Holiday Homes Portal News

Fractional consultancy launched in SA

Date: 28/09/2009
Article source: fractionalownership.co.za

Fractional real estate veteran launches Geyser Fractional Consulting Firm, providing expertise to developers and existing unstructured syndicate owners

Drawing on his extensive experience in finance, real estate and the fractional market, Thys Geyser announced the formation of  “Geyser Fractional Consulting Services”, a new firm specializing in design, structuring, marketing and operational management of fractional interest products.

Geyser is one of the pioneers in the South African fractional interest market where he created Staytus Luxury Lifestyle, which he merged with Pam Golding Properties during 2007 to become their operating executive in charge of Fractional Ownership. He was also the initiative behind the creation of the South African Association of Fractional Intermediaries.

Geyser says he had been inundated with requests over the past 3 years from developers, agents and existing syndicate members wanting advice and assistance in developing fractional products and taking them to market.

After attending the international conference on fractional interest in the US in March it became clear that there is a void regarding independent advice to developers and owners in so far as fractional conversions go, hence the brave move to enter the consultancy and structuring arena. As an independent advisor he has made his services available to existing fractional marketing players and a number of resort estates.

“ The change in the SA and global economic conditions has had in impact on investor’s appetite for a wholly owned second home, and we see a dramatic move into joint vacation ownership products, and in existing investors wanting to offload their second homes into this market” says Geyser. The real challenge according to him is to have the product integrated into the resort or host complex, to have a proper marketing and sales strategy and very important to have access to a sustainable after sales project management system. Without these elements the product will not survive in a competitive fractional market.

Main stream estate developers will also move towards offering integrated fractional products as part of their estates, properly planned and designed from the onset. Geyser says the international market typically allows for clusters of such fractional products within a resort on a scale of no more than 20/40 on the entire development.

The challenges that potential entrants face when considering launching fractional products are diverse, ranging from the legal framework, the product design and positioning, how to allocate use to the owners in a fair system, exchange options, management obstacles and lastly finance for the end users. Geyser believes that without a proper professional plan and partners many will try but few will succeed.

In as much as the services on offer by the Geyser Fractional Consultancy will be beneficial to developers Geyser feels that the service is also available to existing owners in syndicate structures that are unstructured, unmanaged and hence almost unsellable! “ By restructuring the existing syndicate market we will assist these owners to enhance their products into the fractional market and to make them tradable and in the near future financeable”

“The existing new sales market might be half a billion a year but the existing syndicate market must be 100 times that” says Geyser. So although the international market in fractions only grew by 8% last year the SA market will show much higher figures due to conversions.

To assist developers, owners, and other fractional interest parties with world class service Geyser has formed strategic alliances with local and international associates in the legal, marketing , design and consultancy fields. “For example Fractional Consultancy.com a UK based firm has already engaged Geyser as their local representative, while access to the Pierce Group in the US allows them to utilizes its founder’s experience in sales, marketing and operational programs, along with strategic alliances with other high-end U.S. and international real estate marketing companies”

Geyser quotes Pierce as saying “There are many square pegs and round holes in the fractional real estate business, without the expertise to recognize them, a great potential can be squandered on the wrong fit. Many enthusiastic developers have paid dearly for their marketing and sales missteps.”

Geyser Fractional Consultancy offers a diagnostic project assessment at a  launch price of R5000, where after the client can assess if the product is viable in the fraction market and if they should commission the firm for detailed assistance.