Dear fellow Club Wyndham South Pacific owner,

The rapid evolution of the coronavirus/COVID-19 situation has left people across the world – including many Club Wyndham South Pacific owners – facing unexpected challenges. While we are all in uncharted waters, I want to reassure you that we are doing all we can to help every owner, and particularly those doing it the toughest.

As you know, our Club Wyndham South Pacific resorts are either closed or are in the process of closing through April 30, as a result of advice from the health authorities and governments of the countries where we operate in to cancel non-essential travel and minimise interaction between people.

Rest assured that we listen to every question we get from our owners and value your feedback. We have received some feedback from owners making the case that levies should not be charged if resorts are closed.

As the Chief Financial Officer for Wyndham Destinations Asia Pacific and a proud and active owner of Club Wyndham South Pacific, I would like to explain to you why we are continuing to request levy payments at this point.

Entitlements

We know many owners have had to cancel reservations through to April 30, or have credits expiring through this date. We are doing all that we can to ensure you will have the opportunity to use your accommodation entitlements in your Club at a future date.

Even where your credits for cancelled bookings have expired during this period, we are putting in place arrangements to allow an extended period of use to prevent the loss of accommodation rights that you pay your annual levies for.

Club Levies Benefit Your Club

Your Club Wyndham South Pacific levies go towards funding the Club operations for each financial year based on projected occupancy and projected costs. The composition of costs are both fixed and variable.

Fixed costs include most property and operational related costs – for example, rates, taxes, insurance, compliance costs associated with property ownership and country, federal and state laws, refurbishments, and a number of labour and service and support contracts (many of which are fixed). There are also some labour costs that are either fixed or substantially fixed – for example, finance, IT, reservations and operations.

Variable costs will include some labour and occupancy related costs for casual employees within resort operations – including housekeeping, front desk, maintenance, security, and food and beverage.

We will definitely have some savings in resort operations with property closures and we have sent resort and central support employees on extended leave where we can (employees using leave entitlements are still being paid so this is still an ongoing cost to the club). However, we have also had increases in costs due to managing cancellations through reservations, increased resort cleaning and hygiene costs as a result of COVID-19, and funding all future reservations and the extension of accommodation for owners whose credits expire during this period.

Where we can, our operations and maintenance teams are bringing forward deep cleans and maintenance work to be done during the close down period so we can free up more accommodation later in the year which would have ordinarily been closed out for this purpose.

Our operational and finance and support teams are minimising costs, while we are also working with all fixed contract suppliers to get some relief in these times. Our club and leadership teams have always been prudent about the allocation of levies.

Hardship

We acknowledge many owners are experiencing hardship currently as they may have lost their employment or have reduced hours. As always, any owner who is experiencing hardship should contact us and we will work with you to try and find a solution that meets your needs and ensures the long term viability of your ownership.

If you have lost your job or have fewer hours, and are having difficulty in meeting your levy payments, then please reach out to our team at accounts.receivable@wyn.com. The same applies if you have finance through Finance by Wyndham and are having difficulty in meeting loan repayments.

It is possibly only early days in the coronavirus/COVID-19 situation. We are currently working through and calculating where we can make savings. We will make adjustments or feed any extra money raised into reserves for the future, as the club is a not for profit.

Levies are set year to year and, practically, we will need a little time to know the full financial effect on the club’s net spend and any net savings.

The coronavirus/COVID-19 is a situation none of us has ever experienced. There is no rule book or formula to follow. However, rest assured that your club and Wyndham teams are working to ensure the best outcome for everyone.

We know some owners are experiencing genuine personal hardship. Our priority is to support those owners as best as we can during this difficult time while protecting and maintaining your Club assets.

Please stay safe and I look forward to seeing you at one of our fabulous resorts in the near future.

Thank you for your understanding, support and patience in these difficult times. We will continue to do everything we possibly can to support you.

Liam Crawley

Chief Financial Officer

Wyndham Destinations Asia Pacific