Macdonald Resorts is set to offer a landmark proposal to their timeshare owners.
The company, which has resorts in the U.K. and Spain, has agreed to offer timeshare owners a ground-breaking deal to exit their existing in-perpetuity agreements.
Following extensive negotiations with the club committees of its resorts, the company has finalised plans that will enable members to have the right to exit.
While the existing timeshare products have been highly popular over many decades, there has been pressure in recent years to provide an exit route for those wishing to end their partial ownership.
The new proposals will have to be approved by the members of each club at Special General Meetings in the coming weeks. It is hoped that owners will vote through these landmark changes, which will undoubtedly have a ripple effect throughout the entire timeshare industry.
Subject to approval the Clubs will convert from a fixed week/fixed unit basis to a more flexible week/flexible unit points club system that has a built in exit mechanism commencing in 2014.
Owners wishing to relinquish their ownership rights will be able to do so either entirely or in part if they own multiple weeks on paying a multiple of four times their current annual management charge per week. Exiting owners will receive two free weeks holiday accommodation as a loyalty thank you per week of ownership.
Part of the one-off exit charge will go towards ensuring that the future quality and standards of the lodges and apartments remain at the highest of standards as 25 per cent of the payment will go directly to the clubs’ sinking funds.
Macdonald Resorts will also be compensated for its loss of contractual rights with the balance. It has a need to protect its business long after owners may decide to leave to ensure business continuity. Owners will have the opportunity to exit every two years if the proposals are adopted.
Owners who continue with their membership will remain as members of their chosen club. The proposed points’ club system will allocate points on an agreed scale that will allow members to utilise a more flexible reservation system including the right to save or borrow points to/from a future year.
These points will also provide owners with access to all other Macdonald Resorts points clubs enabling those owners who wish to travel less the option to holiday closer to home.
Simon Jackson, chief executive officer, Macdonald Resorts, commented: “A tremendous amount of effort has gone into creating this exciting but, in our view, essential new opportunity for owners.
“As a significant owner in our own right across all resorts we are pleased to confirm our full commitment to support this exciting new flexible holiday concept that will meet the needs of owners for many years to come.
“We are confident owners will welcome and support these proposals that will not only reinvigorate and maintain thriving clubs and resorts for owners who want to continue to holiday with us but enable those who wish to exit the opportunity to do so – an industry first for in-perpetuity contracts.”
Harry Taylor, TATOC executive chairman and CEO commented: “Macdonald Resorts should be commended for this initiative that provides a solution to an issue that has blighted the industry in recent years.
“TATOC will provide its full support to Macdonald Resorts and I have asked to join the company on its series of roadshows across the U.K. prior to the SGMs to reiterate this support.”
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