You're lounging on the deck of your Colorado ski lodge, basking in the late afternoon sunshine after a day on the slopes. It was difficult choosing between the slopes and the talcum sands of the Caribbean, but with a private jet at your disposal, your last minute whim was a done deal.

Second homes in Aspen? Private jets? You've either scored a three-picture deal or need to wake-up from your power nap. Or maybe you've just wised-up to the newest trend in luxury travel options, fractional ownership.

There was a time when second homes, private jets and yachts were exclusively the domain of marquee names or studio titans. Now, a variety of ownership options have opened up the platinum-level playground to wider audience. Available in widely differing flavors (and financial arrangements), they're labeled variously as Fractionals, Private Residence Clubs and Destination Clubs, depending on variables such as whether the asset is actually a deeded piece of property or configured more like a membership one would enjoy at a private golf club. What they all have in common is a shared cost of owning or having access to luxe travel accoutrements such as townhomes, yachts and jets.

Other elements they share to varying degrees that are especially important for the industry crowd include a variety of member destinations and resorts, last-minute flexibility and a decidedly upmarket twist.

Although there is an obvious analogy to the timeshares which boomed in the Eighties, this is not your father's co-op condo. Modern luxury fractionals (also known also as Private Residence Clubs) began life in the early Nineties with pioneering developments such as Telluride's Franz Klammer Lodge.

Today's fractional properties differ substantially from the older paradigm because of the upscale extras and amenities that are an inherent part of the new equation. These include access to concierge services, transportation options like private jets and yachts and tightly controlled memberships designed to ensure access to properties during the most desirable times.

One of the biggest factors enabling this new varietal of vacation homes to flourish is the involvement of established luxury hotel brands such as Four Seasons, Starwood Hotels and Ritz Carlton. Several years ago, they began testing and expanding the concept -- and found a very receptive audience. The logic was that a hybrid could be developed that meshed the convenience and services of a deluxe hotel property -- such as maid service and 24-hour room service -- and combine that with the desire of some guests to own a stake at a favorite destination.
A key factor was the realization that even for travelers of means, owning a second home outright was a major commitment of time and resources, with the continual worry of leaving a property empty or hiring a management company to facilitate maintenance and rentals to offset costs.

Fractionals take those expenses and divide them between a small pool of owners. But paradise still has a price. To get in the game, an upfront investment ranging from approximately $75,000 - $500,000 per share, depending on location and residence type, is required. What that buys is generally a deeded "share" (normally 1/12 or three to four weeks per year's worth) of either a specific residence or particular type of accommodation, such as a three-bedroom condominium, at a resort such as the Ritz Carlton Club Aspen Highlands. Annual fees, which include necessary items such as maintenance and insurance, are another part of the equation and can run around $9,000 in a premium destination such as Aspen.

With their network of hotels and resorts in desirable locations around the world, hotel companies such as the Ritz Carlton are perfectly positioned to offer residence club owners additional perks, including exchange privileges that allow participants to experience far-flung destinations at sister clubs and hotels. From ski trips in Colorado to sand-and-sea flavored adventures in Hawaii and the Caribbean, clients can vary their itineraries while enjoying the best features of owning a second home while having access to guest services at a cushy resort.
"We realized that loyal guests that came back did this as a substitute to other ways of vacationing that we weren’t offering, such as owning a home or renting a condo at the destination," says Bob Phillips, vice president of business development of the Ritz Carlton Club, the company's private residence division. "We wanted to give them more space and privacy without having them give up the Ritz Carlton ambiance and service."

In the case of the Ritz Carlton Club, Phillips explains the program has self-defining limits on the number of owners (currently around 1,500), set by the number of available units, which are offered at the standard ratio of 12 fractions per specific residence. "This gives guests three to four weeks per location in what represents the very best of a deluxe condominium in that marketplace," according to Phillips.

Owners then have various options. They can work with a Club concierge to confirm a visit at their home residence during allocated times on a rotating calendar, arrange a swap with another member at a different location, or pay deeply discounted rates to visit different destinations if they've exceeded their allotted time.

Typically, on-site staff can also handle small details at a share owner's residence, including stocking a refrigerator with favorite items or retrieving stored ski gear and having it tuned and ready to go prior to arrival.
Other extras involve transportation perks, such as the one offered by Marquis Jet Partners, a provider of short-term leases of fractional interests in private jets. An agreement with the Ritz Carlton Club allows members to purchase varying levels of private jet usage that guarantees on-call aircraft availability 365 days a year.

But it's not just premium hotel companies that have jumped into the fractional fray. High-end tour operators Abercrombie & Kent have joined forces with industry innovator Private Retreats to create a novel model they term a "Destination Club." Integrating the structure of a private country club with capacity models developed by the fractional jet industry, the destination club stresses membership over the deeded ownership involved in a true fractional.

The destination club still involves an upfront cost and an annual fee (in this case $250,000 and $8,750 respectively), but stresses variety above all else. While a fractional usually involves a "home" resort and limit on allotted days, Private Retreats by Abercrombie & Kent provides for unlimited access to a portfolio of 65 luxury Club-owned resort residences and yachts scattered throughout the US, Mexico and the Caribbean. "We are actually offering our members 65 second homes," says company spokesperson Michelle Bambino.

The club also touts fashionable one-bedroom apartments and suites in coveted cities such as London, Paris, New York and San Francisco that are complemented by membership privileges with the Quintessentially Concierge Service. This service provides virtually unlimited access to exclusive restaurants, shows, clubs and sporting events while traveling. In exchange for this flexibility in venues and unlimited travel days, members pay $155 per night for the various resorts and yachts, with a fee of $250 nightly for the city suites.

Showing how the category has further evolved, the Abercrombie & Kent affiliation means that for the minimal charge of $75 per day, members can also take advantage of a selection of safaris and other worldwide excursions enjoyed in the past by notables such as Denzel Washington, Tom Hanks and Bill Gates. As is the norm in the industry, membership caps are utilized in the destination club model as well, with current levels set at 400 participants.

But not all fractionally flavored getaways involve cross continental travel. For those who would like their second home closer to home, The Club is a newly opened high-end fractional property in Big Bear, just two hours from Los Angeles and surrounded by a national forest. Comprised of 58 fully furnished three and four bedroom villas, The Club's residences feature luxuries like a gourmet kitchen (Sub-Zero and Viking appliances), stone fireplaces and wide screen, high definition satellite TV's with surround-sound systems.

For those who do need to travel by air for business or pleasure, the "getting there" conundrum is always a key factor. Security issues, long lines and limited flight schedules have made commercial airlines less appealing, especially considering the last-minute nature of the industry crowd. Providing an increasingly popular alternative are fractional jet companies such as Flexjet, NetJets and Flight Options. Their programs, policies and equipment vary, but essentially they provide a similar service: the opportunity for clients to own a fraction of a jet (1/16 is an industry-norm minimum share) for use with as little as 4 hours notice.

In addition to the convenience of having the fractional company manage, staff and maintain the aircraft, owners of the fractional jets can receive tax benefits from their investments as well. An intensely competitive industry, new programs are constantly evolving as the different firms attempt to attract new corporations and individuals to their service.

One such program is Marquis Jets, which NetJets launched last year. Rather than owning a fraction of an aircraft, Marquis customers buy short-term 25-hour leases that can be applied to different aircraft in the NetJets fleet, the largest in the industry.

Rates for a traditional jet fractional vary depending on the type of aircraft and number of shares, but can be generalized as ranging from about $300,000 for a light cabin craft such as a Citation IV Ultra to $2.5 million for a Gulf Stream V. Popular with CEO's, celebrities and sports figures (governor-elect Schwarznegger is a fractional jet owner) the trend is currently flying high.

Having staked a claim on land and in the skies, the final frontier for part-time, part-mine luxury ownership is the high seas, where the fractional yacht is the trend's new wave. "Our research shows that boat owners typically enjoy their vessels three to four weeks per year, yet are financially responsible for fifty two," says Jonathan Metcalfe, co-founder of YachtSmart, a fractional firm specializing in luxury motor yachts. "We offer clients the pride of ownership without the costs and hassle of owning and maintaining a luxury yacht."

Virginia-based YachtSmart has plans to expand to California and owners of shares hail from everywhere from Southern California to New Zealand. Yachting itineraries range from New England in the summer to the Florida Keys and Caribbean in the winter. An example of the vessels in the YachtSmart fleet include a 2002 62-foot Fairline Squadron with teak decks, entertainment center and wet bar and a new, $4.2 million Italian Azimut 85, with more vessels currently being added due to demand. It appears that whether on land, sea or air, fractional and related businesses are looking at smooth sailing ahead.

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