Destination clubs, also called vacation clubs, are receiving much attention lately as consumers seek to explore all their options for enjoying their leisure time away from home.
Destination Clubs are part of a new wave of luxury clubs that let travelers buy into a portfolio of luxury vacation homes. They are ideal for the individual who loves variety and opportunities to visit different locations.
In destination clubs, members get to spend several weeks a year in million+ dollar houses or condominiums in any of a couple of dozen ultra-luxurious properties in highly desirable locations around the world. The portfolio of homes in a destination club are the creme-de-la-crème both from a value standpoint and location. The homes in the lesser-priced clubs average a minimum of one million each and go up to $10 million homes in the higher-priced clubs. They are situated around the world in the finest locations money can buy. Destination clubs also often make available to their members jets and yachts.
There are two types of Destination Clubs – equity and non-equity. In the first type, you receive a deed to a percentage of the entire real estate portfolio. In the other type, you receive a right to use.
A membership typically costs several hundred thousand dollars and has annual maintenance fees up to $25,000.
The advantage of destination clubs is a wider choice of properties and the high caliber of vacation homes. However, unlike fractional ownership in which owners can resell their shares for a profit, club members generally don’t make a profit. They can however, sell their membership for partial or full reimbursement of their membership fee. Their annual maintenance fees are not reimbursed.
- Who’s buying: People who travel often, want extremely luxurious accommodations and desire regular access to beach, ski, and city destinations. Also people who might be able to afford a second home, like the million-dollar-plus properties available to club members, but who cannot in their minds justify spending that much.
- What you get: Generally, you’re buying the right to stay for a certain number of weeks in a property of your choosing.
- Location: Exclusive Resorts has 123 properties available in 27 locations including Beaver Creek, Colo.; Tuscany; Naples, Fla.; New York City; and Los Cabos, Mexico. Abercrombie & Kent, its next biggest competitor, is in 30 locations including Belize, North Carolina’s Outer Banks, and Rome. Solstice, a new entrant at the ultra high-end, plans to have a 94-foot yacht sailing around the Caribbean, the Bahamas and New England.
- Price: Solstice tops the list at $525,000 for its top plan, plus $21,000 in annual dues. Exclusive Resorts charges $375,000, plus dues ranging from $15,000 to $25,000 depending on the number of desired days. Abercrombie & Kent’s two clubs have an entry fee of $275,000 or $475,000 and dues of $9,500 or $13,500.
- Resale: Clubs return a portion of your original investment (usually between 80% – 100%) but not the annual dues. There is usually a formula for getting your initial investment back, to wit, for every two new members that come into the club, one member is permitted to redeem his membership.
Interested in learning more about destination clubs? Contact us at info@CondoHotelCenter.com or call (954) 450-1929.