The Fractional Ownership Consultancy (“FOC”) is the company that provides residential developers with the legal infrastructure and full management structure for successful sales on a fractional basis. FOC is the leading European company in the fractional sector, with over seven years experience of Fractional marketing, sales and development. FOC continues to expand with clients in Portugal, Spain, Greece, Cyprus, Morocco, Florida, Egypt and the Caribbean.
Les Milton, Chairman of the Fractional Ownership Consultancy says: “Fractional Ownership allows unconnected individuals to share ownership of a property. Properties have typically been divided into quarters but sometimes into as many as twelfths. A property worth £400,000 at outright sale, for example, owned by four owners would cost each around £125,000 (the small premium used to facilitate the fractional structuring and furnishing the property). The owners of each fraction then have the right to stay in their home for the corresponding amount of time. For example, if you own a quarter share, you may stay in it for a quarter of a year – 13 weeks. Which 13 weeks of the year you are allowed to use will vary from developer to developer, but typically the weeks will be spread throughout the year and will rotate each year so that over a four year period each owner gets the opportunity to use all 52 weeks of the year.
“This very much suits people looking for a holiday home abroad. Not only are their initial costs in purchasing the property greatly reduced, but the costs of running it are also shared. And it is very unlikely that they would wish or be able to spend more than 13 weeks a year in their holiday home. Furthermore, they really do OWN 25% of the property, so they take proportionate advantage of any property price rises and asset appreciation. They can also sell their interest at market value at any time.
Les Milton continues: “The owners, along with family and friends, can afford the lifestyle advantages of a superior property, for which they have only paid 25% of the sales price, and 25% of the service and maintenance costs, too. Most fractional ownership properties are available in quality resorts with a full range of amenities and facilities, which means the resorts are professionally managed with a full rental programme in place. That is the final benefit to the fractional owner. When he or she is not in residence, the property can be let to generate income, probably enough to pay the overheads for a whole year.”
“Owner Share” is FOC’s unique documentation product, which provides developers with:
• Legally approved structuring, documentation and practical advice
• proven management systems for sales, re-sales and after sales service
• Technical training for developer sales and administration staff
• Continuous management support
Les Milton, Chairman of FOC says: “Fractional ownership, tailor-made for our clients, has increased developers’ sales by over 20% per annum – with greater margins than outright sales. Financially it makes great sense for both developers and buyers.”
The benefits to buyers include:
• Asset appreciation through freehold ownership
• Acquiring an affordable luxury lifestyle
• Minimisation of running costs in relation to usage
• a professionally managed home and infrastructure
• income generation from rental of unoccupied periods
Advantages to developers include:
• Maximising profit opportunities through increased property values
• Increasing sales velocity
• Opening up a much larger market
• Creating a busy "all year " round resort
• Developing an ongoing business through rental and resort management
FOC’s documentation service is the most comprehensive available anywhere in the fractional market. Continuously refined and updated, it is compliant with European law and directives and has been specifically tailored to meet the extra demands of local legislation wherever we oprtate. FOC approaches Fractional Ownership initially from a legal perspective and moves on to cover every aspect of the relationship between the multiple buyers, the developer, the maintenance and services support and rental agency.
FOC through its associated company Fractional Administration Solutions Limited provides administration services for the fractional owners to ensure that everything is legally compliant and operational on a day-to-day basis. As part of the service, FOC, provides developers with a sales training programme at launch and on an on-going basis. This ensures that sales staff understand fractional ownership and are comfortable selling it.
Article provided by The Fractional Ownership Consultancy