DC4MS

How Will Ultimate Escapes Stack Up Against Exclusive Resorts?

Halogen Guides takes a peak at two Destination Clubs that may be batteling for the top dog position. They provide a nice side by side comparison of the membership costs, plans, and the breadth of the property portfolio.

How Will Ultimate Escapes Stack Up Against Exclusive Resorts? | Halogen Guides Real Estate - Luxury 2.0 Guides and Reviews

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Of course all this speculation may be a moot issue if the Private Escapes and Ultimate Resort merger does not go through as planned.

Everyone, it seems, is holding their breath for any definitive news of this merger.

Desties

Amy's article does a great job of pitting both clubs, though I thought that the UR and PE were adopting the three-tier PE approach instead of the two-tier UR approach.

It's really the only approach that makes sense since UR Elite dovetails nicely with PE Pinnacle (both with $3 million home avg.) and UR blends in perfectly with PE Platinum (both with $1.5 million home avg.). That leaves the PE Premiere group (with the $800k home avg.) out under a two-tier plan.

I trust that the PE Premiere members wouldn't mind being upgraded to what would be the new low tier (of UR and PE Platinum), though I don't think it would sit well with PE Platinum (and UR for that matter) if PE Premiere members got the courtesy bump with just half of the initial deposit.

I'm sure that PE will adopt many of the UR practices, but I just can't see this NOT going with the three pricing tiers (which was pretty much the point of the merger -- so UR can get into the entry-level market and that PE can upgrade its high-end offering).

DC4MS

What if PE spins off their Premiere homes to another club like HCC?

Do you think the problems that Portofino Destination Club faced trying to market and sell three membership levels will affect PE/UR?

What URL will the PE/UR have considering ultimateescapes . com is already taken?

Desties

I can't see PE spinning off the Platinum homes, because they are equal in value to the UR homes ($1.5 million). Premiere would make more sense to a club like HCC, but why kill the entry-level gateway drug? More importantly, why would Ultimate Escapes start off a club by losing members (since you can't unload properties without unloading members, or the property-availability issues go through the roof).

I believe that the UR presentation at Ragatz that Amy was citing in her piece was based on UR's plans pre-merger -- like the recently announced Discovery pre-purchase plan at UR. You just can't fit three circles into two squares.

As for the challenges that Portofino had marketing three levels, I don't think that's what held Portofino back. Obviously PE has had no problem growing into the 3rd largest club with three plans.

As for the URL, we may have a winner -- not in Ultimate Escapes, but in Ultimate Escape. Check out the whois for UltimateEscape.com.

It is registered by the same Ultimate Resort, LLC that owns UltimateResort.com. In other words, maybe I'm breaking news here today, but the whois would seem to indicate that the new club will be Ultimate Escape and NOT Ultimate Escapes (unless they somehow negotiate for the UltimateEscapes.com domain soon, which is something they may want to do anyway).

LTTravel

1. The plans from what I have heard are to keep the three levels. I don't think the article in Halogen said they were going to only be a two tier club, they just left off the third tier, I think.

2. With UltimateEscape.com they can use the phrase used by Dial-a-Mattress(1-800-mattres) "Leave off the last s for savings" ?

DC4MS

very clever

Great detective work. I mixed up the PE Premiere and Platinum homes (I corrected the original post).

I guess the other DC Media needs to update their articles to better reflect the possible new name...."Ultimate Escape"

Kagehitokiri

they could still call it ultimate escapes, just with ultimateescape.com website..

nice work checking that out desties.

Desties

Well, the UltimateEscape.com domain was registered back in October, so it may be just a placeholder. Either way, whether it's Ultimate Escape or Ultimate Escapes, they probably need both domains.

Ultimate Resort owns both UltimateResort.com and UltimateResorts.com. Private Escapes owns both PrivateEscapes.com and Private-Escapes.com. You can't afford to lose any potential type-in traffic, so you need them all.

As I pointed out recently, Private Escapes is actually the first club you see when you Google the term destination clubs. Ultimate Resort is just a few notches lower (HCC is inbetween). It is different for destination club -- singular -- as ER is the top listing there, but I don't know if PE and UR want to lose all of the free leads they generate through their own domains (rankings that may diminish as they team up to promote the new name).

One can always argue that the clubs should have negotiated with the owner of UltimateEscapes.com BEFORE making the name public. It just strengthens the domain owner's hand now. Yes, the club can use UltimateEscape.com or any snappy URL, but they won't want to lose the natural traffic that will trickle in from folks who just type in the domain dot-com of the club name.

Kagehitokiri

thats why im surprised they dont just go with private escapes.

maybe were seeing issues because private escapes is more recognized, and seems to have better management / satisfaction, but ultimate resort is the larger club because of the T&H acquisition / bailout.

DJTraveler

Desties, nice observation that the Amy's article - but would really like some journalistic research I've been researching Halogen and there is some good info but no follow-up. Is UR really #2 in assets? According to Halogen, Ultimate seems to have the majority of growth from the T&H members who joined with no deposit after Ultimate bought the T&H portfolio for $110M or so. Still trying to find out how they are going to pay for this...deep pockets! The club bought these homes without member deposit equity. (60% owned and 40% leased) Then brings in over 650 members to use those home for no deposit (nice deal for T&H members considering alternative).
Ultimate Resort Closes on Tanner and Haley Transaction | Halogen Guides Real Estate - Luxury 2.0 Guides and Reviews
After 7 years of membership, they can exit Ultimate with 80% of then-current deposit.
Official Ultimate Resort Offer Letter to Tanner & Haley Members | Halogen Guides Real Estate - Luxury 2.0 Guides and Reviews
So in 7 years (now 6) 650 membeers with 14 night bronze memberships avg. half UR currently $125K and half UR elite $200K would be $175K and $260K. math says that's $113 million deposit return liability or more.....and UR CEO claims $200M in assets. Can anyone explain this? Tiering up here

TarheelTraveler

That is an interesting question DJTraveler. If the T&H members get to use UR assets without putting in any money that does seem like it would be a huge liability currently because you've got to provide availabilityto them, but also long-term, upon redemption by some of those members. However, was the purchase of the T&H houses on the cheap out of bankruptcy contingent upon taking on the T&H members? Maybe Jam can answer that question. I thought there was a connection, but maybe not.

I agree with others that PE does seem to have the better name/reputation. It's surprising that they would give up that branding. I knew nothing about UR until they bought the T&H assets.

Desties

I'd love to hear jam's take too, but this is how I see it.

The T&H members are unlikely to bolt until the end of 2013, where they can receive 80% of the UR deposit. This may be why UR warmed up to PE now, to get big fast so it will be less of a sting later (while also giving the company years to win over T&H clients to stick around, who may have been skeptical at first).

It's definitely an albatross around UR's neck, but it also came with the sweet deal of picking up more than 60 $2-$3 million homes for just a little more than half of their actual value.

I'm sure that UR weighed all of the sides in outbidding Ciel for the T&H assets. As a PE member do I wish that UR would be in a more ideal situation? Sure. Am I drooling over the prospects of staying in some of those amazing homes post-merger? You bet.

Personally, I don't care which is the brand on the company by the time the deal gets hopefully done. Private Escapes? Ultimate Resort? Ultimate Escapes? Private Resort? It's just a name. However, cheering for the home team, I hope that the new club is more PE in scope, management, and attitude than UR.

Kagehitokiri

i also thought they only acquired the properties T&H owned. (not the leased ones)

DJTraveler

Thanks TarheelT - hope the final four does not have you down, lot's of talent our there!
Appreciate the concurrance on liability, and long-term is what I'm concerned with - looking for transparency help. Can't imagine the homes went for less than current value - that would put T&H BK committe in conflict with their jobs...and why would they? Press reporting has no contingency requiring T&H members to join. Also, the CEO said 40% lease homes that he plans to drop in first year or so - no word on any progress on that either.

Desties

The homes that were purchased were the owned ones. At least everyone from WSJ to Halogen referred to them as owned at the time.

As for the claim that UR is the second largest club in terms of assets behind ER, that certainly appears to be the case. PE and UR referred to their deal as a combination of $200 million in assets. The T&