Clubhouse: Group Merger
The Hideaways Club fuses a destination club with fractional ownership.
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ShareFebruary 1, 2008
In 2004, Londoner Stephen Wise and his family considered purchasing a destination club membership. "I had read about the concept in the Financial Times and liked the idea," he says. He imagined vacationing in Tuscany but then learned that destination clubs—all of which were based in the United States at the time—were not located in the places he wanted to go, nor did they offer the flexibility of taking shorter vacations."Europeans holiday differently than Americans," says Wise. His solution was to create the Hideaways Club, a variation of the destination club concept that caters specifically to Europeans.
Wise was concerned that other destination clubs, where members
pay for usage of the homes, did not offer members a stake in ownership. "If a
club were to go bust tomorrow, you the member could be left with nothing," he
says.
Thus, the Hideaways Club offers its members partial ownership
in the club’s portfolio of properties. To launch the Hideaways Club, Wise, along
with three other investment partners, used the private equity business as a
model. Members buy a share in a Gibraltar-registered property company, which in
turn owns all of the individual residences. Another company—also in
Gibraltar—manages the properties, for which it receives 20 percent of the
portfolio’s rise in value. The remaining 80 percent belongs to the members, who
share in the portfolio’s appreciation. "We took the good parts of destination
clubs and merged them with the good parts of fractional ownership," says Wise.
Wise’s club is limited to 600 members and requires an initial
investment of $400,000 and annual dues of about $24,000. The club’s current
portfolio consists of 13 homes, and it will grow to a maximum of 100 properties
throughout continental Europe and the Mediterranean. The club bases usage on a
100-point system, with one-week stays during the peak season costing 30 points
and stays during non-peak weeks costing 20 points. Shorter stays are also
available.
The homes themselves average more than $2 million each and
feature a minimum of four bedrooms and three bathrooms. Eventually, the homes
will be located in a mix of established destinations, such as the French Alps
and Tuscany, as well as in emerging locations, including Croatia and Turkey.
Initially, all of the destinations will have flight times of four hours or less
from London. "That lets us cover just about all of Europe, as well as Morocco,"
says Wise, who considers proximity to be one of the most important requirements
for a home’s location.
The club’s properties feature interior designs that complement
their regions and are backed by British standards for service and amenities.
Each residence comes equipped with a concierge to help members navigate their
vacations. "‘Normal’ is not the same in every location," says Wise. "You
really need someone who is conscientious of the local customs."
The Hideaways Club +44.207.664.8860, www.thehideawaysclub.com
