Holidaymakers trapped in Hideaways Club as it hasn’t attracted new backers since 2019

The Hideaways Club is facing fresh criticism from rebel investors after documents revealed its property funds have failed to attract new shareholders for almost five years.

The struggling luxury holiday company, which is backed by celebrities and sports stars including former tennis player Tim Henman, is marketing itself as an alternative to second homes and timeshares.

The company offers investors the opportunity to purchase a stake in a property portfolio consisting of villas, chalets and luxury apartments. They can then book the properties for holidays if they pay an additional membership fee each year to cover maintenance costs.

But it is locked in a battle with a group of rebel shareholders calling themselves the Hideaways Members Action Group (HMAG).

They are preparing to file a lawsuit against the company and have demanded documents showing that the company has failed to bring in new investors since 2019, meaning the existing backers are trapped, due the company’s ‘two-in-one-out’ system. The policy means that for every member who leaves, two new members must join.

The Club says these investors are trying to leave by “disputing” the contracts they originally signed when they joined, including the two-for-one system.

But in a 2022 review of one of the Club’s property funds, seen by This is Money’s sister title, The Mail on Sunday, Hideaways reported that no new full shares had been purchased since 2019, with the only transactions involving fractions of the shares. Another fund, focused on city apartments, showed that only half of one new share had been purchased between 2019 and the end of 2022.

“As members say, they really checked into Hotel California,” an HMAG spokesperson said.

The spokesperson claimed that even after the death of members, heirs remain stuck.

“Anyway, they can never go away.

‘But unlike the song, neither can their partners and children. These generations will also have to pay increasingly higher contributions for decades, even if they cannot and do not want to use the Club.’

In addition to Henman, Hideaways Club members included Formula 1 driver Nick Heidfeld and billionaire Mike Balfour, founder of the Fitness First gym chain.

The Club has previously claimed that it operates a service that allows some members to leave

But shareholders respond that in that situation they would have to accept a significant discount.

However, the latest data threatens to increase pressure on the company as the lack of new shareholders means existing members are likely to remain stuck unless demand recovers. The row comes as around 70 members prepare to file a class action lawsuit in Gibraltar against the Club.

It will be the first time such a motion has been attempted in the area.

The rebels are being assisted by Sir Peter Caruana, a lawyer and former prime minister of Gibraltar, who is part of a legal team representing the group.

In separate proceedings, Hideaways Club is suing several members for unpaid membership fees.

The company scored a victory earlier this month when a court in Gibraltar ruled it could continue to charge members even if they had not used the properties. It is not yet known whether the investors will appeal the decision.

But the rebels are undeterred and are said to be pushing for their case to ultimately be heard by a panel of British judges.

A spokesman for the Hideaways Group said: ‘A small percentage of disgruntled high net worth members waged a two-year failed campaign to buy the club, control the fund boards, escape large personal debts – recently reaffirmed by the High Court of Gibraltar – and liquidate the club. the Club’s holiday properties for their benefit.

“As part of their campaign, they appear to be engaging in new campaigns of defamation and lawsuits.”