CN Mar122012 RUD

Aimfair Member Updates - Nuevo Vallarta and Riviera Maya

March 12, 2012

What are members of the Grand Luxxe Residence Club talking about at the pool, in restaurants, in sales presentations and through the electronic airwaves? Generally speaking, the following topics seem to be catching attention:
  • Punta Owners Expectations vs. Their Experiences To Date

    Punta Pool Use and Other Punta Issues

    This pool is the South Pool and is closest to the Ameca River. It is also the closest pool to the beach deck, with lounges that face west and south west to Puerto Vallarta.
    The West Pool is the largest of the three. This is the pool owners of Presidential Villa units in the Punta feel should be restricted to owners in the Punta building.
    Three pools make up the Punta Pools - North, West and South. This view is the North Pool.

    Expectation: Current Status:
    • Areas of the Punta Pools should be designated for Presidential Villa owners only.
    - There is enforcement but it seems to be with erratic regularity. It is possible if the area is not crowded, enforcement may be lax.
    • Upgraded furnishings in Presidential Villa units
    - Crews are installing new furniture and equipment. However, it is likely there will be further adjustments after the furnishings are installed.

    For example, the company has installed new armoires/dressers/hutches for clothing storage. Some guests have warned there are pungent odors that are absorbed by clothing placed inside, so they did not use them. We think this may be a short term issue as the wood becomes acclimatized with the surroundings.

    Requested changes to living area furniture is underway. Although the seating arrangements in the living areas are nicely laid out for socializing, the overall impression is less stirring than one would expect from such spacious and open accommodations. Maintenance crews are installing upgrades to the furnishings. We understand crews are installing 52" TVs in the living rooms.

    Decorating is such an individual preference. Some express the desire for more color and warmth while others are more concerned with convenient closet and dresser storage. There is progress, but the end result may take more time than expected.
    • Construct more Presidential Villas
    - The developer seems to be "between the proverbial rock and a hard place". In November, 2011, construction activity was high, which resulted in many complaints. Today, construction activity is low, which postpones openings of anticipated new accommodations.

    Early adopters directly sponsor newer, larger accommodations by committing to pay for new contracts. The last thing they want to see is postponed construction of accommodations they have committed to purchase. However, each project takes time to complete. The Punta, for example, took about two years to complete.
    • Heated Punta Pools
    - Although members have been told that there is an advanced Punta Pool heating system, which is said to combine solar with gas heating, there is no evidence of maintenance crews having activated the system. Punta pool water remains cool to cold.
    • Early adopters expect preserved value.
    - Early adopters have expressed concern that features of their memberships are diluted and commoditized and feel the value they gained by purchasing early is being reduced relative to members who purchase later in the sales cycle. They hear that later stage buyers of completed projects get similar benefits included in their purchase, without assuming risk.

    We feel this is a difficult issue to reconcile because our understanding is all contract terms and costs are different and confidential. Talk around the pool leads to comparisons of contract benefits and costs. Again, it is human nature to confirm relative value for prices paid.

  • Grand Luxxe Residence Club Construction Plans - Nuevo Vallarta

    Construction Plans - Nuevo Vallarta

    Expectations: Current Status:
    • Grand Luxxe Tower III B - Completed by mid-2012
    - Tower III B is the second building starting from right to left in the above photo. The furthest on the right is Tower III A, and it was opened in November, 2011. It does not appear Tower III B will be completed before November, 2012.
    • Grand Luxxe Tower IV A and B - Completed by November, 2013
    - We hear that construction of Grand Luxxe Tower IV A and B is on hold for the time being. These buildings are furthest to the left in the above photo. We hear the reasons for the delays could be related to structural issues (settling) or configuration issues (fewer or more Presidential units, Luxxe Master Villa and Luxxe Suite units with no lock offs, etc.).

    Developers have to plan for demand. There could be many discussions about what can and cannot sell in this market. These discussions could delay completion and opening of both buildings of Tower IV.
    • Grand Luxxe Tower V - Construction to begin in 2012
    - Grand Luxxe Tower V may be just a pad at this stage, but not much more. This building may offer only larger sized three and four bedroom units (4,200 SF to 6,000 SF) and be very exclusive. We understand the only way to purchase contracts for these units is by invitation.

    Construction plans for this building are uncertain at this time. It is not clear whether Grand Luxxe Tower V will be treated as an independent building like the Punta with its own construction schedule or if it will follow the completions of Grand Luxxe Towers III B and IV A and B. Only time will tell at this stage.
    • Pools for Grand Luxxe Towers III, IV and V
    - Obviously, construction of pools that will service the four buildings that make up Grand Luxxe Towers III and IV will be delayed as well.

    After watching the construction of Grand Luxxe Towers I through III and the Punta, it is clear completing the pools will be done a few months before the buildings are ready for occupancy. Therefore, we will all watch the construction progress of Grand Luxxe Tower III B and Grand Luxxe Tower IV A and B. As soon as workers begin installing windows and sliding glass doors, we can expect to see work start on the pools.

    As far as Grand Luxxe Tower V is concerned, we hear that this building will have its own pools, and these will be very exclusive.

  • Grand Luxxe Residence Club Construction Plans - Riviera Maya

    Construction Plans - Riviera Maya

    Expectations: Current Status:
    • Grand Luxxe Buildings Three and Four - Same configurations as Grand Luxxe Buildings One and Two, both to open in 2012
    - Prior reports said opening Grand Luxxe Buildings Three and Four would follow shortly after the opening of Grand Luxxe Buildings One and Two. The term "shortly" implied within a year or so.

    This does not seem to be the case. Instead, there is an indefinite hold on completing the new buildings at this time. Again, there are a number of reasons given for the delay, the most consistent of which is the configurations of the buildings are currently uncertain. Management may be assessing the types and mix of units that would be available in these buildings.

    FYI, Building One is the triangular building in the center of the above left hand photo and Building Two is the triangular building to the lower right of Building One. The construction sites for Buildings Three and Four are the two triangular figures in the upper portions of the photo on the left.

    Buildings One and Two each have 18 Grand Luxxe Villa Master Suites (located on each corner of the building) and 18 Grand Luxxe Suites (located between the Grand Luxxe Villa Master Suites). There are a total of 72 open Grand Luxxe Residence Club units in the Riviera Maya inventory at this time. Members are concerned that 72 units are enough to satisfy demand.
    • Availability of Grand Luxxe units will increase
    - Members are now being told there are no plans to build additional Grand Luxxe Villa or Grand Luxxe Suite style units at Riviera Maya. Also, there are no plans to purchase additional land to the north or south for construction of new units.

    Instead, members have recently been told Buildings Three and Four will have three units per floor on each side of the triangular "pods", which is consistent with Buildings One and Two. Also, both buildings will be three stories tall, which is also similar to the Grand Luxxe Buildings One and Two. However, we hear that the mix of units in Buildings Three and Four could be either a combination of Spa and Presidential Villas or all of one type in one building and all of the other type in the other building.

    The Spa and Presidential Villas are four and three bedroom style units, respectively. Only the Presidential Villas are available at Nuevo Vallarta in the Punta at this time. There is also a four bedroom unit in the Punta. But this unit is not part of the Member inventory. It could be a prototype of the Spa units.

    Regardless of the mix of units, it appears each building will have a total of 27 units (Three floors of three units on three sides = 27 units per building). As mentioned above, it is not clear whether one building would contain only Presidential Villas and the other building would contain only Spa Villas or the buildings will contain two Spa Villas and one Presidential Villa per floor. If the two are offered in the same building, then Spa Villas would be on the corners and Presidential Villas would be between the Spa Villas.

    In either case, there will be 27 units in each of the two remaining Grand Luxxe buildings, or a total of 54 Grand Luxxe Villas added to member inventory. It will likely take two years to complete, once construction begins in earnest.
    • Mansions of the World would be built nearest to the beach
    - We do not know if the Mansions of the World hotel will be built at Riviera Maya. In earlier presentations, a Mansions of the World building appeared on the property.
    It was located on the southern end of the beach, near the building that housed the Grand Luxxe, Grand Bliss and Bliss models. The area is consistent with recent musings that described building a beach club, convention center, more pools and air conditioned facilities that would include restaurants, a spa and other meeting rooms. Could this be a Mansions of the World location? Not sure. Development is at the north end of the beach, so everything is very unclear at this time.
    • New golf courses on the other side of the highway
    - There is now conversation about two new golf courses that will be built across the highway from the main entrance to the Riviera Maya property. We hear there will be a tunnel that extends under the highway for safe access to the new golf facilities.

    We also hear that there will be a Celebration type facility in the new golf area across the highway. This will house a water park and theme park generally similar to the theme park that will appear in Nuevo Vallarta. No living units are planned for this area.

We have not heard any updates from the other properties. We know that Acapulco opened a new and beautiful Mayan Palace. Pittle's review is very complementary. She also shared her photos. Thank you again for your contributions, Pittle.

One member suggested that we do not forget Mazatlan. However, we do not have any recent information from anyone. Don's is the latest.

San Jose del Cabo will develop East Cape. But not right now.

We will post other updates as we get them.

Thank you all for providing your input...

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