Destination clubs are a relatively new, luxury travel “hybrid” that attempts to combine the best aspects of vacation home ownership and five-star hotels. Destination clubs provide members with access to fully furnished, single family homes and condo suites in popular resort and urban destinations. Membership deposits range from $50,000 to $3 million with annual dues from $8,000 to $50,000. Fees typically include travel planning, concierge and housekeeping services. Helium Report defines destination clubs as high-end vacation providers that meet three general criteria: shared access, multi-bedroom residences in multiple destinations and membership-based, non-equity programs.

Shared Access
It’s important to note that destination clubs are fundamentally a shared-usage model. Unlike private residence clubs, destination club members do not own or have deeded rights to a specific residence in a specific location. Rather, members join a destination club for the ability to spend vacations at any of the homes in a club’s portfolio for a specific amount of time each year (typically two to five weeks, depending on the club and program). In general, destination clubs maintain a ratio of six members per home to ensure sufficient availability at each property. Availability varies by season and location. Holiday travel among members is often booked in advance through a rotating priority system. Space-available reservations provide members with additional access for spontaneous travel.

See our chart of destination club alternatives.

Multi-Bedroom Residences, Multiple Destinations
Ranging from 2,000 to 6,000 square feet in size, destination club homes are typically outfitted with top-of-the-line furnishings, gourmet kitchens and high-end audio/video equipment. The unique value proposition destination clubs offer when compared to other luxury travel alternatives resides mainly in the ability for members to access multi-bedroom homes in multiple locations. Both luxury hotels and private residence clubs (PRCs) are typically one- to three-bedroom options. Five-star hotels provide upscale accommodations in many destinations, but it’s difficult for families or large parties to book adjoining rooms. Private residence clubs offer a similar product in a single destination. Some PRCs offer exchange programs to access other properties, but usage is primarily for a specific unit in a specific location. Second homes and villa rentals provide more bedrooms but share the PRC’s limitation of a single destination. Vacation homes include significant additional expenses such as maintenance and property taxes and are often used only four to eight weeks each year.

Membership, Not Equity
Destination clubs are generally membership-based models with no equity ownership of any real estate assets. Recently, new clubs have begun innovating on the membership model and created “equity” offerings for members to share in the appreciation of real estate assets. In general, consumers should consider destination clubs as a lifestyle investment and not as a financial investment. Memberships cannot be resold and resignation policies typically require the addition of new members before a deposit is refunded. In this respect, clubs differ from private residence clubs, fractional real estate and timeshares.

Conclusions
When you compare the costs, a destination-club membership is a viable and attractive option for families whotravel frequently to many locations. In addition to providing the residences and on-site services, the club essentially operates as an outsourced, all-inclusive vacation planner.