The new entrant in shared vacation home ownership builds groups of 100 participants who collectively own 12 luxury residences.
The initial capital contribution is $300,000, so that homes are owned debt free typically through an LLC structure. Lifestyle Asset Group is the management company that finds and acquires the homes, manages them and then arranges the sale at the end of the 7 year term for each LLC. This debt free structure and specific exit date are designed to provide security to the participants.
Lifestyle Assets is building up regional groups, initially with an East Coast and West Coast group. Most of the locations will be 12 month travel destinations rather than having very seasonal homes. "Each of our properties is in a prime location that our equity owners will appreciate and want to return to over the length of the LLC." said Rich Keith CEO of Lifestyle Assets.
The East Coast group has two homes lined up in Cap Cana, Dominican Republic and
The first two West Coast homes are an expansive, four-bedroom villa overlooking the Ocean Course in the Cabo de Sol residential community in Cabo San Lucas, Mexico and Blue Sky Lodge in Deer Valley, Utah, a 6,700 square-feet, five-bedrooms home with ski area views. Future locations in this region are
Points Based Reservation System
Using a point-based, online reservation system, you choose the residence where you want to vacation for the days or weeks you desire. Each equity owner receives 5,000 credits per year in exchange for their $30,000 in annual maintenance costs and usage.
Each night is assigned a credit value that varies by type of destination, property size, arrival day, and time of year. For example, a one-week stay at a four- or five-bedroom residence during New Years' week might require 1,600 credits whereas a five-night stay in a two-bedroom property during a value season might be 160 credits. Based on this model, equity owners can average between 30 and 40 nights of vacation a year. Although depending on how you use your points, you could enjoy travel for up to eight weeks a year. Equity owners have the option of booking a vacation in their non-home region for a premium.
The leadership team includes Richard Keith, CEO; Ed Powers, President and COO; Karla Jones, SVP of Sales; and Tommy Robinson, SVP of Finance who all helped create Private Escapes Destination Clubs, which became the third largest destination club in the sector. “We’ve taken the lessons of the last 7 years and started over to create the perfect model” Rich Keith told SherpaReport.
The management team does not own the LLC which buys the properties. Instead they make their money by taking a 5% initial subscription fee from the capital contribution, there’s a management fee included in the annual dues and they receive 10% of any gain on the final sale of the homes. “We’re looking to take advantage of historically low real estate prices” said Rich Keith.
With their launch Lifestyle Asset Group are offering the first 35 participants the ability to travel to any of the planned 24 locations, so they can use the homes in both East and West regions. For later members there will be a premium charge to use homes outside your own region.