TIMESHARE RENTALS

In the periods during which the units operated under a timeshare or “rotational enjoyment” system are “unoccupied”, the units are often rented out by their owner to third parties (tourists) and the holders of rights of occupation can thus obtain an extra income.

The legal nature of this kind of “rentals” in Spain may be subject to debate both on a practical and on a theoretical level, but the issue is not without importance as, if we are talking about a “seasonal rental of a dwelling house”, we may find that the lessor has the obligation to demand that the renter pay a deposit amounting to two months’ rent (despite the rental period being one week), which does not happen in the case of occupation of a tourist unit.

The Urban Lease Act 1994 (amended on 04/06/13) does not regard as a lease “the temporary assignment of use of a dwelling house in its entirety, furnished and equipped for immediate use, marketed or promoted through tourism channels and rented out with a view to making a profit, where the house is subject to a specific system arising out of the regulations of its own sector”.

 The difference is that in a, let us call it, “ordinary rental”, the building the subject of the lease is a dwelling house, be it intended for use as permanent or as temporary living accommodation, whereas two essential elements must be present  in the occupation of a tourist accommodation unit: (i) the accommodation unit itself, whether from an architectonic point of view it is a room, an apartment or a singular dwelling house; and (ii) the service inherent in tourist accommodation units, such as reception, cleaning, etc., all of which must also be situated in a “tourist accommodation resort” and managed by one only operating company; both of them (the resort and the company) being registered with the relevant tourism registry as guarantee that they both meet he requirements of the sector’s tourism regulations.

TIMESHARE BRANDING

A prestigious, well known brand is currently one of the most important factors to marketing success, and this obviously applies to the holiday accommodation industry.- Large companies have, through their respective brands, made this one of their main selling arguments. Small companies, however, with a lower economic capacity, can hardly compete by themselves in this sector, which may be the most representative of a globalised industry.  A reaction to that is the “branding” concept, i.e. the creation of a common brand with widespread media exposure which comprises several companies of the sector, whether on such companies’ own initiative or as a result of the establishment of a brand by one only company whose business is precisely to allow others to use the common brand according to specific rules and for valuable consideration to its owner.

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