Island One Files For Bankruptcy
Written by: Traver
As with all industries and businesses in the United States and around the world, the timeshare industry has also been hit fairly hard over the last couple of years with the downturn in the economy. In addition to the economic downturn, real estate values dropped across the United States, especially for Florida timeshares, making it very difficult for some timeshare operators to stay in business, even though last week we demonstrated in our blog posts how the economy and timeshare industry were starting to recovery this has not happen soon enough for some companies. The most recent timeshare company to file for bankruptcy protection in Florida is Island One Reosrts Inc., who operates nine different timeshare resorts throughout the United States as well as Caribbean timeshare resorts. Island One’s portfolio included popular Florida timeshare resorts such as Barefoot’n Resort in Kissimmee, Bryan’s Spanish Cove, Liki Tiki Village, Orbit One Vacation Villas and Parkway International Resort all of which are in Orlando. The company had been in business for over 25 years and had grown to the point of employing 700 at the time of filing for bankruptcy.
What caused the downfall of Island One Resorts Inc.? In simple terms it seems the company had over extended themselves in attempt to weather the recent economic storm with total debts and liabilities in the amount of $148.3 million, however assets estimated at only $100 million. Any company whose assets can not cover their debts and liabilities is on the road to going out of business, unfortunately for Island One Resorts this was no fault of their own. Most likely before the recent downturn the estimated value of the company’s assets would have been much higher, the reason for this, as mentioned above, was the drop in property values across Florida especially in the timeshare sector. In Florida both commercial and residential developers have found themselves suffering a similar fate because of the drop in property values. When combined with the drop in property values and people cutting back on non-essential items, such as timeshares, the recipe for disaster was complete for Island One.
Many owners might find themselves wondering what to expect at this point if they own a timeshare at a resort operated by Island One. The simple answer is most times when a company files for bankruptcy in the timeshare industry the actual timeshare owner will not really be affected, the day to day operations of the resort will continue just as they did before. If you are an owner at one of the Island One properties do not worry about losing your ownership or enter into panic mode, you most likely will not even be able to feel the effects of these court proceedings.
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