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Maskot/Image Source; Flirt/Image Source
What’s Urban?
Defining an urban resort is more about the experience than the popula-
tion density at the locale, says Mark Waltrip, chief operating officer of
Orlando, Florida–based “Las Vegas, for example,
has destination resorts that are more like cruise ships on land,” he
says. “South Beach [in Miami, Florida] is a blend of urban and beach. I
think of an urban destination as someplace that’s not driven primarily
by tourism.”
For Al Mohannad Sharafuddin, CEO and chairman of Dubai-based
it’s the activities guests enjoy while on vaca-
tion. “Although the city is on the beach, 90 percent of the clientele who
have bought here are fans of Dubai as a city,” he explains. “They enjoy
the culture and museums, but they most often come for the night life
and shopping.”
City vacations aren’t just for clubbing and eating out, however. “At
our Boston property, Marriott’s Custom House, we welcome a broad
range of age groups,” says Ed Kinney, global vice president of corpo-
rate affairs and communications for
“Children are very adaptive and love the Boston seaport.”
Pencil Problems
Urban real estate commands some of the highest prices on the market.
Manhattan development sites sold for a record US$657 per square foot
on average in the third quarter of 2013, according to New York–based
Massey Knakal Realty Services. Three purchases were for more than
US$1,000 per square foot. In Singapore, Joe Hickman, vice president
and executive director of Asia/Pacific at Interval International, says fin-
ished apartments sell for as much as US$5,000 per square foot. Prime
residential property in Paris lists at US$2,000 per square foot. It all adds
up to a steep challenge for timeshare developers.
“The whole idea of timeshare is affordable luxury; that’s very diffi-
cult to deliver where prices are so high,” Waltrip says. “The worst hotels
in New York City are selling for US$500,000 a key, and you would have
to put two together to make a timeshare unit.”
“It really comes down to a formula: What can developers afford to
spend on the product including real estate and construction,” explains
Bryan Ten Broek, senior vice president, resort sales and marketing for
“After 2008, there has been a reset that brought
prices down to where they can pencil out in some areas.”
At Marriott, there’s great interest in developing urban resorts both
in the U.S. and internationally. “It does come with challenges,” Kinney
says. “We have spent 30 years establishing the brand promise. Urban
resorts may have to be a little smaller or have accommodations that are
more similar to hotels. We have to condition owners properly so that
expectations are clear.”
Do Owners Get the Picture?
Because owners will be dining out and exploring the city rather than
spending time in their units, some amenities aren’t as important. “The
urban experience includes dining out, so maybe we wouldn’t need full
kitchens,” Kinney says.
Waltrip notes that space is also something to consider. “Our guests
are used to having 1,200 square feet. We can’t give them all the ameni-
ties they’re used to,” he says of urban accommodations. “We have to
find a way to maintain the value proposition; that’s the challenge. The
main thing is making sure that the guests are happy.”
Hickman believes owners get the picture. “In an urban destination,
you don’t need restaurants [on property] or full kitchens,” he says.
“People eat breakfast, then don’t come back until bedtime. They don’t
use the pool because they’re out all the time. They understand that if
you’re going to a major city, the resort will be different.”
Shell has three resorts in San Francisco, one of the most expensive
cities in the U.S., as well as the Inn at the Park in San Diego. “Although
units may be smaller, there’s an efficient use of all available space,”
Chamblin says. “Owners and guests enjoy well-appointed units with
updated amenities, and some feature separate bedrooms, living areas,
December 15 article in USA Today described a booming
hotel market in Manhattan, with occupancy averaging
85 percent in 2013, and a 175-square-foot (16.25
square meters) room at Yotel New York commanding a
rate of US$289 a night. The Big Apple is not alone, as the world’s
largest cities are rising in popularity as vacation destinations.
“There’s a groundswell of opinion that millennials are more
interested in urban vacations,” says Simon Jaworski of Leger, a
Washington, Pennsylvania–based research firm. “This represents a
coming together of two major trends. First, the trend toward shorter
vacations, and, second, that millennials want new experiences and
to see the world. The idea of taking a week, going somewhere
warm, and just relaxing may hold some interest, but they’re going to
want to see London and Paris and Singapore, too.”
Alex Chamblin Jr., vice president of resort operations, Western
Division, at can speak from experience. “We’ve
seen a rise in interest from our owners in urban destinations,” he
says. “As our target market continues to change, we understand
that people want options. Our owners still love their beach and ski
experiences, but by adding urban resort locations, they can have a
whole new timeshare experience.”
What does the trend bode for timeshare developers and
exchange companies? It’s hard to say as the high price of real estate
in these markets may mean the traditional timeshare experience —
two bedrooms, lots of room to spread out, and a full kitchen — is
prohibitively expensive. Still, this is an industry known for finding a
way. Here, Vacation Industry Review looks at global demand for
urban timesharing and how developers may meet that demand.