Tag Archives: Ranches

Fractional Ownership Ranches

Fractional Ownership, also known as Tenant-in-Common (TIC) is a form of holding title to real property. Under this co-ownership structure, individuals will own an undivided fractional interest in an entire property and share in their portion of the net income, tax benefits, and appreciation. Further, they will receive a separate deed and title insurance for their percentage interest in the property and have the same rights as a single owner.

Fractional ownership is not a new concept. In fact, it has been successfully applied to several industries, including yachts, airplanes, resort condominiums and luxurious second home real estate. The resort industry is entering a period of explosive growth, and luxury fractional resort products are becoming a more significant and recognized component of this industry. According to Omni Brokerage, Inc, TIC real estate investments exceeded $4.0B in 2005. In addition, it has become the preferred investment vehicle for real estate investors who wish to defer capital gains via a 1031 exchange and own real property without the management headaches.

Fractional ownership typically ranges from 1/4th to 1/13th shares. The affluence of the location and the length of the season determine the size of the share. The majority of the recently completed fractionals are located in the Rocky Mountain ski areas, but the concept is spreading rapidly to other popular national resort destinations in the United States, the Caribbean, and Mexico and other international vacation hot spots. The pricing of fractional ownership shares varies greatly and can be influenced by several market factors, including unit size, number of owners, location, amenities and available supply. Typical share prices range from $100,000 to $500,000, but can easily exceed $1.0M for high end Private Residence Clubs (PRC).

Fractional Ranch Ownership

Ranch Partners, LLC is bringing the fractional ownership concept to the ranch real estate sector. We have discovered that the price and responsibility of full ranch ownership is beyond most of our client’s desires and expectations. By packaging ranches into fractional ownership, we are able to serve a significantly larger group of investors and provide a luxury resort experience, while continuing to preserve the western ranching heritage. All owners will have 4-season access to the ranch, 8 to 12 weeks of luxury accommodations and unlimited use of ranch facilities and recreational amenities.

While all fractional ranches have access to outstanding recreational activities, such as hunting, fishing, hiking and horseback riding, individual ranch properties can be developed to meet a variety of ownership lifestyles. Some ranch properties may be tailored to the luxury resort owner, complete with high-end lodging accommodations, full service management, and an assortment of amenities similar to private residence clubs. Other fractional programs may be designed around the ranch operations. These programs provide the owner with the opportunity to live, and play on a working ranch. The accommodations are much more conservative, the lifestyle is more rural and the activities are related to the ranch operations, including horses, cattle, farming and ranching.