Bluegreen stock price...

[VA_Traveller Senior Member Find all posts View Profile Close VA_Traveller]

Its made a nice recovery....any thoughts on if or how this could affect the owners?

[BocaBum99 Super Moderator Find all posts View Profile Close BocaBum99]

Yes, it's made a nice recovery since last year when it went below $1/share.

I personally believe that the market is seeing just how good of a company Bluegreen Corp is. In the worst possible markets for real estate in a credit crunch, Bluegreen increased it's cash position from the end of 2008 to the end of 2009. And, I believe they only had one unprofitable quarter since the melt down in Oct 2008.

The company is still weighted down by its residential real estate business. But, it's timeshare business is doing really well. If residential real estate ever recovers, watch out.

The fee for service business model is really starting to work. About $15M of its $60M in sales in the 4Q of 2009 were from fee for service. That means sales commissions with no cost of capital.

What this means for owners is that our resort developer and manager is in pretty good financial shape. In this market, other timeshare companies will want to work with Bluegreen. So, we could see more fee for service resorts in the system. That means more resorts for us to use in the Bluegreen Vacation Club.

[Tom in GA Member Find all posts View Profile Close Tom in GA]

Stock UP !!!

We purchased Bluegreen stock mid 2009 when we went Bronze. It has returned over 50% since then. I wish we would have bought more as Bluegreen's financials, while not perfect, seem to be way ahead of other players in the game. The stock still has above average risk....but it has delivered above average gains.

[crwisconsin Senior Member Find all posts View Profile Close crwisconsin]

The fee for service business model is really starting to work. About $15M of its $60M in sales in the 4Q of 2009 were from fee for service. That means sales commissions with no cost of capital. ... So, we could see more fee for service resorts in the system. That means more resorts for us to use in the Bluegreen Vacation Club.

Jim,

I think I understand "fee for service" but I would like to make sure. In the past, Vacation Club inventory came from BG sales to us owners from units at resorts that either:

1) BG built from the ground up (Club 36) or purchased a building and converted it into a timeshare (Solara); or
2) BG purchased unsold inventory from a developer who wasn't good at marketing; or
3) BG builds additional buildings at an existing resort (Big Cedar); or
4) a combination of 2 and 3.

In case 1) all of the sold inventory would be in the Vacation Club; in case 2) only part of the sold inventory would be in the Vacation Club (however, some of the inventory sold before BG got involved would slowly trickle into the Vacation Club as those owners convert to points and buy more points); and in case 3) all of the sold inventory in the new buildings would be in the Vacation Club (and I am guessing that some of the inventory sold before BG got involved would slowly trickle into the Vacation Club as those owners convert to points and buy more points).

I believe in the "Fee for Service" model, a developer who has unsold inventory that he can't market allows BG to market the inventory with the inventory that BG sells going into the BG Vacation Club and the developer getting some price only after BG sells it. That way, BG doesn't have to ante up any capital or pay maintenance fees on unsold units.

Is my understanding correct?

Charles

[BocaBum99 Super Moderator Find all posts View Profile Close BocaBum99]

Jim,

I think I understand "fee for service" but I would like to make sure. In the past, Vacation Club inventory came from BG sales to us owners from units at resorts that either:

1) BG built from the ground up (Club 36) or purchased a building and converted it into a timeshare (Solara); or
2) BG purchased unsold inventory from a developer who wasn't good at marketing; or
3) BG builds additional buildings at an existing resort (Big Cedar); or
4) a combination of 2 and 3.

In case 1) all of the sold inventory would be in the Vacation Club; in case 2) only part of the sold inventory would be in the Vacation Club (however, some of the inventory sold before BG got involved would slowly trickle into the Vacation Club as those owners convert to points and buy more points); and in case 3) all of the sold inventory in the new buildings would be in the Vacation Club (and I am guessing that some of the inventory sold before BG got involved would slowly trickle into the Vacation Club as those owners convert to points and buy more points).

I believe in the "Fee for Service" model, a developer who has unsold inventory that he can't market allows BG to market the inventory with the inventory that BG sells going into the BG Vacation Club and the developer getting some price only after BG sells it. That way, BG doesn't have to ante up any capital or pay maintenance fees on unsold units.

Is my understanding correct?

Charles

Close. But, still some inaccuracies. Bluegreen also acquires inventory through foreclosure and buybacks/trade ins.

The biggest difference between Fee for Service and non-fee for service is that Club inventory developed or acquired by Bluegreen costs them money to purchase. Fee for Service revenue is owned by someone else and BG earns a commission on the inventory.

In the future, I believe BG will have both Club owned inventory and Fee for Service inventory. BG owned inventory can be much more profitable to BG. But, there is a cost to develop/acquire inventory which isn't favorable in a tight credit environment.

[crwisconsin Senior Member Find all posts View Profile Close crwisconsin]

Bluegreen also acquires inventory through foreclosure and buybacks/trade ins.

Jim,

Thanks. Are the "foreclosure and buybacks/trade ins" then resold to people buying in to the Vacation Club or do they go to Pinnacle? If they are resold for the Vacation Club, where does Pinnacle get their inventory?

Charles

[BocaBum99 Super Moderator Find all posts View Profile Close BocaBum99]

Jim,

Thanks. Are the "foreclosure and buybacks/trade ins" then resold to people buying in to the Vacation Club or do they go to Pinnacle? If they are resold for the Vacation Club, where does Pinnacle get their inventory?

Charles

Pinnacle is strictly a broker for other owners who are reselling their points. In other words, the seller who signs the agreement is NOT Bluegreen.

Foreclosures are owned by BG and sold as new to owners and new prospects at the resorts. The owner is Bluegreen or a Fee for Service Resort.

[crwisconsin Senior Member Find all posts View Profile Close crwisconsin]

Pinnacle is strictly a broker for other owners who are reselling their points. In other words, the seller who signs the agreement is NOT Bluegreen.

Jim,

Thanks again. I have wondered about that for years.

Charles

[VA_Traveller Senior Member Find all posts View Profile Close VA_Traveller]

Pinnacle is strictly a broker for other owners who are reselling their points. In other words, the seller who signs the agreement is NOT Bluegreen.

Foreclosures are owned by BG and sold as new to owners and new prospects at the resorts. The owner is Bluegreen or a Fee for Service Resort.

Boca,
Pinnacle sells for a premium, since those points include the bonus features...is that an agreement they have with BG? Can you comment on if BG gets a share of those sales?

[BocaBum99 Super Moderator Find all posts View Profile Close BocaBum99]

Boca,
Pinnacle sells for a premium, since those points include the bonus features...is that an agreement they have with BG? Can you comment on if BG gets a share of those sales?

Yes, Pinnacle Vacations has an exclusive agreement with Bluegreen for the transfer of VIP/Premier features.