10 years ago we were a pure-play vacation ownership company, with three brands, 64 resorts and approximately 420,000 owners.
Today we're about vacation experiences, with seven brands, 120 resorts and 700,000 loyal owners in our vacation ownership business and we also have 3,200 resorts and 1.3 million members in our exchange business and more than 150 other resorts and lodging properties in our third-party management business.
I've been with Marriott Vacations for 25 years.
For example, we ran nearly 95% occupancy in Hawaii for the quarter, so when the government asked travelers to stay away for a few months, we did see occupancy soften a few points late in the quarter.
Our urban locations continued to improve nicely during the quarter, with San Diego running over 85% occupancy and Boston running nearly 95%.
With the strong domestic occupancy, we delivered $380 million in contract sales which was within 3% of 2019 levels.
First-time buyers represented more than 30% of contract sales improving sequentially from the second quarter.
And with the products we sell resonating with customers now more than ever VPG excluding, Welk was almost $4500, nearing 30% higher than the third quarter of 2019 with both first-time buyer and owner VPG up double digit.
In total these agreements will bring nearly 50,000 new members through the interval system beginning on January 1.
We sold more tour packages in the third quarter than we did in the second, ending September with more than 214,000 tours in our package pipeline.
Owner and preview reservations for the first half of next year are up 10% compared to the same time in 2019.
In a recent survey 71% of our owners stated that they are likely to travel within the next three months with 90% likely to travel in the next 12 months.
I've had the pleasure of working closely with Tony since I joined Marriott Vacations nearly 13 years ago and I couldn't be happier for him.
As a result, we grew contract sales by 5% sequentially in the third quarter to $380 million which was almost back to 2019 levels.
Adjusted development profit increased 19% sequentially to $98 million.
Adjusted development profit margin expanded sequentially by 335 basis points to 30%, the highest margin in our 10 years since becoming a public company, highlighting the benefits of more efficient marketing and sales spending, lower inventory costs and synergy savings.
This did impact our transient keys rented during the third quarter, but with average revenue per key, increasing 9% sequentially, rental revenues increased 11% and profit grew 73%.
Resort management revenue increased 2% compared to the second quarter and margin was approximately 56% and financing profit increased 16% from the prior year due to the inclusion of Welk.
With our contract sales growing 5% sequentially in the third quarter, and financing propensity improving to 60%, our notes receivable balance increased sequentially.
Turning to the acquisition of Welk, while we're not providing detailed results for the Welk business given its relative size, our vacation ownership results did include $30 million of contract sales and $18 million of adjusted EBITDA better than we anticipated.
As a result, total adjusted EBITDA in our vacation ownership segment increased 18% sequentially to $215 million.
The quarter benefited from strong growth in development and rental profit and the impact of our business transformation initiatives, enabling us to deliver margins that were nearly 360 basis points higher than two years ago.
Turning to the exchange and third-party management segment, active members at Interval declined slightly on a sequential basis, and average revenue per member declined 7% due to lower exchange volumes, which I mentioned last quarter.
As a result, adjusted EBITDA at our exchange and third-party management segment declined $2 million sequentially.
However, margins expanded by 70 basis points on cost-saving initiatives.
I'm also very excited about all the new resort affiliations Steve talked about, which will bring nearly 50,000 new interval members to the system by early next year.
Finally, corporate G&A expense declined 20% sequentially in the third quarter, primarily related to lower bonus expense.
As a result, total company adjusted EBITDA increased 25% in the quarter on a sequential basis to $205 million and margin improved to over 27%, more than 300 basis points above the third quarter of 2019, demonstrating the strength of our leisure-focused business model and the benefits of our synergy and transformation initiatives.
So with the recovery in the business, we felt that now was the right time to reduce our corporate debt by the $500 million, we borrowed last May at the onset of the pandemic and begin to return cash to shareholders again.
In September, we've paid off the remaining $250 million of our 6.5% notes due 2026.
We followed that in October by repaying $250 million of the 6% and 8% notes we issued last May.
With our current corporate debt at $2.5 billion and the strong recovery in the business, we are on track to get back to debt to adjusted EBITDA of three times or less.
And more importantly by taking advantage of the favorable rate environment and healthy capital markets, we expect our cash interest expense next year to be around $20 million lower than our 2019 cash interest expense.
We ended the quarter with $448 million of cash, gross notes receivable eligible for securitization of $278 million and almost $600 million of available capacity under our revolver.
Pro forma for the debt repayment in October, we had $4.1 billion of debt outstanding including $1.6 billion of non-recourse debt related to our securitized notes receivable as well as total liquidity of more than $1 billion.
Finally our Board of Directors reinstated our quarterly dividend and authorized the $250 million share repurchase program effective September 10, enabling us to repurchase $4.5 million of our own shares in the last couple of weeks in September.
As a result, we expect contract sales to grow to between $385 million and $405 million in the fourth quarter just above the fourth quarter 2019 at the midpoint.
For those trying to compare our fourth quarter results to the fourth quarter of 2019, remember that reportability that year positively impacted our adjusted EBITDA by $22 million.
And this year, we only expect the benefit to be in the $10 million to $12 million range.
Finally, while we're not providing free cash flow guidance today, with more than $640 million of excess inventory, I would expect our adjusted EBITDA to adjusted free cash flow conversion to be well above our normal 55% range for a number of years enabling us to return to our historic capital allocation strategy.

Summary:
As a result, we expect contract sales to grow to between $385 million and $405 million in the fourth quarter just above the fourth quarter 2019 at the midpoint.