Luxury hotels have seen the future — and it's fractional
Ritz-Carlton just announced that it's entering the "fractional ownership market." What's that, you say?Time-shares—but no one wants to use the word, evidently concerned it brings to mind tacky Fort Lauderdale condos.
"People have mixed feelings about what that is, what that was," says H. E. Duffy Keys, senior vice president of vacation ownership at Four Seasons (which calls its time-share program "vacation ownership").
By any name, though, time-shares are what people want: more than 2 million Americans own them. Ritz-Carlton is opening two Ritz-Carlton Clubs in the next two years—in Aspen and St. Thomas—and plans on building one or two each year through 2004. Four Seasons has sold 2,100 time-shares to individuals at its Aviara resort outside San Diego since 1998, and will offer Four Seasons Resort Club "villas" at its new hotels in Scottsdale and Punta Mita, Mexico, in 2000 and 2001.
At both companies' clubs you buy the right to stay for a given amount of time, and you gain access to the resort amenities (if there's a resort nearby: the Ritz-Carlton Aspen property has no hotel; what was the Ritz-Carlton is now the St. Regis). You also get the service guarantee—housekeeping, turndown—each brand brings. Properties are sold in perpetuity; you can sell them, will them, give them away.
Where they differ is in the level of commitment they ask of you. At Ritz-Carlton, for $85,000 to $335,000 (with annual dues of about $7,000), you get a 1/12 share in the same two- or three-bedroom condo; that is, you get three or four weeklong stays in prime season. Four Seasons Resort Clubs offer more traditional time-shares. You're buying time, not space—you can request a certain condo, but there's no guarantee you'll get it. Prices for one week at Aviara range from $26,000 to $38,000, plus annual fees of about $600.
Four Seasons also gives you something that has always appealed to most time-share owners—more freedom to trade. You can spend your annual week at other Four Seasons clubs, at the 1,600 time-shares listed with Interval International, or at Four Seasons hotels. Ritz-Carlton Club members can trade only within Ritz-Carlton Clubs.
Two other companies—Rosewood and Amanresorts—are betting that their upscale guests have less interest in sharing, and that they wouldn't want to buy something unless they could use it year-round. Both sell villas or land near their hotels, but the owners can choose to put their property into a rental pool when they're not there. The 27 villas at Rosewood's Martineau Bay—opening on Vieques, Puerto Rico, in March—sold "before the shovel hit the dirt," says Rosewood president Jim Brown.
Amangani, Amanresorts' new hotel in Jackson Hole, has carved out 22 parcels of land. The first eight houses, closest to Amangani proper, must be designed by the hotel's architect. Buyers of the other 14 parcels can select their own architects as long as they work with the same materials used at Amangani. "No one's bought any yet," says Monty Brown, the general manager. Could be the cost of at least $3 million. Then again, maybe not: "I have a guest right now who wants to buy three."