The importance of fractional ownership to Bermuda's economy has been highlighted by the development at Tucker's Point Club.

The $350 million, 200-acre development, which includes a residence club, estate and town homes, villas, a hotel and spa, golf, and beach and tennis club, is in the final phase of its construction, with the new residence club villas at Harbour Court opening their doors in August this year and the hotel set to officially open in April 2008.

Ed Trippe, president and CEO of the Tucker's Point Club, said that because the owners had already paid an upfront fee for a stake in the fractional properties and paid a $75 per day rate when staying there, they were more likely to spend more money on the Island than those guests residing in a hotel paying higher daily rates.

"In terms of what it does for the Bermuda economy it is significant — the owners have paid their initial fee up front, but they spend their money by going into town and having dinner, they use the golf course and they use taxis," he said.

"In a sense, we have got very high-end affluent people who come here, and that is the Bermuda market. They are spending more compared to the guy on the cruise ship who leaves $300, because they leave $3,000 on the Island, they love Bermuda and they are absolutely the market that Bermuda needs to go for."

Mr. Trippe came up with the idea of creating a mixed use development based on models which had been successful in other parts of the world.

"We have got residents down there filling in the spaces, which works economically, but also people like people and they enjoy the social aspect of the club, and as we built out the rest it was residential in the basic plan and then we began to refine it with fractional ownership, which was a brand new concept in 2000," he said.

"Today this concept of fractional ownership has taken off because people do not want the hassle and expense of full ownership.

"Here you have services that many people could not afford to do economically if they owned the place on their own."

The project was financed with the help of Butterfield Bank, the Bank of Bermuda, the Argus Group and BF&M, with $50 million being put into the construction of the first residence club alone, said Mr. Trippe.

"All of them believed that the concept would work and it worked so much better than we thought it would do," he said.

"We sold out much quicker than we thought on the first residence and at better prices."

But, overall, he just believes fractional ownership is a good thing for attracting more tourists to the Island, while the local economy has also benefited with Conyers & Associates and other local design affiliates being used on the project.

"If you look at the hotel industry in Bermuda it now broadly makes 60-percent occupancy, but if you look at the fractional ownership, it operates at 72 percent, and that is great for Bermuda, having all of those people coming down in the off-season using the restaurants and taxis and playing golf," said Mr. Trippe.

The residence club, in which owners have a deeded fractional interest in a villa guaranteeing them frequent and flexible use throughout the year, is made up of two developments, the first of which was opened in 2005, and which proved so successful that a second one is on the way.

The existing Golf Villas, which comprise 20 villas, including five two-bedroom, 10 three-bedroom and five four-bedroom, have all sold out, while the Harbour Court properties, which are currently being built, will consist of five two-bedroom and nine three-bedroom villas and are still up for grabs at $340,000 upwards.

Prices range from $345,000 for a two-bedroom villa, $400,000 for a three-bedroom and $465,000 for a four-bedroom, with values rising from 30 percent to 40 percent since the start of the project.

The owners of the villas also receive membership of the Tucker's Point Golf, Beach and Tennis Club, giving them an advantage over residents of the estate and homes and other full ownership villas, who have to pay $100,000 for the privilege, and allowing them use of the freshwater and family swimming pools, outdoor bar and lounge, and restaurant at the beach club, the clay tennis courts and clubhouse at the Tennis Centre and the 18-hole championship, 6,361-yard, par-70 Tucker's Point Golf Course.

They can also enjoy the clubroom, where they can sit down in front of a roaring fire, read the paper at their leisure or even savour a cocktail at the bar. Downstairs, there are storage rooms where they can keep their possessions when leaving the Island.

Each property is one-tenth ownership, meaning there are a total of 200 owners in the first residence club, with 70 ownership opportunities still available in the second one.

John Bush III, executive vice-president of the residential development at the Tucker's Point Club, explained that the club introduced the first fractional ownership of its kind in the Bermuda market, which is now one of the most successful independent schemes in the industry.

"Fractional ownership is a lot of what is driving the hotel and hospitality business in Bermuda, so it is pretty important," he said.

The new hotel and spa, which comprises 88 rooms, will be the first luxury hotel to open on the Island in more than 30 years, modelled on a traditional cottage-style community including a great house, and hillside and waterfront cottages.

For more information on the Tucker's Point Club, visit www.tuckerspoint.com or call 298-6915.