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Making the most of the changing vacation investment industry

by Corben Grant on 13 Jun 2022

There are some industries that simply don’t go out of style. One is real estate – everyone needs a place to stay after all – and another is the vacation industry, which thrives from the constant stream of people looking to get a break from their everyday lives. Between the two is the massive industries of vacation real estate and vacation investments where people hope to grow their wealth while enjoying the lifestyle benefits. Despite the huge popularity of the vacation investment industry, you may be surprised to learn that new innovations are still being made all the time.

Unfortunately, in the past, the ability to make good money in vacation investments was not always available to the average investor. For a long time, the industry was dominated by large hotel and resort corporations who failed to provide the best returns for investors, even when they claimed to do so. Now, however, things are changing, thanks in large part to new technology and investment options that allow investors to unlock the value of their vacation spending and see even better returns.

We spoke with Craig Shawn Williamson, an investor and businessman with over 20 years of experience in the vacation real estate industry. In addition to his work in the field, he is the author of a book on the topic of vacation rentals and is the CEO of ResClub, an investment firm that offers hassle-free vacation investments with fixed annual returns across a number of packages.

We spoke to Williamson about his own history in the vacation real estate industry, the many changes he has seen over the course of over 20 years, and how the state of vacation investing is changing even today. Under the old way of doing things, Williamson explains investors would invest in a portion of a unit from a resort who would rent your unit to guests when you weren’t using it for your vacation. The problem is that few people made the money they hoped with these sorts of deals. Hotels would prefer to rent their own rooms than to share income with investors. With so much of the field being dominated by large hotel and resort companies, there were few options for a single investor to make things fairer.

“Nobody ever made money, at least in my experience, unless you were in a very special location or a special niche,” recalled Williamson. “Along comes these new vacation rental services like AirBnb and VRBO and it just exploded. Now, instead of fighting to get their units into the rental pool of hotels, developers said: let's just form a vacation rental management company and build the resort ourselves. New technology helped to lower costs of renting and managing units and now it's no longer on the hotels to do the heavy lifting,”

According to Williamson, this new freedom was the key to a massive expansion of the vacation rental industry. However, things still weren’t perfect for the investors. He notes that while these vacation clubs have their purpose, they were often “predatory” in their business models, offering people great vacation opportunities but not the best returns on their invested dollar.

“The bottom line is if you don't use it, you lose those allotted weeks and you're not making income on it. On one hand, it's emotionally a great purchase because you're literally hard scheduling your family vacation every year. On the logical side of it, however, it doesn't make a lot of financial sense,” said Williamson. “It's really just a discounted vacation and there are a lot of other ways to get a discounted vacation without the same kind of constraints. But, there is no way to profit off of the dollars that you allocate every year to that vacation. If these companies are deploying these units as rentals and getting that income, why is none of that being passed through to the members when it's the member's dollars that bought that real estate? I always thought that was a little bit unfair.”

Recognizing the opportunity for more equitable use of families' vacation dollars, Williamson drew upon his multifaceted experience in the industry as well as the experience of a well-constructed team to devise their own vacation investment offering. Using his team's expertise in real estate and finance, they are able to select only the most reliable and highest performing investments and then pass the returns on to investors. Combining stringent investment criteria and new technologies, Williamson’s ResClub was able to innovate even further in the rapidly growing vacation rental industry.

Today, there is no shortage of offers that investors can use to generate wealth in vacation rentals, including doing the hard work themselves to purchase and manage a property. This can be a profitable endeavour but it comes with a lot of headaches, growing pains, and risks.

Like other vacation investment programs, ResClub offers investors the opportunity to invest money while enjoying the properties the firm manages but with a few major differences. The first is fixed returns that scale inversely to how much usage of the vacation property you want, up to an 8% annual return. The firm also offers investors a path to ownership through its short-term investment plans, allowing you to convert your investment dollars into part of your purchase at the end of the term. Furthermore, the company has partnered with travel providers to offer their club members access to destinations around the world at discounted rates. Through their travel portal, investors who love to travel often can make their vacation dollars go even further once they’ve used their allotted weeks at ResClub’s own properties.

Finally, Williamson recognized the fact that many of his would-be investors thought his offer may be too good to be true. To put minds at ease, ResClub worked with the U.S. Securities and Exchange Commission (SEC) to register their membership plans as SEC-regulated securities, providing investors with transparency into filings, reports, and offering an extra level of security.

So far, the response from investors has been great, Williamson boasts, and he predicts the company and the industry as a whole to only continue developing as more and more people come to recognize the opportunities available beyond the standard investments they may be familiar with. Currently, ResClub manages resorts in Florida, Costa Rica, Las Vegas, and more, and plans to continue its growth in even more new areas for investors to enjoy.

Both ResClub membership and short-term investment programs are open to accredited investors in Canada and there are multiple investment options available to choose from that suit you best. To learn more about how ResClub can help you invest and maximize the value of your vacation dollars, visit ResClub.

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