Kissimmee’s Inventory of Rooms in Large Homes Expands Operator’s Reach in Favored USA Destination: It was about eight months ago, when Brazil was in the trough of its worst economic recession in a hundred years that the, São Paulo-based tour operator Trend Group (Grupo Trend), which also has offices in Orlando, started what seems, at first, to be a counter-intuitive business direction. No matter. The move ratifies what comes across as another out-of-the-park move made a decade ago by Osceola County, Florida (location of Kissimmee), which is adjacent to the southern border of Orlando/Orange County, Florida, to differentiate its lodging product from other jurisdictions in the Greater Orlando Area and to make the land generate tax revenue.
As reported by the Brazilian trade publication Panrotas, Luis Paulo Luppa, Trend’s president, saw the strength of the home rental market for Brazilian families in the Orlando area, especially in Kissimmee. By the end of 2016, he decided to invest in the segment, and the company purchased 70 percent of the Vacation Home Collection (VHC), which has some 500 homes in its portfolio in the Orlando and Miami areas. All of the Orlando/Kissimmee properties are near the Disney complex of attractions. VHC was created by Fábio Cardoso—a long-time veteran of the tour and travel industry, he has held senior sales positions for both Stella Barros Marketing and Walt Disney Parks & Resorts–who will continue as CEO of the company.
“We researched a lot, with the help of the CVB of Kissimmee—a city that today already receives 48 percent of its occupancy from renting houses of all kinds, from $150 to $800 a day,” Luppa told Panrotas, noting that he counted on the help of DT Minich, president and CEO of the Kissimmee CVB, in researching the move. “We did not want to buy invoicing but rather expertise and we found the company and Fábio the best in the industry in Orlando. Fábio has a DNA very similar to Trend’s and we wanted him in the group.”
With the action, the Trend Group—at a time when most tour and travel industry players in Brazil were re-trenching or scaling back their operations—completed an aggressive development program in 2016. In May, the company hired Jay Santos, who had recently left the Orlando CVB and whose career has been focused on the Brazil market (he is a native of Brazil) as vice president, global business development. Trend also expanded its reach at trade shows: its table at the NAJ Group’s RTO Summit Orlando last November was the busiest in room.
The Kissimmee Model—how it Works: The Trend Group acquisition is another step or variation in the vacation home rental model developed in Kissimmee. A decade ago, at the time the vacation rental market had just begun to grow, Kissimmee officials reasoned that subdivisions with a residential character—but zoned for the purpose of attracting guests and visitors—wouldn’t clash with the residential character of the Kissimmee area that is not already part of the tourism industry.
They also reasoned, correctly, that such properties would attract investors who wanted a reliable investment. They were right. Wealthy investors have financed the growth and development of the areas of Kissimmee zoned for home rentals, whose operations are handled by separate management organizations.
Reunion Resort was the first community. It is the location of homes that range from what one might consider a traditional four-bedroom residence with added amenities for those who rent it to a 14,500-square-foot house with nine bedrooms, a two-lane bowling alley, fully stocked arcade, spa, racquetball court and a 12-seat in-home movie theater.
The Reunion Resort and subsequent communities have found that the residences are ideal venues for small business groups that wanted to conduct team building exercises, but have entertainment options nearby. The accommodations work well, too, for large, multigenerational and extended families who want to stay at the same place but were unable to do so when booked at hotels. Incentive groups are also a natural for the large rental homes.
Those receptive tour operators that sell the product like it because there is no rate parity to deal with. The units are owned by private investors who care about keeping their properties rented and keeping the revenue stream going. Receptives like the flexibility and packaging possibilities offered by rental homes. For instance, they don’t have to work around the price parity demands of major hotel chains.
In an October 2015 interview with the Inbound Report, Minich said that the number of available rooms through the vacation home rental segment was about 20,000 and that the top two country markets for the product were the UK and Brazil, with the Middle East growing quickly.
And, because the Kissimmee model hasn’t really been replicated elsewhere, no destination seems to be a position to challenge its officially registered designation and de facto status as “Vacation Home Capital of the World.”