SXMElections.com

~ Clients in disbelief, want Government to take action ~

SIMPSON BAY--Timeshare owners at Caravanserai Beach Resort are up in arms after being informed recently by the property's new owners Alegria Real Estate BV that all timeshare rights granted by the previous owners are being annulled and that instead the company will offer hotel units against payment.

The news, seemingly the only contact that has been made by Alegria so far, is causing considerable concern amongst timeshare owners who are overwhelmed with questions. Some have invested tens of thousands of dollars in the property.

Following the transfer of Caravanserai to Alegria after a public auction by Scotiabank which was finalised September 15, "Kildare Properties Ltd., Island Hotel Corporation N.V., Endless Vacation N.V., Haresh Manek and/or any of their affiliates thereof are no longer involved in the Caravanserai Beach Resort, including the hotel and timeshare operations," the letter informed.

In a statement that has been regarded as questionable, Alegria added that any type of timeshare agreement through Kildare qualified as a "lease agreement" for which no approval had been granted by Scotiabank. Questions arose as to how this could be possible, as the bank undoubtedly would have known that timeshare was being sold. Alegria further stated that it was not bound by any type of timeshare agreement made though Endless Vacation N.V.

The company asserted that it was not responsible, but that it sympathised with the sudden loss of timeshare rights. As compensation, it is offering a "hotel room usage agreement" which will allow usage of "a hotel room and facilities at the resort against an annual fee to cover part of the operational costs of the resort," the fee being equal to the annual fees owners were obligated to pay under the previous timeshare agreements. The offer stands until November 1.

The news can be regarded as a major threat to the industry, affecting thousands of clients. Investments of US $60,000-100,000 are not unheard of. Some clients already have paid their annual fees and will have booked their winter flights.

"This is a disaster," said Jeff Berger, who writes a popular tourism-specific newsletter on the island. "This has the potential to take what might be a historical year in terms of tourism and throw it out the window." He has been flooded with questions and complaints by clients who he says are angry at both the old and new Caravanserai owners as well as the island's government.

"If the island government allows this entity to nullify our rights, they will be continuing to show contempt for those of us that help support their economy," said one disgruntled client, a feeling that resonated, according to online discussion.

Another said that if the government allowed the situation, it would "prove yet again" that timeshare owners can depend only on the integrity of property owners.

This is not the only timeshare property mishap to tarnish the island in the past years.

The notice has been forwarded to Prime Minister Sarah Wescot-Williams, United People's (UP) party leader and Member of Parliament Theo Heyliger and President of Parliament Gracita Arrindell. Tourism Minister Ted Richardson's e-mail address also was shared on a forum.

The St. Maarten Timeshare Association (SMTA) also was made aware of the situation on the same day. In a letter to its members, SMTA called the move a major threat to the industry and the island's tourism economy. The organisation expressed the widespread doubts that Scotiabank had not given permission for the sale of timeshare and suggested actions members might take, including possible legal action and lobbying government to take action.

The two main sentiments Berger has been hearing are disbelief that something already owned can be taken away and dismay that there is no differentiation between clients who bought a week in summer and those who had spent as much as $100,000.

Americans and Canadians, by far the bulk of clients, expect strong consumer protection, he said. Many clients keep returning to the island as a result of their investment. The law should stipulate that when someone takes over, the new owner must honour the contracts.

In an invited comment, Berger said there had been talk of consumer protection for several years. The SMTA has pushed for consumer legislation, but this has not been realised.

A designated FaceBook community page was established the next day "to compare notes and help each other during the coming transition."

The scanned letter was dated September 30, although the e-mails were sent on October 4 and some online clients said that they had not received any e-mails. No one said they had received hard copies mailed to them.