resale market.

As with many things that are happening now … time will tell.

Central Florida Investments, Inc, the corporate owners of Westgate timeshares, has closed its Westgate Houston Preview Gallery and laid off all of the 106 workers employed there.

The property was located at 5177 Richmond Avenue and included a full-size model timeshare complete with living room and fully equipped kitchen. It originally opened in 2004 and was the first offsite timeshare sales center outside Orlando.

Reportedly, CFI filed documents with the Texas Workforce Commission saying that the company had, “experienced an unforeseen business emergency brought on by the collapse of the credit markets. Westgate has been unable to access its regular and customary borrowing sources and, as a result, does not presently have the cash flow to support its operations in their current form without these staff reductions.”

The layoffs in Houston follow previous announcements of employee layoffs at other Westgate timeshare locations. The blog posts listed below provide further information about cutbacks and financial concerns at Westgate timeshare.

• The Other Side to the Westgate Timeshare Lawsuit Story
• More Bad News for Westgate Timeshares, Hit with $1 Million Judgment
• Bluegreen Timeshares and Westgate Timeshare Mogul Settle Pending Lawsuit
• Hotels, Timeshares, and the Bailout

In Saturday’s The Timeshare Authority blog, we told you about the Utah lawsuit that ruled in favor of a small group of consumers and against Westgate timeshare. The consumers, represented by Consumer Protection Group, had received gift vouchers to be used for airfare and lodging in Anaheim, California. According to the attorney representing Consumer Protection Group, the vouchers were simply too difficult to redeem, and they left the voucher holders with something that was of little to no value. The judge apparently agreed, ruling in favor of the consumer group and handing down a verdict of $1 million in punitive damages against Westgate timeshare.

As expected, Westgate will appeal this verdict. According to ParkRecord.com, Michael Marder, an attorney for Westgate based in Orlando, Florida, explained, “A number of them (the people who received the vouchers in exchange for attending the timeshare tour) had made a habit of visiting other timeshare resorts and receiving gifts, and based upon the testimony, they had no intention to buy anything; they were coming solely to get a gift. Some of these people came three or four times to other places.”

Westgate Timeshares Respond

The Timeshare Authority mentioned on Saturday that, “there are always two sides to every story,” and it is no surprise that the other side of this story is now coming out …

One thing is certain, you can bet that we have not heard the last of this situation. So here’s our hope: let’s get this resolved fairly, and let’s get this resolved quickly, because if ever we all need to be working together in this country instead of fighting among ourselves, the time is now. There are many highly satisfied Westgate timeshare owners who would be quick to tell you that they are pleased with their vacation ownership through Westgate resorts.

Sources: The Park Record; Deseret News

The tightening of the credit market combined with the declining economy has already forced Westgate timeshares to lay off workers and to scale-back sales efforts. And just when they did not need more bad news, a Utah County Court has ordered Westgate timeshare to pay $1 million in punitive damages in a consumer related court case. The timeshare company is being held accountable for having attempted to attract prospective timeshare buyers to their Westgate Park City Resort, by using problem-ridden travel vouchers as bait.

An attorney representing the Consumer Protection Group says that the timeshare company defrauded consumers. “They weren’t telling them they were getting a voucher; they were telling them they were getting an Anaheim trip,” explained attorney Scott Boyd, who qualified that the trip was supposed to include air travel and lodging and have a value of approximately $500. Boyd explained, “For all timeshares, they have to get bodies through the door so they can do the sales. Now how different companies choose to get people through the door may tell you who’s reputable and who’s not so reputable in the industry.”

Here’s How the Westgate Timeshare Problem Started

People who toured Westgate timeshares in late 2000 and in 2001, received letters advising them that they may have been defrauded. More than 900 individuals responded to the Consumer Protection Group’s letter. In the end, 30 Utah residents (or 15 parties) made up the case against Westgate Resorts.

As is too often the case in such timeshare problems, people who toured at Westgate timeshare believed they were receiving a product (a gift) that in the end, turned out to be too problematic to use. Voucher holders were restricted from redeeming their trip during any weeks before or following 10 different holidays and they were required to depart only on a Tuesday, and return only on a Thursday.

Adding to the confusion and complexity of the ‘deal’ was the fact that the voucher holder had to kick in $135 upfront, and redeem the voucher within 21 days. While many people looked at the extensive restrictions and simply tossed out the vouchers, others complied with all the stipulations only to be told that the dates requested were not available.

After a three-week jury trial, the case was decided in favor of the plaintiffs. Attorney Boyd admitted that the individuals involved, “did not stand to make a lot of money,” but said that, “This is to make a point to the timeshare industry, to Westgate, that you cannot have a fraudulent scheme.”

Westgate reportedly has plans to appeal a final civil judgment. The timeshare company’s attorneys claim that it was an independent telemarketing firm that scheduled the timeshare tours, and that they (the telemarketers) had failed to warn callers of the travel restrictions.

The Timeshare Authority is not defending or condemning Westgate timeshares, as there are always two sides to every story. But the question does arise … if there were only 30 plaintiffs, which was defined as 15 couples, and they do, “not stand to make a lot of money,” then who do you think is receiving the lion’s share of the million dollar settlement?

Other recent posts on The Timeshare Authority involving Westgate timeshare:

• Bluegreen Timeshares and Westgate Timeshare Mogul Settle Pending Lawsuit
• Hotels, Timeshares, and the Bailout

After a dry summer, a few days of rain and cooler weather have brought beautiful autumn colors to much of the Smoky Mountain vacation area. Although fall’s color showed a little late this year in this part of the US, reports say it is making up for its late arrival with a spectacular show of red, orange, gold, and yellow.

Westgate Smoky Mountain timeshare resort is a great location for enjoying this glorious burst of seasonal color, or for taking to the ski slopes in winter months, or spending a lazy summer vacation horseback riding, trout fishing, and hiking the nearby mountain trails. With lots of causal comfort and some amazing on-site amenities, it is easy to understand why the Westgate Smoky Mountain Resort is a high-demand destination and ranks as number 49 on Sell My Timeshare NOW‘s HOT 100 Timeshare List.

About Your Westgate Smoky Mountain Timeshare Vacation

The Westgate Smoky Mountain timeshare resort is adjacent to the Great Smoky Mountain National Park, which offers over 800 square miles of forest and wildlife preservation area and recreational-use land. The main highway through the park is US 441, Newfound Gap Road, which winds scenically through the mountains between two favorite tourist spots, Cherokee, North Carolina, and Gatlinburg, Tennessee.

Most Westgate Smoky Mountain timeshare villas have a fully equipped kitchen with microwave and dishwasher, a stone fireplace in the living area, and a garden spa tub in the master bathroom. Each log cabin-style timeshare villa offers either a mountain view or a creek-side view. This family vacation destination resort features two arcades, an activities program, a fitness center, multiple heated swimming pools, hiking trails, stables, the Serenity Day Spa, a lounge, snack bar, 24-hr. marketplace, the Smokehouse Grill, and the resort’s newest feature, a spectacular 60,000 square foot, climate controlled, indoor, water park.

Wild Bear Falls at the Westgate Smoky Mountain Timeshare

While the nearby mountain streams and waterfalls rarely get warmer than 60 degrees F, the temperature is always just right at the Wild Bear Falls Water Park. Covered by a retractable roof, this is the largest water park in the southern US and includes a 900 foot lazy river, a 360 foot body slide, a 300 foot tube slide, a zero depth entry pool and toddler play area, and a tree house play feature that dumps gallons of water (periodically) on the guests below.

You and your family can enjoy water fun recreation any time of the year, when you take advantage of the opportunities in Westgate Smoky Mountain timeshare resales and Westgate Smoky Mountain timeshare rentals available through Sell My Timeshare NOW.

Marriott International, owners of Marriott Hotels and of Marriott Vacation Club International is expected to officially announce a new project that will create some 220 jobs – in Cork, Ireland. Great news for the people of Cork; disappointing news for recently laid off U.S. timeshare company employees like those at Westgate timeshares or Wyndham Worldwide resorts.

According to Finfacts, (Ireland’s top financial news portal) Marriott International is gearing up to more than double the size of its Cork call center which currently employees 160 people in reservations and customer service for inquires originating from Ireland, the United Kingdom, and Continental Europe. The new call center will occupy 10,400 square feet in Blackpool, Cork City and is expected to handle approximately 1,500,000 calls by the end of 2009.

Billy Kelleher TD, Ireland’s Minister for Labour Affairs at the Department of Enterprise, Trade, and Employment, says this about Marriott’s expansion in Ireland, “We are delighted that Marriott chose Ireland and Cork for its second operation. It shows a level of confidence that the company has in our ability to provide the highly skilled personnel necessary to support a rapidly growing international business. Marriott’s positive experiences at its existing Vacation Club International facility in Cork and the standard of its Irish management and workforce were instrumental factors in securing this investment for Cork against strong competition from other global locations. It is also a substantial endorsement of Ireland’s reputation in the business of global customer services and support activities.”

Both Cut Backs and Expansion Ahead for Marriott Timeshares

It’s interesting that the news of Marriott’s expansion in Ireland surfaced on the same day as Bill Marriott wrote in his blog, “In early October, we reported our third quarter earnings results and also provided observations about business for the rest of 2008 and into 2009. At that time, we expected business in late 2008 and 2009 to decline, but in just the last few weeks our business outlook has further weakened.”

For more information on the layoffs at timeshare companies, see these recent The Timeshare Authority blog posts:

• Wyndham Timeshare Announces Cut Backs
• Layoffs at Wyndham Timeshare as Wyndham Worldwide Shares Drop
• Layoffs Coming at Westgate Timeshare

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.

Bluegreen timeshares is the blog topic again today here at The Timeshare Authority. Last week, Bluegreen Corporation settled a pending lawsuit with Orlando timeshare magnate, David Siegel, another timeshare industry name who makes our timeshare blog from time to time.

David Siegel founded Central Florida Investments, the parent of the Orlando timeshare company, Westgate Resorts. In recent months, Siegel had acquired 2.3 million shares of Bluegreen timeshare’s common stock. He also had options that would have given him nearly 10 million shares, or about 32 percent of the company’s stock, if he exercised those options.

But this was already in the pipeline when Westgate Resorts timeshares announced budget cutbacks and massive layoffs in response to the credit freeze. A Sept 29, Orlando Sentinel article, said this of Siegel, “He blamed the national financial meltdown and said until the situation in Washington straightens out, Westgate and all other time-share companies likely are in for very hard time.”

Bluegreen’s board had voted and approved bylaws to allow them to dilute the value of Siegel’s holdings, but not the value of other existing shares held primarily by those Bluegreen shares held through the Levitt Corp.

Under the terms of the new settlement, Siegel and his associates must reduce their Bluegreen holdings by at least 5.4 million shares within a year and within two years, have disposed of all of them. Additionally, pending the sale, Siegel’s shares must be voted in accordance with the recommendations of the Board of Directors of Bluegreen. David Siegel has agreed to not pursue any takeover of Bluegreen nor seek to influence Bluegreen’s management.

The Timeshare Authority will continue to keep you abreast of the changes, shake ups, and shake downs in the timeshare industry … interesting times we are living in, to say the least

Other recent posts about Westgate Resorts Timeshares:

• Hotels, Timeshares, and the Bailout
• Layoffs Coming at Westgate Timeshare

Other recent posts about Bluegreen Resorts Timeshares:

• Credit Crisis May Change the Deal for Bluegreen Timeshare Resorts
• Bad News for Bluegreen Timeshares

In yesterday’s The Timeshare Authority Blog, we reported on recent comments and releases by Marriott timeshare, Westgate Resorts timeshare, and Wyndham Hotels and timeshare. Today we are following that timeshare blog post with news of an announcement by Wyndham timeshare that they will be scaling back their timeshare business.

According to an AP release that appeared on Yahoo Finance and other news outlets:

When any company says they will ‘shift their sales and marketing efforts to consumers with higher credit quality’, you have to wonder what that says about their past practices. Are some timeshare development companies guilty of the same types of behavior that led mortgage companies to extend credit to subprime consumers? What does a company have to gain by writing loans to customers who may not have the income and creditworthiness needed to carry the debt? The answer is simple: loans equal assets. Assets enable a company to borrow money, expand, or generally improve the look of their portfolio.

If Bill and Mary’s Bakery lets you buy donuts on credit, then the loan document that defines your credit obligation has a value to Bill and Mary as a source of incoming cash. And when Bill and Mary want to splurge on colored sprinkles, they can go to the bank and show your debt document as part of their own security needed to incur debt themselves.

But if you can’t afford to pay your donut debt, then all the lender holds is bad paper.

When you don’t pay Bill and Mary on time, then they in turn can’t pay the bank. And pretty soon, legislators are called in to write a bakery bail-out bill.

Let’s hope the reason some of the big timeshare companies are feeling the impact of the economic downturn is because of the cost of gas and increases in the price of durable goods, and not because they have been playing their own version of the subprime lending game. And if you don’t want to be caught up in any portion of the game, consider buying timeshare on the resale market, dealing directly with the person who owns it. Dollars to donuts, you will always find the best values in timeshare on the resale market.