Timeshare Trends Blog

The Orlando based company that owns the Mystic Dunes Resort and Golf Club in Celebration filed for chapter 11 bankruptcy reorganization and plans to sell its properties to Diamond Resorts International. Tempus Resorts lender, GMAC Commercial Finance has stated that it is getting out of timeshare financing. The Tempus Resorts CEO says they are profitable, but filed for bankruptcy because the private-equity company that bought its loan portfolio opposed the sale to Diamond Resorts. The deal will now be reviewed by a bankruptcy judge. Existing timeshare owners would retain Tempus privileges, but could upgrade to the Diamond Resorts

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While highlighting its significant market opportunities and competitive advantages, Marriott International has informed security analysts and institutional investors in New York, that its earnings per share of stock could hit well above the highest earnings achieved during Marriott’s most recent peak earnings year of 2007. The company expects to add at least 80,000 to 90,000 hotel rooms to its portfolio from 2011 through 2013 with additional opportunities for 22,000 rooms to open in Europe and Asia during that same period. Marriott has plans to adapt and expand current brands, such as Courtyard and Fairfield, to meet the growing needs of customers in markets worldwide. The company will also be expanding its new brands outside of the United States, including Edition, which just opened its first hotel on Waikiki Beach in Hawaii. Marriott is also successful in the high-end timeshare market.

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The Westin Riverfront Resort and Spa has added an adventure option for their owners and walk-in guests. It has a new package called Adrenaline Rush Guaranteed, which combines rejuvenation and wellness with exceptional service and stylish amenities. The Westin Riverfront Adrenaline Rush package starts at $319 per night and includes lodging for two in a studio suite, a $200 credit to Timberline Tours for a whitewater rafting adventure down the Colorado or Eagle Rivers or an off-road Jeep tour, two four hour bike rentals, two complimentary fitness classes at the Riverfront Club (including yoga, pilates, kickboxing, and body sculpting), and complimentary valet parking.

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Starwood Vacation Ownership has expanded its Sheraton Vistana Villages, located on the south end of world-famous International Drive in Orlando. The current expansion phase includes 200 new villas, a new swimming pool complex, a new recreation building that will house a second fitness center, game room and arcade, as well as an activities desk with sports, pool games and equipment. The Sheraton Vistana Villages is the second Sheraton vacation ownership property located in Orlando. The first property is the Sheraton Vistana Resort, one of the Orlando’s largest timeshare properties.

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Wyndham Worldwide Corporation has recently renewed its financing for its Orlando based timeshare operations. According to a recent story in the Orlando Sentinel, Wyndham has stated that the securitized timeshare receivables conduit has a capacity of $600 million, and is renewed through September 2011. Timeshare companies typically use the receivables facilities to turn timeshare buyers mortgage into cash that the companies can use for further development.

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Interval International has revealed that its U.S. resident members reported annual household income greater than $125,000 per year, 88% are satisfied with their membership, 33% would like to purchase additional holiday time, and Interval International’s U.S. members spend about 23 nights away from home, taken as leisure time. Also determined in the profile, Florida, California and Hawaii are the most popular destinations members said they wanted to visit within the next two years, with New York City the most popular urban destination. The Caribbean is the number one “international” favorite destination for US residents. An official at Interval International said, “The observations and insights drawn from this research reinforce the value our members place on vacationing. This study also represents the latest in Interval’s continuing commitment to bring timely and consumer-centric research to the market.”

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Timeshare operations have learned from the credit crunch. According to a recent article in the Orlando Sentinel, the plummeting sales of timeshares have finally leveled off. Nationwide, timeshare sales have fallen from a peak of $10.6 billion in 2007 to $6.3 billion last year, according to figures released during the 12th annual Vacation Ownership Investment Conference held at the Peabody Orlando Hotel. Employment in the industry has fallen 30% from about 279,000 to about 196,300. Timeshare business was humbled as credit markets dried up in late 2008, but the industry’s major trade group said the credit crunch that crippled the industry also helped change the way companies do business for the better. Marketing techniques have changed into more efficient tactics, such as selling more product (upgrades) to current owners and targeting prospects with higher credit scores resulting in higher closing percentages. Down payments are up, occupancy is steady at 80% and individual units are now selling at an average of $20,468 versus $16,278 in 2005. Financing is still tight, but it is easing up, but according to officials in the timeshare industry, it is still going to be awhile until we get back to the way it was three years ago when there was plenty of financing.

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Tahiti Village, Tahiti and Club de Soleil resorts were part of the Consolidated Resorts group of properties acquired. The Las Vegas headquartered company completed the acquisition of all of its timeshare inventory and operating assets of Consolidated Resorts, which had filed for bankruptcy in June 2009 when its major lenders had discontinued funding due to the effects of the credit crisis and the slumping economy. The closing of the sale from the bankruptcy estate is the first in a series of planned transactions that will result in the Spector family investing more than $30 million back into the local Las Vegas economy. The Arthur Spector Companies has been a leading timeshare resort developer in Las Vegas, Hawaii and Florida for more than 30 years.

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The timeshare industry has contributed $69 billion of economic output in the US economy. A recently released economic impact study of the timeshare industry highlights the key economic and fiscal impacts on the U.S. economy in 2009, according to the American Resort Development Association (ARDA). Developed in conjunction with Ernst & Young, the report shows that the U.S. timeshare industry generated an estimated $69 billion of economic output with 465,800 full and part-time jobs, more than $22 billion in income and nearly $8.4 billion in total taxes. “The contribution of the timeshare industry on local economies goes beyond the resort footprint,” said Howard Nusbaum, ARDA president and CEO. “In addition to sales and corporate operations, development of new resorts and renovation projects, it also includes the impact of expenditures from vacationers during timeshare stays.”

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Among timeshare owners, owner satisfaction rates are high, while defaults are low. According to the latest research by the American Resort Development Association (ARDA) and Smith Travel Research, despite the fact that timeshare sales continue to reflect the national trend of lower consumer spending, there are 80% occupancy rates in timeshares versus a 60.4% hotel occupancy rate.

Timeshare buyers also remain happy about their purchases with 86% reporting that they are satisfied are very satisfied with their purchase. Research also indicates that nine out of ten timeshare owners are current on their monthly payments.

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