Disney Vacation Club’s Future: The Introduction of a Timeshare Trust Product

Unveiling the Upcoming Timeshare Trust

Back in August of 2023, the wizards at Disney Vacation Development conjured up an innovative solution to enhance their vacation club offerings. They registered a non-profit organization named the Palmetto Trust Association, Inc in the State of Florida, which has been rumored to be the beginnings of a new chapter for DVC over the past few months. Now, with new documents being filed for DVC’s newest resort, The Cabins at Disney’s Fort Wilderness, this new trust product has been conclusively confirmed.

A Trust foregoes the traditional model of purchasing a deeded interest in a single resort, and offers buyers the chance to become part of a multi-resort trust. This means Disney will be placing a large bucket of individual deeds into this new trust, and members will be granted access to a variety of Disney resorts by owning an interest in this trust.

The Benefits of a Timeshare Trust

The Timeshare Trust holds many treasures for future members. One of the most appealing is the ability to vacation at any of the participating Disney resorts, granting an 11-month booking window for multiple resorts. Currently DVC members are allowed to book their home resort at 11 months out. With the new vacation option, if there are many different contracts held within the trust, members could book any resort that’s part of the trust at 11 months in advance.  Of course, this works as long as there are enough points deeded to a specific resort to cover the bookings.

The incorporating documents, which were filed with the State of Florida, also show that the trust would offer a straightforward 50 years of ownership. This eliminates the concern of prospective buyers, since some Disney home resort ownerships are coming to end of their right to use soon.

The Challenges of a Timeshare Trust

However, every magic spell comes with a unique set of challenges. The Timeshare Trust is no exception. With more owners gaining access to popular accommodations at 11 months, there could be increased competition for booking certain rooms.

Value rooms at Animal Kingdom Villas are already notoriously hard to book, and with everyone in the trust having access at 11 months, if the number of contracts that are part of the trust isn’t large enough to support demand, there could be availability issues.

Although availability for current deeded owners should remain relatively stable, Trust buyers might face stiffer competition for high-demand accommodations.

In addition, there would need to be sufficient inventory in the Trust for owners to have sufficient availability to book in general. This can occur by Disney building new resorts or acquiring deeds from resale owners at existing resorts to put these deeds into the Trust.

A Whole New World of Possibilities

The unveiling of the Timeshare Trust opens a door to a world filled with endless possibilities. Disney has historically found it challenging to sell points at resorts located away from theme parks, but the Trust could potentially include new locations without selling points directly tied to those facilities.

This development could mean DVC will be incentivized to build additional non-park resorts, which could offer an even wider array of vacation options in popular destinations with a sprinkling of Disney magic.

The Right of First Refusal Monster

In the mysterious realm of developing a trust-based timeshare ownership, there lurks a formidable creature known as the Right of First Refusal monster.

When other developers have made this transition to trust-based timeshare ownerships, we have seen a large up-tick in the developer buying back contracts from owners who wish to sell on the resale market. For example, when Marriott created a trust, in order to fill the trust with inventory, they began buying back a large number of deeded weeks, then adding them to the new trust.

How Resale Prices Could Be Affected

Historically, when a developer buys back a large proportion of inventory, it can affect resale pricing. Over the course of 2023, there were sections of the year that saw higher-than-normal buy back rates. The question for 2024 will be, has Disney already acquired the contracts it needs to build out this trust product, or will they be exercising their right of first refusal at higher rates in the coming years?

If Disney does go on a buying spree, we could see prices creep higher as inventory becomes constrained. Also, this constraining of inventory could be seen predominantly with resorts that are already sold out, where Disney doesn’t have the deeds to place into the trust.

The future behavior of the Right of First Refusal monster remains shrouded in mystery. Only time will tell how hearty and vicious the Right of First Refusal monster will be, so stay tuned to the Premier Timeshare Resale blog for more updates as this story develops.

You can learn more about Right of First Refusal in our comprehensive guide for timeshare buyers & sellers here: Right of First Refusal: Everything Timeshare Buyers & Sellers Need To Know.

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