Real Estate That’s A Real EscapeSM
There will always be a market for well-conceived, well-executed and properly priced condominium and single-family home developments at premier international vacation destinations. However, the decision to purchase vacation real estate is also influenced by time constraints, cost of travel, hassles associated with property maintenance, an unwillingness of potential buyers to place expensively furnished residences in rental programs, and a lack of services and amenities typically associated with second-home ownership. The result is that many financially and emotionally qualified households opt not to purchase vacation real estate — not because they don’t want it or can’t afford it but because they can’t rationalize it. The up-front and annual expenses plus the responsibilities compared to the amount of personal use do not compute for them.
The Market Niche
Residence clubs are a natural evolution of upscale resort real estate that dramatically expands the market. It allows for the sale of fractional real estate interests or right-to-use ownerships in a form that is very palatable to high-income buyers and is a natural addition to the product mix at world-class resorts or vacation destinations.
Residence clubs are a shared real estate product that differ significantly from timeshare developments in terms of pricing, prestige and flexibility. However, they do create the high occupancies generated by timeshare developments (but with more-affluent, higher-spending owners). Residence club ownership is much like membership in a prestigious golf country club. Residence Club owners are not locked into a specific week or weeks and are not limited in the number of days they can lodge at their club (similar to the unlimited tee times afforded golf country club owners, subject to availability). Residence club marketing strategies also differ markedly from timeshare sales techniques. The selling approach for residence club ownership is more closely aligned with traditional, upscale real estate sales. Residence club owners typically would not purchase a timeshare or other types of fractional ownership.
The only constraint on club lodging use by residence club owners is use by other owners. There are a generous minimum number of lodging days available to each owner based on the ratio of owners per residence. When some owners use their club less, others can use it more. Residence club owners can reserve club accommodations well in advance and also use them on a short-notice, space-available basis. At a minimum, club owners can use their club as much as the “typical” vacation homeowner uses his or her resort condominium or house.
The real benefits of vacation home ownership are predictable escapes from daily hassles, abundant recreation, adventure and relaxation that provide and quality family time in a desirable environment — not the “sticks or bricks” of a condominium or house. Residence clubs offer all these benefits at a fraction of the price commanded by comparable vacation homes.