21 May 2005

Startup to timeshare luxury suites

A novel concept to the marketing of luxury suites was launched today by a startup called Owner's Pass. John Arledge and Peter Cochran created the Los Gatos-based firm, which will sell timeshare packages of luxury suites. The packages not only bring down the often prohibitively high cost of suites ($100,000 per year or more), but they'll also offer the opportunity to use a single fee to cover multiple sports. More details are available in an Oakland Tribune article.

When I first saw the article, I thought, "Why hasn't anyone done this before?" Then it occurred to me that the major pro sports franchises are often in competition with one another and do their best to lock their customers into annual or even multiyear deals. Sometimes it even appears that the market is oversaturated. As for the startup, buying leases for the 6 major franchises here in order to timeshare them can cost upwards of $500,000 a year, a risky capital cost for a business whose customer base has potential, but is yet unproven. Still, there are many firms who have a hard time justifying annual leases on suites, and this could very well open up the market significantly for them as well as smaller companies. If the Owner's Pass business model works, they will expand to other markets, and they may become a cornerstone of a huge secondary suite sales market. Good luck to them.