Why Travel + Leisure hangs on the top half of the ‘K’

ORLANDO, Florida — It’s a great time to have your business situated in the “upper leg” of a K-shaped economy, so it’s a great time in general for the vacation ownership business.

“2025 was a strong year. We all know about the revenge travel in 2022 and we came off of that, and people thought we were moving back to just everything being stable,” said Michael Brown, president and CEO of Orlando, Florida-based Travel + Leisure Co. “But 2025 proved that consumer demand remains strong. Our company performed extremely well throughout 2025, and it’s even coming through in 2026, which is especially important given the macro conversation around the K-shaped economy.

Our performance has really brushed all of that aside and it’s as if everything in the macro environment is falling in place, because on a micro company-wise, we really are performing at the top end of everything we’re doing at the moment.

Michael Brown

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“Our performance has really brushed all of that aside and it’s as if everything in the macro environment is falling in place, because on a micro company-wise, we really are performing at the top end of everything we’re doing at the moment.”

Travel + Leisure has made a number of notable M&A moves and partnerships over the past few years, including a $48.4 million acquisition of the Accor Vacation Club business in 2024, and partnerships with brands like Sports Illustrated, Margaritaville and Eddie Bauer. Hotel Investment Today talked to Brown after the company’s fourth-quarter earnings, when it reported net revenue year-over-year increases of 6% for Q4 and 4% for full-year 2025.

Brown said the company has clearly positioned itself in that “upper leg” of the K-shaped economy by steadily moving its customers’ demographics up (both average household income and FICO scores have increased).

“We’re not playing in the budget space,” he said, noting that’s primarily because of how T+L has positioned itself, but because of the nature of the vacation ownership business. “I strongly believe that the nature of vacation ownership is… when there’s an affordability issue, they say, ‘I’ve already paid for my ownership. So, why wouldn’t I go on vacation?’”

As the quality of T+L’s consumers has improved, Brown said their preferences have moved in positive directions as well.

“The length of stay has definitely stayed up post-COVID. It went up initially, and it’s stayed there,” he said. “We haven’t seen any meaningful move on drive-to versus fly-to, which says that our consumers are not changing their behavior, which means they’re not feeling the stress that maybe others might be.”

Sports Illustrated Resorts' first property is scheduled to open in the coming months. (Sports Illustrated Resorts)

Expanding partnerships

Brown said T+L is definitely leaning into the vacation ownership model for Sports Illustrated Resorts, with its first Nashville property scheduled to open in the coming months, followed by its Chicago property, which will open in Q3. But he also said the company is being flexible in its approach and will let the customer guide where it eventually heads.

“What we are seeing is there’s hotel components and there’s full-ownership condos,” he said. “As we get the first one up and being sold, we’ll start to see which one has the greater demand and then it’s like with everything, optionality is critical… We try to give ourselves maximum flexibility and with Sports Illustrated resorts, depending on consumer demand, we can push toward vacation ownership, hotels or condos or a combination of all three.”

Another key component to T+L’s acquisition of Accor Vacation Club and its desire to continue with the partnership is the thesis that a multi-brand business is the future of the vacation ownership space. Brown said that the thesis is proving out and noted during Q4 earnings that the company is already nearing 10% of its sales going to brands that were not core to its business, up from $50 million three years ago to $200 million in 2025.

Moving to this multi-brand approach, it just puts a lot more doors in front of us that we’re able to walk through and have conversations in and see if we can make a partnership work.

Michael Brown

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“Moving to this multi-brand approach, it just puts a lot more doors in front of us that we’re able to walk through and have conversations in and see if we can make a partnership work. Some work, some don’t,” he said, noting that it also includes looking for new partnerships as well. “We’re very focused on it. Lifestyle purchases usually yield much better results than those of someone with no affiliation with a brand or partner. It’s very important to do things through partnerships so that we tie in new marketing opportunities, but also to tie into owner activities.”

One of the newest partnerships is with the Eddie Bauer Adventure Club, an outdoor-focused brand that launched last summer. Brown said T+L was able to quickly convert an existing resort in Moab, Utah and that sales so far have been very well received. He said the partnership is a great example of not specifically picking a brand to partner with, but rather finding a sector it wanted to expand into.

“If you were to ask someone two years ago, ‘Do you want to be with Eddie Bauer?’ I would not have said, ‘Oh, Eddie Bauer is a specific brand I need to be with,’ but I would have said, ‘I want to be in the outdoor space,’ he said.

So, what other sectors would T+L love to expand into? Brown pointed to the water.

“We’d love to be closer to cruise companies. We’re already connected with the Margaritaville cruises. We started that this past year,” he said. “We are on the top side of the K-shaped economy, but I think we can be more present in the luxury space and we would love to be in that space at some point in the future.

“There are a lot of different ways you can go there, but they’re almost too many to enumerate. Something that floats would be great, and something on the higher end would be super as well.”

The more T+L successfully expands its multi-brand business, the easier it becomes to lure other brands into partnerships, Brown said.

“What we’re trying to prove out to people, and we’re doing it so far, is that our skill set is not a mono brand, it’s our ability to execute an overall leisure travel strategy for someone else’s brand,” he said. “Now that we’ve moved along with Accor, Sports Illustrated, Eddie Bauer and Margaritaville, I think more and more people will start to come our way and say, ‘We’re willing to allow you to be our brand steward and grow our brand’s presence and customer base.’”

So where else would T+L like to be geographically?

“I don’t think we have nearly enough presence in Texas. We would love to be there. There are some beach locations anywhere on the southeast of the United States that are a winner,” he said, noting that the company would like to expand its presence in Mexico as well as in college campuses through SI Resorts (the first one is being built in Tuscaloosa at the University of Alabama).