It's Friday, October 20th, and I've just returned from the ULI Convention in Denver. For all ARDA folk - this is where the action takes place outside of timesharing. And, I'm including fractional products in that statement. The resort component of the 32,000 membership of ULI is in their Recreational Development Councils. As I've written before, among these resort developers, there is significant [make that in caps!] interest in the fractional product. Many have projects under way, others in planning and still others learning about fractions and all their derivatives.

I believe that major fractional players, who are not in ULI, need to be there.

I was also reminded that fractional interests are still a rather new product, and there has been and still is a lot of trial and error in the use plans that are designed and reciprocity programs. There will be some failures.

As seems common there was some confusion, but less this year, about fractions and non-equity clubs. Are they the same? No! Can the term 'private residence club' be used for a non-equity club? Not in our universe! One of the breakout groups had a panel with Exclusive and a former exec from the failed Private Retreats/A&K/Tanner & Haley. Until these clubs accept some form of regulation and ensure for their members that the dwellings they purchase for them are debt free the major risk continues.

On the flip side - hey, great for we fractional developers standing there with deed in hand!

At this meeting Star Resorts was 'fully loaded' with Chris Tivey, Rich Feldheim and Christine Zahedi all there and participating in the resort groups.

My view of an explosion of fractional programs from very established developers should give rich fodder for Dick Ragatz and his next conference all the while leaving ARDA pretty much out in the cold due to their requirement that all speakers be members of ARDA. At this juncture most all fractional practitioners see no value in ARDA membership, hence, the panels dealing with fractions are only half-loaded. Wasn't there an expression....the chicken or the...?

What's lacking for fractions to continue straight up without hitches?

#1. Separation from the non-equity folk.
#2. Detailed programs to understand the nuances of the business of which there
are a multitude.
#3. Experienced talent in product formation, marketing & sales
#4. Exchange options
#5. Media support so buyers will understand that fractions are the 'smart choice'

How Thin is the Fractional Marketplace?

That's 'thin' on talent on the side of those of us 'in the business'.

Star just finished a two-day planning session, and we got talking about how to gauge ourselves, best practices, etc. We came to the conclusion that there are very, very few companies that focus exclusively on luxury fractions, and of that few, few are really good at it.

So, our goal to 'continue to be the best' in our universe, upon analysis, became a limiting goal rather than an inspiring goal. We have set our sites substantially above any other company in the business to make sure we deliver the goods for our projects and those of our developer clients.

What's that say about the fractions business? It's a partial indicator of a new niche business. But, it's also a statement that many developers assume they can successfully expand their offerings to include fractions and use their same sales staff to handle the addition.

Not so in our experience, but time will tell.

The timeshare selling model is well known, like it or not. The fractional sales model is being designed and developed each and every day. Those in the business for a long time, like Star, have learned the best performing lessons, and we continue to refine our capabilities to stay on point.

We recently promoted Ashley Offermann to VP of Project Management. His portfolio includes Purgatory Lodge, Durango CO and Mt. Superior Residence Club, Snowbird UT.

Also, joining Star is Chris Cannon designer and marketer of the first rank. He's worked with us for a number of years, but is now full time. We are handling multi million dollars in marketing budgets and he leads that effort along with our Chris Tivey who continues his duties as President and COO.

Lastly, Gary Bixler has joined us as VP Project Management with the Expedition Lodge, Kirkwood CA and Saguaro Ranch, Tucson AZ has his portfolio.

I continue to have Meriwether Ranch and all the new business development.