Fractional Ownership in Watersound

What is the fraction? Price? Type and size of property? Is that allowed in WaterSound?

Considering 1/8 or 1/13. 1/8 would give everyone 6 weeks per year with a few weeks left over and 1/13 would give everyone 4 weeks/year. This would probably be done in a rotating schedule where everyone would have it once a quarter. We are just looking into it at this time but are looking at a 4 bedroom or more. The property would have to be held in an LLC and have equal shareholders to the fractional ownership. St Joe does not have any restriction on an LLC owning the property. The property is lot 10 Wind Rose, if you go onto their website you can find it.

Considering 1/8 or 1/13. 1/8 would give everyone 6 weeks per year with a few weeks left over and 1/13 would give everyone 4 weeks/year. This would probably be done in a rotating schedule where everyone would have it once a quarter. We are just looking into it at this time but are looking at a 4 bedroom or more. The property would have to be held in an LLC and have equal shareholders to the fractional ownership. St Joe does not have any restriction on an LLC owning the property. The property is lot 10 Wind Rose, if you go onto their website you can find it.

It seems reasonable to me - but I wouldn't be suprised if St. Joe has restrictions, if legally able. The fractionals I've heard of around here - the property is turned over to a professional association after completetion. Keeps all the particulars and rules fair for all I suppose.

Under $500k or over?

$200,000-$300,000. We do not have any concrete figures yet because we are in the early stages. We would have no problem turning it over - looking into that -we would like to keep the overhead down because we would be owning part of it as well.

There are laws regarding true fee-simple "fractional ownership." You better make sure you talk with a real estate attorney before jumping on the fractional boat. My undersanding is that by creating an LLC as the owner, you are not creating a fee simple fractional ownership. It may be similar, but your bi-laws of incorporation will dictate who has what interest, and all the what happens if's. I know several people who do go in together and purchase property jointly. Typically, these people are close friends.

In a fee simple fractional ownership, any owner could sell his or her interest to anyone else, without the other owners' consent. If you are creating an LLC to bypass the rules, there is much more involved.

Regarding WaterSound allowing people to set up fractionals, I doubt the answer you received was correct.

Bottom Line -- hire an attorney!

Thanks for you are input. We have been in a discussion with an attorney on this and definitely would go about it that way. You are correct WaterSound will not let you deed the property into fractions but they have no problems with a corporation owning a house. We currently own the property in a LLC.

Instead of using the term "fractional," perhaps you should consider something along the lines of co-ownership or investment group? I think your idea is a great way to reduce costs and risks, you just need to work out many details of the what if's. When you furnish it, I would recommend having an interior decorator select everything with no input from you owners. Don't let your good friends turn in to enemies. Maybe you could say that no type A's were allowed to buy in.

I am one of 10 people who owns a home in Jackson Hole, WY. Actually, the LLC owns the home...I just own one of ten shares of the LLC. We have a three person executive committee that runs the show. One person is designated as the managing member...and in exchange for dealing with bill paying, maintenance, etc, this person doesn't have to pay the 1/10th share of normal expenses such as utilities, taxes, insurance, etc. There are 'management' companies in South Walton that will do this for a fee. Our arrangement works particularly well because there is no mortgage on the property. LLC members either paid cash or, as I did, got a home equity loan to purchase a 1/10th share. Also, we don't allow rentals...and we have a comprehensive operating agreement that spells out rules and regulations. I believe this is a much less complicated arrangement than fractional ownership. It was easy to do because we purchassed an existing house but we did have a lawyer guide us through the laws of Wyoming, in order to assure that everything was done properly. Any member of the LLC is free to sell to anyone else...though the right of first refusal is given to other owners. Some of our owners own two shares. So far, the arrangement has worked very well. Send me a PM if I can provide additional info, such as operating agreements.

GVM - Thank you for your input. I have sent you a PM.

Hi everyone. I'm up here in Atlanta.

I too have been interested in this fractional concept for those of us who really know we're not going to get down as much as we'd hope or originally think.

Heard that big condo tower project (Destin?) just sold out fractionally, but I myself feel better in single family.

Anyone know the firm structuring these fractionals. I was considering doing that on my lot in Cyperss Dunes at 1/6 or 1/8.

Hi everyone. I'm up here in Atlanta.

I too have been interested in this fractional concept for those of us who really know we're not going to get down as much as we'd hope or originally think.

Heard that big condo tower project (Destin?) just sold out fractionally, but I myself feel better in single family.

Anyone know the firm structuring these fractionals. I was considering doing that on my lot in Cyperss Dunes at 1/6 or 1/8.

The big one on the Destin Pass is a Peter Bos project. You should also check with Cypress Dunes to see if they allow such a thing, and if so, hire an expert, read attorney, to set it up. As noted in the posts above, it would be easier to create an LLC as an owner and have people buy into the LLC.

Re: Fractional Ownership in Rosemary Beach

Rosemary Beach has a nice fractional that is suppose be complete by spring 06
I purchased lit last year. It has gone up 100,00. I think they might have a few left.
If you or anyone esle is interested I might be interested in selling
send me a private message

Regarding Bos' project, Harborwalk, when did it sell out? The only thing that I heard is that they were having problems selling the fractionals and so they converted some of the fractionals to whole ownership. I talked to them last week and it sounded like they still had quite a few fractionals left.

Also, does anyone have a lender that 's willing to finance fractionals? A good friend is a mortgage broker and he says he doesn't have anybody that will lend on fractionals. Watercolor and Rosemary fractionals did quite well but financing is a concern for some buyers and also from a resale standpoint after initial developer offerings.

I think the wheels are about to fall off of the "condo/fractional ownership" wagon in Florida--that fad has pretty much run its course. Raising interest rates, tighter lending, Hurrincane Dennis and the publicity of more and stronger hurricanes in the coming years are unscrewing the lug nuts a bit sooner than anticipated.

I guess you are another person who does not understand investing in the market. This not fad. It is a business as long as you know when to buy and when to sell. If you have purchased a condo/house to enjoy the beach and make a little money to go along with it I think that is wonderful. Don't worry about the wheels falling off.

http:/www.30Acondosandhomes.com :clap_1: Fractionals are an alternative to whole ownership in that you don't have the headache of managing your property from another state or area. The major advantage is that you can own a property, share the expenses with others, maintain a luxury lifestyle during your stay and a credible company tends to all the details. Many Entrepenuers and Business Executives find they have less time than they have money and choose fractional ownership. I personally am not inclined to purchase fractionals at this time but will consider it it as a viable means for a second home in another location for the winter months and a great escape when I make the time to travel.

Scenic 30-A homes Debbie, Financing for Fractionals
BankTrust, Contact Name: Bebbie Burns is financing fractionals. Bebbie Burns is located in the Sandestin BankTrust branch and is financing Emerald Grande on the Harbor.

Re: Fractional Ownership in Rosemary Beach

30-A homes and condos I would be happy to add your Rosemary Beach Fractional to my website. Mind you I am still working on this site and plan to include all the Fractionals on 30A. And yes. the prices have increased with each new release.

Thank you for the offer
I sent you an e-mail through your website

Whew...I never knew SoWal could be so much WORK! I hope that those that see owning a property as a business get to enjoy this place as well. We have enough of that business stuff in our everyday life...personally we do not need it at the BEACH!

Agreed, fractionals are just a different way to get into the market in something that fits your price range.

We own a fractional in a ski resort which is 1/4 ownership. We use our time, rent it, and with a good management company, do not have to deal with any of the other owners (whom we don't know) or make any decisions. Each fraction is deeded separately and can be sold at anytime. You pay your share of the property taxes and HOA dues to the mgmt co. Furnishings, repairs, etc. are done by the mgmt co. from money put in by each owner and are done according to the standard at the property.

The latest alternative to "owning" condos/fractionals is "Destination Clubs" where one plunks down a substantial sum of money to join (depending on the club and their assortment of destinations) and pays annual dues to get access to all the properties (and yachts) around the world depending on how much vacation time they chose to buy. Each "Club" owns places like homes on St John, ski chalets in the Alps, yachts around the world, penthouses in Vegas, Beach homes/condos in Maui, castles in Scotland, etc, etc. The member can vacation around the world and isn't tied to one place (or the headaches/heartaches of ownership). It's a pretty new concept, but interesting nonetheless.

Some of these are for the ultra rich. Got one in the mail the other day and Initiation Fee started at 195k with annuals dues a minimum of 9500.

>>Initiation Fee started at 195k with annuals dues a minimum of 9500.<<

The alternative may be to drop $2M + carrying costs on a beachhouse that is in the SAME place--ALL the time (unless some hurricane decides to move it).

I think the wheels are about to fall off of the "condo/fractional ownership" Hurrincane Dennis and the publicity of more and stronger hurricanes in the coming years are unscrewing the lug nuts a bit sooner than anticipated.

As soon as they can accurately predict what's going to happen next week I'll start believing this. Heck, we haven't had a hurricane blow thru here in weeks!