October 21, 2008
Traditional Timeshare Producti

Through the year timeshare developers have built resorts. The vacation timeshare
industry first began to track resort growth in 1975, when 35 resorts were identified.
At year-end 2007 there were 1,641 timeshare resorts located in 47 states. Florida
leads the way with 370 resorts representing 22.5% of all U.S. timeshare resorts.

These timeshare resorts represent 180,200 units for an average resort size of 110
units. The two-bedroom unit is the most popular, representing 64 percent of all

The timeshare product is sold in weekly increments or intervals. Of the
approximately 9 million available timeshare intervals, 6.5 million intervals are
owned by 4.7 million U.S. households. This translates into 1.4 timeshare weeks
per owner.

Sales volume of traditional timeshare product reached $10.6 billion at year end
2007. This represents a 64% increase in growth since 2003 or an average of 13%
compounded annual growth. There were approximately 551,500 timeshare
intervals sold in 2007 for an average price of $19,216 per interval.

The average occupancy was 80.1 percent in 2007. This amount includes nearly
70 percent who were either owners or exchange guests and more than 10 percent
who were renters or marketing guests.

Industry Outlook

Trends indicate strong industry growth. Sales have seen compounded annual
growth of 13 percent (2003 through 2007). Compounded annual growth rates for
sales price and intervals sold grew in the same time period by six and seven
percent, respectively. Developers plan to build 8,000 units in 2008 and have a
firm commitment to add an additional 30,000 units in 2009 and beyond.

Fractional and Private Residence Club Product ii

Fractional and Private Residence Clubs (PRC) are an upscale version of
timeshare. They feature the purchase and use of extended time periods, and offer
amenities, personal services and furnishing packages comparable to luxury hotels
or resorts. Fractional and PRC resorts are further defined by their size – resorts
tend to be smaller while units tend to be larger than traditional timeshare.
Additionally most of these resorts are located in high vacation demand areas.
Although this is a relatively small segment of the industry in terms of the number of
owners, this segment of the industry has demonstrated rapid growth.
At year end 2007 there were 213 Fractional and Private Residence Club resorts
located in 34 states. Sales volume totaled $2.1 billion.

Timeshare Ownersiii

More than three-fourths of timeshare owners (78.1 percent) are married or have a
domestic partner. Only 23.6 percent have children under 18 living at home. The
mean age of the timeshare owner head of household is 52.6 years old. Fifty
percent are college graduates or have a professional degree. The mean
household income is $82,100.

Timeshare owners love to travel. In 2007 timeshare owners spent an average of
19.5 days on leisure travel. Of the days spent away from home on leisure travel,
68.2 percent of owners vacationed at the timeshare they own. The average length
of stay on their last timeshare vacation was 7.5 days. Over half of these individuals
traveled more than 500 miles from home on their most recent vacation. And
nearly half of timeshare owners (46.7percent) vacationed as families traveling with
their children or grandchildren.

It should come as no surprise that 84.8 percent of timeshare owners are satisfied
or very satisfied with the timeshare they own.

Looking to the Future

The timeshare product appeals to the Baby Boomer generation. Currently Baby
Boomers represent 55.2 percent of all timeshare owners, and we project that
number will continue to rise as the nearly 76 million Boomers enter into retirement.

This is a generation that values their leisure time. A 2005 Del Webb Baby Boom
Survey, reports that 62 percent of respondents listed travel as their most desired
activity. This is a new generation of retirees that seek more for their retirement.

Timeshare is positioned perfectly to fulfill the Boomer generation demand for a
better way to vacation. Resorts are located throughout the world and the benefit
of exchange makes it possible for Boomers to travel the world, using their
timeshare as vacation collateral. Timeshare units are large, providing public areas
that allow families to spend time together, with sleeping areas that provide privacy
when needed. Amenities and health focused activities offer fun ways for
individuals and families to focus on staying fit.

Timeshare meets the goals of the way we all need to vacation – today and into the
   Source: State of the Vacation Timeshare Industry: United States Study-2008 Edition prepared by Ernst &
Young for the ARDA International Foundation
    Source: The Shared Ownership Resort Real Estate Industry in North America: 2008 prepared by Ragatz
    Source: Vacation Timeshare Owners Report-2008 Edition prepared by Synovate for the ARDA
International Foundation

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