2009 Destination Club Review

When 2009 began, The LUSSO Collection had just filed for bankruptcy and High Country Club had been restructuring their ailing club for months. New clubs like Botiga and Diamante Residences had launched in 2008 only to find a near complete lack of interest, closing their doors just as they opened them. With these club failures ushering in the new year, many were uncertain about the future of the destination club industry entering 2009 and by the time the year concluded, 2009 had arguably been the year that most greatly reshaped the destination club sector.

In January of the new year alone, High Country Club would lose their battle and announce their intention to file for Chapter 7 bankruptcy, the ultra-luxury Yellowstone Club World would be forced into their own involuntary bankruptcy filing, and the fringe club One Key World would cease operations, further eroding consumer confidence in the destination club sector. Within the first quarter, The Solstice Collection would also file for Chapter 11 bankruptcy, making them the third member of the Destination Club Association to file for bankruptcy within a four month window.

To prevent a similar fate, the industry's three leading players, Exclusive Resorts, Ultimate Escapes, and Quintess, would each make changes to their models through various methods including increased annual dues, reduced costs, and membership assessments.

While the industry leaders were looking to become more self sufficient and sustainable, a growing number of new clubs entered the sector looking to capitalize on greatly reduced real estate prices and the hundreds of members left without travel arrangements due to club bankruptcies and closures. In 2009 alone, the following clubs all made their official introduction to the destination club industry:

• Demeure Club
• Emperum Club
• How Fun Resorts
• LUXLife
• Paragon Destinations
• Phoenix Club
• Ritz-Carlton Destination Club
• Southridge Club
• ViaMari

The most notable name in the list is without question the Ritz-Carlton Destination Club who made their official introduction in April of 2009, bringing a deeded component to the model and one of the most recognizable travel names in the world. How Fun Resorts, Paragon Destinations, and The Phoenix Club would all be formed as an outgrowth of bankrupt destination clubs. How Fun Resorts courting members of The LUSSO Collection and Paragon Destinations and The Phoenix Club pursuing members of High Country Club.

With these clubs going after former members, some of the more established clubs in the sector would introduce trial membership offers and deferred payment options to attract new members. Exclusive Resorts' Sponsored Guest Program and the Quintess deferred payment option both proved to be successful initiatives and the Abercrombie & Kent Residence Club would introduce a dues only trial membership option for those considering membership.

While the beginning of 2009 began poorly, these initiatives would help stabilize the industry in the latter half of the year and provide some newfound interest in the destination club model.

One of the most chaotic years in the history of the sector, we invite you to learn more about the most notable events, both positive and negative, of 2009 through the archive below:

• January 16, 2009: Ultimate Escapes Charges Members One Time Special Assessment
• January 19, 2009: Quintess and The Oyster Circle Announce Partnership
• January 19, 2009: One Key World Ceases Operations
• January 27, 2009: High Country Club To File For Chapter 7 Bankruptcy
• January 28, 2009: Yellowstone Club World Files For Involuntary Chapter 7 Bankruptcy
• February 18, 2009: Equity Estates Enjoys Success Despite The Economy
• March 5, 2009: Solstice Collection Files For Chapter 11 Bankruptcy
• April 15, 2009: Quintess Offers Deferred Payments and Trial Membership
• April 16, 2009: The Hideaways Club Sells Partial Stake In Club
• May 1, 2009: Abercrombie & Kent Residence Club Leaves Destination Club Association
• May 22, 2009: ARDA President Howard Nusbaum Discusses Destination Club
• May 29, 2009: Ritz-Carlton Destination Club Redefines The Model
• July 30, 2009: Exclusive Resorts Discloses Mid-Year Update
• August 11, 2009: Ultimate Escapes Reactivates Over 300 Suspended Members
• August 26, 2009: Quintess Passes 500 Member Mark
• September 3, 2009: Ultimate Escapes and Secure America Sign Agreement
• September 8, 2009: Former Destination Club Executive Thanos Papalexis Guilty of Murder
• September 16, 2009: Ultimate Escapes Completes Private Escapes Acquisition
• October 29, 2009: Ultimate Escapes Acquisition Approved By Secure America
• December 10, 2009: Abercrombie & Kent Residence Club Discounts Equity Memberships

While 2009 was not the year that many destination club executives and members had hoped for, the year has ended on a far better note than the year previous. Exclusive Resorts and Quintess have both made positive steps to maintain their long term sustainability and Ultimate Escapes has created the world's first publicly traded destination club, the vanguard in what may well be another new popular club model. Despite a slow sales year for the industry, Exclusive Resorts still posted triple digit sales figures, Quintess passed the 500 member mark, and Ultimate Escapes is fresh off a successful referral marketing campaign.

While destination club mainstays like High Country Club and The Solstice Collection may no longer exist, a growing number of clubs are looking to usurp their positions within the industry.