Fractional interests: for some vacationers, 1/12th slice is right.

• Author: Taylor, Mike
• Position: Aspen, vacation homes shrinked

As the owner of an Aspen real estate brokerage, Gwen Dickinson got used to visitors stopping by her office, looking at photos of listings and lamenting their inability to afford property in the upscale resort town. And as real estate prices kept rising, even people able to buy a second or third home were hard-pressed to justify spending millions on a mountain property they might only use a few weeks a year.

"It's kind of sad," Dickinson says. "People would say, 'I love Aspen, but I can't afford Aspen.' They were right, and that was hard."

So in December 2003, Dickinson and some investors did what a lot of resort and lodge owners have done in Colorado in recent years: They bought the Innsbruck Inn on Aspen's Main Street and turned the 17-unit lodge into fractional units, offering 1/12th sares at prices ranging from $64,700 to $157,000. In Colorado resort towns with two distinct vacation seasons--summer and winter--the fractional concept has flourished.

"I've had buyers tell me, 'I can afford to buy a whole place, but I'm only going to be there a small portion of the time anyway, so why pay for the whole thing?'" says Dickinson, the owner of Aspen's RE/MAX Premier who settled in the town 11 years ago after growing up in Alabama and later living in Florida. Sales of Innsbruck fractional interests began in early June and within a month, 22 out of the 204 total fractions had been sold even though the remodeled lodge on Aspen's Main Street isn't scheduled to open to new owners until mid-2006.

Colorado has been the leader in fractional properties--often described as high-end timeshares with stepped-up services--since the term "fractional" started surfacing in real estate lingo about 10 years ago. According to Ragatz & Associates, a leisure-travel research firm based in Eugene, Ore., Colorado has 30 fractional properties, the most of any state. And that count is undoubtedly low; Ragatz lists five fractional projects each in Aspen and the Vail area, followed by Telluride with four, but those figures don't count all the small, converted lodges like the Innsbruck. A recent report by BJ Adams & Associates lists Aspen alone as having 12 fractional properties.

Converting small lodges from rentals to fractionally owned properties makes sense for the same reason it made sense for Ritz-Carlton to build a 73-unit fractional-interest club at Aspen Highlands about six years ago, and two years later build a 54-unit fractional at Bachelor Gulch, a gated resort...