At a recent conference of the Timeshare Board Members Association (TBMA), Jan Samson, Vice President Corporate and Business Development, and Alex Chamblin, Jr., Executive Vice President Resort Operations with Capital Vacations, headquartered in Myrtle Beach, SC, led a panel discussion about the common issues facing independent timeshare resorts.
In serving over 200 timeshare resorts, Capital Vacations fully understands the challenges and has significantly expanded its resources to provide timeshare owners’ associations solutions to help keep them viable for the future. While specific challenges can vary by location and resort type, there are some common issues with which many resorts grapple. Samson and Chamblin discussed the following topics as key challenges that independent resorts face.
1. Insurance Premiums: Increasing insurance premiums is a significant concern, especially for coastal properties. The risk of natural disasters, like hurricanes and sea-level rise, has led to higher insurance costs. This can strain the resort’s budget and make it challenging to maintain financial stability.
2. Aging Infrastructure: Many independent resorts have aging infrastructure, which requires ongoing maintenance and updates. This includes repairs to buildings, pools, roads, and other amenities. The cost of maintaining and modernizing these facilities can be a substantial budget challenge.
3. Labor Costs: Labor costs, including competitive wages, benefits, and the need to attract and retain qualified staff, are a concern for many resorts. Labor shortages can lead to higher wages and recruitment challenges.
4. Environmental Concerns: Resorts in locations vulnerable to environmental issues such as beach erosion, snowfall variability, or water scarcity must adapt to these changing conditions. Strategies for adapting to climate change can be expensive.
5. Reserve Fund and Capital Planning: Ensuring the adequacy of reserve funds and implementing effective long-term capital planning is essential for resorts. A lack of proper planning can result in deferred maintenance, which can lead to higher costs in the long run.
6. Competition: The vacation industry is highly competitive, with new resorts and lodging options constantly emerging. Legacy Independent resorts need to compete by offering desirable amenities and experiences to attract owners, guests, and renters.
7. Changing Owner Demographics: As the demographics of owners change, resorts may need to adapt to the preferences of new generations. Some owners may want more flexible travel options, including points-based systems and more varied experiences.
8. Legal and Regulatory Challenges: Resorts must navigate complex legal and regulatory landscapes, which can vary significantly from one location to another. Compliance with local laws and regulations can result in additional costs and administrative burdens.
In addressing these challenges, collaboration is crucial between boards, their management company, and owners. Open communication, strategic planning, and a commitment to adapt to changing conditions are essential for legacy independent resorts to evolve and thrive. Resort communities should consider options like technology upgrades, sustainability initiatives, alternative revenue sources, and seeking government support for insurance-related issues to help mitigate some of these challenges. It’s important to develop a clear long-term strategy to address these challenges and secure the financial viability of the resort.
Contact Capital Vacations to learn more about its resort management services and solutions. Call 843-213-2383 or email learnmore@capitalvacations.com.