Marriott International Inc. said it plans to take a third-quarter pretax charge of $760 million in its timeshare business as the economic slowdown cuts leisure travel and investing.

The company, which operates four timeshare properties in Hawaii, will cut prices, halt development at some luxury fractional ownership and residential resorts, and sell some undeveloped land, Marriott said today in a statement.
It also plans to sell its inventory of rooms as part of a new program with Ritz-Carlton Destination Club.
Hotel owners are struggling to attract customers as the recession deters vacationers. Demand for luxury timeshares “was soft in 2008 and weakened further in 2009,” Marriott said.
Timeshares have become a diminishing part of Marriott’s business, accounting for about 14 percent of revenue in the fiscal year ending in January, compared with 16 percent in the year earlier period.
“Marriott has shifted from development mode to cash- harvest mode in its timeshare business,” said Jake Fuller, an analyst with Soleil Securities Group Inc. in New York. He rates the shares “buy.” “This timeshare business will now produce cash instead of use cash.”
Marriott Vacation Club operates the Kauai Beach Club and Waiohai Beach Club on Kauai, the Maui Ocean Club on Maui, and the Ko Olina Beach Club on Oahu.