The Resort Development Organisation (RDO) features in numerous articles on this website, most of which are not very flattering, but can they really be the trade body they purport to be for the timeshare industry in Europe? Before we dig deeper we need to establish where the RDO fits into the timeshare jigsaw.
The RDO was originally formed under the name “The Timeshare Council” in June 1990 and then changed its name to Organisation for Timeshare in Europe OTE. In November 2011 the OTE name changed again to the RDO.
To quote directly from the RDO:
“The Resort Development Organisation is the European trade association for the vacation ownership industry, offering advice and information about timeshare.”
From this statement it may be gathered that the RDO covers all facets of the vacation industry but in reality the name says it all “Resort Development”. The RDO is funded entirely by annual fees paid by members. Membership contains a number of companies on the peripheral of the industry such as accountants, solicitors, trust companies and resale companies; however in developer terms, there are only 12 members, many of which are single owner run resorts.
Being totally realistic even taking into account the four largest member developers, we would calculate that the RDO represents no more than 60 resorts, however according to Resorts Condominium International (RCI) there are 903 timeshare resorts in Europe. On this basis the RDO represents less than 7% of the overall resort market in Europe.
Timeshare Europe, a contracting market
Over the past three years we have seen dramatic movements in the sales operations of developers across the continent. In 2017, Diamond Resorts announced the closure of their sales division. In 2020 both Silverpoint and Azure were placed into administration. In the October 2020 Club la Costa announced the temporary closure of all sales activity, this developed into placing its sales companies into administration. Finally, in 2021 the mighty Anfi Resorts placed their sales companies into administration.
Admittedly, some of these moves were engineered to avoid paying compensation to timeshare owners awarded said compensation by the Spanish courts for their ownership contracts being in contravention of Spanish timeshare law, however, not all.
Out of vogue, out of sorts, out of fashion
The title of this paragraph says it all; the contraction referred to above is propagated by a seed change of opinion in both owners and prospective owners in Europe. The outmoded idea of paying a substantial sum up front, which in most cases represents around £20,000 for an entry level purchase, for most this is no longer realistic. Following on, an annual maintenance fee, again at entry level is about £1,000 is once again unrealistic.
When factoring in that timeshare literally loses all its value almost as soon as the ink has dried on the purchase contract, then add in a complete inability to resell, long term tie in and difficulties surrounding holiday availability, you can begin to see why the rot has set in.
Where does the RDO go from here?
This is a difficult to answer. A contracting market means fewer members therefore less income to run the organisation. The global pandemic has affected all industries but because of lockdowns and travel restrictions, the tourism industry has suffered more than most. TCA have heard of no major new developments planned for Europe and certainly no new developers looking to launch on the continent. Being fair, the Wyndham announcement regards Club la Costa may offer a glimmer of hope for the RDO but in reality; even if Wyndham takes over CLC in its entirety this will simply replace one member with another.
Hilton Grand Vacations and Diamond resorts are both members of the RDO but with the joining and future replacement of the Diamond brand with Hilton, this may mean the RDO is one member short with the loss of an estimated considerable contribution paid by Diamond.
Conclusion
For the RDO to survive would it not be a good idea for them to pay a little more attention to existing owners and the plight of high and rising maintenance fees, high costs of exit, which assumes exit is allowed in the first place! Add to this a myriad of smaller inadequacies worrying owners that need addressing, such as availability, maybe this would be a good place for the RDO to start. The industry as a whole should remember, without customers there is no business so surely the message is; look after what you’ve got before you lose the lot.
In Europe, new timeshare sales are dwindling so the importance of keeping owners on board is more important now than ever. Tying them into long term contracts with no apparent way out is no way to gain loyalty. Selling their rights via online platforms such as booking.com thus substantially reducing availability is also extremely short sighted. Keep upping their maintenance fees for no apparent reason, apart from bigger corporate profit is also insane.
Maybe the RDO and associated companies might work on these and other related problems of ownership, but then again with funding from the industry responsible for the problems we doubt this will ever happen.
Just to finish we publish the RDO values as per their website with our comments:
Values
- Enforcing strong business ethics. “What about overselling and making false promises at sales presentations and failure to disclose all facts about ownership.”
- Promoting transparent company practices. “Like disclosing all the facts surrounding ownership and allow real time to study, understand and make an informed decision rather than be cornered into signing on the day.”
- Fostering rigorous adherence to legislation. “Really? What about all the illegal Spanish timeshare contracts sold by RDO members?”
- Respecting members, affiliates and consumers. “For sure the RDO respect their members and affiliates but when it comes to the consumer?”
The majority of the content in this article is taken directly from the RDO website. The very same website includes a “news & Information” tab but when exploring the content all we see is the RDO blowing smoke for their members. Bearing in mind the statement above “Fostering rigorous adherence to legislation” we find it odd that there is no mention of the timeshare law in Spain being totally disregarded by RDO members with disastrous consequences from the thousands of Spanish court cases that have gone against them.
There is also scant coverage of the devious tactics employed by members Club la Costa, Anfi and former member Silverpoint who have all engineered insolvency to avoid satisfying the sentences passed down by the Spanish courts. At worst we would have thought this would make a news item, at best, in accordance with clause 3.5 of the RDO Code of Conduct, which states:
“To comply with all laws, which apply to Member’s, business in the jurisdiction in which the Member operates.”
The offending members should have had their membership terminated, but did they? Of course not.
As a service provider for an industry that seems to shun change and evolution we ask “are the RDO a spent force?” Well if both the industry and the RDO don’t change and evolve the answer will probably be yes.
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