Timeshare Interests....or Fractional Ownerships....What are We?
August 5, 2013
A fellow member of Aimfair raised the following question:Hi,Interesting question for sure. Here is our response to our friend's question:{DIV(type="blockquote" width="600" align="justify" bg="lavender")}Thank you for your note.
I am surprised that you are still referring to Grand Luxxe as a Timeshare when it is a Private Residence Club (same as Fractional Ownership).
Major differences.
Should the correction be made?
We believe there are very slight differences between "Timeshare" contracts, "Fractional Ownership" units, "Private Residence Club" memberships and "Private Destination Club" memberships. All are clearly defined by the terms of their contracts.
Here are some definitions we rely upon:
- Timeshare: A timeshare is a property with a particular form of ownership or use rights. https://en.wikipedia.org/wiki/Timeshare
- Fractional Ownership: Fractional ownership is a method in which several unrelated parties can share in, and mitigate the risk of ownership of a high-value tangible asset, usually a jet, yacht or piece of resort real estate. https://en.wikipedia.org/wiki/Fractional_ownership
- Private Residence Clubs: A form of Fractional Ownership. Private residence clubs are the luxury, high end of the fractional property market. They provide the services and amenities of five star hotels, and some of the luxury hotel groups run their own private residence clubs. Occasionally membership in a private residence club grants to its member only the right to usage of the club properties and services, without ownership rights in the properties themselves. Note a private residence club is different from a destination club, although the terms are sometimes used interchangeably. https://en.wikipedia.org/wiki/Fractional_ownership#Private_residence_clubs
- Private Destination Club: While there are several variations, the basic choices are between equity, non-equity and hybrid clubs. This is similar to the membership model choices at country clubs. In all models, club members provide an up-front sum and an annual fee though the exact amounts vary significantly by club-type. In non-equity clubs, members enjoy the hospitality benefits of the club, but don't have an equity interest. The benefit of not having an equity interest is the annual carrying costs likely are lower than the cost of having an equity interest. The benefit of having an equity interest is the possiblity of recouping sunk costs.
The Grand Luxxe Residence Club is a non-equity, non-fractional interest club. Use is floating and subject to availability. Generally speaking, there are options to not use allotted time and not pay for unused weeks. Finally, there are options to use Sister Resort exchanges, which is not unlike options offered by other timeshare companies. The only difference is the Grand Luxxe Residence Club sister resort options are all located in Mexico.
Do your research. Examine the options that are best for you. Make sure you are realistic about the value of the option you choose. In the end, the highest value comes from use.