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Fractional ownership . . . you may have heard the term but what exactly does it imply? Usually offered in the form of a Private Residence Club, fractional ownership is title to real property, making it possible to own a vacation residence without worrying about maintenance, taxes, or property management. You pay for the weeks or months you use with the costs shared by the number of owners of each residence.
Many fractional ownership purchasers could easily afford full ownership, but chose a Private Residence Club for the lavish amenities and the limited time they have to spend at their vacation home. The added value is very appealing, especially when compared with timeshare or full ownership. Timeshare, no matter how luxurious, is a usage contract; and full ownership comes with full responsibility, including maintenance—often a headache for owners thousands of miles away. Fueling the growth of this active slice of the vacation home market is the fact that fractional ownership requires far less capital investment. |
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Located in world-class resort destinations like Miami Beach, Aspen, and Whistler, prices average $100,000 to $500,000 U.S., for residences that would generally cost two to five times more if purchased individually, without club amenities and benefits. And, because it is deeded ownership, you have a real asset, one you can will to your heirs, sell, rent, or mortgage.
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In Cabo San Lucas, where unfurnished luxury oceanfront condominium prices can start in the $300,000 U.S. range, fractional ownership at Private Residence Clubs are taking hold. And, with less than 75 properties world wide, they are highly coveted. According to market research group Ragatz Associates, 26 percent of Private Residence Clubs are sold out, with sales of close to $450 million U.S. in 2001 alone. New developments have increased by 150 percent.
So, what does Cabo San Lucas, Los Cabos, Mexico have to offer in the way of fractional ownership? With this in mind, I visited Club Perla Rosa, the only oceanfront luxury Private Residence Club in San Jose del Cabo. I came away very impressed with both the property and their Private Residence Club program. At Club Perla Rosa, amenities go far beyond the ordinary, combining the intimacy of an exclusive private residential retreat with the convenience of a five-star hotel.
Four weeks per year of fractional ownership at Club Perla Rosa is under $100,000 U.S with attractive trade offs for peak holiday usage. Ownership isn’t limited; investors may purchase as many four-week fractions as they wish. Club Perla Rosa will appeal to those looking for sterling amenities and services in a gracious and relaxing fully equipped luxury condominium setting.
Resorts throughout the Los Cabos region near around Cabo San Luas featuring fractional ownership include The Grand Regina Los Cabos at the Westin Regina Resort, where ownership opportunities in fully furnished villas have residence club services and amenities. The 36-two and three bedroom Auberge Residences at Esperanza are within Punta Ballena, an exclusive resort community near Cabo San Lucas. Adjacent to the exclusive Esperanza hotel, owners enjoy superb facilities and residence club services including pre-arrival shopping, housekeeping, airport transportation, and personal year-round storage. Guaranteed a minimum of four weeks from October through June, owners have unlimited use and no limit on length of stay. Weeks may be exchanged at Aspen’ Snowmass Village and Napa’s Calistoga Ranch. Prices here range from $150,000 to $2.5 million U.S. Under construction on Playa El Médano in Cabo San Lucas, the Mexican-Mediterranean style 214-suite Médano Beach Resort broke ground in March 2004, with 35 suites scheduled for completion in the spring of 2005. Fractional ownership will be offered on fully furnished one, two and three bedroom suites and penthouses with residence club hotel amenities and services. Pioneering the fractional trend in Los Cabos, Villa La Estancia is large luxury development on the east side of Playa El Médano. Phase III will open in June 2004. Priced from $175,000 to $800,000 U.S., turnkey fractional ownership is offered in one quarter and one eigth shares of two and three bedroom condominiums with five star resort amenities and services.
The emphasis on building Private Residence Clubs in only the most desirable locations worldwide has created strong demand, with excellent appreciation and resale value. The popularity of this relatively new phenomenon in Los Cabos shows little sign of abating, giving second or third home purchasers more flexibility, amenities and services than were previously available in Mexico’s most exclusive resort destination.
Excerpt from Los Cabos Magazine article by Sabrina Lear. |
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Advertiser Section
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Elite Destination Homes offers unique Private Co-ownership opportunities in Cabo and elsewhere around the world. Private Co-ownership is a unique model that improves on traditional fractional ownership or destination club membership in two very important ways:
1. Privacy - Elite forms small private groups of partners, typically three to five, to own a single family home, typically valued at $2-$3M. Each partner is invited to become an owner only after a personal 'fitting' conversation and extensive mutual due diligence. We are absolutely committed to finding owners for whom our model is an excellent fit.
2. Investment Quality - Elite structures each partnership to reflect the features of a strong real estate investment. We have been extremely successful at generating rental income when owners are not in residence and our fee structure is a 'fraction' of what other fractional ownership offerings charge.
Today there are many ways to own or access a several million dollar vacation home, without spending several million dollars. While the Elite model is not the right fit for everyone, we have been very effective at serving owners who value privacy and investment quality, in additional to the dream vacation home experience (we do that part too).
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Copyright © 2008 - Joseph A. Tyson - Tyson Promotions Inc - All Rights Reserved
Los Cabos Magazine - Los Cabos Visitor's Guide - Promociones Tyson, S. A. de C. V.
Cabo San Lucas, Baja California Sur, Mexico - Last Revision - December 6, 2007 - AAS
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