Staycations up in down economy

Getaways to Malibu, Palos Verdes on the rise

"Staycation."

Thanks to the current economic doldrums, that term is becoming more of a reality, as French-born corporate communications consultant Jean-Marie Bonthous knows. He's seen everyone renting his Malibu home, from a pair of lawyers spending a three-day weekend with their two children to a filmmaker taking a week off after finishing a movie.

"There's a growing demand from local people who want to save money and also share the house with one or two other couples," he says.

Indeed, one in four U.S. leisure travelers with an annual household income of more than $50,000 took at least one overnight vacation within a 50-mile drive radius of their home within the previous 12 months, as an alternative to vacationing in a destination that would have required traveling a greater distance -- that's up 15% from the previous year, according to the Ypartnership/Harrison Group 2010 Portrait of American Travelers, published in April.

The economic advantages of the staycation are obvious: It's cheaper to pile family members into a car and drive to the coast than buy them individual plane tickets to Hawaii or Europe, and the food, lodging and incidentals are less expensive upon arrival.

"We have three bedrooms; if you have two or three couples staying there, in the end it's a lot cheaper than a hotel," Bonthous adds. "And there's stuff for them that you don't always have in hotel, like a fireplace and a Jacuzzi facing the ocean, so they can relax and chill out."

The convenience of sticking close to home can also be a strong attraction, according to Terri Haack, executive vp and managing director of Terranea Resort, a 102-acre oceanfront development in Palos Verdes, Calif., 30 miles southwest of downtown Los Angeles.

"If you're in Los Angeles, you can be here in 35-50 minutes and be at the pool with a cool beverage in an hour, instead of getting to an airport 2 1/2 hours early, standing in line and then flying somewhere for two to three hours," Haack says.

Opened in June 2009, Terranea features 102 fully furnished luxury condominiums available for rent or purchase ($1 million-$2.5 million), along with a 360-room hotel, a nine-hole golf course, a 5,000-square-foot fitness center, a spa, three pools with ocean views, eight restaurants, bars, cafes and 150,000 square feet of meeting facilities and event space. Situated along the Palos Verdes Peninsula, it has a 270-degree view of the ocean, with Catalina Island visible in the distance.

Haack boasts that the abundance of activities and attractions -- which also include bluff-side hiking trails, a beach cove perfect for whale watching, a 140-foot waterslide and a day camp for kids -- gives local professionals who can't afford to leave work the ability to send their family on vacation without shipping them off.

Terranea Resort
 

"The mom and children can be out going to kids' camp and doing all those things while the father is working, then he comes down here in the evening and they do family activities," Haack says. "So he's on vacation without really being on vacation."

While Bonthous sees his share of harried Angelenos using his Malibu house for a quick decompression, the biggest driver for local rentals is weddings.

"People tend to want to get married on the beach, but the wedding budgets have been slashed and they can't afford a hotel or a professional caterer or wedding places," he explains. "So they have someone bring the food -- a friend who's a caterer or the family -- and they do their little reception at the house, or the family stays there for the wedding."

Previously home to the husband-and-wife music act Captain & Tennille and actor Jan-Michael Vincent, the property sits on a 330-foot bluff overlooking Zuma and Broad Beaches, accessible via a private road. It has a 2,000-square-foot main house with three bedrooms and two baths, as well as a guest house and a detached gym. Other amenities include a gourmet kitchen with a subzero refrigerator, along with three boogie boards and an eight-foot surf board to use on the Malibu waves.

Rates run from $2,990-$3,490 a week. While rentals are brisk during the April-June "wedding season," Bonthous' house is most in demand during August, which is traditionally the most popular vacation month worldwide. "August gets rented out in January," he says.

For the most part, renters have been respectful of his property, with one conspicuous exception who spent a week partying with his pals and left the house littered with hundreds of cigarette butts and broken beer bottles.

"There's a $1,000 deposit and people are very eager to get it back," Bonthous says.

While the Ypartnership/Harrison Group study defines a staycation as being within 50 miles of one's home, that has little bearing on the habits of Angelenos, who have a long history of using Palm Springs, 110 miles to the east, as their backyard retreat. Hollywood celebrities Kirk Douglas and Frank Sinatra both had second homes in the area, and Bob Hope, who built a mammoth, ultra-modern, John Lautner-designed home on a ridge overlooking the city in the early 1970s, served several terms as honorary mayor. According to Palm Springs Realtor Rob Kincaid, in recent years there has been a tremendous growth in the number of people who make the trek for a brief getaway.

"We call them speed vacations," Kincaid says. "It's a big part of our business. People are coming to Palm Springs to hurry up and relax. Even people who have plenty of money are shopping for ways to economize, and people just don't take long vacations like they used to."

In Palm Springs, there are about 1,000 homes registered for vacation renting with the city, and Kincaid's company, VacationPalmSprings.com, represents about 20% of them. His listings range from a two-bedroom condo near downtown for $195 a night to an eight-bedroom mansion in Rancho Mirage that goes for $1,095. The latter might seem a bit pricey to qualify as a cost-saver until one considers that the price can be divided among eight couples. With room to sleep 18 people and a 90-foot-long pool -- not to mention a bar and a whirlpool spa that seats 20 -- the 7,500-square-foot property makes the perfect party house.



"A lot of people liken it to renting your own private boutique hotel," Kincaid says. "They're coming for some kind of shared social experience, be it a family or a group of friends. It's a combination of privacy and togetherness. They have their own bedrooms, but they have common areas where they can socialize and big, spacious gourmet kitchens."

Relative to Los Angeles, prices in Palm Springs are still affordable: Two-bedroom houses with pools sell in the $350,000-$500,000 range. Kincaid says it's not uncommon for people who rent one of the properties to turn around and buy a similar home, which they then rent out to cover the mortgage while continuing to use it as their personal vacation destination.

The ability to make use of the property depends on one's tolerance for heat. Traditionally, vacationers have flocked to Palm Springs during the winter months, when the coolest days have temperatures in the upper 60s to low 70s, and avoided the brutally hot summers, when the mercury regularly rises above 105 degrees. But Kincaid says in recent years the desert community has become more of a year-round destination.

In July, "We had about 130 houses rented, and it was 100 degrees," he notes. "In the winter months, it tends to be people from all over the country and Canadians. In the summer, (it's) even more people from Los Angeles."

Greg Huglin's house on Miramar Beach in Montecito, 90 miles northwest of Los Angeles, is only available for rent during the summer, from mid-June through Labor Day. That's because, during the rest of the year, the semi-retired photographer and documentary filmmaker lives there with his wife and two children.

The property originally belonged to Huglin's parents. His mother had always wanted to live on the beach, and in 1964, when Huglin was 11, his father retired from the military and paid $24,500 for a "funky, two-story shack" on the beach, built in 1910.

Palm Springs rental
 

"My dad was earning $13,000 a year, so it was about twice his gross income, which was reasonable for a middle-class fellow back then," he recalls. "Then my mom got it in the divorce, and she got Alzheimer's in the early '90s and I bought it from her. About three months later, there was a really bad March rain and the whole house came off its foundation."

Huglin extricated himself from his contract to shoot a Land's End swimwear catalog and spent the next two years rebuilding the house as a duplex with two kitchens. It served exclusively as a rental property until four years ago, when he converted it into a single-family home with four bedrooms and two baths.

"We decided, the heck with it, we'll sell all our stuff from our big house and 90% of our possessions and move in," Huglin says. "Now we live there for the school year, then we take our kids and bail out for a couple of months and use it as a vacation rental."

Dubbed the Dolphin Den, the interior resembles the inside of a wooden sailing ship. Each of its three stories is accessible by both interior and exterior stairwells and has balconies with 180-degree views of the ocean, the beach and the nearby Channel Islands. A self-confessed "maintenance nut," Huglin replaces the caulk around the sinks and touches up the paint every year so it's pristine before he and his family depart.

"Miramar Beach is the only area in Santa Barbara County where houses are actually on the dry sand," he says. "Everywhere else, they're either up on a cliff or on seawall with wet sand in front. With our place, you walk right off the side of the house, there's a surf spot right there. And, of the 29 homes on the beach, we've got the best view because we're the tallest house."

Huglin estimates that 30% of his renters are from the Los Angeles area.

"It's pretty laid back and casual here and it takes them a while to calm down and let go of the alpha-dog thing," he says. "Most of them want to just sit on the beach and vegetate and not do business."

It's impossible to completely escape Hollywood in Montecito, of course, because many of its residents are industryites, from semi-anonymous screenwriters to talk show queen Oprah Winfrey, who has been spotted occasionally at Vons.

"Nobody walks up to her and hassles her and asks her for an autograph," Huglin says. "That's the appeal of Montecito."

Spending time in Oprah's neighborhood ain't cheap. This year, the nightly rate at the Dolphin Den was $600 for June, $800 for July and $1,000 for Aug. 1-Sept. 8, with a minimum stay of one week. On top of that, tenants are required to pay a cleaning charge of $250 and a refundable damage deposit of $2,000. Still, it's cheaper than it used to be: Huglin estimates that rates for his other rental properties on Miramar Beach have dropped 30% in recent years.

"We used to get $1,200 a night in July and August, but we've all had to bring our prices down," he notes.

Huglin's rental income not only pays for the house itself, but also an extended summer getaway for him and his family. And, no, it's nothing close to a staycation.

"The last two years, we've gone to Puerto Vallarta," he says. "The year before, we went to Barbados. Next year, we're going to do Australia. We just do some place different every year."
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