HomeMy WebLinkAboutExhibit 6Exhibit No. 6
TIMESHARE SALES, MANAGEMENT, AND
CONTINGENCY PLANS
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HYATT REGENCY NEWPORT BEACH
TIME -SHARE DEVELOPMENT
SALES, MANAGEMENT AND CONTINGENCY PLANS
Introduction
Section 20.84.040, Application Process, of the City's Time Share Developments Ordinance,
stipulates that any proposed time -share project be accompanied by Sales, Management and
Contingency Plans which will be subject to the approval of the Planning Director. Section
20.84.040 specifies the contents of each of these plans:
"...Sales Plan: A Sales Plan shall address the times, areas and methods that will be used to sell
the time -share project. Factors to be defined in the plan shall include, but not be limited to: the
location, length, and marketing methods that will be used, distinguishing on -site and off -site
marketing and signage; and an estimate of the potential numbers of individuals and automobiles
expected during the various stages of the sales effort. The plan also shall describe measures that
will be implemented to reduce traffic during peak hours."
"...Management Plan: A Management Plan shall describe the methods employed by the applicant
to guarantee the future adequacy, stability, and continuity of a satisfactory level of management
and maintenances of a time -share project."
" Contingency Plan: A Contingency Plan shall address the actions to be taken by the applicant
if the time -share project is an economic failure or fails to sell 50 percent of the time -share estates
or uses within two years of receiving a permit to occupy the first unit."
Sales Plan
The Sales Plan will use several marketing channels including the following:
In -Hotel Lead Generation — These customers are already staying at the hotel and will be
solicited to take a tour of the project. A Hyatt Vacation Club Welcome Desk will be
located in a prominent place in the lobby, which is designed to interest customers into
taking a tour.
Direct Mail Marketing — This will generate tours from mail sent to pre- determined,
qualified buyers. These prospective purchasers will generally stay overnight at the Hyatt
Regency Newport and take a tour while they are on property. This will not generate any
additional traffic other than the traffic generated by the customer coming to the hotel to
stay overnight, as these customers will already be staying at the property pursuant to the
marketing plan.
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Local Market Lead Generation — This will also take place once we determine potential
locations within the market area. Such locations may include a kiosk location in the
Fashion Island Mall or other similar locations. We anticipate that five to ten tours per day
will be generated from this activity and will result in a trip to the property.
In addition to the above three primary market channels, we will aggressively pursue
owner reloads and referrals. The reloads will typically not result in a trip, as those
customers will either purchase another week over the telephone or when they are in
residence. The owner referrals will typically result in a stay similar to the direct -mail
program described above.
All of the above referenced marketing programs will be in place during the duration of
the sell -out, which is likely to take from four to seven years.
With respect to traffic, it is anticipated that a majority of the tours will be scheduled from
10:00 a.m. to 4:00 p.m., therefore, will not interfere with peak traffic times.
Management Plan
Hyatt Vacation Management Corporation, an experienced manager of rime -share and fractional
resorts, will manage the vacation ownership component of the project. Hyatt Vacation
Management Corporation currently manages 12 resorts in ten destinations around the country
and Puerto Rico. The property will be managed pursuant to the laws of the State of California
governing time -share and homeowner's association management. The condominium and time-
share documents for the project will require that the project be maintained to the first -class
standard. Hyatt's policy is to fully fund reserves for replacement and every other year
commissions, on behalf of the homeowner's association, a reserve study to determine the
adequacy of reserves and the need to adjust Fixtures, Furniture and Equipment (FF &E) reserve
funding.
Contingency Plan
During the sell -out of the project, which likely take more than two years and as many as seven
Years, inventory of the time -share project, as well as inventory in the hotel, will be used for
marketing purposes and, when not used for marketing purposes, will be made available for
rental. If the inventory is available for rental, all distribution channels available to Hyatt,
including Hyatt's reservation system (SPIRIT), the Global Distribution System ( 'GDS') and
other web -based rental outlets will be used. In addition, inventory will be available to the hotel
to book for the general public.
Pursuant to time -share regulations in the State of California, the developer must fund the reserves
of the unsold inventory annually to support the project.
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