Homeowners at The Abaco Club
Wednesday, November 27, 2013
Wednesday, November 27, 2013
ORLANDO, Fla., Nov. 27, 2013 /PRNewswire/ — An organized group of owners that represents the majority of the home and property owners at The Abaco Club on Winding Bay in The Bahamas (“the Abaco homeowners”) announced that the Club’s owner, Marriott Vacations Worldwide Corporation (“Marriott Vacations”) (NYSE: VAC), has offered Members of the Club the opportunity to purchase the property for $28 million. This offer was made after Marriott Vacations had failed to offer the homeowners the opportunity to acquire the property before the Club was brought to market. In a recently filed lawsuit, the homeowners seek, among other forms of relief, a permanent injunction barring Marriott Vacations from selling the Club, based upon the homeowners’ claimed rights with respect to acquiring the property.
While the Members are reviewing the notice, as well as other available options to purchase the Club, and welcome the input from all interested Members and third-party developers, they collectively believe the Club to have little, if any, market value. In its offer notice, Marriott Vacations does not disclose deferred maintenance obligations, liabilities for membership deposits and underfunded reserves, or future capital injection requirements, which the Members believe substantially affect the Club’s marketability and value. The Abaco homeowners note that while Marriott Vacations has marketed the Club for several months, they believe it has not received any offers for the property.
The Abaco Club, located on Great Abaco Island in The Bahamas, was established and marketed as a luxury resort, leveraging its remote location and promises of casual and barefoot elegance. In the homeowners’ recent suit against Marriott Vacations, The Ritz-Carlton Hotel Company, L.L.C. and related entities, it is alleged that they have not maintained and operated the Club at a five-star level, and have not delivered certain high-end amenities, including a golf course promised to be one of the top 100 in the world. The suit further alleges that, as part of a later-acknowledged strategy to sell its luxury inventory, Marriott Vacations in early 2013 removed the Ritz-Carlton flag and listed the Club for sale on the public market – an action that was not disclosed to the Abaco owners at the time, but was noted subsequently in Marriott Vacation’s SEC filings.
The Abaco homeowners’ legal action was filed in the Circuit Court of the Ninth Judicial Circuit in and for Orange and Osceola Counties, State of Florida in Orlando, where Marriott Vacations Worldwide, which was spun off from Marriott International (NYSE: MAR) in November 2011, is based. The group is represented in the litigation by Todd E. Soloway and Joshua D. Bernstein of the law firm Pryor Cashman LLP.