DVC Right of First Refusal (ROFR): December ’16 Report

Filed in Bay Lake Tower, Boardwalk, Disney Vacation Club, DVC Resale, Old Key West, ROFR, Saratoga Springs

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Aerial view of Disney's Bay Lake Tower Pool

In the month of December, Disney exercised their right of first refusal (ROFR) on 8 contracts sold through the DVC Resale Market, representing roughly 5.6% of the contracts sold in that same month.  This month’s 5.6% percentage was above the 2016 percentage of 4.4%.

Right of First Refusal is the option Disney Vacation Club has to purchase any resale package after a sales price has been agreed upon and a contract has been executed. Each contract must be forwarded to DVC for review. DVC may take up to 30 days to review the contract. At their discretion, Disney may step in and purchase the property themselves at the terms agreed upon by the Seller and original Buyer. DVC then becomes the Buyer, and the purchase is complete. Once DVC is the buyer there is not an opportunity to come back with a better offer in hopes of still purchasing the contract.

The month of December was dominated with buy backs of Bay Lake Tower.  6 of the 8 contracts bought back were Bay Lake Tower.  For 2016, this brings the buy back volume for Bay Lake Tower head and shoulders above the other resorts as seen in the graph below.

Year-to-date 2016 Right of First Refusal buy back chart

For 3 straight months prior to December, there were anywhere from 2-4 Boardwalk contracts bought back each month. However, in December, no Boardwalk contracts had ROFR exercised.

As previously mentioned, the heavy buy back rate for Bay Lake Tower continued with one contract being bought back as high as $114/pt. as seen in the table below.

Resort Price Per Point Points on Contract Price Closing Costs Paid by 2016 Annual Dues Paid by Use Year Point Availability
Bay Lake Tower $98 150 $14,700 Seller Seller Oct. 150 Pts. ’16 + 150 Pts. ’17
Bay Lake Tower $102 100 $10,200 Seller Seller Oct. 100 Pts. ’16 + 100 Pts. ’17
Bay Lake Tower $89 160 $14,240 Buyer *Seller Apr. 160 Pts. ’18
Bay Lake Tower $110 200 $22,000 Buyer Seller Feb. 1 Pts. ’16 + 200 Pts. ’17 + 200 Pts. ’18
Bay Lake Tower $102 160 $16,320 Seller *Seller Feb. 160 Pts. ’18
Bay Lake Tower $114 160 $18,240 Buyer Seller Feb. 320 Pts. ’17 + 160 Pts. ’18
Saratoga Springs $79 210 $16,590 Buyer Seller Aug. 167 Pts. ’16 + 210 Pts. ’17 + 210 Pts. ’18
Old Key West
$74 220 $16,280 Buyer Seller Apr. 191 Pts. ’17 + 220 Pts. Coming ’18

* Seller provided credit to buyer at closing for 2017 annual dues

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Comments

  • Sarah
    March 3, 2017

    Do you know what the price point was for the Vero Beach ROFR buy backs? What is a reasonable range of price per point for Vero Beach points that theoretically should pass ROFR?

    • Nick Cotton
      March 3, 2017

      Sarah, thank you for your question. We actually haven’t had a Vero Beach contract purchased back through ROFR in over a year. The last two bought back were in January 2016 (https://www.dvcresalemarket.com/blog/dvc-right-of-first-refusal-rofr-january-16-report/). They were $56/pt. and $60/pt. and both had strong point availability. Certainly, since then we have sold many Vero Beach contracts, so Disney has not been particularly aggressive with buying back Vero Beach. The price per point that would be reasonable would certainly depend on the contract (i.e., point availability, size, etc.), so I would advise consulting with one of our Team Members when submitting an offer on any specific contract for advice.

  • Keola
    January 21, 2017

    Hi Nick,

    Do you have a spreadsheet that you can share showing all of the properties that were bought back? I’d like to see all of the properties that were bought back, along with their purchase price and terms (points mostly). It will be interesting to see how Disney decides to deal with resales in the months to come.

    Thanks!
    Keola

    • Nick Cotton
      January 21, 2017

      Keola, thank you for reaching out with your question. I don’t have all of the 2016 buy backs summarized in one spreadsheet, however, to see what you are looking for is very possible. An easy way to do this would be to filter our blog by the term “ROFR”. You can do this by clicking “ROFR” where it says filed in at the top of any ROFR monthly blog post. Your results will be each monthly ROFR report.

      Thanks, Nick

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