Interval info-exchange seminar “Future looks bright for the timeshare industry”POSTED: 05/23/16 6:45 PM
Howard Nusbaum, President and CEO of the American Resort Development Association. Photo Today / Hilbert Haar
St. Maarten News – “The comfort of knowing what the rules are is as important as what the rules are.” With that statement Howard Nusbaum underlined yesterday how necessary it is for St. Maarten to establish its timeshare legislation.
Nusbaum is the president and CEO of the American Resort Development Association (Arda) an advocacy group for the timeshare industry. Nusbaum was in St. Maarten for the first Info-Exchange seminar hosted by Interval International at the Westin Dawn Beach Resort and Spa.
Together with Interval President David Gilbert, Nusbaum fielded questions from reporters yesterday morning ahead of the beginning of the seminar. They revealed some interesting data about an industry that has been in the news in a negative way locally over the past several years with troubles at the Pelican Key Resort (now Simpson Bay Resort and Marina), the Caravanserai Resort (now Alegria) and more recently the Sapphire Beach Club in Cupecoy.
However, as Marcel Javois, the President of the St. Maarten Timeshare Association, later would say during the seminar, “there are a lot of positive things happening and the future looks bright for the timeshare industry.”
Interval’s US membership profile shows that 81 percent of Americans would, as their first choice, like to buy more timeshare in the United States. Their second preference (27 percent) is for the Caribbean – where St. Maarten is second only to Aruba. Another 13 percent gives Mexico as the third choice and Europe and Canada (9 percent) as the next preference.
Gilbert said yesterday that the average income of the timeshare owner in St. Maarten is $147,000 – way above the average for all Interval timeshare owners ($124,000).
Interval International started doing business in 1976 and it is now celebrating its fortieth anniversary. The leisure group has around 2 million members – mainly US citizens – and a network of 3,000 resorts in 80 different countries. In the Caribbean, just 185 resorts are part of this network.
“A nice feature of timeshare is that their owners are the first to come back to a destination after a natural disaster,” Gilbert said. “They are reliable customers and they spend more on dining, shopping and gaming than a regular hotel guest because when they get here, their vacation has already been paid.”
Interval has an ambitious focus in the Caribbean. “We need more projects because right now we have only 185 Caribbean resorts in our network. We’d like to have more product here, because there is more demand for the Caribbean than we are able to supply.”
That St. Maarten is in a hurricane belt is no reason for investors to stay away, Gilbert said. “It is a business issue, a fact of life. So you put in impact glass, you install generators and you make sure that you are prepared for these events. This is not an exclusive St. Maarten issue; the weather is changing all over the world.”
Brick and mortar projects are not the only focus. Through Interval, timeshare resorts have to date donated $700,000 to the Education Fund of the Caribbean Hotel and Tourism Association and the Caribbean Tourism Organization. “The timeshare industry is the largest contributor to this fund,” Gilbert says. “However, we need more people from St. Maarten to apply for these scholarships because the funds will go to people who apply.”
The timeshare resorts donate “inventory” (timeshare units) to Interval for the education Fund. Interval sells these units and donates 100 percent of the proceeds to the education fund.
Howard Nusbaum described tourism as “the big dog” for the local economy. “It is the driver of the economy, so you don’t want to burn people or make them unhappy,” he says.
Nusbaum is almost lyrical about the qualities of St. Maarten: “safety, quaintness and cleanliness” but he underlines the importance of balanced legislation. “But I would rather have the right legislation than something that is put together in a hurry. It does not matter what the rules are, but the comfort of knowing what the rules are is as important as what the rules are.”
During the seminar, Nusbaum pointed to the 83 percent satisfaction level among timeshare owners. Interval’s network in the US consists of 1,555 resorts that offer 198,480 timeshare units. The average maintenance fee in the resorts is $880 and 92 percent of the timeshare owners are current with the payment of these fees.
In 2014, the rental revenue from timeshare units amounted to $1.9 billion for 11.2 billion nights at an average rate of $172 per night.
SMTA-President Marcel Javois said that timeshare needs to be acknowledged as the most important part of the tourism industry. “Timeshare makes up 70 to 75 percent of all stay-over tourism and these people return year after year,” he said, adding that the average spending of timeshare owners outside of their resort is around $5,000 per booking.
“Timeshare is the golden egg and we have to do everything to protect the industry, we can no longer just depend on our beaches or our natural assets,” Javois added. “There must be more focus on developing St. Maarten as a destination, make it second to none. We have to improve our staff and the services we provide to our guests – that makes the difference in the tourism industry.”
Javois pointed out that several resorts have made investments in renovations. The Simpson Bay Beach Resort invested more than $20 million in renovations, Oyster Bay Beach Resort has renovated all unites, created a new marina and upgraded the Infinity Restaurant, while Divi Little Bay also has a renovation plan.
Consumer protection, safety and security, the standard of services and activating the St. Maarten tourism Authority as “a proper functioning body” are all aspects that require attention, Javois said.