Case pumps $10M
into vacation clubThe AOL co-founder's
investment gives him
a 50 percent stake
in Exclusive Resorts
Steve Case, the America Online co-founder and former AOL Time Warner chairman, has invested $10 million into a company that is tapping a trend in the fast-growing vacation-home industry in Hawaii and elsewhere: vacation clubs.
Essentially a more-evolved -- and far more-expensive -- form of time-sharing, exclusive vacation clubs grant members nearly unlimited access to multimillion-dollar homes in resort areas and cosmopolitan cities around the world. They also offer members the amenities of a five-star hotel, such as concierge service, private chefs and fly-fishing guides.
Case's investment in Exclusive Resorts gives him a 50 percent share in the company started by brothers Brad and Brent Handler.
"I like the fact that, like mortgages, this approach democratizes access, making great vacation homes more accessible and affordable to more people than ever before," Case said in an e-mail message.
"An Exclusive Resorts membership is like having multiple second homes all over," said member Buck Blessing, chief executive of Colorado Springs real-estate investment and development firm Griffis/Blessing Inc. He recently stayed at a Cabo San Lucas, Mexico, house that was staffed with a cook, concierge, driver and other employees.
The company's portfolio of houses, valued at an average of $2.5 million, are in places such as Beaver Creek, New York and Paris. Exclusive Resorts grants members access to more than 30 roomy vacation homes, including homes at Wailea on Maui, the Kohala Coast on the Big Island, four-bedroom villas in the Bahamas and even a two-bedroom apartment on a luxury liner, the World of ResidenSea.
Members pay a $295,000 initiation fee and annual dues ranging from $12,000 to $18,000, depending on the number of guaranteed reservations they want in a year.
The company began to accept memberships 10 months ago and now has membership deposits of more than $10 million a month, Brad Handler said.
Case, who left his post as chairman and chief executive officer of AOL Time Warner this year, serves on the company's board of directors and as head of a corporate advisory committee.
A handful of high-end vacation-club companies have emerged in the past four years hoping to offer an upgrade to the time-share industry. They are positioning themselves as fancier, more flexible and more sophisticated alternatives to other forms of property-ownership clubs.
The clubs' prime targets are well-off people who want the benefits and prestige of owning multiple homes but not the burdens and responsibilities.