ST. MAARTEN NEWSLETTER


We have heard from many owners at Royal Palm Beach Resort and Flamingo Beach Resort who are frustrated about the current construction timeline and we agree that the process is slower than we would all like. But the resort is being rebuilt the right way. All new roofs, electrical, plumbing, windows, doors, mechanical components – the resorts are being completely rebuilt aside from the concrete frames. This isn’t just a few repairs and we are in no way dragging out the reconstruction process. We want to see the resorts reopen, so we can once again welcome you home.

Here are some details:
Based on the advice of insurance adjusters, industrial hygienists, remediation specialists and other experts, the decision was made to completely rebuild Royal Palm Beach and Flamingo Beach because of the damage caused by Hurricane Irma. Our resorts were not the only properties damaged in the storm. In fact, resorts across the island sustained varying degreend several other properties have also remained closed – some with no set date of reopening, such as the Westin Dawn Beach.
Blueprints were not available for either resort, forcing us to complete new drawings before beginning any work. That took time and construction could not proceed without them.
Building materials are not readily available on the island, and everything has to be imported. With an incredible number of reconstruction projects happening across the island right now, it is taking longer than normal to get supplies through the ports.
Finding skilled workers has also been a challenge. We currently have nearly 200 workers between the resorts. When we began the project, obtaining local workers proved to be difficult – the island didn’t have any skilled trade workers for some of the pieces needed. That has forced us to hire foreign workers, and obtaining the necessary paperwork for the foreign workers has been a daunting and long process. Each of the workers needs to have a permit before they are allowed on the construction site. If we don’t follow the process, it could jeopardize the entire project.
Flamingo Beach was fortunate there was adequate cash flow to cover 2018 insurance premiums and other administrative costs. Owners, including weeks owned by Diamond Resorts and the Trust, were billed a reduced maintenance fee for 2019 because the cash flow was insufficient to cover estimated 2019 expenses. The operating portion of the maintenance fee, as noted in the summary budget enclosed with the billing statement, covers the insurance premiums and some minor administrative costs. It is necessary not only to keep the building insured but to maintain insurance coverage given the difficulty of keeping insurance at all. Premiums increased significantly over previous years due to the number of natural disasters occurring (hurricanes, fires, floods, even volcanoes) across the globe. Even though the resort is not operating, there are administrative costs that occur which would not be paid under the insurance claim, such as owner mailings, audit fees, and credit card charges. The reserve portion of the maintenance fee is allocated to a few projects including the upgrading the waste treatment facility, adding a fitness center and an outdoor hot tub to provide additional amenities, replacing corridor tile in Building 7 and modifying the studio layout. The insurance claim is paying to rebuild the resort “like for like.” The claim is in excess of $60 million to rebuild the resort. The only expenses not covered under the claim are the deductible and any improvements or upgrades that may be considered.

Royal Palm was billed a reduced maintenance fee for 2019. Like 2018, the cash flow was insufficient to cover the insurance premiums and other administrative costs. The operating portion of the maintenance fee, as noted in the summary budget enclosed with the billing statement, covers the insurance premiums and some minor administrative costs. It is necessary not only to keep the building insured, but to maintain insurance given the difficulty of keeping insurance at all, as premiums have increased significantly in recent years because of the number of natural disasters occurring (hurricanes, fires, floods, even volcanoes) across the globe. Even though the resort is not operating, there are administrative costs that occur, which would not be paid under the insurance claim, such as owner mailings, audit fees and credit card charges. The reserve portion of the maintenance fee is allocated to a few projects such replacing corridor tiles and includes a provision for any possible upgrades or uninsured expenditures. The insurance claim is paying to rebuild the resort “like for like.” The claim is in excess of $50 million to rebuild the resort. The only expenses not included under the claim are the deductible and any potential improvements or upgrades that may be considered.

The Royal Palm Beach Resort annual owners meeting will be held Tuesday, May 21, at noon at Simpson Bay Resort. The Flamingo Beach Club annual owners meeting will be held Wednesday, May 22, at noon, also at Simpson Bay Resort. A preview of model units will be included as part of the meeting agendas. As the resort is an active construction site, the contractors are allowing us to tour without personal protective equipment; however long pants and closed toe shoes are required.

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Flamingo Beach Resort




At this time, we’re estimating the following completion dates:

Royal Palm Beach Resort:Project completion estimated for June 2020

Flamingo Beach Resort: Completion of building 6 in April 2020; building 4 in June 2020, and buildings 3 and 7 in August 2020


As always, there are many unknown factors that could impact the project, including labor constraints, availability of materials, government permits and the 2019 hurricane season. We understand that this is situation is not ideal. But we’re happy to say that when you return to Royal Palm Beach or Flamingo Beach Resort, you will essentially be walking into a brand new resort.

Our Member Services team is available by calling 1.877.374.2582, should you have any additional questions at any time.


Diamond Resorts™ 10600 West Charleston Boulevard, Las Vegas, NV 89135 USA.