Fractional Ownership News
Fractional Summit USA: Day one
The inaugural Fractional Summit USA real estate conference hit the ground running as around 170 delegates from across the US, the Caribbean and Europe arrived at the InterContinental in Miami for the two day-event.
Day one kicked off with an introduction from Fractional Life founder Piers Brown (pictured), who explained that when he first announced his plans for the event – to be held in a city whose real estate market has fared particularly badly during the recession – people thought he was mad. But Piers reiterated his commitment to growing the fractional marketplace and stressed the importance of backing your convictions with action.
Then Sarah Rezak, of Rezak Resort Consulting (pictured below), took to the stage to chair the day's Fractional 101 sessions – a comprehensive guide to the fundamentals of fractional development, including sessions on definition, feasibility, finance, legals, sales and marketing, usage programmes, exchange and rentals. She began by establishing who was in the audience, which contained a significant number of developers, many of whom were thinking of entering the fractional market for the first time.
Sarah then stressed what many subsequent panelists then backed up, that fractional real estate only works in established tourist destinations which potential buyers already have a strong affinity with: “It's really hard to sell a community,” she said. “You want to be selling to people who are already engaged with the community.”
Many of the speakers had one eye on the future of the industry. During a session on how to get a new project off the ground, Jim Marmorstone of Tenstar Development Group said he thinks that the sector will eventually see a move away from fractions to more points-based ownership systems.
And several marketeers in the room predicted a return for direct marketing, a technique currently out of favour with many, but which can be highly effective if well targeted, according to Randy Burgess of Peter Kempf International.
Sean Zimmerman of Strategic International Advisers told delegates that his company was devoting around 70 per cent of its resources to what he described as “ground warfare” marketing – getting brands in front of likely buyers by engaging them through alliances with golf clubs, hotel concierges and the like. He also stressed that providing buyers with an experience rather than a product is essential: “Products don't sell – emotions sell, and people are emotional.” Zimmerman also stressed that although many companies are frantically rushing to embrace social media, he doesn't see it as a particularly effective tool in engaging fractional real estate buyers.
On a similar note, Chad Barker of Barker & Associates noted that because so many people now access their emails via phones, a lot of wasted effort is going into long elaborate marketing emails and attachments which don't ever get read.
Randy Burgess gave some straight-talking advice on sales, and stressed the vital importance of having a highly-trained sales team who know their product intimately, rather than relying on the traditional brokerage community.
He said that high-end fractional and PRCs necessitate a relationships sale, which take time and regular follow ups to inject a sense of urgency into the sales process.
Day one ended with a slightly chaotic but effective business card swap and a rum tasting courtesy of Zacapa.
For a report on day two click here.
01/09/10
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