Grand 'Manor House' .Conceptual design..
Private Residency Club @ Windmill Point 1711
Yorktown, Virginia
Questions/Comments: Robert E. D'Eramo, bob@windmill-point.com (757) 873-1776
What is a .. 'Private Residency Club' ?
The concept of purchasing vacation property, or a second or third home, using a Fractional Ownership model is relatively new. The first projects have been luxurious and exclusive resort real estate product that has the quality of a four to five star resort hotel. This type of project concept ‘ is not’ a time share where you purchase a block of time or a number of points that are then traded off. In contrast Fractional Ownership is evidenced by a deed on a specific unit and sold on a fee simple basis. Shares of a unit are sold usually between ¼ and 1/13th. The average purchase is approximately 1/7th or 8 weeks with many selling at a 1/13th share or 4 weeks.
The Private Residency Club (PRC) concept is utilized to establish exclusivity and a sense of belonging like a Country Club. Members tend to socialize and are made to feel they are part of an exclusive organization consisting of a peer group similar to the peer group at home.
The buyer profile of fractional’s include professionals, corporate executives, entrepreneur’s and those that consider their time most precious. They are also frequent visitors with some returning several times a year. They may now own a second or third home and are frustrated by the maintenance, vandalism and expense to only stay there 5 to 6 weeks a year. The average income for the lower tiered 3 star shares is $150,000. The average income for the 5 star level exceeds well over $250,000 per year. Boomers in the 45 to 55 age group are the majority with the 30 to 45 year group growing in numbers. The typical income is $200,000. The second market group are the parents of the boomers that have a low annual income but have a net worth exceeding $3,000,000. The empty nesters and the retired who remain active. Interestingly, as the per share price goes up, the cost sensitivity goes down. The primary concern becomes product, amenities, location and service, not cost.
In PRC/Fractional project, equity appreciation and resale value are inherently much stronger. The reason is the much lower cost of sale averaging 10 to 12 percent. The average sales cost in a time share can exceed 25 to 30 percent. The product cost in the fractional market can exceed 40%. This compared to a time share product cost of 25%. In the PRC much more of the buyers dollar is spent on high end finishes thereby creating a value at the time of purchase. At a minimum we should expect value retention not seen in time share. The Deer Valley Club in Park City, Utah has a turnover rate of 5% with an annual year over year appreciation of 16%.
Bob D'Eramo
bob@windmill-point.com (757) 873-1776
THIS SITE IS UNDER CONSTRUCTION