Cambay Resort Project

8/3/2019 Cambay Resort Project

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EXECUTIVE SUMMARY

Cambay Family Holidays Club (CFHC) is the vacation ownership business vertical of

Neesa Leisure Ltd. (NLL), an integrated hospitality management company.

Cambay Family Holidays Club powered by RCI introduces for the first time,

internationally acclaimed Point System for the timeshare market in India. Through this

point system, CFHC offers cost effective holidays with endless benefits at excellent

locations across the globe. CFHC customers are now benefited with more choice and

flexibility on the type, size, quality and duration of holidays; transparency of buying

power as usage of points is always precisely calculated and optimum utilization of the

timeshare ownership.

The main objective of this project was to understand the Timeshare market in India, with

a special focus on Cambay family holidays. The competitive environment, customer’s

needs and expectations and various products available in market.

Since I was given the task of explaining the products to walk-in customers and selling

the same, the research methodology adopted was qualitative interviews andobservation of customer behavior.



INDUSTRY PROFILE

.1 Tourism in India

Tourism in India is the largest service industry, with a contribution of 6.23% to the

national GDP and 8.78% of the total employment in India. India witnesses more than5.5 million annual foreign tourist arrivals and 740 million domestic tourism visits. The

tourism industry in India generated about 100 US$ billion in 2008 and that is expected

to increase to US$275.5 billion by 2018 at a 9.4% annual growth rate. In the year 2010,

17.9 million foreign tourists visited India. Majority of foreign tourists come from USA and

UK. Maharashtra, Tamil Nadu, Delhi, Uttar Pradesh and Rajasthan are the top 5 states

to receive inbound tourists. Domestic tourism in the same year was massive at 740

million. Andhra Pradesh, Uttar Pradesh, Tamil Nadu and Maharashtra received the big

share of these visitors. Ministry of Tourism is the nodal agency to formulate national

policies and programmes for the development and promotion of tourism. In the process,

the Ministry consults and collaborates with other stakeholders in the sector includingvarious Central Ministries/agencies, the State Governments/ union Territories and the

representatives of the private sector. Concerted efforts are being made to promote new

forms of tourism such as rural, cruise, medical and eco-tourism. The Ministry of Tourism

is the nodal agency for the development and promotion of tourism in India and

maintains the Incredible India campaign.

According to World Travel and Tourism Council, India will be a tourism hotspot from

2009–2018, having the highest 10-year growth potential. The Travel & TourismCompetitiveness Report 2007 ranked tourism in India 6th in terms of price

competitiveness and 39th in terms of safety and security. Despite short- and medium-

term setbacks, such as shortage of hotel rooms,tourism revenues are expected to surge

by 42% from 2007 to 2017. India's 5,000 years of history, its length, breadth and the

variety of geographic features make its tourism basket large and varied. It presents

heritage and cultural tourism along with medical, business and sports tourism. India has

a growing medical tourism sector. The 2010 Commonwealth Games in Delhi were

expected to significantly boost tourism in India.



.2 Vacation Ownership

Vacation ownership essentially means owning a week annually at a resort. While buying

vacation ownership, one can choose the type of unit, the week and the location where

one would like to own holiday weeks. For instance, one can choose to own a one-

bedroom unit in the second week of December, every year, in a specified resort in Goa.This week can then be traded for a week at a different (similar sized) resort of choice, in

a different destination. The availability of the week in demand depends on several

factors, including the trading value of the vacation ownership week being exchanged.

This is where exchanges companies also fit in. These companies charge an exchange

fee to arrange the holiday week that customer has requested. An additional advantage

of this exchange is when one travels to an overseas destination, one don't have to pay

in foreign currency for an accommodation. All that the customer has to pay is theexchange fee once they have a vacation ownership.

Cost of the vacation ownership: The cost of vacation depends on the size of the unit,

the location and amenities at the resort, the time of the year one wants one’s holiday,

the specific period of the vacation per year, and other factors. A vacation in the peak

season at a very popular resort and place will cost more than a resort in an offbeat

destination purchased in off-season.

History

The notion of the term "time-share" was originally created in Europe in the

1960s.Hapimag, a ski resort developer in the French Alps, was experiencing trouble

finding customers for his high priced resort. Realizing that coffee shops sold cake only

by the slice (since the entire cake was too expensive and could not be consumed at one

sitting) He marketed his resort by encouraging guests to "stop renting a room" and,

instead, "buy the hotel". Success followed and the concept of partial ownership was

embraced by developers worldwide, boosting sales of surplus condominium units at a

time when the resort industry was depressed.

Due to the promise of exchange, these units, called "vacation ownership" by the

industry, often sell regardless of their deeded resort (most are deeded into a certain

resort site, though other forms of use do exist). What is not often disclosed is that all



differ in trading power. If one is in Hawaii or Southern California it will exchange

extremely well; however, those areas are some of the most expensive in the world,

subject to demand typical of a highly trafficked vacation area. The vast majority of

inventory flows briskly through two international exchange companies: RCI and Interval

International.

Industry

This concept has attracted many resort developers and prominent hoteliers, such as

Starwood, Wyndham, Accor, Hyatt, Hilton, Marriott, and Disney. Vacation ownership has

proven to be lucrative for stakeholders in these major resort families, due to its

popularity with vacation-goers. This form of lodging has spawned a variety of products

sold on similar occupancy schemes; cars, planes, boats, condo-hotel units and luxury

fractional properties (at which affluent guests may stay for as long as a quarter of ayear, and which often command a six-figure price tag)

Scope of the industry

The scope of today's timeshare industry in the USA is well documented. The ARDA

International Foundation (AIF), which is the research arm of the American Resort

Development Association (ARDA), reports there are 1,604 timeshare resorts, with

154,439 units, in the USA as of January 1, 2006 (AIF 2006). Though reportedly fewer

than six percent of U.S. households own one, the prevalence of vacation ownershipcontinues to expand. Approximately 4.4 million households own one or more U.S.

weekly intervals or points-equivalent as of January 1, 2007, an increase of sixteen

percent from the prior year.

About half of the resorts in the USA are currently selling, generating sales of $8.6 billion

in 2005 (AIF 2006).

The global scope of the industry is not as readily quantified. Interval International, one of

the two major exchange companies, reports there are 1,800 resorts in nearly 80

countries, with 2004 worldwide sales estimated at nearly $11.8 billion (Interval

International 2006). RCI has more than 4,000 resorts in nearly 100 countries.



A 2001 report estimated there to be 5,425 timeshare resorts worldwide, of which around

31% are situated in North America, 25% in Europe, 16% in Latin America (where

Mexico leads with 40% in the region). Emerging resorts in Asia offers 14%, led by

Japan, but with Thailand and India increasingly prominent.

Legislation

The industry is regulated in all countries where resorts are located. In Europe, it is

regulated by European and by national legislation.[12] In 1994, the European

Communities adopted "The European Directive 94/47/EC of the European Parliament

and Council on the protection of purchasers in respect of certain aspects of contracts

relating to the purchase of the right to use immovable properties on a timeshare basis",

which was subject to recent review[13] which resulted in the adoption on 14 January

2009 of the European Directive 2008/122/EC.Methods of use

Owners can:

• Use their usage time

• Rent out their owned usage

• Give it as a gift

• Donate it to a charity

• Exchange internally within the same resort or resort group

• Exchange externally into thousands of other resorts

• Sell it either through traditional advertising, online advertising or by using a

licensed broker

Recently, with most point systems, owners may elect to:

•

Assign their usage time to the point system to be exchanged for airline tickets,hotels, travel packages, cruises, amusement park tickets;

• Instead of renting all their actual usage time, rent part of their points without

actually getting any usage time and use the rest of the points;

• Rent more points from either the internal exchange entity or another owner to get

a larger unit or more vacation time or at a better location;



• Save or move points from one year to another.

.3 Timeshare Market in India

With India growing as one of the key emerging markets in the hospitality industry, many

hotels and holiday homes have started revamping and reinventing their business

strategies to woo the customers. Factors such as pricing, locations, services and other

things matter for a customer to select between a hotel and a holiday home.

When the holidaying concept took off, many preferred timeshare to hotel. The reason

was simple. They want to be away from home but in a home-like atmosphere. This

attitude made this vacation holiday/timeshare industry to take a shape. When there

were hotels offering services both in budget and premium categories, customerspreferred timeshare resorts when it came to family holidaying.

Vacation ownership, commonly known as timeshare, has been growing globally but

evolving in India and it has become a customer-choice product. It has been creating a

strong impact among Indian customers and has been growing rapidly over the last few

years.

From the consumer’s perspective, timeshare accommodation costs less compared to

hotels. When one becomes a member of a holiday resort, he/she owns a timeshare at a

select resort for 25-30 years. It will offer one week of vacation time, which will be

accumulated up to three weeks.

The choice of accommodations generally offered is: studio, one-bedroom and two-

bedrooms on various seasons. The pricing for the accommodation is also based on

seasons. Owning a timeshare gives the customer value for money. It also gives the right

to use the accommodation and services without having to pay daily room charges. The

room charges are adjusted in the annual maintenance paid by the customer and he/she

will have to pay a nominal price for the food.

The advantage is that consumers can recover the cost in six to eight years within their

25-30-year period. On the business side, the timeshare concept has been showingprofitability.

The Indian timeshare industry has estimated the revenue so far at Rs. 750 crore. There

are major players such as Mahindra Holidays, Royal Goan Beach Club, Sterling

Holidays, Cambay, Country Vacations, Toshali Sands and Avalon.



Growing demand

The demand for timeshare products in India is likely to grow at about 16 per cent

annually from 2006 to 2015, facilitated by supply growth of about 12 per cent annually

over the same period, according to a report released by Group RCI and global real

estate consultants, Cushman & Wakefield, “The spectrum of leisure real estate productsin India”. This is further reflected by the growth in holiday exchange bookings that

increased by 28 per cent in January-November 2008.

The report indicates that the average unit sale for a typical timeshare development is

likely to grow at 3 per cent annually from 2006 to 2015. The average unit cost per day

for a consumer is likely to grow at 4 per cent annually during the same period compared

to 5-8 per cent for a pure hotel product. However, with an estimated 41,600 pure

product hotel rooms across major cities that will be furnished over the next four to fiveyears, the markets are likely to see a drop in occupancy rates and rationalisation of

average room rates in the long-term.

The timeshare industry in India is in its development stage and comprises about 4,640

timeshare units and 1.46 lakh members. Of this, the western region holds the largest

share of members with 42 per cent of the total, followed by South (29 per cent), North

(23 per cent) and East (6 per cent). Radhika Shastry, Managing Director, Group RCI,

India, has stated in the report that shared ownership of real estate, where multiple

individuals own a piece of real-estate, offers considerable potential for developers,operators and financial institutions.

On the business side, some major players operate on a unique integrated mixed use

business and correspondent revenue model. Others take resort creation (land

identification and construction), member acquisition (sales and marketing) and member

management (holiday planning and booking) as one entity.

Assets creation

Generally, most companies initially sell their timeshare memberships to customers and

with that upfront cash flow, the assets are created. The members are entitled to holiday

for an average of 12-15 months from the date of enrollment.



There is assured occupancy even in off-season and it does not go below 50-60 per

cent. As far as revenue is concerned, there are multiple avenues such as upfront

admission fee, entitlement fee, which is charged for 25 years, annual subscription fee

and the interest income is generated from financing membership purchase.

However, it is different in hotels. The project is built first and then sold to the customer later. So there is a long wait for the asset to get created and the revenue to flow in.

As a result, there is high upfront cash flow and high interest rates for the builders. The

occupancy and revenues are highly subject to seasonal and environmental factors.

There is no long-term relationship with consumers.

Key Players in India-

• Club Mahindra Holidays

• Cambay family holidays

• Royal goan Beach club

• Sterling holidays

• Country Vacations

• Avalon



Company’s Profile

Background - Cambay Family Holidays Club (CFHC) is the vacation ownership business

vertical of Neesa Leisure Ltd. (NLL), an integrated hospitality management company.

Cambay Family Holidays Club powered by RCI introduces for the first time,internationally acclaimed Point System for the timeshare market in India. Through this

point system, CFHC offers cost effective holidays with endless benefits at excellentlocations across the globe. CFHC customers are now benefited with more choice andflexibility on the type, size, quality and duration of holidays; transparency of buyingpower as usage of points is always precisely calculated and optimum utilization of thetimeshare ownership.

Neesa Leisure Limited is the first company to launch Cambay Family HolidaysClub - Points program in Indian Timeshare Industry.

Cambay Family Holidays Club (CFHC) is the vacation ownership business vertical of

Neesa Leisure Ltd. (NLL), an integrated hospitality management company.

Cambay Family Holidays Club powered by RCI introduces for the first time,

internationally acclaimed Point System for the timeshare market in India. Through this

point system, CFHC offers cost effective holidays with endless benefits at excellent

locations across the globe. CFHC customers are now benefited with more choice and

flexibility on the type, size, quality and duration of holidays; transparency of buying

power as usage of points is always precisely calculated and optimum utilization of the

timeshare ownership.

CFHC give the customers holidaying preferences in selected own resorts and more

than 4800 RCI affiliated resorts in more than 100 countries and 76 resorts in India. Thismembership is a passport to inflation-free annual holiday, worldwide, for 25 years

Unique Selling Proposition:



• Cambay Family Holidays is a Value for Money proposition for the customers

• The existing and upcoming resorts/hotels are all four star/five star properties

• Presence of Worldclass SPA is a unique feature in all properties

• Choice of Golfing at two different locations

• All resorts are designed/planned with entire family in mind. Indoor/Outdoor

recreation facilities, health clubs, mutli-cuisine restaurants, libraries etc. form a

part of almost all the projects.

• All the properties are located near prominent tourist places

The CFH Membership specification is as mentioned below:

• More choice and flexibility on the type, size, quality and duration of holidays.

• Inflation free holidays for entire family every year for the next 25 years.

• Specially designed theme resorts for the family

• Transparency of buying power as usage of Points always precisely calculated.

•

Complete utilization as one never spends more Points than one needs to.

• Ability to borrow and save Points.

• Increased flexibility such as nightly reservations, purchase of air tickets etc.

• Reservation system operated on first come, first served basis.

• No seasonality Barrier in choosing holidays.

• No rigidity of one week only for holidays. It can be extended as well.

• Provide power to borrow, Save, Extend, Transfer and Rent points.

• CFHC points owners can extends its benefits to Getaway Specials, Bonus

Holidays, Late Deals, Exclusive magazine and extra help and advice.



• Special benefits in CFHC’s own resorts for recreation and entertainment with

unlimited fun in Golfing, pampering your body and senses in the world-class SPA

in all its properties.

• Games etc. at specially designed prices, for its Members.

• Fun Rovers team in each resort just to make sure that every moment of member

holiday is memorable one.

• Spacious and comfortable apartments depending on the size of the family.

• Easy installment options or full payment with the benefit of extra discount

GROUP OVERVIEW

Neesa Leisure Ltd is a public limited company based in Gandhinagar, Gujarat that is on

its way to becoming an Indian hospitality major in the near future. Its flagship brand

Cambay was established in 2005. During the initial stages of development the company

has acquired properties in various cities i.e. Ahmedabad, Gandhinagar, Jodhpur, Jaipur,Udaipur, Gurgaon, Kollam, Goa and Neemrana for structuring hospitality masterpieces.

Cambay offers innovative and integrated hospitality solutions. From corporate

hospitality to holiday management, it ensures best of services in absolute luxury. It is

into hotels, resorts, spas, clubs, golf, time-share and hospitality education.

Cambay properties are all ornamented with contemporary features like golf and spas,which give them a competitive edge. While golf distinctly attracts the corporate world,

spas are a natural extension of modern lifestyle. The latest of all ventures is the

hospitality education institute that will certainly meet the requirement of hospitality

maestros, for the group and also the whole hospitality industry.



Vacation Club

When you buy a timeshare, you buy the right to use holiday accommodation for eachyear. it would mean purchasing the amount of holiday time you need, at the time of theyear you want in the type of accommodation that is right for you. Therefore, the buyingprice is less and the upkeep cost makes sense because the annual charges areshared.

For a one –time purchase price & an annual maintenance fee, timeshare purchasersown their for a predetermined (25) years. Apart from this vacation exchange addsflexibility & variety to timesharing by allowing timeshare owners to trade theaccommodation they have subscribed with other similar accommodation at other throughout the world.

Every unit at each resort has 52 weeks in a year at its disposal of which two weeks areallotted as maintenance weeks which are not sold to any customer. A member canpurchase any week of a particular unit at a particular Destination resorts for a specificseason. This of course, means that there can be a maximum of 50 holiday owners for each unit. The basic concept of a timeshare can therefore be summed up by saying thatit is a one-time payment that entitles you for a week at various resorts every year for 25-30 years . Thus a timeshare ownership may be defined as “A person pays a capital sum



to promoter of a timeshare resort and, in consequence, acquire a right to the useaccommodation and facilities in that resort for a defined period each year.”

Evolution of Point Program in Timeshare:-

First and foremost it is important to understand the traditional timeshare exchangeprogram known as weeks is not broken, has not been taken away or replaced. Butkeeping in mind the changing customer behavior, needs and demand, it is essential tointroduce a more flexible holiday option. Indian Families are demanding greater valuefrom the holidays they take and the money they spend taking them. Points will allow allmembers around the world a complete flexibility to design their personal holiday planaccording to their individual needs at the time.

With Cambay Family Holiday Club – Points, it is best to think of points as currency. You

spend exactly the amount you want, when you want, to get precisely the holiday you’dlike. It really is that simple. Each resort and all categories of holiday accommodation aregiven points values which are determined by season, location, apartment size, resortquality and demand.

Every year members are automatically allocated a number of points based upon whatthey have purchased or own and each location lasts for two years – members may alsosave unused points from their previous year and transfer or gift points, however rules doapply.

The easiest way to explain members simply is to:

• Decide where they want to travel.

• When they want to travel.

• What size accomdation they will need

• how long they want to be on holiday for

• Is there any other way the CFHC can assist.



Products

Explore the Joy of maximum vacation in India



Cambay Hotels & Resorts has luxurious and lavish hotels and resorts all over India

among the top most favorite holiday destinations for spending family vacation. The ten

properties are spread across places namely:

• Cambay Grand (Ahmedabad)

• Cambay Sapphire (Ahmedabad)

• Cambay Spa & Golf Resort (Gandhinagar)

• Cambay Spa & Resort (Udaipur)

• Palm Lagoon By Cambay (Kerala)

• Crystal Beach Resort By Cambay (Goa)

• Cambay Spa & Resort (Jaipur)

• Cambay Golf Resort (Jaipur)

• Cambay Sapphire CRN (Bangalore)

• Cambay Sapphire (Neemrana)

With several projects in the pipeline across the country, the hotel chain expects to offer a variety of destinations to its clientele. By year end, NLL will operate about 711 rooms

and aims to have 15 properties in its portfolio by end of 2013. Currently NLL has ten

properties. The timeshare product is recession and inflation proof. In a bullish market,

people are more inclined to take up a time share membership, which enables them to

take a vacation even when they are on a cost cutting spree. Thus, even in a downturn

market, the memberships are unaffected.

Project Profile



The project is undertaken with an objective to have a clear understanding of the

timeshare market in India as well as detailed observation of customer behavior in the

real market. For the purpose, sales profile was offered to me as cambay holidays, jaipur

office.

Cambay Resort Project

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