RCI Ventures Magazine (European edition) - September 2011

Martin Armistead: ‘Thedeveloper’s master plan shouldinclude a long-term interest ingrowing value.’ PAGE 16

Denis Ebrill: ‘Maintaining theintegrity and credibility of our brandshas always been at the forefront ofour vacation club strategy.’ PAGE 20

Simon Jackson: ‘Keepingcosts under control is theonly way for timeshare tosurvive.’ PAGE 24

September 2011

VENTURESEnterprising ideas for the vacation industry

INDUSTRY INNOVATOR

FRESH APPROACH TO SELLINGGIVES SILVERPOINT THE EDGE

MARKET LEADER

RCI’S NEW MEMBERSHIPPACKAGE BRINGS LUXURIOUSLIFESTYLE BENEFITS TO ANALREADY EXCLUSIVE CLUB

TIMESHARE PIONEER RETURNSTO EUROPEAN MARKET

VENTURESworkV7-CovSept2011b-sa-rb:Layout 1 6/9/11 14:57 Page 1

For over 35 years we’ve been helping our affi liates achieve results that grow their business. With 3.8 million members and more than 4,000 affi liated resorts worldwide, RCI continues to be the exchange provider of choice for some of the largest and most successful developers in the vacation ownership industry. Backed by industry-shaping innovations and service that includes some of the best products, the best technologies, and the best people, RCI is uniquely positioned to help you achieve your goals in shared ownership.

For more information, e-mail [email protected] or call +44 (0) 1536 314651.

RCI and related marks are registered trademarks and/or service marksin the United States and internationally. All rights reserved. ©2011 RCI, LLC. All rights reserved. Printed in the U.S.A.

“Our working relationship with RCI, stretching back more than 25 years, has been one of mutual benefi t and support with both companies sharing a dynamic and far-sighted approach, which has been instrumental in shaping the industry and taking it forward. As the largest international exchange facilitator, RCI is integral to our sales adding a further dimension to owning with Club La Costa. Our two companies continue to work together to increase the number and diversity of quality resorts across Europe, and beyond, to serve an expanding membership.”

Roy PeiresDeveloper and Chairman, Club La Costa Resorts & HotelsRCI Affi liate since 1986

For long-term growth, take thelong-term view

When the going gets tough – thetough do indeed get going. Despitefacing harsh economic conditions,our industry and its key playerscontinue to focus on ways toimprove our products and servicesto provide even greater value toowners and potential customers.

In this issue of RCI Ventures we see both Pearly GreyOcean Club (page 22) and Macdonald Resorts (page 24)investing heavily in resort maintenance and management toprotect the value of their owners’ weeks, as well assafeguard the holiday experience.

One of the industry’s great pioneers and ambassadors,John Spence, is bringing his business back to its Europeanroots with significant investment in new brands and newproducts. John’s new ventures will be influential in helpingboost the organic growth of the European industry, just ashis projects have grown shared-holiday ownership numbersacross Asia, particularly in consumer markets such as Indiawhere a rapidly growing middle class have shown atremendous propensity to embrace timeshare. Thesecustomers will undoubtedly follow his brands to Europeproviding great new opportunities for all our businesses. Find out more about John’s plans on page 12.

Meanwhile on page 14, we learn that Silverpoint – whichalready has a fantastic resort and leisure property portfolio– has invested significantly in training and its people,bringing a fresh and professional approach to the businessof sales and marketing which will go a long way to making apositive impact on the consumer and media perception ofthe industry.

RCI is proud to be associated with these greatentrepreneurs and continues to support them by investing inseveral large and innovative programmes that we believewill be invaluable tools for our affiliate developers in theirsales and marketing activities. In the cover story on page 9we launch our RCI Platinum Membership, which gives yourowners the opportunity to buy into a total lifestyleenhancement programme that they can use both at homeand on holiday. While on page 8 we introduce our latestinteractive tiered sales programme – the RCI Presenterpackage – designed to engage potential buyers at point ofsale, as well as providing a fabulous showcase for yourresorts using professional photography and video footage.As a developer you decide what level you want to invest in,but we have something to suit all needs and budgets.

These may be tough times but, working together, we willcome out on the other side stronger than ever.

RCI Ventures, September 2011 | 3

CONTENTS EDITORIAL

VENTURES is published by RCI, a trading name of RCI Europe, Kettering Parkway, Kettering, Northants, NN156EY, United Kingdom. Tel: +44 (0)1536 310101. Fax: +44 (0)1536 314682. Email: [email protected] EDITOR:Helen Foster. CONTRIBUTING EDITOR: Steve Adams. DESIGN: Richard Blaney. PRODUCTION: Claire Williamsand Lorraine Karabin. ADVERTISING SALES: Media Line Ltd. Tel: +44 (0)870 250 8701. PRINTING: CKN Print Ltd.Original articles and contributions may be reproduced or transmitted only with written permission from thepublisher. All facts and figures stated in the articles contained in this publication are provided by the contributorsand no responsibility is accepted by RCI Europe for content not created by them, nor for any losses or otherconsequences resulting from advertisements or other material appearing in this publication. You are advised tomake your own enquiries and conduct further research if necessary. RCI Europe reserves the right to accept orrefuse advertisements at its discretion without assigning any reason for doing so. © RCI Europe 2011.

Sincerely,Gordon GurnikPresident RCI North America and Europe,Middle East, Africa and India (EMEAI)

VENTURES MAGAZINE SERVING RCI’S MARKETS IN EUROPE, SEPTEMBER 2011 THE MIDDLE EAST, AFRICA AND INDIA

4 MARKET OUTLOOKA news and views round-up from Europe and around the world

6 RCI INSIDEThe latest news for RCI affiliates, including new additions to the exchangenetwork, updated membership packs and sales tools

9 COVER STORY – IT SHOULD BE A WAY OF LIFERCI’s new Platinum tier of membership adds a range of luxurious lifestylebenefits as part of RCI’s unique member offering

12 WINNING WAYSIndustry pioneer John Spence of Royal Resorts brings new brands andprojects into the European market

14 SILVER SERVICEA fresh approach to sales and marketing ensures Silverpoint is among thetimeshare industry’s leading lights

16 LANDS OF OPPORTUNITYA market report on Croatia and Bulgaria, where a variety of factors arecreating real investment potential for the shared ownership industry

20 BRAND NEW BEGINNINGClub Meliá is looking to the future after a major rebrand and marketrepositioning

22 QUALITY FIRSTTaking a bold approach to resort refurbishment has paid dividends forPearly Grey Ocean Club

24 MACDONALD’S MANAGEMENT MASTERPLANWhy using an external management company can be key to the survival of mature timeshare resorts

Cover: RCI Platinum

workV7-ContsSept2011-sa-rb:Layout 1 6/9/11 17:01 Page 3

4 | RCI Ventures, September 2011

DIAMOND RESORTS’GARDENS GET GREENER

TATOCLAUNCHESINDUSTRY CODEOF CONDUCT

Marketoutlook

Diamond Resorts International ispromoting eco-awareness at its resortsthrough a sustainable gardening initiative.

The Las Vegas-based company, whichalso has a European base in Lancaster, UK,is a global leader in the hospitality andholiday ownership industries. It iscultivating and using homegrown fruit andvegetables at selected resorts to enhancethe natural environment and benefit theeco-system and local economy.

Three resorts are taking fresh producegrown in their own grounds for use in theirkitchens at Vilar do Golf in the Algarve,Ka’anapali Beach Club in Maui, Hawaii, and The Historic Powhatan Resort inWilliamsburg, Virginia. Each gardenfeatures an array of fresh produce

indigenous to the area and integral to thecultural cuisine.

In addition to cooking benefits for therestaurants, the gardens have been auseful educational tool for guests andchildren as they are allowed to visit, pickfresh ingredients and participate incooking demonstrations.

Stephen J Cloobeck, chairman and chiefexecutive officer, Diamond ResortsInternational, said: “As a leader in thehospitality industry with a major globalfootprint, it’s important that we actively takesteps toward sustainable growth.

“Through the production of on-sitesustainable gardens, Diamond promoteseco-awareness and encourages propertiesworldwide to engage in green initiatives.”

RESORT:

RDO REVAMPS ONLINE PRESENCEIndustry association the Resort

Development Organisation (RDO) haslaunched revamped versions of its websitesrdo.org, gotimeshare.org.and gofractional.org.

The industry and consumer-facing websitesnow feature a more contemporary user-friendlyformat and a number of new features includingintegration with social media.

RDO’s chief executive, Paul Gardner

Bougaard said: “We wanted to give ourwebsites a fresh look to keep up with the timesand reflect what members and consumerswant to see nowadays – something that isinformative, interesting and engaging.”

The new design and programming wascreated for RDO by UK-based digitalcommunications agency Digital Trip, whichspecialises in travel-related websites.

INDUSTRY:

The Timeshare Association(TATOC) has launched a Code ofConduct for the timeshare industry.

The Code is a commitment byTATOC, its members and accreditedand affiliated companies to thehighest standards of businessethics, principles and practices. It isalso an assurance of the higheststandards in the provision ofproducts andservices – thatthey will becorrectly sold,well managedand maintainedwith theconsumer as theprinciple focus.

The Code is the first of its kind inEurope and breaks new ground in thedevelopment of relationships betweenindustry suppliers and recognisedconsumer representatives.

Harry Taylor, above, TATOC’sexecutive chairman, said commitmentto the code created a partnershipbetween timeshare businesses andtimeshare consumers that would helpsecure a strong and healthy future forall involved.

“The reputation of the industryhas suffered in the past with someless than transparent companiespreying on owners,” he said.

“It is important that consumerscan identify companies that are openand transparent and have productsto suit their family needs andaspirations.

“It is our hope that these high-quality, consumer focusedtimeshare organisations recognisethe commercial benefits ofcommitting to the TATOC Code ofConduct.”• To view the full Code of Conduct visitwww.timeshareassociation.org/about-tatoc/code-of-practice

TATOC:

Vilar do Golf in the Algarve is one of a number of resorts taking part in a sustainable gardening initiative.

A R O U N D - U P O F I N D U S T R Y N E W S , V I E W S , A N D P E O P L E T O W A T C H

workV7-MktOLookSept2011-p4&5-sa-rb:Layout 1 6/9/11 16:56 Page 4

Leading international holidaymembership club Sol Meliá Vacation Club (SMVC)has officially launched Club Meliá as its newname and brand.

The move comes in conjunction with thename change and rebranding of its parentcompany Spain-based Sol Meliá Hotels & Resorts as Meliá Hotels International.

Denis Ebrill, executive vice president of Club Meliá, said: “We are extremely proud and excited aboutour new name, new look, new branding and positioning.

“It’s an upscale, updated and impactful way to say in a couple of words who we are and what we do,while being joined at the hip with the new positioning of our corporate office in Spain. We have a lot ofexciting things to achieve this year and our new name and new look is the driving force behind it.”

Club Meliá currently has 27,000 members, 14 member resorts and 27 associated resorts at locations inthe Caribbean, Mexico, Central America and Europe. The company opened its newest member resort inCosta del Sol, Spain, in February 2011 and is due to open a resort in Playa del Carmen, Mexico by year-end.• Turn to page 20 to read more about Club Meliá.


RCI has expanded its network in Chinawith the affiliation of Shining Star Vacation Club,Xing Yao Shui Xiang Resort, located in the Jia Lizewetland in Kunming.

The integrated tourism development consists ofmore than 10,000 diverse holiday accommodationsspread across theme resorts, hotels, holiday villasand town houses. There is also an equestrian clubwith a landscaped 20-kilometre riding boulevard,ecological wetland park, country-style fishing club,golf academy and a driving range designed by PhilMickelson.

Adrian Lee, managing director, RCI Asia,said: “The addition of Shining Star Vacation Club,

Xing Yao Shui Xiang represents anotheropportunity for RCI to offer great exchangeoptions.

“Located in a region that consistently boastsgreat holiday experiences, this developmentreaffirms RCI’s commitment to offering highlydesirable destinations in Asia and globally.”

Li Ji Feng, assistant general manager of sales for Shining Star Vacation Club, added: “This affiliation with RCI represents an importantopportunity for us. We are excited to be able toexpand our business areas, provide newopportunities for our customers, and bring thebeauty of China to new global audiences.”

INDUSTRY:

RCI AFFILIATES NEW RESORT IN CHINA

CLCEXPANDS US RESORTPORTFOLIO

NAME CHANGEAND REBRANDFOR SOL MELIÁ

Denis Ebrill at the launch of the new Club Meliá branding.

Club La CostaResorts & Hotels hasexpanded its portfolio ofproperties with theaddition of Regal Oaks,located three miles eastof Walt Disney World inOrlando, Florida.

The company, whichtrades in America as CLC,is undertaking a majorrefurbishment andimprovement programmeat the resort, and selling69 three- and four-bedroom freehold townhouses with plans to buildmore, including two-bedroom, going forward.

Brad Margison,director of Club La Costafreehold, said currentexchange rates shouldmake Regal Oaks anattractive proposition forcustomers anticipatingFlorida’s economicturnabout.

CLC’s first Orlandoproperty, Encantada,which was purchased in2010 and is also close toWalt Disney World, openedits doors in April and isnow virtually sold out.

RESORT:

RESORT:

workV7-MktOLookSept2011-p4&5-sa-rb:Layout 1 6/9/11 16:56 Page 5


AS A member-focusedorganisation, RCI places greatimportance on its members’opinions, constantly monitoringfeedback and satisfaction levels.

Top of our members’ agendais having access to a greatervariety of destinations andholiday experiences, and RCIhas responded pro-actively inseeking out new resorts toaffiliate to the company’sexchange portfolio.

RCI’s business developmentteam has introduced 13 newproperties to the company’sexchange networkacross the EMEAIregion during 2011,including four to itsluxury shared-ownershipprogramme TheRegistry Collection.

Dimitris Manikis,RCI’s vice president,BusinessDevelopment, EMEA,said finding newresorts was anongoing priority forthe company.

Manikisexplained: “We fully

appreciate that RCI and TheRegistry Collection serve twoclients – our members and ourdevelopers. This year we havecontinued our focus ondelivering more to each set ofour clients by bringing greatervariety of destination andaccommodation to them.

“The breadth of productchoice and flexibility we offerwill further increasesatisfaction levels amongowners and strengthen theproposition at the sales decksof our affiliated developers.

“We are especially keen tofocus on emerging markets andexciting new destinations – TheResidence Club in Slovakia is agood example of this – and areconfident that the overall impactof adding these resorts will be toincrease the engagement andtransactional activity of ourmembers which will help todrive higher occupancy levels at

RCI-affiliated resorts.”Nick Turner, vice

president Europe – TheRegistry Collection andFractional OwnershipDevelopments, saidemerging markets werealso playing a key role inthe development of thefractional product.

“New resorts in thepipeline come from aninteresting mix ofestablished and emergingmarkets,” he said.“There’s real scope forgrowth in places likeTurkey and Russia where

people are becoming moreaffluent and able to buy a shareof a second home for the firsttime. The top locations such asProvence, Tuscany – home ofManzano Golf Resort, one of ourlatest affiliates – the Cote d’Azur,Majorca and South West England,where second home valuesremain high, will always top ouraffiliation acquisition list.”

Turner said the fractionalmodel had come into its ownduring the economic downturnby offering a way for whole-ownership developers to keepbusiness ticking over.

“There’s an acute lack ofconsumer credit as well as alack of appetite for risk, makingit much easier to sell a £50,000fraction than £500,000 worth ofreal estate,” he explained.

“Consumers are wary so willalso only invest in new projectsthey consider bulletproof – thosethat will be built, maintained andoperated to the standards thatdevelopers claim they will.”

RCI continues to expand its holidayexchange network by affiliating excitingnew resorts across the EMEAI region.

RCInside

RCI EXPANDSEXCHANGE NETWORK

Located in the ski areas ofDonovaly, the Residence

Club is one of RCI’s latestexciting affiliations.

NEW RCI AFFILIATES – 2011

RCI• Kamelya World Vacation Club, Turkey• Skistar Vacation Club Timmerbyn, Sweden • We Are Home @ Horizon Sky, Turkey• The Residence Club, Slovakia• Akamaos Resort, Cyprus Retreats, Cyprus • Alexandria, Cyprus Retreats, Cyprus • HM Vacation Club, Dubai• ZamZam Grand Suites, Mekkah, Saudi Arabia• Royal Paradise Resort, Egypt

THE REGISTRY COLLECTION • Vilnius Golf & Spa Resort, Lithuania• Manzano Golf Resort, Italy• Lower Mill, England• Sunset Gardens, Croatia

I N F O R M A T I O N E X C L U S I V E L Y F O R R C I A F F I L I A T E S

workV7-RCInside-p6&7-sa-rb:Layout 1 6/9/11 17:04 Page 6


NEW MEMBER KITS GIVEN A NEW LOOK

CELEBRATING THEINDUSTRY’S BEST

RCI has launched new-look new membership packs for purchasersof Weeks and Points at its affiliated resorts.

The new member kits, which have been completely redesignedand refreshed, now include a welcome letter, card, DVD, memberguide, Destination Directory and Certificate of Ownership (RCIPoints members).

The packs are available in 18 languages and represent animportant educational piece and form an integral part of the journeyinto timeshare and exchange for new timeshare owner/members.They explain how RCI Weeks/Points works, the various productbenefits and how to make the most of membership. The kits aresent to new timeshare purchasers within their first month ofmembership.

Dimitris Manikis, RCI’s vice president Business Development,EMEA, said the packs played a major role in communicating thebenefits of timeshare ownership to new owners.

“The new membership packs are RCI’s way of engaging with newmembers at the earliest opportunity in order to encourage highlevels of transactions with affiliated resorts and enhance the newmember experience,” he said.

“We want to make it as easy as possible for new members tostart exploring the world of exchange holidays, which is somethingthat will also help the business of our affiliated resorts.”

The new member kits incorporate recent enhancements to RCI’smembership product (see panel story, page 9) and online

capabilities, and also reflect the company’snew brand guidelines.

A key element of the kits is ahigh-quality DVD – available in all

languages – which featuresaspirational footage of

resorts, ownertestimonials and

interviews with RCI Guides toreaffirm the benefits of the timeshare

purchase. Sample copies of the new membershippack are available free of charge to RCI affiliates for use on

sales decks, and a separate version of the DVD is also available foruse at point of sale.• To obtain copies of the new member kit contact your RCI accountmanager.

VENTURES NEWS ONLINECan’t wait for the next issue of Ventures to find

out what’s going on in the shared-holiday ownershipindustry? Stay up to date by checking out the news sectionon the new and improved www.rciventures.com

Dom Pedro Portobelo resort in the Algarve received a RADALong Service Award to celebrate 25 years of affiliation with RCI.From left: RCI’s Paula Veríssimo and Isabel Santos present theaward to project director Nelson Gonçalves and residentmanager Rosa Custodio.

The RCI awards programme to formally honour sales andinnovation among the company’s European affiliates hasbeen expanded to incorporate an additional region and newcategory.

The RCI Award for Developer Achievement (RADA)programme recognises the work and performance ofaffiliates and their employees at all levels, and now coversseven regions, with the Middle East joining the UK, Maltaand Ireland; Portugal, France and North Africa; SouthernEurope; Central Europe; Scandinavia and South EasternEurope.

In addition, the RCI Green Award – for resorts thatactively engage in sustainable practices and demonstrate acommitment to incorporating green measures into theirdaily operations – has been added to existing categoriesthat include Top European Performer; Top RegionalPerformers; Top Performer – Newcomer; DeveloperInnovation and Developer Technology. RADA Distinctionawards recognise individuals and include Sales Person ofthe Year, Manager of the Year and Employee of the Year, and there are also Long Service Awards.

Nomination forms for the 2011 awards will be distributedto affiliates by the end of the year. RCI will analyse results forthe performance categories, and Dimitris Manikis, RCI’s vicepresident Business Development EMEA, has called onaffiliates to start thinking about what awards to enter andwhich staff to nominate now.

“The RADA awards are designed to thank our affiliatesand their staff for their continued support and to furtherrecognise their success in sales, marketing, productdevelopment and service quality, so we want to hear aboutthe best of the best,” he said.• To find out more about the RADA awards visitwww.rciaffiliates.com

workV7-RCInside-p6&7-sa-rb:Layout 1 6/9/11 17:05 Page 7


From fabulous resort photos and video footage to an interactive A to Z of how to use timeshare, RCI has given its affiliate developers apowerful tool to engage, entertain and educate on the sales decks.

THE RCITV Resort Showcase has beendeveloped with non-members and non-owners in mind as an engaging leadgeneration and sales tool for developers.

The package is available in three tiers –Bronze, Silver and Platinum – and eachincludes a number of resort photographs anda video, professionally shot by LENZ-works. Aswell as accessing RCITV, browsers can searchby holiday category and view resorts, localattractions, owner testimonials and more.

Developers can customise and dualbrand their own RCITV Resort Showcase by

SALES DECK SIZZLE

I N F O R M A T I O N E X C L U S I V E L Y F O R R C I A F F I L I A T E S

RCInside

incorporating links to their booking site, fly-buys, mini-vacs and other offers, as well asbuilding in videos of their sales team talkingabout what makes their resort special.

The developer owns all the material intheir RCITV Resort Showcase and can re-purpose it, even creating an e-blast videofrom it to support marketing campaigns.

For just under $23,000 affiliates who buy the Platinum package will receive TheRCI Presenter free of charge. Working withGenerator Systems, RCI has created aprogramme which takes the viewer through

the highlights and workings of RCI HolidayExchange membership using wall-mountedtouch screen technology.

Through colourful animations, informativefilms and interactive modules, purchasers cansee how their Weeks exchange deposits andcredits – or RCI Points – can be used to givethem a wide choice of holiday options andexperiences. An interactive map displays RCI-affiliated resorts worldwide, together withRCI Travel cruise routes, while the ‘80Seconds Around the World’ film takes viewerson a whirlwind tour of the fabulous destinationswhere RCI membership could take them.

Developers are able to customise systemcontent and can add more Generator Systems’products that align to the resort’s specificsales process, as well as taking it from wall-based technology on to desktop or tabletscreens. Affiliated resorts will be responsiblefor acquiring the hardware and GeneratorSystems has negotiated with a leadingworldwide distributor to provide 42- or 46-inchtouch screens at discounted rates.

RCI Presenter will help to structure andenhance sales presentations, ensuring aclear message and greater credibilitythroughout the process.

Geoff Ballotti, CEO, RCI, said: “RCI hasalways been a leader in the vacationownership industry, and we saw a uniqueand powerful opportunity to support RCI-affiliated resorts with both quality contentand leading-edge technology through the RCITV Resort Showcase and RCI Presenter.

“We’re investing on our affiliates’ behalfbecause we believe we can help improve theperception of timeshare, drive traffic, generatesales and ultimately lower their marketingcosts – and when our customers win, we win.”• For more information contact your RCIaccount manager or visit www.rciaffiliates.com

workV7-p8 rcInsideNew:Layout 1 6/9/11 17:17 Page 8


NEW PRODUCT

TIMESHARE exchange pioneer RCIhas launched an enhanced version ofits membership programme as part ofa raft of innovative measures designedto increase the benefits of RCImembership.

RCI Platinum is a premium tier ofRCI membership offering a range ofexclusive privileges and lifestyle

IT SHOULD BE A WAY OF LIFE…

The launch of a new level of timeshare ownermembership – RCI Platinum – will elevate theownership experience by introducing a suite oflifestyle benefits. STEVE ADAMS reports.

benefits that RCI members can enjoy,both on holiday and at home. It wasofficially launched in Europe in July2011 and is open to both Weeks andRCI Points members.

The new luxury lifestyle-ledprogramme is set to be a powerfulsales tool for RCI’s affiliate developersto offer to new purchasers, as well as

At the heart of RCI Platinum Membershipare the company’s Points and Weeksprogrammes, which offer the ultimate inflexibility, choice and value.

In addition to traditional exchange services,these programmes incorporate a range ofbenefits including access to Extra Holidays,Late Deals and RCI Travel, which enablesmembers to book cruises, tours, hotelaccommodation, flights, hire cars and more.

Members who upgrade to RCI Platinum –at a cost of £49 – enjoy greater value,flexibility and holiday opportunities. The mainbenefits are:

● Priority Access – Exchange privileges at sought-after destinations enabling RCI Platinum members to be among the first in line to book exchanges at a number of specially acquired destinations.

● Unit Upgrades – The opportunity to receivecomplimentary unit upgrades if larger unitsare available within two weeks of check-in.

● Platinum Rewards – These range from£15 to £20 in value and can be earnedthrough various RCI transactions such asbooking Extra Holidays, purchasing RCIGuest Certificates and making Pointsbookings or depositing Weeks. The Rewardscan be used towards future RCI transactions.

● Foreign Currency – Offers include freedelivery on currency delivered to homes, ora free ‘Cash Passport’ from Mastercard,which is a safe and convenient way to carrytravel money.

● Travel Benefits – A variety of exclusivediscounts and offers on travel includingcruises, car hire and insurance with RCI Travel.Deals could include 20 per cent off car hire andinsurance or a £50 on-board cruise credit.

● Additional Benefits – RCI PlatinumMembership also offers:

• Discounted Theatre Tickets – greatdeals on select West End productions, withup to £30 off some London shows.

• Leisure Discounts – discounts on diningout, attraction tickets, days out and more,meaning members can make great savingsat home too.

• Secure Luggage – travel with peace ofmind courtesy of complimentary luggagetracking service from CallUma. Servicesinclude Tag ‘n’ Traq, Lost Key Assist, OnlineDocument Store and Emergency Assistance.

HOW RCI PLATINUM WORKS

QUOTE: RCI PLATINUM MEMBERSHIP WILL OFFER TREMENDOUSLIFESTYLE BENEFITS THAT OUR MEMBERS CAN USE AND ENJOYIN A VARIETY OF DIFFERENT WAYS. SEAN LOWE

workV7-Plat-p9-11c-rb:Layout 1 6/9/11 17:26 Page 9


to existing owners. The new tier ofmembership is not only geared togenerate deeper engagement with newowners, but also to broaden therelevance of timeshare ownership andRCI membership to all ownersthroughout the duration of theirmembership. Designed to give ownersand members enhancements to somany aspects of their leisure time,RCI Platinum joins RCI ExchangeHolidays, its Weeks Exchangeprogramme, and RCI Points toreinforce RCI as being the provider ofthe most innovative and flexibleholiday exchange memberships in theindustry.

ALL ABOUT SERVICESean Lowe, RCI’s managing director forEurope, Middle East, Africa and India(EMEAI), said: “Timeshare ownersexpect so much more than greataccommodation and RCI is well placedto work with its affiliated developers tohelp them deliver genuine value to theirowners. We are pleased to be able togive our developers the opportunity tooffer services such as priority access andspecial member discounts at their salesdecks.

“As the pioneer of timeshareexchange, RCI is always looking for waysto enhance its products and services togive its members the best experiencesand exceed the expectations of ourresort affiliates and members.

“RCI Platinum is an enhanced tier ofRCI membership that essentially offers anew level of luxury to what is alreadyan exclusive club.”

Lowe said the move had come partlyin response to member demand for anelite product that would encompass agreater element of luxury lifestyle.

RCI Platinum is designed to helpmembers get more out of theirmembership and so their RCI holidaystoo. Membership costs just £49 and,with many Platinum services beingavailable while at home as well as onholiday, the service benefits can beenjoyed across the whole of a member’sleisure time.

While on holiday, RCI Platinummembers enjoy benefits such as priorityaccess to specially-acquiredaccommodation in sought-afterdestinations, free unit upgrades if largerunits are available within two weeks ofcheck-in, complimentary luggagetracking, savings on RCI transactions,travel arrangements and more. While athome – or on holiday – a range ofdiscounts are available on dining out,theatre tickets and attractions.

MAJOR DEVELOPMENTSThe RCI Platinum Membership packageis one of a number of major RCIdevelopments in 2011. At the turn ofthe year the company transformed itstimeshare exchange programme byoffering trading power transparency forWeeks members, and in Q4 it willlaunch a new enhanced search facilitymaking it easier for RCI Points members

QUOTE: WE RECOGNISE THAT WE NEED TO CAPITALISEON OUR ABILITY TO PROVIDE WIDER LIFESTYLE ANDMEMBERSHIP SERVICES. DIMITRIS MANIKIS

NEW PRODUCT

to book holidays through its website atrci.com (see panel, page 11).

The developments reflect RCI’songoing commitment to providing asuperior service to both its membersand developer affiliates, according toDimitris Manikis, RCI’s vice presidentBusiness Development, Europe, MiddleEast and Africa (EMEA). Manikisbelieves consumers have every right toexpect high-quality timeshareaccommodation as standard for theproduct and that the industry has todeliver more than this to fulfil theproduct promise. He said: “Throughmember feedback and regular focusgroups, we know our members areseeking other advantages and servicesfrom the product, particularly in termsof lifestyle benefits.

“In these financially challengingtimes we are all looking for greatervalue from the products and serviceswe buy. In our industry today it’s agiven that the accommodationpurchased will be of high qualityacross the board, so how do wedistinguish what we have to offer? The answer is in being able to provideinnovative and extraordinary servicesdelivering lifestyle benefits at acomparatively low cost.”

RCI Platinum Membership offers a range of luxury lifestyleenhancements to be enjoyed at home as well as on holiday.They include priority access to destinations, unit upgrades,Plattinum Rewards, foreign currency and other benefits.


Manikis said that consumersincreasingly wanted to enjoy lifestylebenefits at home as well as on holiday,citing aspirational luxuries such asconcierge services and luggage tracking,plus exclusive deals, including discountson dining and theatre packages to seeWest End shows.

Manikis explained that the greatdeals in the RCI Platinum Membershippackage had been won by leveragingRCI’s strong brand and reputation, aswell as its scale – including access to theresources of the Wyndham Worldwidegroup and sister companies.

“RCI’s standing in the hospitalitysector means we are in a strong positionto foster affinity relationships throughour established brands, such as RCITravel, to improve our exclusivemember benefit offering,” said Manikis.

The company’s scale of operationsalso means it continues to service itsmembers in 17 languages from callcentres in Cork, Greece, Turkey, SaudiArabia and India – a service that

2011 has seen RCI introduce majorenhancements to services for both its Weeks and Points members.

Earlier this year the company made iteven easier for its Weeks members tounderstand and use their ownership, in turnproviding greater flexibility in holidayplanning.

The enhancements brought completetransparency to the trading power of RCImember accounts, as well as to the tradingpower values of resorts. This makes it easyfor members to see which resorts they canaccess and to better understand why theycan’t access others. Weeks members arealso being given a credit for any tradingpower value left unused from an exchange,as well as the chance to combine weeks andcredits to either trade up to access resortspreviously outside their trading power reach,or to book more weeks accommodation ofless value than their owned week to givethem more time on holiday – or more unitsto enable them to take friends and family.

The ability to combine deposits, saveweeks or borrow from future use years givesRCI members much greater flexibility andmany more holiday options to choose from.

“Increasing the holiday options availableto our members is a major step forward fortimeshare exchange,” explained Manikis. “Itwill lead to greater activity throughout thesystem and help to bring more guests toresorts.”

There are new benefits for RCI Pointsmembers too, in the form of an enhancedsearch facility being launched on rci.com inQ4 of this year.

The new system is designed to make iteasier for members to find the vacation theywant. The new-look website will enable RCIPoints members to conduct a search forweeks exchanges and standard reservationsat the same time, as well as searching for aspecific holiday they want rather than by acategory ‘type’.

In addition to being able to search usingmaps, a number of other tools and a newfiltering system will ensure members cansee all availability options open to them.

“These new features are again designedto make booking easier for our pointsmembers, encouraging them to visit more ofour affiliated resorts,” said Manikis.

“This results in a win-win-win situation –for our members, our affiliate communityand for RCI.”

● For more information visit www.rci.com

remains a high priority.“RCI has always, and will continue

to, invest heavily in its call centreoperations to ensure members enjoy thebest possible holiday planning journey,”said Manikis. “However, we recognisethat we need to capitalise on our abilityto provide wider lifestyle andmembership services.

“The latest raft of enhancements dojust this, and delivering these features tomembers not only drives theirsatisfaction levels, it also supports ouraffiliate developer community by givingthem a more attractive proposition toput before customers at sales decks andhelp boost loyalty among owners.

“Improving our member servicesand exchange system also increases thepropensity for existing owner-membersto transact and, by increasing RCIexchange activity, we are increasingoccupancy levels at our affiliated resortsand bringing fresh guests – who can ofcourse become potential purchasers –over their thresholds.”


A GOOD THING GETS BETTER!

V


John Spence, founder and chairman ofthe Karma Royal Group, is a born entrepreneur. In 1993 he was way ahead of thegame in identifying the enormous potential in the Asian market when opening hisfirst resort in Goa, India. Today the Group has more than 55,000 full or associatemembers and 21 resorts – the most recent acquisitions being in Europe where,as Spence tells HELEN FOSTER, he has bold plans for expansion.

in Germany we purchased the AlpenClub,Schliersee in the foothills of the BavarianAlps.”

OPENING UP THE MIDDLE GROUNDMore than stylish accommodation, Spence isalso introducing a new brand and leisureexperience with Chakra Resorts. The Chakrabrand will be rolled out globally and,characteristic of Spence’s thinking, will bringsomething unique to the market and supportthe creation of a new consumer segment.

“Chakra will be targeted to the market’smiddle ground. It will take some of the DNA ofour luxury Karma brand which will position itas an aspirational product but available at alower price,” he explained.

“Chakra will be a four- or five-star brandcomprising 50 per cent timeshare/fractionalapartment ownerships and 50 per centboutique hotel rooms. It will make the lifestyleexperiences of Karma – the fashion shows,the beach bars and beach parties – accessibleto the Royal Resorts’ market and is designedto attract a younger affluent purchaser.”

Spence plans to build a network of ChakraResorts and has initially identified sevendevelopment sites in the Philippines, the GiliIslands, Bali, Shanghai and Thailand. Severalcountry house hotels in England and a furtheracquisition in Croatia are also under consideration.

The Karma Royal Group is in the enviableposition of being debt-free and has a ‘zeroborrowing policy’, owning many developmentplots across Asia which will now beredeveloped for the Chakra project.

“We are great believers in mixed-usemodels driving traffic from hotel guests and,using online marketing, we have filled Germanresorts,” he said. “We will not be relying onthe Asian source markets alone, though ourloyal Asian customer base will certainly buy us

some time to establish our brands in Europe.You can’t move in Europe for Australian touristsand with its strong economy that market will betargeted, as will the younger consumer.”

The power of a strong brand is critical to theKarma Royal Group, which Spence describesas being fundamentally “Asian minimalist witha combination of local charm and character”.To this he carefully adds new experiences toappeal to different consumer groups. To attracta far younger buyer he plans to expand thegroup’s beach club brand, Nammos. Featuringlive DJs and beach parties, the first NammosClub in Bali has already been voted The BestBeach Club in Bali by the readers of Hello BaliMagazine. Spence will roll out Nammos with asecond Bali Beach Club opening in November,followed by resorts in Harbour Island in theBahamas, Boracay in the Philippines and Cubawithin 12 months.

The beach club experience is one thatSpence is introducing in varying degrees to theRoyal Resorts brand. He said: “These resorts aredesigned to attract buyers in the age profile of 25 to 35 years – the singles market as well – andwe will offer a short-term ownership package.

“The AlpenClub will be a five-star timeshareproperty but it will benefit from the Karma DNAwith live DJs and funky sporting amenities. Itwill be a sexy, strong product. I always say thatwe’re not in the lodging business, but theentertainment business. My job is to give ourguests and owners much more than beaches.”

Innovation characterises Karma RoyalGroup’s business, which has constantly evolved,anticipating consumer trends to set the bar interms of delivering unique holiday experiencesto owners and guests. For Spence there willalways be fresh opportunities because he is amarket maker, with the vision and talent tocreate destination, product and demand almostanywhere he chooses.

QUOTE: THE WORLD HAS CHANGED AND NOW TOURISTS FROM...INDIA FOREXAMPLE, ARE LOOKING TO VISIT EUROPE FOR ‘CHEAP’ HOLIDAYS. IT IS THEEXACT REVERSE OF WHAT WAS HAPPENING 20 YEARS AGO. JOHN SPENCE

PROFILE


JOHN SPENCE and the Karma RoyalGroup are bringing a whole lot more toEurope than new resorts and brands. TheRoyal Resorts and Karma Resorts and Spabrands have earned a reputation forproviding high-quality holiday and leisurelifestyle experiences and deservedly won theloyalty of tens of thousands of members,many of whom will follow the Group intoEurope. Spence will be opening up theEuropean market to thousands ofconsumers from countries such as India,whose booming economies are set to makethem the big spenders of the future.

“We are experiencing a reverse tourismtrend,” says Spence. “We started out buildingresorts in Asia 18 years ago when a growingEuropean middle class with a desire to travelwere looking for value holidays. Travel to Asiawas, at that time, both relatively inexpensiveand exotic.

“The world has changed and nowtourists from the fast-growing economiesof India for example, are looking to visitEurope for ‘cheap’ holidays. It is the exactreverse of what was happening 20 yearsago. Many of our Asian member familiescould only dream of visiting places such asGermany and the UK in the early ‘90s.Today, with rising incomes and cheapflights, what our Asian members neverbelieved would be possible is now wellwithin their reach.

“The Karma Royal Group is here todeliver dream holidays, which is why wehave started buying resorts in Europeunder the Royal Resorts banner – in Italywe have K2 at Borgo di Colleoli, a luxuryresort in the Tuscan hills between Florenceand Pisa, in Bulgaria K2 at Park View is astunning property in the upper reaches ofthe ski resort in Bansko and, most recently,

WINNINGWAYS

V

workV7-Spence-p12-13-sa-rb:Layout 1 6/9/11 17:32 Page 12

ABOUT THE KARMA ROYAL GROUPHaving established the Royal Resorts andKarma Resort and Spa brands in Asiaduring the last 18 years, John Spence isnow returning to Europe to boost hisbusiness portfolio and with it, the shared-holiday ownership industry at large.

Royal Resorts has long been knownfor its family-friendly approach, offeringexceptionally well-appointed apartmentsfeaturing a lounge, kitchen, masterbedroom, second bedroom, twobathrooms and balcony, accommodatingup to six people. Interior design typicallyfeatures a fusion of local andcontemporary styling, while resortamenities are of the highest standards.

Royal Resorts’ portfolio comprisesseven resorts in India, four in Indonesia,two in Thailand, one in Italy; one inBulgaria and its latest acquisition inGermany.

In 2002 the group diversified intoluxury villa development in some of theworld’s most desirable locations.Launched under the Karma Resorts andSpa brand at Karma Jimbaran Bay in Bali,Spence’s concept of whole villaownership coupled with an overlay offive-star boutique hotel services andfractional ownerships quickly proved tobe a success. The Karma Kandara andKarma Agung in Bali, Karma Samui inThailand, Karma Bahamas in theCaribbean and Karma Pelikanos on theGreek island of Mykonos are now all partof Karma’s luxury property portfolio.

Karma resorts are sold on the basis ofa 15-year fractional programme and theproperty sold when the term ofownership expires, with the moniesdivided between owners.

workV7-Spence-p12-13-sa-rb:Layout 1 6/9/11 17:32 Page 13

The ‘pride’ element is also keyfor Cushway, CEO of SilverpointLeisure, who placed greatimportance on ensuring all salesactivities complied with the new EUTimeshare Directive, even before itbecame law. This has meant the lossof some sales staff, and no doubtsome sales, but Cushway is happy tobe doing the right thing.

“Not everyone has embraced thenew laws – in Spain they haven’t evencome into force yet – so we’ve probably madelife more difficult for ourselves than we hadto. But we decided we’re either a compliantcompany that’s fully committed to change orwe’re not.”

He also admits it can be easier to recruitsales staff from outside timeshare than toconvince industry diehards to change theirhabits. “As a professional credible companywe are able to attract talent from otherindustries and bring them into timeshare toshow them an industry that, if workedcorrectly, can offer them a fantastic future,”he explains. “The industry didn’t attract high-calibre sales staff and then compounded theproblem by giving them sloppy training whichmeant they didn’t really understand whatthey were selling and didn’t have any brandor product belief.”

Cushway – who has a passion for trainingand life coaching in particular – now ensuresall sales staff (the company has more than140) are trained to the highest possiblestandards, to the extent that the only way topass their Timeshare Association-approvedsales licensing exam is to score 100 per cent.

“The way ourbusiness is perceived, thereisn’t room for the smallestpercentage of unhappycustomers or misleadingpresentations,” he added,admitting that only around 70per cent of trainees pass firsttime. Successful candidates receivea license, complete with photographic ID, but this can be taken away if they go on to makemisleading sales presentations, which aremonitored by a team of mentors and managers.

“If a sales person makes an error we suspendthem from the line, take their license away for aweek and retrain them,” says Cushway. “Theyhave a couple of opportunities to show it was justa mistake but if they continue to misleadcustomers we let them go.”

Deutsch admits recruiting the right people isone of Silverpoint’s biggest challenges. He says:“Whenever we think about expansion or a newproject our number one challenge – along withfunding – is finding people who want to be ascommitted as we are.”

Silverpoint’s UK-based centre of excellence,planned to open within 12 months, will help in this

QUOTE: IF YOU ARE GOING TO COMPETE IN A TOUGH ENVIRONMENTYOU’RE GOING TO HAVE TO BE DIFFERENT, AND YOU NEED TO BE THE BEST AT WHAT YOU DO. MARKUS DEUTSCH

COMPANY PROFILE


SILVERPOINT arrived on the scene at theturn of the year as a major new player in thetimeshare industry.

Headed up by timeshare industryveterans Markus Deutsch and MarkCushway, the company is taking a freshapproach to marketing and sales. The objectis clear and simple – to become one of theworld’s leading leisure brands.

A key element is the Silverpoint VacationClub (SVC), a contemporary holiday andlifestyle product developed in partnershipwith RCI (see far right). The company hastaken a 21st-century approach to allelements of its operations, according toDeutsch, the CEO and chairman ofSilverpoint Group Holding.

“Even though we were buying existingassets and history, when we createdSilverpoint we saw it as an opportunity to trya fresh approach,” he says.

A key focus for the new company hasbeen updating its sales and marketingoperations. Employee training has been giventhe highest priority with Silverpointdeveloping its own licensing exam for salesstaff. There have also been major investmentsin IT with ultra-modern sales decks, such asthe recently-opened Silverpoint ExperienceCentre in Gran Canaria, which uses the latestApple Mac technology.

“We wanted to move away from pads andfelt tip pens with the salesperson virtuallymaking the presentation up as he goesalong,” explains Deutsch. “If we want tocreate a brand that we can be proud of, wehave to be proud of everyone that works forus and every presentation that we do.”

Silverpoint is set to become one of theindustry influencers since entering thebusiness at the start of 2011, not leastbecause of its fresh and transparentapproach to marketing the product,reports STEVE ADAMS.

SILVER SERVICE

workV7-SilverP2-p14-15-sa-rb:Layout 1 6/9/11 17:38 Page 14

search. The facility will handlerecruitment and training in the UK and then sendfully-trained staff to its resorts.

It’s an ambitious move in the currenteconomic climate but Deutsch clearly believes inthe old adage ‘when the going gets tough’.

“If you are going to compete in a toughenvironment you’re going to have to be different,and you need to be the best at what you do,” hesays. “The recession creates opportunities becausethere are independent resorts that perhapswouldn’t consider collaborations or partnerships inboom times. It’s a good time to acquire assets too.

“Of course there are challenges with a lack ofconsumer credit, but if we come through thenwe’ll be in a very strong position.”

SILVERPOINT + RCI = SUCCESSSilverpoint Vacation Club is a points-based holiday systemthat combines ownership of a deeded week at a member’s

‘anchor resort’ with a range of benefits, including access tothe RCI exchange system via a private members’ club.

According to Mark Cushway, the blueprint for the product came from a conversationwith Dimitris Manikis, RCI’s vice president of business development for the EMEA region.

“Rather than thinking ‘this is what we’ve got, let’s work out how to sell it’, we satdown as two industry professionals and discussed what would be the ultimateproduct,” says Cushway. “The idea was to build exactly what today’s client wants andthen deliver it.”

The two companies invested heavily in product development to ensure the highestservice standards and introduce a full concierge programme and travel service.

“All these elements are embedded into a very flexible product that can be used onlineor over the phone via our call centre concierges,” Cushway explains. “It takes the bestparts of everything out there and packages it into one super product.”

Cushway said working with RCI had been an especially rewarding experience and theRCI team “couldn’t have supported me and Silverpoint any more if they tried”.

“I think we understand that our futures are intertwined,” he added. “Together we’vecreated an experienced team within the call centre and worked hard on the packaging ofthe product to make sure it’s appealing to a new market. I don’t think there could be abetter example of teamwork.”

Manikis said: “The Silverpoint team kept on challenging us to think outside the boxand we all enjoyed a real partnership.

“Working with Mark and his team in creating Silverpoint Vacation Club was not easyand many challenges had to be dealt with but it was a great opportunity to address anumber of consumer needs and build a product that people would want to buy and enjoyusing for many years to come.”


Pictured: 1: Silverpoint Vacation Club’s modern website; 2: Silverpoint

receives the RCI RADA 2010 Star Award for a Top Performer in Europe.

From left are RCI’s Vicky Funnell and Dimitris Manikis, Mark Cushway

and Josephine Cuthill of Silverpoint, Andy Miln of RCI; 3, 4, 5: Members

of RCI’s dedicated Silverpoint call centre team in Cork; 6: Markus

Deutsch; 7: RCI staff undergo training at Silverpoint’s training centre in

Tenerife with Silverpoint training director Josephine Cuthill, centre.

V

To read more about Silverpoint, includingits unique approach to resales, intelligent

sales system, trial product and ambitious plansfor new markets, visit www.rciventures.com

workV7-SilverP2-p14-15-sa-rb:Layout 1 6/9/11 17:38 Page 15


QUOTE: CROATIA IS KNOWN FOR ITS INTERNATIONAL APPEAL ANDRIVIERA LIFESTYLE FROM A TOURISM PERSPECTIVE, MUCH LIKETHE SOUTH OF FRANCE. KATE STINCHCOMBE GILLIES

MARKET REPORT

Croatia has a long line of celebrity fans.Among them, British comedic actress andactivist Joanna Lumley, who went public with

her view that Croatia is ‘absolutely fabulous’. In an interviewwith the London Evening Standard, she commented on afamily holiday in Croatia, describing the country as “Blissful:it’s as tidy as Switzerland and looks a bit like Italy”. WhileIrish poet, George Bernard Shaw, was years ahead of his timein spotting Croatia as a slice of Riviera life. “Those who seekparadise on Earth should come to Dubrovnik,” he said.

With a firm grasp on today’s residential leisure market,

Kate Stinchcombe Gillies, head of communications atholidaylettings.co.uk, said: “Croatia is known for its internationalappeal and Riviera lifestyle from a tourism perspective, much likethe South of France. It seems to consistently grow in popularity,although current land preservation rules protect much of thecountry from over development.”

Millions head to this summer hot spot year on year. Theholiday season runs from May to September and extends longerinto the autumn and winter for those who want an exciting citybreak in the capital Zagreb.

Visitors to Croatia are spoiled, not only by the choice of

LANDS OFOPPORTUNITYThe Croatian and Bulgarian holiday sectors have a growing setof drivers providing opportunity for resort development.KATHERINE STEINER-DICKS finds out from the people on theground what makes each of these unique destinations – onematuring and one burgeoning – strong in investment potential.

CROATIAAN ‘A’ LISTER

workV7-MktRep-p16-19-sa-rb:Layout 1 6/9/11 17:54 Page 16


Riviera-style beach holidays, but also its islands, naturereserves, mountains, forests and historical cities. Croatia has something for everyone and, in the shape oftimeshare options, RCI has identified the country as asought-after destination and currently numbers resorts inDubrovnik at the Radisson Blu and apartments at theFontana Resort/Pinus Apartments in Jelsa amongproperties affiliated to its exchange network.

VISITOR TRENDS & FIGURESMore than nine million inbound visitors flocked to the countryin 2010, representing 90.4 per cent of all visitor nights andtotalling 51 million bed nights. The total 10.6 million tourists –foreign and domestic – that holidayed in Croatia last yearrepresented an increase of 2.6 per cent on 2009.

Germans made up the lion’s share of tourist inbound visitorsamounting to just under 1.5 million arrivals and accounting for22.5 per cent of the total amount of inbound visitor bed nights.They were followed by visitors from Slovenia (11.5%); Italy(9.3%); Austria (8.7%); the Czech Republic (8.2%); Poland(5.7%); the Netherlands (4.4%); and Slovakia (4.1%).

Russian visitors posted the greatest percentage increase in theirvisitor numbers for any source market. With 165,000 arrivalsthey were 35.3 per cent up in 2010, staying for 1.37 million bednights. There were also healthy increases in visitor numbers fromUkraine, Turkey and China. Japanese visitor numbers, however,fell by 9.8 per cent from 2009 to 2010.

There were 241,217 inbound visitors from the UK in 2010, typically staying between four and nine bed nights(source: Croatian National Tourist Board, www.croatia.hr).

RENTAL MARKET INDICATORSA strong rental market is a good indicator of timesharedevelopment potential, and overall Croatia generates an averageof 34 enquiries per holiday rental villa and apartment propertyper year, according to holidaylettings.co.uk.

“We currently have just over 400 holiday homes in Croatiawith the bulk of our inventory in Dubrovnik and the islands,”says Stinchcombe Gillies. “North of Dubrovnik, the Island ofBrac and the coastal town of Trogir seem to have drawn the mostinvestors and typically holiday homes in these locations attract20 and over 50 enquiries per property per year, respectively.”

However, demand significantly outstrips supply in Trogir,which represents great promise for potential resortdevelopment investors. In the far north, the province of Rovinjseems to have experienced the least investment and consumerdemand in the holiday rental market in recent years.

“Croatia is best known for its stunning beaches and citybreak appeal, and many of our rental advertisers are capitalisingon this,” says Stinchcombe Gillies. “On the city break side, Splitand Dubrovnik generate an above average level of 35 and 42enquiries per property per year, respectively.”

But Croatia is no longer the bargain property and holidaymarket it was ten years ago and some argue it is on a par withmore established holiday markets, such as Spain and France –though its supply of holiday accommodation is much less.

Holiday rental prices will differ between locations. A two-bedroom apartment during peak season in Dubrovnik rangesfrom £520-£2,500 per week, while on the Island of Bracprices range from £350-£770 per week. In Trogir, a one-weekstay costs between £370-£790, while Rovinj comes in at£495 through to £750.

“Inventory in Croatia has grown by almost a quarter – 23per cent – in the last 12 months,” says Stinchcombe Gillies.“Demand remains consistent, and is slightly above average,which is indicative of the strength of the tourism marketgiven the relative expense of accommodation here comparedto other Mediterranean offerings.”

GAPS IN THE MARKET“We had been on a family holiday to Croatia and weresurprised to find that it was difficult to find a single familyvilla to rent,” recalls Nina Burns who, with her family, leftSilicon Valley to enjoy a new lifestyle in Europe seven yearsago. “So we decided to address that market – large luxury villa with pool, privacy, and on the sea.”

The Burns family built a solar-powered eco-villa in DubokaBay, a beautiful unspoilt bay on the Island of Brac. Burns said:“At the time there were only a handful of luxury villas on theisland and this type of tourism was not well understood inCroatia. Although there is now a growing market on theisland there is still a scarcity of luxury villas in the region sowe have been very successful in renting ours out.”

However, the family did face learning curves, as Burnsexplains: “The biggest challenge was in developing themarketing channel in order to raise the visibility of Croatia andBrac Island in the world villa rental market. The second challengewas developing the infrastructure of services to support luxuryvillas. This has changed dramatically in the last couple of years.”

Holidaymakers, property buyers and resortdevelopers always have a keen eye for upand coming destination markets. Bulgaria is

one destination that RCI’s Business Development teambelieves promises much for future resort development.

Some of the first people to take note of what Bulgaria hadto offer were the wine lovers. Bulgaria has some of the oldestvines in the world and the Danube River Plains in thenorthern region are home to about 30 per cent of thecountry’s vineyards. In addition to other wine tour pocketsthere is also the Thracian Valley or southern region, whichincludes around 35 per cent of the country’s vineyards and ischaracterised by a moderate continental climate.

The southern region enjoys a Black Sea resort location, as

CROATIA – FACTS FIRSTVISA REQUIREMENTS: A Croatian tourist visa is not required for citizensof the UK or the US for a stay up to 90 days, but there are visarequirements for other source markets such as Russia.TRANSPORT: Currently, nine airlines operate direct scheduled flightsfrom the UK to Croatia during the year. Other airlines covering theCroatian market include GermanWings, TUIfly Norwegian, Blue1,Aeroflot, Air France, Alitalia, Delta Airlines, Delta, Emirates, Iberia,Lufthansa, SAS, Swiss International Air Lines, TAP (Portugal) andTurkish Airlines.DRIVE TO: Croatia is accessible by car from the main inbound countriesit borders including Italy, Slovenia, Austria and Southern Germany. LEGISLATION: Timeshare legislation is in place.

BULGARIAA RISING STAR

Pictured left: Theregion of Rovinj

offers developmentpotential in Croatia.



QUOTE: THE SOUTHERN PART OF BULGARIA ALSO SEES A LOT OF TOURIST ACTIVITYAND TIMESHARE DEMAND FROM THE GREEK MARKET DUE TO ITS CLOSE PROXIMITYTO ONE OF THE REGION’S BEST SKI RESORTS. DIMITRIS MAVRIKIS

MARKET REPORT

well as being ideally situated for wine and vineyard-themedholiday experiences. Resorts that already have an establishedholiday season market include Golden Sands, PrimorskoRiviera and Sunny Beach.

Bulgaria has the advantage of having established itsreputation as a good winter ski resort, giving it a year-roundseasonality. The winter ski resorts of Bansko, Chepelare,Borovets, Pamporovo, Uzana and Vitosha are seeing increasedvisitor numbers from abroad. Bulgarian ski holidays areconsidered good value and their locations are readily accessibleby car or plane by many Europeans. The high-quality resortsand holiday experience available here come without the usualski resort price tag which is an added bonus for visitors.

Rural tourism, hiking and city breaks all add to Bulgaria’sholiday attraction mix. New properties and resorts are of highquality and are available at a fraction of the price of many of itsEuropean neighbours. For the developer of timeshare orfractional property models, the good news is that the shared-holiday ownership market is only just starting to take shape inthis country so new opportunities are plenty for the early mover.

RCI IN BULGARIAThis year will mark RCI’s first resort affiliations in Bulgaria,which will be announced in due course. “I am confident thatthese resorts will produce a healthy return on investment,”says Dimitris Mavrikis, new business manager, RCI Europe.

Bulgaria is still a young timeshare market and RCI isworking closely with developers to ensure a regulatoryinfrastructure is adhered to in order to boost consumerconfidence. “Companies and developers already in the marketare very well organised. We have affiliated some beach-frontBlack Sea resorts, which are targeting mostly the Russian andBulgarian source markets, and we have also affiliated twomajor ski resorts,” says Mavrikis.

Target source markets for the ski resorts tend to beBulgarians, Central Europeans and Russians, who consider itto be a value-for-money holiday destination. “The Spanish,for example, can get direct flights to Bulgaria for a summer ora ski holiday,” explains Mavrikis. “The southern part ofBulgaria also sees a lot of tourist activity and timesharedemand from Greece due to its close proximity to one of theregion’s best ski resorts.”

SOLUTIONS FOR SEASONAL CONSTRAINTSMartin Armistead, left, senior vice president,Wyndham Hotels, agrees with Mavrikis thatBulgaria could have huge potential, but only if“the price is right”.

Armistead said: “Bringing the RCI brand intonew destinations, such as Bulgaria, will give

investors and purchasers the confidence they need to buy intothese markets. It is also important that the developers buildthe on-site and nearby product offering gradually over a five-year period, rather than rushing everything to market at once,since it gives people something new to see each year.

“The developer’s master plan should include a long-term

interest in growing value; whether it’s spa facilities, climbing,scuba diving, rock climbing, etc. By doing this you are creatingthe destination.”

YEAR-ROUND POTENTIALBulgaria has enjoyed a substantial growth in income frominternational tourism over the past decade. Beach resorts arepopular with Germans, Russians and Scandinavians, while theski resorts attract the British and Spanish.

The perfect places for eco-tourism in Bulgaria are the smallvillages near the city of Sofia, or those situated on the numerousmountains, such as the Pirin, Rila, Rhodopes and Vitosha ranges.Bansko is the perfect place for a holiday or second home.

One couple that decided to invest in a rental property in themountains was Peter and Greta Holland. One of the firstattractions was the hospitality of the Bulgarian people, which

TOURISM POSITIVESThe number of foreign tourists visiting Bulgaria in the first two monthsof 2011 grew by 6 per cent year-on-year, a senior official announced atthe Cultural Tourism Expo in Veliko Tarnovo earlier this year.

According to Ivo Marinov, Deputy Minister of Economy and Tourism,during January and February this year, Bulgaria saw the majority of itstourists coming from Greece, Romania, Serbia, Turkey, Macedonia, theUK and Russia. The number of visas issued to Russian tourists inJanuary rose by more than 50 per cent on the same month last year.Bulgaria’s revenues from foreign tourists in the first two months of2011 amounted to €109 million, a 5 per cent year-on-year increase.

Impressively, Bulgaria’s ski resorts experienced a 7.8 per centincrease in foreign visitor numbers during the first two months of theyear, with more than 437,000 foreign tourists arriving in this period.

Visitor numbers from Macedonia and Serbia are increasingconsiderably, following the launch of the visa-free initiative withBulgaria, which took effect in late December 2010.

The two principal source markets for winter tourists to Bulgaria – Britain and Russia – recorded increases of three per centand 24 per cent respectively. Source: Bulgaria’s Ministry of Economy and Tourism



V

pleased them from the outset. “We had a rental property inSharm el Sheikh on the Red Sea and were successfully letting itwhen we decided we would try to complement this with adifferent holiday home up in the mountains for winter skiingand spring, summer and autumn outdoor activities, includingwalking, cycling and fishing,” says Peter Holland.

The couple settled for an off plan apartment, 500 metres fromthe ski lift in Pamporovo on the Smolyan side of the Snejanka peakin the scenic Rhodope Mountains amongst the famous SmolyanLakes in a small apartment block called Pine Lodge.

From a rental perspective, the property has been “relativelyprofitable”, says Greta Holland, “but you must rememberBulgaria, the new boy of Europe, is still relatively undiscoveredas a tourist destination. With so much to offer the country needs,and will attract, more publicity and promotion in the media as awonderful tourist destination which will be the way forward.

“We are thrilled with our holiday rental property in thisrelatively unknown gem, especially with a location that isonly 25 kilometres from the Greek border and only twohours’ drive from the Greek coast.

“Everything is perfect – friendly people, good restaurants,fantastic scenery, lakes and fresh mountain air, with plenty tosee and do all year round.”

The Hollands believe Bulgaria is different from typicaltourist destinations, being unspoilt by mass tourism. GretaHolland explains: “Our customer feedback tells us this, andbecause the country hasn’t adopted the Euro yet, a holidayhere is very low cost compared with other destinations.”

For an exclusive market insight into the current tourism andresort development trends in another rapidly emerging

market – Estonia – visit www.rciventures.com

BULGARIA – FACTS FIRSTVISA REQUIREMENTS: Foreign citizens enter Bulgaria with theirinternational passport, which must be valid for at least three more months.TRANSPORT: Airlines flying direct from the UK include: BritishAirways, Bulgaria Air, Wizz Air, Thomson Flights, easyjet, Monarch and Ryanair among others. Non-UK airlines flying to Bulgaria includeLufthansa, Air France, Austrian Airlines and Germanwings amongmany others. There are two international Black Sea airports Bourgasand Varna, both of which have modern train stations and goodconnections to other Bulgarian towns.LEGISLATION: Being put in place – during implementation phase.

Pictured below: The skiresort of Borovets is a

popular destination fortourists to Bulgaria.



QUOTE: THE VACATION MEMBERSHIP CONCEPT FOR WHAT ISNOW MELIÁ HOTELS INTERNATIONAL WAS CREATED WITHTHE GOAL OF BECOMING A GLOBAL BRAND. DENIS EBRILL

CASE STUDY

WITH 27,000 members, 14 member resorts and 28associated resorts, Orlando-based Club Meliá has quicklybecome a major player in the world of vacation ownershipsince entering the industry as Sol Meliá Vacation Club(SMVC) with just three resorts in 2004.

The company is part of Spain-based Meliá HotelsInternational, formerly Sol Meliá Hotels & Resorts, a 55-year-old international hospitality company with morethan 300 hotels in 26 countries on four continents.

In keeping with the parent company’s recent rebrandingas Meliá Hotels International, SMVC has been renamed ClubMeliá and can rightly claim its place among the industry’smajor players. In February it opened its newest resort on theCosta del Sol and will open another in Playa del Carmen,Mexico, by the end of 2011.

The new additions will take Club Meliá’s portfolio to 15 core resorts – in Mexico, the Caribbean, Central Americaand Europe – plus another 28 associated resorts in its Resort and Urban Collections.

The former resort portfolio features prime beachlocations in Spain, Mexico and the Caribbean, while thelatter offers a variety of European and Latin American citydestinations, including London, Paris, Rome, Madrid andBuenos Aires.

The combination of a strong portfolio and a well-respected brand name make for a great sales proposition.Given today’s challenging market conditions, the companyis keenly aware of the need to retain a competitive edge andmaintain its reputation for superior standards of quality,according to executive vice president Denis Ebrill, who gavethis exclusive interview to RCI Ventures.

Ventures (V): What was the rationale behind the company’schange of name?Denis Ebrill (DE): It’s an upscale, updated and impactful wayto say in a couple of words who we are and what we do, whilebeing joined at the hip with the new positioning of ourcorporate office in Spain. We have a lot of exciting things toachieve this year and our new name and new look is the drivingforce behind it.

V: What motivated Sol Meliá to enter the shared ownershipindustry in the first place?DE: The vacation membership concept for what is now MeliáHotels International was created with the goal of becoming aglobal brand in the industry. We wanted our members to have thesecurity of the Meliá name and experience behind their everyvacation, and we saw shared-vacation ownership as a furthermeans of enhancing our customer loyalty programme with aconcept that appealed to our most loyal and frequent hotel guests.

V: Entering a new market with an established brand bringsa unique set of challenges. How did RCI help?DE: Club Meliá worked closely with RCI and subsequently TheRegistry Collection teams to launch its vacation club product.From structuring the relative values of each product for internaland external exchange purposes, to identifying candidateproperties for inclusion in The Registry Collection andreviewing design features and physical conditions at each resort

BRAND NEWBEGINNING

Major Spanish hospitality companyMeliá Hotels International is looking tothe future following a major rebrandand repositioning, which includes a newname and look for its hugely successfulvacation club. STEVE ADAMS discussesbrand new beginnings with Denis Ebrill,executive vice president of Club Meliá.

workV7-SolMelia3-p20&21-sa-rb:Layout 1 6/9/11 18:04 Page 20


property, there was constant communication and interactionbetween the Club Meliá and RCI teams.

V: Protecting your brand must have been an issue whenentering a new business. Did RCI help to alleviate someof these concerns? DE: Maintaining the integrity and credibility of our brandshas always been at the forefront of our vacation club strategy.We have designed our marketing process thoughtfully tomake it more service-oriented and as discreet and unobtrusiveas possible. Having RCI as a partner has helped us build onthe credibility of our own brands.

V: What do you want the new Club Meliá brand to mean tothe market and how will it help to promote sales?DE: Club Meliá’s mission, in concert with the mission ofMeliá Hotels International, is to offer global hospitalityservices and experiences, focused on excellence, responsibility

and sustainability, all with the dedication of a family businessto contribute to a better world.

Our brands are what drive our credibility and the trust ourmembers place in us. For example, in a major timesharemarket such as Spain the vast majority of our competitors arefocused on the international traveller with a heavydependence on the UK, Scandinavia, Germany and France askey feeder markets for their business. However, due to thestrength of the Meliá brands – and the respect and credibilitythey bring to the market – our geographical mix of businessis actually heavily weighted towards the Spanish market. Thisis considered an anomaly but reflects an important marketthat few of our competitors have targeted.

V: The current economic climate, both in the US andEurope, is making things tough for the hospitality industry.What can you do to meet the challenges it creates?DE: Although our fully-integrated hotel and vacation clubmodel, with all of the benefits that our members enjoy as aresult, has a great competitive advantage, in times of discountedhotel stays it becomes essential to be more creative. We need toensure that club members receive added value during their stayso that the short-term perception of promotional hotel rates canbe offset and the value of membership be ensured for the club.

From our perspective, the key is not only to emphasise thebenefits of a lifetime of family vacations and the emotionalexcitement of ownership of a product that provides its buyerswith such a broad choice of vacation options, but also to makesure that prospective buyers understand that the promotionalhotel rates recently experienced are not sustainable and cannotbe used as a basis for comparing the relative value of a vacationclub purchase in today’s economy.

V: How are sales going, and what are your hopes for 2011 and beyond?DE: The sales volume for 2010 was approximately $116 million. To date in 2011 we are seeing approximately 10 per cent growth over that number, with our strongestresults coming from the Dominican Republic and Mexico.

We believe that 2011 will provide opportunities forgrowth and are confident that we will see our vacation clubsales continue to grow in the region of eight to 10 per centthis year, as compared to 2010. We believe, in the longerterm, we will see some improvements in consumerconfidence to help prompt growth in our industry.

To read more of our exclusive interview with Denis Ebrill, visitwww.rciventures.com where he talks about member profiles

and the benefits of the mixed-use business model.

Far left: Denis Ebrill, executive vice president ofClub Meliá. This page from top: Gran Meliá Palaciode Isora in Tenerife, Meliá Marbella Banus in Spainand Gran Meliá Puerto Rico are all part of the ClubMeliá portfolio, which comprises 14 memberresorts and 28 associated resorts.

V

workV7-SolMelia3-p20&21-sa-rb:Layout 1 6/9/11 18:04 Page 21


QUOTE: OUR OWNERS PLAY AN ESSENTIAL PART IN OUR SALES, AND OUR THRIVING COMMUNITIESON FACEBOOK AND TWITTER REALLY REFLECT OUR STRONG RELATIONSHIP WITH THEM, SO WENEED TO LOOK AFTER THEM. JAMES BECKLEY

RESORT MAINTENANCE

JAMES Beckley is clearabout his commitment toowners at Pearly Grey OceanClub. He bought the propertyin 1998, taking on a thrivingbusiness in one of Tenerife’ssouthern resorts where he hasworked to exceed owners’expectations ever since.

Pearly Grey has atraditional constitutionalstructure, whereby ownersshare maintenance costs withthe developer year on year.Beckley explains: “We pay

maintenance on every weekwe own and, with increasingcosts throughout the globaleconomic crisis, we’ve seenour resort maintenance billspiral from €250,000 to€500,000 per annum. Whenmaintenance costs go up weare affected just as much asour owners, as responsibilityfor resort maintenance is partof our constitution based onthe original timesharemodel. So we’ve been prettyheavily impacted of late.”

Beckley extends thatresponsibility to the well-being of those owners whoare looking for a way outwhen their circumstanceschange. He said: “Before thecrisis we bought back a lot ofweeks from our elderlyowners who had been with usfor 20 years or more. Whenthey got too old to come outwe started buying back theirweeks so we have added theseto our inventory for resale.”

The resort startedrefurbishing its public areaseight years ago, refreshingthe bar and restaurant andentertainment area. “I owncertain parts of the resortfreehold and when theeconomic crisis first hit wewere aggressive in ourapproach and put a positivespin on a difficult situation,”said Beckley. “Our mainclientele is British and it’sbeen a tricky time for them.

Their maintenance effectivelywent up by 35 per centovernight due to the drop invalue of the pound againstthe euro.

“But we wanted to showour commitment to ensuringour owners’ resort thrived,that the value of theirownership was protected andtheir maintenance moneywas being well spent. So at atime it might have beeneasier to put majorrefurbishment plans on hold,we went ahead and are nowin the third phase of ourrefurbishment programme.”

THE PLANThe 120-apartment resort inthe quiet location ofTenerife’s Callao Salvaje hasso far refurbished 12 of atotal of 70 units planned forthis third phase, at a cost of€20,000 each.

“The plan is to complete

QUALITY FIRSTA commitment to providing owners with alifetime of quality holiday accommodationis essential in a timeshare development,but in a depressed economy it’s temptingto cut capital expenditure. However, a boldapproach to resort refurbishment can berichly rewarded, as SARAH LEE discovers.

workV7-Pearly-p22&23-sa-rb:Layout 1 6/9/11 18:20 Page 22


25 apartments a year and thisis the first year. It’s alwaysbeen difficult as we couldn’tjust shut down a wing so wedo most construction workin the afternoons when wefigure people will be out,”said Beckley. “We’re installingnew electrics and plumbing– it’s a full refurbishmentand we have contracted ourown team headed by a greatmanager. I believe this is areally cost-effective andefficient solution for thelonger term maintenance ofa resort.”

Beckley and his team also

commissioned interiordesigner Annette Pisani toassist in the refurbishment ofthe units. He said: “Annettehas redesigned the interiorspace of each apartment,making 56 changes to ourunit structure. She’s slippedin another bathroom andmade two-bedroom units outof one-bedroom apartmentswith what amounted to quiteminimal changes.

“All interior designersneed to have two sides totheir brain – they need toknow how to work with usand our budgets and, ofcourse, how to make themost of interior spaces.

“Annette has a greatbusiness mind and isn’t just adesigner. Added to that shehas access to architecturaldrawings so produces all ourdrawings for us, whichmakes life much easier whenliaising with the different

people involved in arefurbishment programme.”

The resort is now in yeareight of a maintenance levythey charged members to helpthem implement the changes.But Beckley and his team arekeen to ensure maintenancefees are kept to a minimum.“We charge €312 a yearmaintenance for a one-bedroom apartment, which isprobably €50 too highbecause of the perceivedvalue. I think people would behappier around the €250mark because they can find anice apartment for around thisprice for a week in Tenerifethese days as the market is sodepressed,” he explains.

“Our objective is to bringa long-term developmentoption to our owners and forthem to feel they are gettingvalue for money. We hopethey think we’ve achieved agood level of quality in theirunits and on resort.”

STICK OR TWISTThough the British markethas traditionally been astrong one for Tenerife – 65 to 70 per cent of PearlyGrey’s membership comesfrom the UK – the continuingeconomic downturn ismaking developers considerother markets. But Beckleyexplains there is no simplesolution to finding the nextsource of sales.

“Our British owners andpotential clients are looking atSpain and the Canary Islandsand see that these destinationsare no longer inexpensiveholiday options for them sothey’re going elsewhere.Although we’ve worked withFrench and Italian clientsbefore, it’s actually easier withthe British as we can supplyall aspects of service to them.We know they’ll use the

restaurant and then havedrinks at the bar, whereas theFrench and Italians will eatmeals with you but they don’tdrink very much in the on-site bars. In the same way weunderstand how our Britishclients wine and dine, we arealso able to tailor our on-resort entertainment towardsthe British preferences.

“We would considerlooking towards the Russianor Scandinavian markets asthey get along well with theBritish and share similartastes in holiday activities.

“The British tourist isrelatively easy to pleasecompared to some othernationalities. For example, theBritish tend not to worryabout the small details, as it ismore important to them to beable to enjoy an atmosphereand ambience on resort that iseasy-going, happy, warm andfriendly. But that’s not the casewith people from other partsof the world.

“Added to that, ourowners play an essential partin our sales, and our thrivingcommunities on Facebookand Twitter reflect our strongrelationship with them, sowe need to look after them.”

Beckley also believes that,given current marketchallenges, timeshare couldmetamorphose into adifferent, shorter-termproduct. He said: “Timeshareis in crisis at the moment aswithout charging highmaintenance rates it’s difficultto deliver a five-star service.You need to find a niche and Ithink timeshare will turn toshorter-term products withbenefits to owners that offerreal value, such as speciallyarranged discounts at localbusinesses. It’s the sort ofthing we are looking towardsto add value to our product.”

James Beckley, developer ofPearly Grey Ocean Club, began an aggressive refurbishmentprogramme eight years ago,starting with the public andentertainment areas that heowned. The resort is alsoplanning to refurbish 25 units peryear, at a cost of £20,000 each.

V

workV7-Pearly-p22&23-sa-rb:Layout 1 6/9/11 18:20 Page 23


QUOTE: AS LONG AS THE HOC AND MANAGEMENT COMPANYCOMMUNICATE AND WORK TOGETHER IT’S A WIN-WINSITUATION FOR BOTH SIDES. HARRY TAYLOR

RESORT MANAGEMENT

PROFESSIONAL PROFICIENCYSuch issues strengthen the argumentfor hiring an external managementcompany, which often provides theperfect solution for small to medium-sized resorts, according to Taylor.

Benefits such as centralised systems,economies of scale, greater efficiencyand higher staffing levels make thedecision virtually a no-brainer, he said.

“A good management companycan really help take a resort forward,”he explained. “HOC members can’talways see this because they areconcerned about losing control of theresort, but that isn’t the case. As long asthe HOC and management companycommunicate and work together it’s awin-win situation for both sides.”

Simon Jackson, CEO of MacdonaldResorts, the timeshare arm ofMacdonald Hotels & Resorts, agrees.The company operates nine resorts inthe UK and Spain, and handles themanagement for all of them.

Jackson admits Macdonald facedsome challenges in the early part ofthe last decade, when alternativemanagement options becameavailable to HOCs for the first time.One resort – Loch Rannoch – optedfor an external managementcompany, which made the othersquestion whether they were gettingthe best deal, he recalls.

“We had to show them that wewere the best way for the resorts tomove forward,” he said, identifying

As timeshare resortsget older effectivemanagement becomesincreasingly important,not just for day-to-dayoperations but long-term survival. STEVEADAMS looks at thebenefits of hiring anexternal managementcompany.

NOW entering its fifth decade, thetimeshare industry is populated withestablished and mature product, withmany resorts sold out and in the handsof their owners.

Resort management is typicallyoverseen by a home owners’ committee(HOC), who in turn can outsource it to athird party. In some cases HOCs carry outsome or all of the management andmaintenance operations themselves.

The latter option is often seen as a wayto keep maintenance fees down, as well asto retain control of the resort, However,HOC members can find they have taken onmore than they can cope with, a scenarioHarry Taylor, CEO of the TimeshareAssociation (TATOC), knows only too well.

“Resort management is a massiveundertaking. When owners’ committeeshandle it themselves, for the most partthey don’t do it that well,” he says.

“For instance, there might be peopleon the HOC with carpentry skills, but thework needs to be carried out at a moreprofessional level than as a hobby. Notonly are there health and safety concerns,but the work needs to be done properly

and efficiently.”Taylor said the changing

needs and demands ofowners, alongside thegeneral ageing of resortsand their owners andcommittee members,created a number of

challenges that exposed the failings ofinexperienced and under-resourcedmanagement. Failure to maintain the upkeepof resorts, in terms of both communalareas and units, could spell financial ruin.

“As resorts and committee membersget older there is no one to take over. Ihad to go to one resort recently to tellthem just how bad things had got,” headded. “In some cases managementchanges could be forced on them by thetrustees who won’t let the resort go tothe point of no return.”

Harry Taylor

MACDONALD’S

MANAGEM

ENT M

ASTERPLAN

workV7-MacDon2-p24-26-sa-rb:Layout 1 6/9/11 18:24 Page 24


three key elements that make the difference:■ Engaging with committees and ownersevery step of the way■ Giving assurances that quality would beimproved throughout the resorts■ Putting plans in place to make that happen,matched by mutually agreed service levels.

Not surprisingly, setting budgets was akey factor to demonstrate the value of feesto owners, explained Jackson.

“Keeping costs under control is the onlyway for timeshare to survive, and one ofthe strengths of a professional managementorganisation is being able to tap intoexpertise and supply chain management toobtain best in class and price, whether thatmeans furniture, staff uniforms, utility costsor food for the restaurants.”

Jackson explained that a balance had to bestruck between keeping maintenance fees at anacceptable level and havingfunds to improve facilities topreserve quality standards.“There’s a constant need toengage with owners,” he said.

“We wanted to showowners that we were notonly in partnership with

them, but that we were in it for thelong term. To do this we developed astrategic plan to improve quality andservice, and part of that meantinvesting in areas of the resort that weowned, such as the public areas,swimming pool and leisure club.”

In return for making such afinancial commitment to the resorts,Macdonald asked for managementcontracts of longer than 10 years.

“Many committee members didn’twant to go over 10 years so we had todemonstrate what we could do,” saidJackson. “We took them to our otherproperties to show them the qualitylevels, refurbishments we’d carriedout and other things such as thestandard of the food in our restaurants.”

Jackson says the company alsoagrees policies on general and financialmanagement of resorts, ensuring HOCmembers are involved throughout.

“One of the reasons we’ve beensuccessful is that we always agree astrategy to ensure the resort improves –it is obviously in all our interests for itto work.”

A refurbishedlounge at

Dona Lola

THE HOC VIEWBill Perrett, chairman of theHOC at Macdonald Doña Lolain Málaga, agreed, saying that agood working relationship hadbeen backed up by realcommitment from both sides.

“Doña Lola has improved noend, with about £2 millioninvested by owners in theapartments, together with asimilar investment byMacdonald to improve the pooland communal areas,” he said.

“This has resulted in happierowners and the feedback fromowners and exchange guests iscontinually improving.

“I think there will always besome fears about how muchpower Macdonald appears tohave, but the club owns theresort units, and as much asMacdonald is obviouslyinterested in the bottom line, itcan’t make money out of theresort unless it is successful.”

Perrett also made the salientpoint that it is the club thatreceives the maintenance fees,not Macdonald. Wheneconomic pressures andchanges in exchange rates –Dona Lola’s expenditure is ineuros but its income is largelyin sterling – forced fees up inrecent years, many ownersblamed Macdonald for theincreasing fee.

“That wasn’t the case, andSimon Jackson


A round-up of some of the recent upgradework carried out at Macdonald Resorts.

Villacana Club, Málaga, SpainNew restaurant, children’s play area and adultswimming pool, refurbished reception area andenhanced grounds.

Leila Playa Holiday Resort, Mijas Costa, SpainTotal refurbishment of reception, bar, restaurant andpool, fully interactive TV system installed providinginternet access in all units.

Macdonald Doña Lola Club, Málaga, SpainRefurbishments to main restaurant, tennis courts, mainpool and terrace, new adult pool added, leisure cluband indoor pool upgraded, outdoor pool heated forwinter, fully interactive TV system installed providinginternet access in all units.

Macdonald La Ermita Holiday Resort, Málaga, Spain£7m build-out of remaining 31 apartments at propertyand associated facilities.

Elmers Court Country Club, Lymington, EnglandNew clubhouse bar for owners, new check-in areas andgolf buggies.

Plas Talgarth Holiday Resort, Snowdonia, WalesRestaurant, bar, reception, indoor leisure facility allrefurbished and upgraded.

Forest Hills Holiday Resort, Aberfoyle, Scotland£2m redevelopment of leisure club/spa, hotelrestaurant upgraded and dedicated check-in areas for owners added.

Macdonald Lochanhully Woodland Club,Carrbridge, ScotlandMajor upgrade programme for all units includingaddition of internet access.

Spey Valley Golf & Country Club, Aviemore, ScotlandRefurbishment of reception and leisure areas, bar andrestaurant, including launch of ‘Scottish Steak Club’.


we still got the best deal we could,” he said. “It’s a team effortworking with the management company to get agreement on costs.

“There’s been some tough talking at AGMs and committeemeetings, because owners want their interests to be paramount, butwe agree on the fundamentals.

“Our committee is made up of three owner-electedrepresentatives and two from the Macdonald group, so we have theultimate casting vote through the club’s constitution. We’ve neverneeded to go as far as that however. It’s much more important toresolve issues and we always agree a solution.”

Perrett said those issues go beyond the day-to-day running of theresort and involve the longer term development of the club, whichfaces increasing pressures as its owner-base gets older.

“The resort was developed in the 1980s, so many owners arenow in their 70s and 80s,” he said. “This brings avariety of issues – some have lost partners, are lessmobile or unable to travel, families have grown upand no longer want to accompany them on holiday,financial pressures and more – and quite often theonly solution is for them to sell.”

This difficult situation highlights another benefitof having a larger management company. In

addition to efficiently running the resort, it can increasemarketability by investing in improvements to communal areas –the first thing a potential buyer sees – and has the resources tocarry out marketing too.

Macdonald Resorts ticks boxes for all of the above. The companyhas invested in a variety of improvements at its resorts (see panel,right) and recently launched its new restaurant concept the ‘ScottishSteak Club’ at Spey Valley Golf & Country Club (formerly known asDalfaber) in Aviemore, Scotland. More are due to be rolled out at anumber of its other resorts and hotels.

“It’s a very important new concept for us and a greatenhancement for owners,” says Jackson. “The restaurants will have amodern menu offering the finest local produce all at a good pricepoint for members. They will attract people to our timeshare resorts– the future owners that we all need to bring in.”

To learn more about the ways in which a large managementorganisation can breath new life into the mature resort, visit

www.rciventures.com

QUOTE: WE WANTED TO SHOW OWNERS THAT WE WERENOT ONLY IN PARTNERSHIP WITH THEM, BUT THAT WEWERE IN IT FOR THE LONG TERM. SIMON JACKSON

RESORT MANAGEMENT

Bill Perrett

MACDONALD TLC AT ...

Left:MacDonald

La ErmitaResort

V


For more than 35 years, RCI® has been the exchange provider of choice for some of the most successful developers in the vacation ownership industry. With over 3.8 million members and more than 4,000 affiliated resorts worldwide, we are uniquely positioned to help you achieve your goals in shared ownership.

Success, by any measure, begins with a solid business vision. RCI is ready to support you in yours.

For more information, e-mail [email protected] or call +44 (0) 1536 314651.

RCI and related marks are registered trademarks and/or service marksin the United States and internationally. All rights reserved.©2011 RCI, LLC. All rights reserved. Printed in the U.S.A.

“Over the last six years, with the help and support of the RCI® team, Macdonald Resorts Ltd. has achieved eight RCI Gold Crown Resort Awards and an RCI Silver Crown Resort Award across our RCI-affiliated properties. Working closely with the RCI team we have enhanced our service and quality to the high standards of today, benefiting the whole Macdonald group as well as all 25,000 of our owners.”

Simon JacksonChief Executive Officer, Macdonald Resorts Ltd.RCI Affiliate since 2001

Higher standards for exceptional holiday experiences

Macdonald Elmers Court Resort, England

Shared visions,Expanding horizons

Who should attend? Real Estate Developers Real Estate Agents Exchange Companies Fractional and Vacation Ownership Sales and Marketing Managers Fractional Consultants Fractional Entrepreneurs Shared ownership Companies Hospitality Management Financial Institutions PR, Sales and Marketing Companies Trustee and Legal Professionals Hospitality Industry Suppliers Investors

Industry Sectors Supercar Aviation Marine Real Estate: Overseas Property Agents Multi Destination Club Systems Hotel Room Leaseback Residence Clubs Condo Hotels

For speaker and sponsorship opportunities,contact Piers Brown at [email protected] +44 (0)208 340 7989

21 November 2011The Burj Al Arab, Dubai

TM

Platinum Sponsors

Ruby Sponsors

Network Sponsor

Travel Partner

Media Partners

Documents

RCI Ventures Magazine (European edition) - September 2011