The next evolution of Rob McGrath's Private Retreats, Distinctive Retreats launched late in 2003 after Private Retreats reached its capacity of 400 members. Shortly after the Distinctive Retreats's launch, McGrath entered into a brandng agreement with Abercrombie & Kent to collect the two destination clubs under the newly created Abercrombie & Kent Destinations Clubs brand.
With the success seen at Private Retreats and their collection of $1.2 million properties, Distinctive Retreats launched with a collection of properties in the $2.5 to $2.8 million price range. The infusion of the Abercrombie & Kent name helped the club enjoy similar success to its predecessor. The proprietary model used at Private Retreats was duplicated for the new club. Limited to only 400 members, members would ultimately have access to just over 70 residences and boats. Members could travel on an unlimited basis, subject to reservation policies, and were entitled to a 100% refund of their membership deposit if they elected to resign their membership.
The success of Distinctive Retreats soon spawned Distinctive Retreats II, a continuation of the Distinctive Retreats offering once the original club reached its 400 member capacity.
The club would eventually launch an even more elite level club in Legendary Retreats in July of 2005. Near the same time, the collective clubs failed to pay Abercrombie & Kent for several months and lost their branding arrangement and were forced to rapidly remarket their club without the A&K name. McGrath named the new club after his two children, Tanner & Haley.
Almost exactly a year after the Legendary Retreats launch, the collected clubs were forced to file for Chapter 11 bankruptcy, citing their "members-first" approach as unsustainable. Each of the club's at Tanner & Haley guaranteed reservations to members, forcing the club to make numerous short-term leases to accomodate members. Factored in with increasing competition and insufficient annual dues, and the club was unable to survive.
In December of 2006, after a bidding war between Ultimate Resort and Ciel for the Tanner & Haley assets, a federal bankruptcy judge chose Ultimate Resort's $100 million bid and approximately 650 members from Tanner & Haley elected to join Ultimate Resort via either a dues only membership or an option to upgrade to full membership when the acquisition was completed in May of 2007.
Just four months later in September, Ultimate Resort and Private Escapes announced their merger to form what would eventually be Ultimate Escapes with the collected members of Tanner & Haley still a part of the club.
MEMBERSHIP PLANS
Like the other two membership clubs under the Tanner & Haley brand, Private Retreats and Legendary Retreats, Distinctive Retreats gave members unlimited annual access to a collection of luxury vacation properties around the world.
The next evolution of the world's inaugural destination club, Private Retreats, Distinctive Retreats would give members exclusive access to an even more extravagant property portfolio. Residences would average nearly $3 million each, located in some of the most popular destinations.
"Members of A&K Distinctive Retreats enjoy an extraordinary collection of luxuriously appointed $2.5 million-plus residences in prime resort locations throughout the United States, Canada, Mexico, Central America, Bermuda, the Caribbean and Europe," the club published. "Because the Club is Member-driven, we select our resort residence locations based on the preferences of our Members. As the Club continues to evolve, Members will be asked to suggest future destinations for us to explore in adding new and exclusive resort residence locations."
"Along with a very low Member-to-resort-residence ratio, our unique Proprietary Capacity Model ensures our Members truly unlimited lifetime access to all Club assets and destinations, when and where you want, 365 days and nights a year including holidays."
Like the other clubs within Tanner & Haley, Distinctive Retreats members would pay a one time membership deposit, annual dues, and a per night usage fee to access club residences.
The unlimited Invividual Membership option was the most popular option for club members, but a Corporate Membership was also available. The number of total nights available per year varied during the club's time in operation, but typically provided approximately 42 nights of annual access.
As mentioned by the club, Distinctive Retreats would give members "when and where you want" travel options, guaranteed if the member made their reservation more than 60 days in advance. If a member wished to travel to a destination where the club's properties were already in use by another member, the club procure a comparable residence. This required the club to enter into numerous costly short term leases, burning away a great portion of their annual dues and membership fees.
In 2006, the three clubs would file for bankruptcy and eventually be acquired by Ultimate Resort. Members would be offered a dues only membership option and discounts if they wished to upgrade to become a full member. Ultimate Resort and Private Escapes would eventually combine to form the master brand Ultimate Escapes where many of the Distinctive Retreats members and properties remain.
ANNUAL DUES
Distinctive Retreats would ultimately prove to be the most popular option within the family of Tanner & Haley Destination Clubs, surpassing the success of the world's first destination club, Private Retreats. In fact, Distinctive Retreats would be so popular, that a companion club Distinctive Retreats II would be created to satisfy demand. Tanner & Haley would also go on to create Legendary Retreats, the capstone to the three clubs, but would soon thereafter file for bankruptcy.
As the first mover in the destination club industry, the collected clubs within Tanner & Haley all had unsustainable business models, requiring the club to lease a great deal of their properties to satisfy member demand. When the club announced their bankruptcy, Tanner & Haley would also cite the insufficient annual dues and fees the club charged to members.
According to the bankruptcy documents, "Distinctive Retreats has 510 members with access to 77 properties. Membership deposits average approximately $429,000, annual dues average approximately $13,550, and daily usage fees average approximately $184."
Ultimate Resort and Ciel would both make a play at acquiring the assets of Tanner & Haley following the bankruptcy, including both members and properties, with Ultimate Resort selected as the winning bidder.
Members of Distinctive Retreats were offered a 14 night membership plan to become an Ultimate Resort Elite Bronze member for $15,000 annually. No membership fee was required.
Ultimate Resort would eventually merge with Private scapes to create the combined Ultimate Escapes, the world's second largest destination club in terms of members and the first publicly-traded destination club.
PROPERTIES
The next level of the already popular Private Retreats, Distinctive Retreats would be the second destination club introduced by Rob McGrath. Members would now have access to a global collection of luxury real estate valued at approximately $3 million each. Like Private Retreats, Distinctive Retreats would be capped at 400 total members.
Distinctive Retreats outlined their club residences by stating, "The Company’s Proprietary Capacity Model is designed to make one Distinctive Retreats ('DR') residence available for every 3.1 Members (i.e. 130 homes per 400 Members). This total includes one 'Club Owned Home' for every 6.1 Members (i.e. 65 'Club Owned Homes' per 400 Members) and one 'Club Managed Home' for every 6.1 Members (i.e. 65 'Club Managed Homes' per 400 Members). With 29 destinations in DR, a mix of 130 homes provides an average of 4.5 homes per destination (2.25 'Club Owned Homes' and 2.25 'Club Managed Homes')."
"When DR reaches 400 Members, the Company expects to continue to expand its Membership and Asset base beyond 400 Members by opening Distinctive Retreats II ('DR II'). Full reciprocity of use across DR I and DR II which will allow for an expansion beyond an average of 4.5 homes per destination. For this reason, the Club currently owns, in certain destinations, more residences than are planned for just DR I. Typically, where such a situation exists, residences are in the construction stage."
Distinctive Retreats would surpass Private Retreats and become the most popular club under the Tanner & Haley umbrella, including the ultra-luxury offering Legendary Retreats. Distinctive Retreats would be created and the combined two clubs would reach 510 total members.
The allocation of the club's real estate assets were planned to adhere to the following break down:
- Beach: 40%
- Mountain: 25%
- Golf: 20%
- City: 15%
Many other destination clubs have adopted a fairly similar structure over the years, but all have restructured the overall business model employed by the collective Tanner & Haley.
As a result of a "guaranteed" access policy that required the club to give members comparable accommodations if a property was in use by another member, all of the Tanner & Haley clubs entered into countless short-term leases to satisfy demand. This would quickly erode the club's first mover position and in 2006 the club filed for bankruptcy.
According to the bankruptcy reports, Distinctive Retreats totalled 77 properties in several popular destinations, including:
- Kiawah Island, South Carolina
- Maui, Hawaii
- Scottsdale, Arizona
- Cabo San Lucas, Mexico
- Cayo Espanto, Belize
- Telluride, Colorado
Ultimate Resort would eventually be named the winning bidder during the bankruptcy proceedings, acquiring a portion of the club's real estate and members. In time, Ultimate Resort would acquire Private Escapes to create the master brand Ultimate Escapes, with many of Distinctive Retreats' properties and members still a part of the club.
MEMBERS
The most popular destination club within Tanner & Haley, Distinctive Retreats would require the creation of Distinctive Retreats II once the first club reached its 400 member capacity.
Launched after Private Retreats, the world's first destination club, Distinctive Retreats provided members with more luxurious vacation properties than their predecessor, averaging roughly $3 million each. Members would have guaranteed and unlimited annual access to club properties for the lifetime of their membership.
While members of the two Distinctive Retreats plans would have reciprocal access to both club's properties, there would be some significant differences between the two clubs.
Members of the original Distinctive Retreats had a resignation structure identical to the one used by Private Retreats. Any member who wished to resign their membership would receive 100% of their original membership deposit refunded to them. Members would be placed on a resignation list and for every three new members that joined the club, the member who had been on the list the longest would be refunded.
Distinctive Retreats II, introduced long after the creation of the original Distinctive Retreats, would offer a redemption model identical to Legendary Retreats, the highest club offering in the Tanner & Haley family of memberships.
"Tanner & Haley Destination Clubs has created a revolutionary financial structure in our two newest Clubs, Legendary Retreats and Distinctive Retreats II, that allow you to 'own' any appreciation of your Club deposit, less a small transfer fee if you should ever choose to leave the Club. This superior financial structure is just another way of honoring our Members and trying to improve their lives in every little way that we can."
Unfortunately, a major attraction to club members was the guaranteed access policy the club offered to members, where if a member desired a club property that was already in use by another member, the club would procure comparable accommodations for the member. As a result of this policy, Tanner & Haley would enter into expensive short term leases to meet demand, burning through the annual dues and fees contributed by members.
In 2006, Tanner & Haley would file for bankruptcy, drastically reshaping the destination club industry.
According to the club's bankruptcy documents, "Distinctive Retreats has 510 members with access to 77 properties. Membership deposits average approximately $429,000, annual dues average approximately $13,550, and daily usage fees average approximately $184."
In the highly competitive destination club sector, the assets of Tanner & Haley would quickly become a sought after commodity. Six official bids would be placed for the club's assets, namely by Ultimate Resort and Ciel. After accepting a $98 million bid from Ultimate Resort, Ciel would submit a $108 million, last minute offer for the club.
The courts would eventually remain in Ultimate Resort's camp and the club would acquire a significant portion of the real estate assets of Tanner & Haley. All of the 874 total members were contacted with an opportunity to join via a no up front membership fee option and discounts to all of the membership plans available through Ultimate Resort.
Ultimate Resort and Private Escapes would combine their two clubs, at the time the second and third largest destination clubs in operation, to form Ultimate Escapes where many of the former Tanner & Haley properties and members remain.
RESIGNATION
The next evolution of Private Retreats, the world's first destination club, Distinctive Retreats would offer even more expensive homes for members to enjoy on an unlimited annual basis.
Originally branded under Abercrombie & Kent Destination Clubs, Distinctive Retreats would prove to be the most popular club option for members, requiring the creation of a Distinctive Retreats II.
The two Distinctive Retreats options would have different properties, members, and resignation policies.
This type of redemption model is now used throughout the destination club industry by many of the leading clubs.
Unfortunately, few got the opportunity to see these policies in action, as Tanner & Haley filed for bankruptcy in 2006. Citing the club's low annual dues and "member's first" attitude, Tanner & Haley was unable to cover their expenses due to their reliance on short term leases to meet availability needs. On July 23, 2006, court documents stated the club had total liabilities of $308 million.
Ultimate Resort would be selected by the bankruptcy court as the final destination of the club's assets. Of the 874 Tanner & Haley members, 645 would join with Ultimate under a membership structure crafted specifically for them.
Following a merger announcement in September of 2007 between Ultimate Resort and Private Escapes, the combined club move forward under the newly created Ultimate Escapes brand. Today, Ultimate Escapes is the world's second largest club in terms of members, with a sizeable portion of Distinctive Retreats members still a part of the club.