The Eden Residence Club - A New Type of Luxury Living

1. Luxury Living A New Type of Destination clubs offer the use of multimillion-dollar houses around the world, without the burdens of ownership. While Residence Clubs offer the chance to own a fraction of the home and a fraction of the upkeep. Simon Turner looks at both clubs and other trends changing the vacation-home world. Nothing remains constant in the real estate market except the old saying, Location, location, location. Know what $4 million gets you on Maui these days? Hint: the Pacific won’t be visible from your front door. Many of the great Destination Clubs have some tempting stand-alone residences, such as a fresco-filled apartment in Florence and a two-story flat on the Île St.-Louis in Paris. But most clubs include the safety of cookie-cutter luxury developments in key locations. On the plus side, resorts offer value-added services—spa, golf, tennis, pools, restaurants, security— that would be prohibitively expensive for a club to provide independently. Joining doesn’t guarantee I’ll be staying in my dream house, however, especially during major holidays. Tiered membership also means there is no level playing field—some entry-level plans black out key holiday periods. Effectively, the more you pay, the more choices you’ll have during Christmas week. Despite being targeted to a new generation of time-starved people who crave bonding experiences in fabulous locations, I still wonder whom destination clubs are really targeting. The super-wealthy don’t share homes. Couples don’t need that much square footage. Independent travellers rarely sit still in one place. So it seems those accustomed to leasing jets will find the concept appealing. Owning a multimillion-dollar home means always working on your property. Many consumers think it’s great not to have to worry about the costs associated with ownership. This is not designed purely to be an investment, it’s supposed to be a lifestyle return.” Some people actually prefer to vacation in the same weather-beaten cottage every year, but sumptuous Destination Clubs continue to attract the interest and capital of others. The value of second homes can go up and down which depends on the state of the market which varies from location to location where Destination Clubs invest to build their portfolio. In some of the most popular areas, where second homes simply aren’t available - like Beaver Creek or Bachelor Gulch - you won’t see dips. In some other, less expensive vacation markets, its different so there are more opportunities; it’s a buyer’s market. Consumers familiar with Fractional Clubs or Residence Clubs know these are more exclusive communities, venue dependent destinations where the cost and maintenance fees can be high. Investors have the comfort that they are only gambling on the state of the market in one location. If you’re looking for six weeks skiing each year in a specific destination, a Destination would be wrong. While you may not be able to guarantee exactly which weeks skiing you’ll get (as these change on a rotor) you can be sure you will get your six weeks. G resulting in frustrating battles with an AWOL contractor and a recalcitrant insurance adjuster, I started to flirt with the idea of dumping my bricks and mortar for the latest carefree-vacation real-estate concept. The first destination club was launched in 1998, when Connecticut-based Private Retreats, subsequently renamed Tanner & Haley, enticed affluent buyers with the promise of multimillion-dollar houses in settings from Cabo to Cannes. Instead of owning a single property, members would share roucho Marx once said, “I don’t care to belong to any club that will have me as a member.” Frankly, I’m with Groucho—with a possible exception for destination clubs. After a freak accident trashed my family’s weekend home, a portfolio of residences; in addition to a hefty one-time fee (generally refundable, at least in part, if a member leaves), there would be annual dues to cover upkeep, mortgages, homeowners’ association charges, housekeeping, and concierge services. The concept’s originators speculated that investors would be willing to pay $200,000 or more for membership—far less than the cost of one luxury dwelling—even though their investment wouldn’t give them the equity stake they’d get with a fractional or condominium. They were right: The idea took off like a house on fire and continues to gather steam as more and more clubs entered the market. So is the destination club model really a viable alternative to second-home ownership? East Residences, Miami Port Ferdinand Residences, Barbados

2. TRAVEL AND LEISURE TRAVELANDLUXURYDESTINATIONS.COM Fractional Ownership Private Residence at a Resort The latest entrant into a rather crowded space is The Eden Residence Club. A licence type membership that’s a transferrable asset for members of selected Residence Clubs and Destination Clubs that become part of a “Club of clubs” or association of Clubs. While only a fraction of their original investment, participation allows members to rent out any un- used nights and access a portfolio of thousands of luxurious home in over circa 400 destinations world-wide at discounted nightly rates. This is not an exchange program but an opportunity to access the unused inventory of the finest clubs on a world basis via payment on reservation. Obviously which type of Club or vacation package you chose is down to your own personal circumstances, the one thing that makes perfect sense for everyone, is adding The Eden Residence Club membership to your Residence Club or Destination Club membership. Together they are substantially more attractive and it immediately adds value to your first purchase, which you’ll notice when time comes to sell. A comparison of destination clubs and other popular choices: Cost Generally between $60,000 and $650,000 What it gets you Depending on the fraction, the right to use a home for one to two months each year for a set term – e. g. 99 years Advantages You have a deeded stake (with 6 to 12 other owners) Drawbacks You have no say in the décor and may not always get the weeks you want Financing Developers will often provide financing, and some banks also offer mortgages Best for People who want more time and substantially nicer properties than time-shares offer Cost $2m to beyond $10 million What it gets you A house at a resort development to use whenever you want Advantages You own the property outright and get all the amenities of a hotel Drawbacks High cost, property taxes, and maintenance fees Financing Financing is available Best for Those who don’t need rental income and don’t like to share Destination Club Cost Up to $450,000 to join, plus annual dues of up to $30,000 What it gets you Use of homes for between one and nine weeks a year Advantages A portfolio of luxury homes to choose from, usually with housekeeping Drawbacks You’re not buying a single home, but into a portfolio, so there’s usually a term on exit Financing Not available. More like a country club membership; there’s nothing to mortgage Best for Well-heeled vacationers who seek both exclusivity and variety Club of Clubs – The Eden Residence Club Cost $35,000 What it gets you Access to a portfolio of the world’s finest Destination Clubs and Residence Clubs at discounted nightly rates Advantages You have no financial exposure or commitments and simply pay upon reservation. You can resell along with your fractional interest or destination club membership. Drawbacks You can only join if you are a member of one of the participating Clubs Financing Financing is not available Best for Members of Residence Clubs and Destination Club who already understand any issues Condo-hotel Unit Time-share Cost Anywhere from $300,000 to over $1 million What it gets you Ownership of a room or suite within a hotel, which you may rent out Advantages You own the unit outright and get all the amenities of a hotel Drawbacks You only get a portion (usually 50 percent) of rental income when you’re not in-house Financing Financing is available Best for Rock stars (and mere mortals) used to luxury hotels and looking to invest Cost A one-time payment averaging $16,000 What it gets you Use of a unit, generally within a resort, for one fixed or floating week a year, in perpetuity for a set term (up to 20 years) Advantages Affordability and a wide array of destinations Drawbacks Typically four-star. Your allotted time is often fixed and can be hard to trade Financing Generally not available, though sometimes offered through developers Best for Cost conscious travellers who want to return to one place at the same time each year For more information on The Eden Residence Club please visit www.theedenresidenceclub.com Grosvenor House Residences, Hyde Park, London Villa Sant Anna, Tuscany