In July of 2003, Private Retreats had already established a foothold in the destination club industry and CEO and Founder Rob McGrath began to look for ways to continue the club's unprecedented growth.
Launched in 1998, Private Retreats created a new model in the luxury travel industry. Several years earlier, McGrath and two partners purchased the 29-unit Franz Klammer Lodge in Telluride, Colorado for $28 million. The group began selling tenth-share interests in each unit and took in $29 million in the first year. After another similar venture in Jackson Hole, Wyoming, McGrath sold his interests and looked to evolve the shared ownership model, convinced that travelers wanted more travel options and increased availability. McGrath's vision took components of the country club market, fractional jet model, and shared ownership and the foundations of the destination club model were in place. Members were promised guaranteed reservations, low annual dues, full refundability of their membership deposit, and a fraction of the cost of second home ownership.
Back to 2003, Private Retreats had grown to over 300 members and connected with luxury adventure giant Abercrombie & Kent. McGrath's demonstrated success over the previous years were punctuated by his winning the Ernst & Young's Rocky Mountain Region Entrepreneur of the Year in Real Estate in June of 2003. In July of the same year, Abercrombie & Kent agreed to license their name to the young club, creating Private Retreats by Abercrombie & Kent. Now with an established brand name 40 years in the making, the club operated as Abercrombie & Kent Destination Clubs and eventually created sister clubs Distinctive Retreats and Legendary Retreats.
The club's success continued, but many of the risks associated with being an early entrant began to catch up with the club. Citing growing competition and the required short-term leases to meet availability, the club was unable to continue making payments to the luxury travel giant and lost the Abercrombie & Kent license. Virtually overnight, the club remarketed themselves as Tanner & Haley, named after McGrath's two young children.
By 2006, Tanner & Haley was forced into bankruptcy and 874 members were left without a club until they were acquired by Ultimate Resort for approximately $100 million. Despite the fact Abercrombie & Kent had no control over the operational policies of the club, many attached the bankruptcy to A&K name and lawsuits were filed against Abercrombie & Kent and Geoffrey Kent. According to legal documents, A&K was not an owner of the club, not the operator of the club, and not the manager of the club.
Abercrombie & Kent would again return to the destination club industry in April of 2008, looking to emphasis the differences between their new club and the club they were once attached to. The Abercrombie & Kent Residence Club launched after acquiring two leading equity destination clubs BelleHavens and Crescendo Residences. Utilizing a debt-free model and committing to annual member meetings, a core competencies has remained a solid financial structure to ensure that the outcome at Tanner & Haley will not happen at A&K. Despite the financial focus, litigation against Abercrombie & Kent continues today.
MEMBERSHIP PLANS
In 2003, Rob McGrath entered into a licensing agreement with Abercrombie & Kent that allowed McGrath to market his destination clubs under the 40 year old Abercrombie & Kent brand, creating Abercrombie & Kent Destination Clubs.
- Private Retreats Membership Plan
- Distinctive Retreats Membership Plan
- Legendary Retreats Membership Plan
Under the new brand, McGrath offered three different clubs: Private Retreats, Distinctive Retreats, and Legendary Retreats. Just as Legendary Retreats was introduced, Abercombie & Kent discontinued their license with McGrath and the collected three clubs went on to continue under the Tanner & Haley Destination Club brand.
Abercrombie & Kent Chairman and Chief Executive Officer Geoffrey Kent said, "Our long term business strategy now requires that we maintain full control over our valuable brand name." Kent's intuition proved accurate as Tanner & Haley would soon file for bankruptcy at Abercrombie & Kent would launch their own destination club, Abercrombie & Kent Residence Club, with a focus on correcting the problems that their namesake suffered through.
MEMBERSHIP PRICING
In 2003, Rob McGrath entered into a licensing agreement with Abercrombie & Kent that allowed McGrath to market his destination clubs under the 40 year old Abercrombie & Kent brand. From 2003 through 2005, McGrath would continue growing Private Retreats, the industry's first destination club and launch higher priced clubs Distinctive Retreats and Legendary Retreats.
Just as Legendary Retreats was launching, Abercrombie & Kent pulled their brand after several months of non-payment, and Private Retreats, Distinctive Retreats, and Legendary Retreats all were under under the club's new universal brand, Tanner & Haley Destination Clubs.
ANNUAL DUES
The overarching brand for Rob McGrath's three collective clubs Private Retreats, Distinctive Retreats, and Legendary Retreats, Abercrombie & Kent Destination Clubs existed from July 29, 2003 until August 19, 2005. McGrath entered into a strategic partnership with Geoffrey Kent at Abercrombie & Kent that would allow the clubs to use the A&K name as part of their marketing and allow members the ability to reserve tours with Abercrombie & Kent as part of their membership.
After several months of non-payment to Abercrombie & Kent, the travel giant discontinued their partnership with McGrath and the three clubs were forced to rebrand themselves under the new company name Tanner & Haley Destination Clubs, named after McGrath's children.
One of the longest tenured destination clubs in the industry, the clubs under the Abercrombie & Kent Destination Club brand changed quite dramatically over their time in the industry. Please visit each of their individual pages to learn more.
PROPERTIES
Looking to reach a wider audience, Private Retreats and Founder Rob McGrath entered into a licensing agreement with luxury travel giant A&K, creating Abercrombie & Kent Destination Clubs. With the valuable name attached to the club, Private Retreats and sister club Distinctive Retreats reach virtually unmatched success.
Unfortunately, the club's business model was flawed as numerous short term leases were required to satisfy availability. After missing licensing payments to A&K for several months, the brand name was pulled and the collected clubs were forced to quickly rebrand under the name Tanner & Haley Destination Clubs.
Due largely to the high costs of the short term leases and low annual dues charged to members, Tanner & Haley filed for Chapter 11 bankruptcy.
According to court documents, members had access to 73 Private Retreats properties, 77 Distinctive Retreats homes, and 8 Legendary Retreats residences.
USAGE
The pioneer of the destination club industry, the three clubs under the Abercrombie & Kent Destination Club brand, Private Retreats, Distinctive Retreats, and Legendary Retreats, all offered members unlimited annual access to the club's properties.
Subject to the club's rules and regulations, members could travel as many or as few nights per year as they wished.
While unlimited travel has been done successfully at several destination clubs, the primary flaw in the three clubs that would go on to be branded under Tanner & Haley Destination Clubs after losing the A&K brand, was the need for short term leases to meet availability.
Members were guaranteed access to properties provided that they gave the club ample notice. In cases where a member wanted to go to a property that was already reserved by another member, the club was required to lease a comparable property for that them, all at no cost to the member.
These short term leases eroded the club's financial position over the years and ultimately led to their Chapter 11 bankruptcy filing.
MEMBERS
After several years operating under the name Private Retreats, the club entered into a licensing agreement with luxury travel giant Abercrombie & Kent. The club would briefly be known as Private Retreats by Abercrombie & Kent and ultimately create the brand name Abercrombie & Kent Destination Clubs, with sister clubs Distinctive Retreats and Legendary Retreats under the umbrella brand.
After several missed licensing payments, A&K pulled their name from the club, forcing a rapid rebranding effort to become Tanner & Haley Destination Club. Less than a year later, Tanner & Haley would file for Chapter 11 bankruptcy.
At the time of the club's filing, 874 members spanned the three clubs, with 349 in Private Retreats, 510 in Distinctive Retreats, and 15 in Legendary Retreats.
Ultimate Resort would eventually purchase the assets of the clubs and the vast majority of the former members continue to remain within Ultimate Escapes, the fusion of Ultimate Resort and Private Escapes.
RESIGNATION
The product of a licensing agreement with Abercrombie & Kent, Abercrombie & Kent Destination Clubs had three distinct clubs within their umbrella: Private Retreats, Distinctive Retreats, and Legendary Retreats.
Each of these three clubs had their own unique redemption policies, evolving as the destination club industry matured.
- Private Retreats Resignation Policies
- Distinctive Retreats Resignation Policies
- Legendary Retreats Resignation Policies
Abercrombie & Kent pulled their license to the collective clubs after several missed payments, citing that their "long term business strategy now requires that we maintain full control over our valuable brand name."
The collected three clubs quickly transitioned to be known as Tanner & Haley Destination Clubs.
Tanner & Haley lasted less than a year as flaws in the business plan quickly caught up to them as sales sagged following the loss of the A&K brand. The club filed for Chapter 11 bankruptcy and was eventually acquired by Ultimate Resort, now Ultimate Escapes after their merger with fellow industry powerhouse Private Escapes.
The long term strategy mentioned by A&K ultimately turned into the Abercrombie & Kent Residence Club, with no affiliation to the previous club, but dedicated to correcting mistakes that were made with their name attached. Today they remain one of the industry's biggest players with their unique, member owned structure.
EXECUTIVES
Abercrombie & Kent Destination Clubs was the collected brand for Private Retreats, Distinctive Retreats, and Legendary Retreats.
Private Retreats would be the world's first destination club, combining elements of second home ownership, country club membership, and fractional jet access to create a new luxury travel option. The young club would prove successful enough for the launch of Distinctive Retreats, an expansion on the Private Retreats concept with even more luxurious properties available exclusively to members.
Rob McGrath, widely known as the creator of the destination club concept, would contact Geoffrey Kent of Abercrombie & Kent and would form a relationship to rebrand their collected clubs under the Abercrombie & Kent name. Operating as Private Retreats by Abercrombie & Kent and Distinctive Retreats by Abercrombie & Kent, eventually the master brand Abercrombie & Kent Destination Clubs would be created.
Eventually, Abercrombie & Kent and McGrath would discontinue their licensing agreement. Without a brand, the club formerly known as Abercrombie & Kent Destination Clubs would be transformed to Tanner & Haley Destination Clubs, named after McGrath's two children.
As a result of a business model where the club was required to lease a great deal of the properties available to members, the new Tanner & Haley would file for bankruptcy. Totaling nearly 900 members between the three clubs levels, Ultimate Resort would eventually acquire the assets of the club. In time, Ultimate Resort would combine with Private Escapes to create their own master brand, Ultimate Escapes.
Rob McGrath
Founder and Chief Executive Officer
Wanda Hairston
Chief Operating Officer
Executives from Abercrombie & Kent Destination Clubs would go on to work at several other destination clubs. Some of the other executives attached to Abecrombie & Kent Destination Clubs that would go on to serve at other destination clubs would include:
- Richard Keith
- Lisa Nier Pansing
- Jay Harbison
- Joel Schoen
- Robert Dorsey
NOTES FROM THE CLUB
In July of 2003, Abercrombie & Kent agreed to license their name to Private Retreats, the pioneer of the destination club concept.
After several successful years under the Abercrombie & Kent license, growing competition, insufficient annual dues, and costly short term leases to meet availability forced Preferred Retreats, the overarching brand that included Private Retreats and companion clubs Distinctive Retreats and Legendary Retreats, to miss several payments to A&K. The travel giant pulled their branding from the club in August of 2005.
In a press release announcing the conclusion of the licensing agreement, Abercrombie & Kent's Chairman and Chief Executive Officer, Geoffrey Kent said, "Our long term business strategy now requires that we maintain full control over our valuable brand name."
After the loss of the A&K name, Preferred Retreats created a new brand in Tanner & Haley Destination Clubs, named after Rob McGrath's children. Not even a year later, the club filed for bankruptcy.
In May of 2007, Ultimate Resort finalized the acquisition of the club, just months before another significant announcement from the club. Ultimate Resort and Private Escapes announced a merger to form Ultimate Escapes in September of 2007.
When Preferred Retreats was using the A&K name, Abercrombie & Kent had no control over the club's operations. In April of 2008, Abercrombie & Kent announced that they would make their way into the destination club sector with the introduction of the Abercrombie & Kent Residence Club. The new club looks to correct the many flaws that existed in the model when Private Retreats were using their name and has already established themselves as a leading player within the industry.
PARTNERSHIPS
Home of the world's first destination club, Abercrombie & Kent Destination Clubs was the master brand for Private Retreats and Distinctive Retreats. Founder Rob McGrath had entered into a licensing agreement with the travel giant A&K to use the brand name, using it until 2005 when the club was unable to make their licensing payments and subsequently lost the powerful A&K identity.
Virtually overnight, Abercrombie & Kent Destination Clubs became Tanner & Haley Destinations Clubs, named after McGrath's two children. Under the Tanner & Haley name, the club would assist members with car rentals and private jet access amongst other businesses, none of which provided any substantial gains and was cited in the club's bankruptcy documents in 2006.
Quoted in the club's bankruptcy documents were the failures of many club initiatives outside of their destination club structure. Holly Felder Etlin, the Tanner & Haley Chief Restructuring Officer, outlined many of these programs.
"Ms. Etlin relates that Complete Retreats, et al., also operate an air travel program, whereby they make available their fractional ownerships in airplanes to destination club members, and book ticket commercial air travel for a fee. The program generated approximately $1,400,000 in revenutes in 2005."
"The Company also previously operated a luxury car rental service, a wine sales business, a fine art sales program, and various other luxury service and amenity programs for their destination club members. 'None of these businesses generated any substantial revenues during their periods of operation,' Ms. Etlin reports."
While Tanner & Haley did look to keep many of their business operations in house, the club did have a substantial partnership network prior to their bankruptcy.
Operating more than 3,600 flights per day at the time of their partnership, Tanner & Haley partnered with American Airlines, but no details regarding the partnership were disclosed.
Considered one of the foremost leaders in luxury linens and textiles, Anichini bedding was used at residences throughout the three Tanner & Haley clubs.
Members of any of the three clubs could access private jet services through the club. Tanner & Haley purchased fractional jet hours through Bombardier Skyjet and would allow members the ability to purchase hours as they needed.
For those that didn't travel through American Airlines or Bombardier, a partnership with Delta Airlines was also established by Tanner & Haley. Like the American Airlines partnership, details regarding the specifics of their alliance were not revealed.
Quintessentially had relationships with 250 of the world's finest spas and gyms, but members could also procure tickets to concerts, VIP access to nightclubs, and a list of other preferred benefits.
PRESS RELEASES
While no longer in operation, Abercrombie & Kent Destinations was one of the largest destination clubs in the history of the sector.
The brainchild of Rob McGrath, Private Retreats was the first true destination club. The club entered into a licensing agreement with Abercrombie & Kent, creating Abercrombie & Kent Destinations. With the assistance of the A&K name, the club went on to be one of the leading clubs in the industry, trailing only Exclusive Resorts.
After missing several payments to A&K, Abercrombie & Kent pulled their name from the club and McGrath's clubs quickly rebranded as Tanner & Haley Destination Clubs.
Abercrombie & Kent and Preferred Retreats Agree To Discontinue Name Licensing Agreement
Date: August 19, 2005
Abercrombie & Kent and Preferred Retreats have elected to discontinue their licensing agreement. Rob McGrath and his club, now under the Tanner & Haley name, look forward to further introducing their new Legendary Retreats to the market.
Abercrombie & Kent Destination Club Opens Newest Gallery
Date: February 5, 2004
Abercrombie & Kent Destination Clubs announce the Grand Opening of their newest gallery in The Borgata of Scottsdale. Visitors are invited to attend on February 13th from 4 to 8 and enjoy free music and appetizers.
Abercrombie & Kent Extends Brand With New Name For Destination Club Product
Date: February 2, 2004
Previously operating under the name Private Retreats by Abercrombie & Kent, the club has a new name for which they will market Private Retreats and their new Distinctive Retreats. Citing the ability to be "identified under one name," the club will now be known as Abercrombie & Kent Destination Clubs.
Private Retreats by Abercrombie & Kent Names New Chief Operating Officer, Industry Veteran Bob Shrader Brings 30 Years of Industry Experience December 8, 2003
Private Retreats by Abercrombie & Kent Acquires New Properties, New Properties Include New York City, Naples, and Steamboat Springs November 13, 2003
Private Retreats by Abercrombie & Kent Honored By American Academy of Hospitality Sciences, Worlds Premiere Destination Club Awarded Star Diamond Award October 22, 2003
Private Retreats by Abercrombie & Kent Launches New Quintessentially Exclusive Concierge Service, World's Premiere Private Conceirge Service Now Available At All Club City Venues
October 7, 2003
Olympic Skier Billy Kidd Joins Advisory Board of Private Retreats by Abercrombie & Kent September 29, 2003
Private Retreats by Abercrombie & Kent Surpasses 320 Members, The World's Largest Private Destination Club Nearly Sold Out September 4, 2003
Private Retreats by Abercrombie & Kent Acquires New Properties, New Destinations Include Squaw Valley, Outer Banks, North Carolina, and Deer Valley August 12, 2003
Abercrombie & Kent and Private Retreats Announce New Strategic Partnership, World's First Private Destination Club Private Retreats by Abercrombie & Kent July 29, 2003
Private Retreats CEO and President Awarded Ernst & Young's 2003 Entrepreneur of the Year For The Rocky Mountain Region June 19, 2003
Private Retreats Adds Private Island, Cayo Espanto, Enhancing Its Offering of Exclusive Resort Properties February 20, 2003
Private Retreats Acquires New Properties in Teton Village, Wyoming, Cabo San Lucas, Mexico, Scottsdale, Arizona, and The Dominican Republic January 16, 2003
Private Retreats - A New Paradigm In Second Home Ownership of the Ultimate Private Residence Club Skyrocket January 7, 2003
Discussed in Deer Valley Was Always on the Wish List and The Island House: Caribbean Villas in the Club Years, from The Ledger.