From Timeshare week owner
2/12/2009
to:
Cliff Hagberg
Managing General Partner
New England Vacation Management Services, LLC
Sandcastle
P.O. Box 576, Rte 6A
Provincetown MA 02657
Dear Mr. Hagberg,
I very much appreciate the letter you sent to us in late October informing us of New England Vacation Services’ interest in Sandcastle and your plans to renovate existing structural problems.
I think it is best to have everything clearly written down so there are no misunderstandings. We all know how people sometimes erroneously hear what they want to hear, rather than what was actually said.
My family owns several units at the Sandcastle Resort, and although I am not the formal spokesperson for other Sandcastle owners, I believe my questions reflect many of the concerns raised by a very rapidly expanding community of owners that are in communication over the internet.
Since you have been intimately involved in managing time shares for over 20 years, and since you are clearly aware of scams perpetrated by others (http://www.ivsrealty.com/Scams.htm), you will appreciate the anxiety that the many changes that seem to be occurring at Sandcastle have created in current owners. As the manager, I’m certain you will wish to make the process as clear as possible for everyone. In this light, we would really appreciate if you would answer the following questions. Thank you for helping us to understand what is happening at the Sandcastle Resort that we all care so much about.
Question 1: What relationships exist among (1) New England Vacation Services (NEVS), (2) IVS Realty (your original company), (3) Festiva, and (4) Outfield Marketing? Are any of these entities affiliates of each other or owned directly, or indirectly, by the same company or people?
In an e mail to Ms. Watson, you wrote “There is no relationship between IVS Realty, Outfield Marketing, and Festiva. All are completely independent companies under separate ownership. NEVMS is the management company that manages the resort for all of the owners.”
However, we are confused by this e-mail because:
1. It was our understanding that you are the CEO of IVS and the Managing General Partner of NEVMS.
2. When you write “separate ownership,” do you mean there is no cross over at the highest management or invested interest levels, or that these companies are not affiliated with each other?
3. In your October letter, you stated that NEVS purchased the “unsold inventory” of Sandcastle from Vince Barth and Robert Woods. Yet, when an Outfield Marketing representative came to our house, he told us:
a. “I’m with a company called Outfield, and there’s a lot of different companies involved here. It’s all one company . . . but nowadays they segment everything. The big company [over everything] is Festiva Resorts.”
b. “Festiva owns 52% of Sandcastle weeks.” Now that sounds like the unsold inventory to us, but you wrote that the unsold inventory was purchased by NEVS.
4. Festiva is listed in the Deeds office as being an owner of many properties which seem to have been acquired many months before your letter to the owners was mailed.
5. Calls to our home from Outfield Marketing to set up the representative’s meeting with us and calls from Kaitlyn of NEVS Customer Service Department are coming from the same phone number 800 436 9094.
6. In the letter we got from you in October, you state that NEVS is pursuing an “affiliation” with both Interval International and Festiva, as well as a “Professional Management Company.” Is this Management Company Outfield Marketing or a subsidiary of Festiva?
Question 2: What is the current status of Sandcastle’s governing body, and who are the current Trustees?
This really breaks down into several related questions:
1. How many current Trustees are there, and what are their names and addresses? In the original Master Deed, the Trustees were listed as four: Joseph and Wayne McCabe (of Provincetown and North Truro, respectively) and two Fred Sarteriales (of Belmont, Mass.).
2. How/when will any new Trustees be appointed/elected?
3. Who has a copy of prior Trust meeting minutes? How can we get these?
4. How do we get a copy of the Trust formation documents and by laws?
Question 3: What is happening with the next annual Owners Meeting?
Again, this breaks down into several related questions:
1. There is a rumor circulating that there will be an Owners Meeting on April 25th at Noon. Is this correct?
2. Will you be sending a mailing to all owners to advise them of this meeting, and if so, when? I am sure, as an owner yourself, that you are aware that in the past many unit owners were not made aware that an Owners Meeting was taking place.
3. What will be the agenda at this meeting, how will it be run and who will be running it?
4. What issues will be discussed and voted upon at this meeting, including will we be reviewing and voting on the plans for construction and improvement that we keep hearing rumors about?
5. Do you intend (or do you know of anybody else who intends) to seek proxies in advance of the Owners Meeting, and when do you intend this mailing?
Question 4: Who owns what and what rights do the owners have?
The Outfield representative told us that Festiva owns 52% of the Sandcastle weeks (mostly from off season weeks), and so, as individual owners, we can “voice opinions,” but we have “absoutely no control” in what happens to the resort. In your letter, however, you wrote that NEVS acquired the entire “unsold inventory.”
1. Our master deed states that off season week holders have no voting rights or limited voting rights! So does that mean that Festiva or NEVS who owns mostly off season weeks has limited voting rights, except for rights related to units obtained from individuals who signed on with Festiva for their points system?
2. Would you be kind enough to send us a copy of the list of all the weeks/units currently held by NEVS and, to the extent you know it, by Festiva?
3. Would you send us a copy of the list of all of Sandcastle’s owners? We understand that the previous managers were unable to provide a list – we understand from the Outfield Marketing rep that the former managers didn’t really have a proper list, but that through your and Outfield’s diligence over the winter, the list is in much better shape – though, considering that the deed ownership is a matter of public record, we weren’t clear why it’s been so difficult to make a complete list.
4. Have any of the Sandcastle properties in default been foreclosed yet or “given” back to the Trust or management company? How many and when?
Question 5: What are the immediate plans and expenses for planned construction and improvements at Sandcastle?
1. In your October letter, you wrote that you already had a detailed budget for 2009.
a. Would you kindly provide us with the same, including management company fees and, if applicable, management salaries?
b. I am particularly (but not at all exclusively) interested in who paid for the Outfield Marketing representatives to go door to door talking to us, rather than sending initial information in writing and then simply manning a phone bank for further owner questions.
2. Our Outfield Marketing rep who came to our house mentioned the need, because of the purchase by NEVS, to bring Sandcastle up to city legal codes. Can you explain why the purchase by NEVS triggered this requirement since what NEVS purchased was just a block of units? Was there something else purchased – for example, did NEVS purchase development rights or something similar — (same questions for Festiva)?
3. In your letter, you wrote that you would be developing a detailed plan for improvements to Sandcastle over the next few months. Now, some four to five months later, and a mere three to four months before summer occupancy, we are hoping the plan is finished and available for review, – at a minimum for proposed dates and costs for any legally mandated fixes, and for any work that is intended to be done before summer occupancy begins. We feel anxious to see that plan so that we know what to anticipate for the summer of 2009.
a. Are you sure that Sandcastle will be open (legally) for regular occupation by unit owners in 2009 who have paid their maintenance fees?
b. I am seriously concerned about the lack of safety of the railings on upstairs hallways and balconies. What happens if a child falls through those railings and gets seriously injured or killed? To me, if there is going to be work done, these railings should be a first priority concern in Sandcastle improvements. Is that already planned to be attended to?
4. The Outfield Marketing representative who came to our house told us that “Festiva had to pay $100,000” to the existing Management to cover “delinquent fees” by Sandcastle owners and that had “to be paid back.”
a. How and why was this possible and necessary? Was there some kind of loan agreement? Why would Festiva be interested in lending money to Sandcastle? What did they get/are they getting in return? Why would delinquent fees need to be covered in the first place?
b. Isn’t fee collection the responsibility of the Trustees per the Master Deed, and why wasn’t it done?
c. If delinquent fees resulted in the management company then renting the related owned units, what happened to that money?
d. We read that you had already collected $50,000 in delinquent fees. Is this money placed into a reserve account now? How does it relate to the $100,000 that needs to be “paid back”?
e. We are unclear as to why, (after reviewing Massachusetts Chapter 183A, the Master Deed, and our individual deeds), individual owners, who are up to date with their own fees, are responsible for the delinquencies of other owners, or of those entrusted with the responsibility to collect those fees, or for the results of not having enough money then to keep the building up to code par because of such delinquencies, and we understand this is quite different from special assessments for property improvements.
Question 6: What is the purpose of these new institutional relationships?
Would you briefly explain your (or the Trustees’) reasons for “associating” with Festiva Resorts, a company which has a significant record of discontent among its constituents? In searches of the internet by us and other owners, I have been astounded by the shear number of negative reviews of the organization – (certainly, far more than one would expect for an organization its size). In addition, Festiva has been fined for illegal behavior by the Attorney General of Missouri. I’m certain you know this company’s record well, but here are just a few examples I found.
http://timeshareconsumergroup.org/fraud_festiva.html
http://ago.mo.gov/newsreleases/2008/Agreement_with_Festiva_Resorts_LLC/
http://festiva resorts.pissedconsumer.com/
2. What benefit is the association with Outfield Marketing with whom you share phones (office space?)? The representative was very knowledgeable about Festiva and its Point System, but not at all knowledgeable about real projected costs / improvements at Sandcastle. What is Outfield Marketing doing at Sandcastle, and are we paying for it?
3. What is the purpose of the professional management company that you were looking to hire? Is this different from what you are doing/going to be doing? Would we have two management companies? Did you hire a professional management company?
Mr. Hagberg, we very much appreciate your attention to these matters, and I look forward to hearing your response. I realize that we are asking a number of questions, but, as I’m sure you can imagine, there is a lot of concern and confusion among the owners. Hopefully, your answers here will clear up a lot of that confusion.
In addition to the above requests, we would like to get copies of the following:
1. Trust by laws
2. Minute book of the Trust/trustees
3. Minutes of the last three or so previous owner meetings
4. Financial records including:
a.. receipts and expenditures of the last three years
b. records regarding all funds, including the replacement reserve fund
c. the most recent audits, reviews or similar documents, etc. (I believe the legal
requirement is that an audit be performed annually).
d. contracts for work to be performed for or services to be provided (including the
Manager's contract)
Could send the above documents and the other items requested in this letter with the response to this letter as soon as possible? (We would be more than happy to pay for the postage). However, if that will not be possible, can you please let us know when, during reasonable business hours, it would be possible for a member of my family (since I am one of the owners) to come to your office to make copies?
Most Sincerely,
Sandcastle timeshare owner
Note: No response to date. Some answers have been found since the writing of this letter, although apparently they did not come from Mr Hagberg.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment