Fractional Ownership News

Miami (continued)

Value

Value, although not necessarily by way of PRCs and Destination Clubs offering a cheaper alternative to more traditional forms of vacationing. Jeff Potter, CEO, Exclusive Resorts said that he felt that joining a club was more about the improved lifestyle for families rather than a strict financial investment and that although there is often a heavy focus on equity potential that the true value was in the experience itself.

Steve Greer, President and CEO, LUSSO Collection backed up this sentiment in saying that that his average member has a $5m net worth that a Destination Club is more of a “consumption product” than an “investment product”.

Time is a precious commodity for the wealthy and the cost is potentially immaterial (within reason- people don’t become rich by paying well over the odds!) if the overall experience is a good one. Richard Keith, Chairman of the Board, Ultimate Escapes made an illuminating proclamation on the topic of net worth against fractional spend in that there is not necessarily correlation to the net worth of a member and the specific club they join. The bottom line being that the wealthiest members don’t necessarily opt for the top-tier clubs but instead select one most closely matching their time, location, facilities and space requirements. A logical but often overlooked point.

On ‘value’ from a more monetary perspective Christian Kirschner, President and CEO, High Country Club made some interesting points. The High Country Club is targeted at a more cost conscious consumer with average member is a 40-55 year old couple with 2-3 children (compared to the older, often retired demographic of higher tier clubs) who would generally holiday at the best hotels and resorts and would often need two rooms to accommodate their families so the HCC can make emotional and economic sense. This is particularly relevant in the current economic climate as families who would traditionally plumped for second home but now see that their down payment could instead be used to join a DC, thus sparing them the cost of continuous second-home ownership and associated hassles.

QTR

We love a decent buzz-phrase here at FL Towers and Gregg Amonette, Senior Vice President, Business Development; Ultimate Escapes introduced us to an absolute winner of a phrase. QTR stands for Quality Time Remaining- which basically means making the most of the time we have before one departs to their fractional residence in the clouds.

Through the results of a recent Ultimate Resorts member survey Gregg explained that 70% of their members are 45-65 years old with children and stated many members are grandparents joining to allow them to spend time with their adult children and grandchildren. They are claiming back time that may have been, to some extent, ‘lost’ whilst they were building their personal empires and are now looking to enjoy the wealth they have accumulated with the people they hold most dear.

This tied in something that Howard Nusbaum mentioned earlier in the day- that retirement is no longer for settling down and that retirees are becoming increasingly active in their later years so are still looking for new opportunities and excitement.

As a positive aside Gregg also indicated that the most recent month was a record one for new member sign-ups.

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