A better way to share
Ah, the joys of owning a vacation home: the second mortgage, the unruly lawn, the on-call maid to clean up when your son stays over with his pals and trashes the place. Which is why Bruce Deichl canned his plan to build a $500,000 second home in Puerto Rico and instead signed up for the latest, low-maintenance twist on vacation homes: private residence clubs. For about half the price of the Puerto Rico house, he bought a membership in Private Retreats by Abercrombie & Kent and gained anytime access to some 60 million-dollar properties.
Now when Deichl, 56, plans his next vacation getaway, the New Jersey investment consultant's only dilemma is which abode to pick: the swank villa on the Caribbean isle of Nevis, the ski chalet overlooking Telluride, Colo., or maybe the fairway-front casita at a Scottsdale, Ariz., golf resort, priority tee times included.
If this sounds a bit like a gussied-up version of the old time-share concept, well, it is. Eager to make the most of vacation property in resorts where land prices have skyrocketed, developers cooked up the club idea. Like time shares, the clubs hawk shared real estate for more than a single buyer would pay. Yet the flexible access and high-end services eliminate most of the drawbacks that have led to a heap of classified ads for unwanted time shares.
The new second-home substitutes come in two flavors: fee-based membership clubs and those that dole out fractional interests in resort condominiums managed by hoteliers like Ritz-Carlton and the Four Seasons. Unlike traditional time shares, which are sold in weeklong segments for the same dates every year, fee-based clubs like Private Retreats allow members to stay whenever they want at some of the world's most posh ski, golf, and beach resorts, as well as chic suites in London and other big cities.
Meanwhile, members of fractional developments like the Ritz-Carlton Clubs in Colorado and the Virgin Islands can count on a month or more of high-season access each year. Every seven to 12 years, they get a crack at the choicest dates--like Christmas week. Additional time is allowed on a space-available basis. And while members of fractional clubs buy in one location, they can trade for time in other affiliated resorts.
The clubs have proved popular among hassle-weary homeowners loath to take on another household to-do list. Annual sales have more than doubled since 1999 to about $360 million, according to Ragatz Associates, a Eugene, Ore., market research firm that tracks the resort industry. "It's become a rational alternative to buying a vacation home," says Dick Ragatz, the firm's president, who points to studies showing that most second-home owners don't use their properties more than four weeks a year.
Fee spree. So what's the catch? Well, for one, the price of membership doesn't cover all your expenses. Annual fees can run as high as $12,000, and some fee-based clubs charge members up to $150 a night. Then come the add-ons: private chefs, spa services, and all the rest.