Baby Boomers Look To Aspen Fractionals

Explosive growth is anticipated in the resort industry over the next twenty years. Second home ownership is showing such a rapid increase - up 16.3% in 2004 from the prior year. Many years ago I was told that if you find where the baby boomers are going, and get there first, you can make a fortune. The baby boomers are now reaching their peak earning years. Children are graduating from college, and they are inheriting from their parents' generation, which was the wealthiest generation in American history.

The Aspen/Snowmass area, in which we live and work, can be the recipient of this investment of money, but we need to realize this is a very intelligent and educated generation of people. Annual use of second homes averages only three to four weeks a year, thus the entry of fractional ownership programs. Fractional ownership gives owners new condos with all of the amenities they have come to expect in this area at a fraction of the price. Unlike timeshares, a fractional interest is an equity position in the building itself, the amenities and is evidenced by a real estate deed like that secured for any other type of real estate. Your deeded undivided interest can be mortgaged, willed, placed in a trust or owned by an LLC.

I had years of people walking into my office on the center of Hyman Mall saying "I love Aspen, but I can't afford Aspen." Now I share fractional ownership projects with them and say, "It is like buying a condo with a group of your friends. It is just we find the friends for you, and the management takes care of all the hassles and details." The new owners just get to come and enjoy the valley and all it has to offer. The true miracle is they get to pay for the time frame they are going to use, and if they want more time, they just buy an additional interest.

Part of the beauty of this type of ownership is the ease it offers owners. At the end of their stay, they just take away good memories. According to some research, fractional properties have already approximated the resale values of local real estate. Should the owners ever choose to step up to whole ownership there has been a secondary market wanting to buy.

Our marketplace now has many options from The Innsbruck with prices starting under $100,000 to The Residences at Little Nell with prices at $2,250,000. It is difficult to find inventory for many buyers, and the fractional programs have offered brokers a way to find homes for buyers that otherwise would have to be turned away to another market.

Fractional ownership is also helping to give Aspen and Snowmass more beds for visitors, which benefits the entire area. Many of the programs, like The Timbers, Ritz Carlton and The Innsbruck offer owners the opportunity to come and stay as much as they want on a space available basis. This brings owners into residence at times that otherwise might have low occupancy. More year round occupancy in our area brings more money and activity to our towns.

Some people have resisted the concept of fractional ownership because it was new, and they didn't want to research it. I must admit I was there also, years ago. Now, I have looked at what it means to the owners, to our area and the benefits for all. All ideas were new at some time and we need to see the true merits of each. As we embrace progress we can also do much to revitalize our area with new properties, new visitors and new owners.

Gwen Dickinson
Partner/Project Manager - The Innsbruck, Aspen
Broker/Owner - RE/MAX Premier, Aspen