The Hideaways Club Founder Mike Balfour On Bloomberg

By: Destination Club News
Date: November 11, 2009

Founder and Chairman of The Hideaways Club, Mike Balfour, appeared on Bloomberg yesterday to discuss the origin of the club, benefits of membership, and where the club is progressing.

"We took a look at the whole second home ownership concept. People buy them and don't use them very often. They are shut up and they cost a lot of money, etcetera, etcetera," began Balfour. "There had to be a better way."

Balfour, the Founder of Fitness First, and the other club founders, Stephen Wise and Helmut Schön, had grown increasingly frustrated with their own travel experiences and looked overseas to the US destination club model. Rather than implementing a shared usage structure where members did not own any of the club or real estate, as was the overwhelming majority of destination clubs at the time, The Hideaways Club would blend the vacation experience with an investment opportunity.

Hideaways Club members buy a stake in the club's total property portfolio with 90% of each member's contribution going into the property fund.

Just last week, The Hideaways Club added Phuket to their growing list of residences. Other recent additions include South Africa, Croatia, and Sotogrande.

Discussing the club's upcoming real estate plans, Balfour stated, "Europe is still very, very popular. Property prices are way down, so anybody investing in the fund is buying properties at rock bottom prices we haven't seen for a long time."

While Balfour discussed the benefits of membership in great detail, it is apparent that the destination club concept and model both remain widely unknown. Originally compared to timeshares, the text "high-end homeswapping" was repeatedly used during the segment, giving credence to the opinion that many destination club executives hold that awareness is the industry's greatest obstacle.

These types of mass media marketing hopefully will expand the reach of all destination clubs, especially in forms that don't focus on the disappointing 2009 that many clubs have faced. In the past year, leading destination clubs such as Solstice Collection, High Country Club, and The LUSSO Collection have filed for bankruptcy while others have reshaped their models and cost structures to better weather the current market conditions. Despite the negatives the industry has seen, there has been successes, including the launch of the Ritz-Carlton Destination Club, the world's first publicly traded destination club in the form of Ultimate Escapes, and a newfound focus on sustainability.

For those looking to learn more about the pros and cons of destination club membership and to compare the structure to other luxury travel options, request a free copy of our Destination Club Guide.