Hotel and Resort Development: Next Wave of Innovation

Transcription

1 Hotel and Resort Development: Next Wave of Innovation Resort and Second-Home Rebound #ULIHotelResort June 20 22, 2016 Omni La Costa Resort and Spa

2 RESORT AND SECOND HOME REBOUND MARKET OVERVIEW ULI Hotel and Resort Development: The Next Wave of Innovation June 21, 2016 Adam Ducker, Managing Director

3 Sales Volume (Thousands) (UNDER APPRECIATED) FACTS ON THE GROUND: VACATION PROPERTIES LEADING HOUSING REBOUND? Residential Sales Volume (Existing and New) by Use Pattern: United States Source: NAR; RCLCO 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 PRIMARY RESIDENCE VACATION PROPERTIES INVESTMENT PROPERTIES TOTAL

4 RCLCO MARKET HOTNESS INDEX RESORT MARKETS MOST DYNAMIC SMALL ECONOMIES IN THE U.S.

5 SECONDS HOMES BROADLY DISPERSED THROUGHOUT THE COUNTY

6 PRICES CATCHING UP TO PREVIOUS PEAK (ALBEIT ALMOST 10 YEARS LATER) Median Sales Price by Use Pattern: United States Source: NAR; RCLCO PRIMARY RESIDENCE VACATION PROPERTIES INVESTMENT PROPERTIES

7 SECOND HOME BUYERS GETTING YOUNGER AS WEALTH RECOVERY GAINS STRENGTH Vacation Home Sales by Age Cohort; Source: NAR; RCLCO 60% 50% 53% 48% 46% 47% % 55% % 30% 20% 40% 46 31% % 28% 26% 26% 26% 26% 27% 44 21% 22% 38% 39% 47 31% 30% 22% 23% 43 16% % 40 0% Under to Median Age 38

8 FLY IN MARKETS STILL HEALTHY -- MUCH ANTICIPATED SHIFT TO DRIVE TO LOCATIONS NEVER MATERIALIZED Second Home Average Distance in Miles from Primary Residence Source: NAR; RCLCO % 23% 14% 21% 14% 11% 10% 16% 15% 17% 26% 20 Miles or Less 28% 20 Miles or Less 21 to 50 Miles 21 to 50 Miles 51 to 100 Miles 51 to 100 Miles 101 to 500 Miles 101 to 500 Miles

9 EVEN HIGH-END VACATION OWNERSHIP STABLE ARGUABLY CONSTRAINED BY LACK OF NEW PRODUCT Vacation Ownership Sales by Product Type: United States; Source: Survey of Consumer Finances 2010 $2,500 $2,000 $1,500 $1,000 $500 $0 Fractional Private Residence Club Destination Club Total

10 Percent of Families with Other Residential Real Estate 60 U.S. SECOND HOME MARKET SPANS INCOME LEVELS, BUT ONLY VERY HIGH END HAS STRUCTURAL EXPANSION Percent of Families with other Residential Real Estate by Income Percentile: United States; Source: Survey of Consumer Finances Less than 25% 25 to 49.9% 50 to 74.9% 75 to 89.9% 90 to 100% Percentile of Net Worth Net Worth $250K-$800K Net Worth $800K+

11 REPORTED INTENT TO PURCHASE TRYING AGAIN TO REBOUND, BUT NO SIGNS OF BEING FROTHY Expressed Intent to Purchase a Second Home in the Next 12 Months Top 10% of U.S. Households by Wealth Source: American Affluence Research Center/RCLCO Annual Survey 12% 10% 8% 6% 4% 2% 0% Plans to Buy Existing Vacation Home Plans to Buy/Build New Vacation Home Total

12 PRODUCT INTEREST VARIED BY LIFESTYLE AND SPENDING POWER; WITH 15%-25% PRICE TO WEALTH PATTERN HOLDING Vacation Home Type and Price Point Preference Among U.S. Households with $1M+ Net Worth; 2015 Source: Resonance Report Vacation Home Home site to build vacation home in the future Vacation condominium Destination club membership Timeshare Private Residence Club membership Hotel Condominium 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% <$500, ,000 to $1,000,000 $1,000,000 to $2,000,000 2,000,000 to $5,000,000 $5,000,000+ 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%