DC4MS

Portofino builds property appreciation into perks

The destination club's plan is one some competitors have tried and others have decided not to pursue.

By Julie Dunn Denver Post Staff Writer
05/09/2007

The Denver Post - Portofino builds property appreciation into perks

In a bid to help differentiate itself and gain new clients, Greenwood Village-based Portofino Destinations Club is offering a new "appreciation package" that allows members to share in the financial upside of joining a luxury destination club.

"We think this offers members things that are pretty forward thinking in the industry," said Rance Rogers, president of Portofino, which has 155 members. "Demand has already been high."

Destination clubs, a hot segment of the travel industry, offer access to multimillion-dollar homes and five-star service for a one-time fee, ranging from about $60,000 to $3 million, plus annual dues of $7,000 to $75,000.

But several other Colorado-based clubs - including Exclusive Resorts, Private Escapes and Quintess - said they felt no need to offer a similar appreciation option.

"When people are on vacation ... they don't want to be thinking about real-estate appreciation," said Rachel Neumann, spokeswoman for Exclusive Resorts.

With more than 2,500 members, Denver-based Exclusive Resorts is by far the largest player in the category. Most clubs, including Portofino and Exclusive Resorts, offer an 80 percent refund on the initial fee if a member resigns.

Portofino's appreciation plan works like this: for an extra fee of between $6,500 and $35,000, members can capitalize on the increase in pricing upon resignation, because memberships are resold, plus get preferred usage on certain homes. And since each member deposit is tied to a single property, they can take advantage of the tax benefits of owning that asset.

Fort Collins-based Private Escapes, which has just under 350 members, said it offered a similar package but terminated the program last year because it wasn't helping to sell memberships.

"We thought that it would be important to people, but it just wasn't," said president and co-founder Richard Keith. "People were a lot more interested in where were the destinations, what are the support services. Our model is selling very well."