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Published Articles on Real Estate - Anguilla Life Magazine


Time Shares - Trauma or Treasure?

When you discuss the introduction of time share hotels on Anguilla, the customary first response is: Not here! We don't want those kind of people on Island. But what is wrong with time share development? Where do the fundamental problems lie? The design or concept? -- I think not. The management and marketing? I think so.

When one considers the fact that the customary length of stay for vacationers from Noth America to the Caribbean is one week, it is obviously sensible to develop and market products which accomodate that one week window. However, in the case of most time shares, that "product" is not (and should never be viewed as) real estate, but as a prepaid annual vacation reservation.

Essentially, time shares allow the vacationer to reserve a series of one week hotel reservations at a discount over traditional rack rates for an equivalent room, by paying for those vacation reservations in advance. Subsequently, in addition to this initial payment which purchases the advance reservation itself, there are annual maintenance fees which must be paid by the purchaser.

So, time shres can be seen to make a lot of sense -- from the standpoint of the developer, the hotel repays its development costs quickly, plus a traditionally handsome profit, with income derived from advance reservation sales. From the standpoint of the manager, the hotel repays its operating budget, plus a traditionally handsome profit, with income derived from maintenance fees, food/beverage/retail sales, and various ancillary services. From the standpoint of the purchasers, they bought what they need, one week.

However, nothing is as simple as it seems. No one familiar with the bombardment of time share sales efforts should be too surprised that it is not unusual for sales, marketing, and promotion budgets to rival or exceed construction costs for tie share hotels. The free casino chip that you are offered for going on a timeshare "tour", the payments offered to bus and taxi drivers for bringing in a client for the "tour", the commissions paid to the sales force, the number of people on the sales force, all work to poison the atmosphere surrounding the concept -- especially when one takes into account the number of sales that must be made, i.e. fifty per room.

I do not believe that anyone wants Shoal Bay, or any other beach or any other location on Anguilla, poisoned by a breakdown in the respect for privacy which so oftern accompanies time share development -- the sales pressures can be relentless and devastating. Considering that time share development is now an accepted component of many international hotel chains, from Disney to Hyatt to Hilton, if time share is deemed necessary, let Anguilla negotiate with those quality providers in preference to little known, independent, entrepreneurial developers, so that the assurances we need to confidently indroduce time share without trauma can be realized.

However, no development should be approved -- and certainly no time share development -- until a need for additional local employment is confirmed. Developers may come and go, but we stay.


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