The Rise and Fall of the Timeshare GIANTS;
Anfi – the rise
When the Anfi Resort Complex opened for business in 1992 it was certainly one of the world’s most luxurious timeshare resorts. Its focus on quality and service made it stand out way above most of Gran Canaria’s hotels and accommodation. Years later, it’s still one of Europe’s leading timeshare resorts and remains unmatched in Gran Canaria.
Billionaire founder Bjørn Lyng always wanted a quality resort and made sure that he got one. He faced Anfi’s building blocks with stone, built a huge, heart-shaped island and shipped in Caribbean sand for the beach.
Anfi was Lyng’s baby and it cost a fortune. Once the first apartments of Anfi Resort opened, the race was on to get the money back and build more. Gran Canaria’s timeshare boom had started.
Once the resort opened the in-house sales team did pretty much as they chose; it was timeshare’s Wild West period and Anfi’s vast network of salespeople sold timeshares as fast as Lyng could build the resort.
Bjørn Lyng
Although Bjørn Lyng funded the entire project he knew little about the mechanics of selling timeshare, this responsibility fell to Calvin Lucock as overall Director and Neil Cunliffe who was eventually elevated to the position of Sales & Marketing Director. There is no doubt that all the Anfi resorts raised the bar of both prestige and style but also of the almost production line sales methods selling thousands of ownerships each year.
The fall
The fateful day when the law changed but Anfi didn’t
On January 5th 1999, Spain brought in a strict timeshare law (Ley 42/98). It outlawed lots of the things Anfi, and other timeshare firms, were putting in their contracts. But the resorts didn’t change their sales tactics or contracts; they just carried on as if they were above the law.
Spanish timeshare resorts, including Anfi were breaking the law every day. The Wild West days were over and the sheriff was heading into town.
Did Lyng know that thousands of the contracts his sales teams were signing were illegal? It’s hard to imagine that a man who built a billion euro empire didn’t know exactly what was going on. Perhaps, like many successful men, he thought he could make any problem go away. He certainly had a huge legal team.
In 2015, the first case against Anfi reached the Spanish Supreme Court. Inevitably, because the purchase contract was so illegal, Anfi lost. Then it lost again, and again. The result is that Anfi is now returning money to owners with illegal contracts when the courts order it to. Not because it wants to, but because it has to. Once the Spanish Supreme Court rules, there is no wriggle room no matter how many lawyers you have.
The decade of madness, after 1998, is now costing Anfi dear. As one of Europe’s largest timeshare resorts, it has the highest number of illegal contracts, and the most to lose.
Anfi faces an avalanche of legal cases over the next few years. Nobody knows what the effect will be, but we do know that it will have to pay out when the courts tell it to do so.
Club la Costa – the rise
Club la Costa can trace its beginnings back to 1984 when founder Roy Peires, purchased his first resort, Las Farolas, on the Costa del Sol in. Offering a fixed week timeshare, Peires developed the concept further, expanding rapidly in the 1980s and 90s. In 2013 a strategic decision was made to rebrand the whole company as CLC World Resorts & Hotels. At the time of writing, there are 32 resorts under the CLC World banner. CLC have also diversified holiday accommodation into luxury yachts and canal boats.
Unlike Bjørn Lyng, Roy Peires is very much “hands on” and is in direct control of future developments and the overall direction of the company. Peires, originally from South Africa, celebrates his 70th birthday this year with no sign of slowing down.
The fall
Much like Anfi, CLC World has been caught up in the selling of timeshare with illegal contracts. Estimates are that there have been awards from the Spanish courts amounting to in excess of £20m.
Recently CLC World took the unusual step of laying off its sales staff, as they said “until further notice”. Within a month of this announcement CLC issued another statement confirming they had closed their sales teams indefinitely. This statement was followed by Club la Costa (UK) PLC being placed into administration; this company was responsible for sales of new timeshare.
Further news broke in December 2020 confirming that four of their Spanish companies have applied to be placed into liquidation; one of the companies was the Spanish branch of the UK holding company Club la Costa (UK) PLC i.e. Surcursal en España which is understandable bearing in mind the UK holding company has been placed into administration, as stated above.
It is a well known fact that CLC World has an active estate agency division known as CLC estates, the recent moves as stated above also saw the creation of another new company name, Jade Realty Ltd (formally Club la Costa Ltd) Maybe with all the associated problems and bad press surrounding timeshare, Roy Peires just wants’ out, sell the lot and be done with timeshare.
Silverpoint Vacations – the rise
Formally known as Resort Properties, Silverpoint was the sales function for the selling of timeshare at Hollywood Mirage Club, Beverly Hills Heights, Beverly Hills Club, Palm Beach Club and Club Paradiso/Paramount all on the island of Tenerife. Resort Properties was founded in the eighties by British businessman Bob Trotta, who for a few months was at the front of operations.
Shortly after a certain Mark Cushway, was appointed executive director of the Resort Properties and then CEO of Silverpoint Vacations. Cushway took the company from strength to strength but unfortunately carried on to create various “investment” schemes that could, at best, be described as dubious and at worse a ponzi scheme.
There is no doubt that Silverpoint were one of the giants in the timeshare industry but like many it all went so badly wrong.
The fall
Silverpoint suffered dramatically from their total disregard of Spanish timeshare legislation which involved not only hundreds of judgements against them but the forced liquidation of the entire company leaving many court case clients, who won their day in court, losing out on the compensation due to them.
Not satisfied with just timeshare, Mark Cushway went on to develop a product called the Excel Overseas Lodging Participation Programme (ELLP) which proved to be his downfall.
In principal it was a great idea, if it was being run by somebody trustworthy! Clients gave him €40,000 and in exchange they would get a return of approximately 6% per annum and after 10 years receive back the initial investment, they were also able to pull out after 6 years, but returns would obviously cease.
These ´interest payments´ were probably only a refund of the client’s own money, not the first time he used this stunt.
The ELLP was an excellent idea on paper, however most clients have only received interest payments for the first year, some of the original buyers might have been lucky enough to have had 2 payments but most have received nothing instead they received a letter from Alvarez & Marsal Cayman Islands Ltd in the British Virgin Islands to let them know that Excel Overseas Holding Ltd has gone into liquidation.
Mark Cushway forever blamed the greed of the clients on the reason why they bought more & more weeks, or the latest ´upgrade´ stopping short of blaming his own greed and total lack of integrity.
Greed and downright deception was downfall of Silverpoint.
Diamond Resorts Europe – the rise
It could never be argued that Diamond resorts have not created a good product and some spectacular resorts in their home country of America, their resorts in Europe were equally nice and new sales were taking place to what appeared to be acceptable amounts. With nearly 50 resorts to choose from in Europe they certainly gave owners a good choice of both resorts and countries.
Being part of one of the world’s largest timeshare groups, Diamond Resorts Europe also brought with it the security and credibility associated with holiday ownership.
The fall
In June 2016 Diamond Resorts International Inc said it agreed to be bought by private equity firm Apollo Global Management for about $2.2 billion. The news at Diamond Resorts had been relatively quiet since Apollo Global took over the helm. Business had been ticking along as usual, until November 2017 when all sales and concierge staff arrived at work for their usual routine.
All staff were summoned to meetings at various locations around Europe. The meetings all took place at the same. These meetings confirmed the upcoming changes to the group, the content of which was a great disappointment of as many as 1000 employees throughout Europe.
With only 7 weeks until Christmas, staff at more than 15 European locations were told to clear out their desks and prepare for the closure of the offices. All prospects being toured around the resorts were asked to leave the premises straight after their presentation.
The explanation that was given to staff was that Europe had targets to keep to in order to continue with their sales operation in Europe. It was originally expected to be measured over a 2-year window, however, there has not even been a full year since the takeover and apparently due to falling sales figures, drastic measures had to be taken.
Falling sales were just one of the problems, a less than acceptable fractional product being sold looked as if it could possibly cause future problems. This together with mounting claims for the selling of illegal contracts in the Spanish resorts compounded the problems.
Diamond Europe still has a few in house sales personnel at their resorts, but nothing like the numbers in the heady days.
Our conclusion
We have only explored some of the largest groups within Europe but no doubt similar stories may be told by the smaller groups. Without doubt, the generally ignored Spanish legislation has had an impact on the finances of many developers and resorts and will continue to do so for a considerable time to come.
The way we holiday has changed dramatically in the past two decades; the package tour operators are all but gone. The high street, that was once full of travel agents, now has one, if you are lucky. The plethora of TV adverts for holidays that started on Boxing Day are a thing of the past.
Booking flights and accommodation via the internet is now the normal, travelling outside Europe to the worlds exotica is no longer the sole domain of the rich, and in real terms, the cost is coming down year on year, the same cannot be said for timeshare.
Another facet of change is that with the advent of online booking platforms, the very same timeshare resorts that were once sold for “members only” exclusive use now appear on most of these online platforms and frighteningly often for a cost less than members annual maintenance fees.
Ok exchange programmes exist, so having to go to the same resort at the same time of year is for the most part yesterday’s story but exchanging one week in Spain will certainly not get you to the Caribbean! Also getting where and when you want to is also a hit or miss game of chance, some may say you have more chance of winning the National Lottery.
If you were the owner of a timeshare resort, given the problems highlighted above, would it not make sense to get rid of all the moaning timeshare owners, sell the real estate and live happily ever after? We will leave you with that thought.
For more information regarding this article or assistance in any other timeshare related issues please contact the TCA on 01908 881058 or email: info@TimeshareConsumerAssociation.org.uk