Why Hotels See Value in Timeshare Units

Do you read Glenn Haussman, the Editor in Chief of Hotel Interactive, Inc.? If you don’t, you’ll probably want to change that as he is a great resource for insights on the overlapping hospitality industry components of timeshares and hotels. In the Tuesday, September 25, 2012 edition of Hotel Interactive, Haussman wrote an article titled, “More Money With Timeshare Conversions? Your hotel may be able to convert hotel rooms to timeshare and increase cash flow. Here’s what you must know.” He took a serious look at the real value for hotels converting some rooms to timeshare units.

As with everything he writes, this piece is thought provoking, especially for those of us who look at vacation accommodations through the lens of timeshare. Haussman points out that the number of hotels converting some of their rooms to timeshare units is growing, and for good reasons:

(1.)         Since timeshare units are larger than hotels rooms, a hotel-to-timeshare conversion reduces the number of hotel rooms the hotelier is responsible to book night after night, replacing the converted rooms with timeshare units that generate what Haussman identifies as, “a steady income stream from people who have prepaid for vacations as well as (who) provide annual maintenance fees.”

(2.)         With fewer units, fulfilling the demands of daily inventory are easier—fewer rooms to sell.

(3.)         When timeshare units aren’t being utilized by timeshare owners, Bruce Kaye, CEO of FantaSea Resorts, points out, they can be rented just like hotel rooms, (only as all of us in timeshares know, hotel rooms that are bigger and better than the standard hotel offering).

And here is the point that Glenn Haussman shared that may be most relevant of all: Although not every hotel is a logical or suitable candidate for converting some hotel units to timeshares, the value of the conversion for those that are suitable is far from limited to struggling hotel properties only.

Instead, turning a hotel into a mixed use property that offers hotel rooms and suites, as well as timeshare units, is just old fashioned good business, a commodity that no one in the work world today can ignore.