The highly successful Ritz-Carlton Club is celebrating its 10^th anniversary this year in a unique way: The luxury hotel company’s equity-based private membership program is changing its name and adding a twist. Now known as the Ritz-Carlton Destination Club, it offers the same fractional ownership option as before, called a Home Club Membership, in addition to a new Portfolio Membership, which offers travel flexibility to premier destinations through a points-based currency.

The Portfolio option offers a beneficial interest in a trust where members can customize their vacations through purchased points. An entry membership comes with 5,000 Club points, but additional interests can be purchased in 2,500-point increments. Pricing starts at $130,000. Club point values are based on the destination, season and size of residence.

The Home Club provides use of a titled residence at a property the member can return to throughout the year. Members can enjoy up to 35 days of pre-reserved access at their specific club annually and can also use a portion of the time at other locations on a reciprocal basis. Prices range from the low $100,000s to the low $800,000s per deeded interest. Both Home Club and Portfolio members must pay annual dues to cover their portion of operating costs.

“The Ritz-Carlton Destination Club provides the discerning few with a new level of privilege and freedom when they travel,” said Peter J. Watzka, executive vice president and chief operating officer for The Ritz-Carlton Development Company, Inc. (an affiliate of The Ritz-Carlton Hotel Company). “Over the last decade of establishing a second-home alternative for our current Ritz-Carlton Club Members, we developed intimate and rewarding, one-to-one relationships. With this commitment to deliver luxury vacation experiences, we evolved the brand to the new Ritz-Carlton Destination Club by blending the attributes of luxurious vacation homes with a heightened, flexibility while also maintaining the exclusivity our members have come to expect.”

There are nine Destination Club properties offering a mix of golf, ski, beach and urban experiences, and Portfolio members can also use up to 25 percent of their points for stays at participating Ritz-Carlton hotels and resorts (nearly all 73 properties are participating).

One of those locations is the Ritz-Carlton Club, Aspen Highlands (CO), where the former general manager, Nicholas DiMeglio, was recently promoted to vice president of operations for the Ritz-Carlton Destination Club. DiMeglio previously worked at a wide range of luxury properties, from the Williamsburg Inn (VA) to the Greenbrier (WV) to several positions at Four Seasons and other Ritz-Carlton properties. With 35 years experience in the hospitality industry, DiMeglio offered up his perspective during a recent Q&A.

What are the greatest challenges, from your perspective, in switching from traditional resorts to a vacation club? What are the major differences between the two?

Since my transition from lodging to a fractional ownership resort, I have found there are both similarities and differences between boutique hotel properties and private residence clubs. When working for a boutique hotel, the preferences of the guests are robust. I have also found this to be similar in my experiences at The Ritz-Carlton Club, Aspen Highlands.

Yet, one of the main differences I encountered was the responsibility associated with working with our condominium owners’ association (COA) in Aspen. I spent approximately 20-30 percent of my time working with the COA on association affairs concerning the property. The passion of our members is high because they own part of the property, and as a result, our members take great pride in the maintenance of the property.

Managing a private residence club gave me the opportunity to build relationships with the members and their families. I was able to go skiing and hiking with members and become much more in-tune with their needs and wants while they were staying in their vacation home at The Ritz-Carlton Club. While out on the ski slopes, I was able to update members on the latest ski equipment, show them the best fly-fishing spots or the most amazing place to see the colors of the leaves in the fall. Additionally, our members develop a comfort zone when they return and are welcomed back by the same employees again and again. This allows our employees to also build relationships with these families.

How does a vacation club differ from a fractional?

One has true ownership in a fractional, which results in members taking a much more active role with the staff and the running of the activities to maintain the asset.

The Ritz-Carlton Destination Club offers much more than traditional timeshare or fractional ownership products:

• For example, a one-twelfth interest in a Ritz-Carlton Club, Aspen Highlands residence provides 28 days of pre-reserved access versus a one-week ownership in a traditional timeshare.

• As available, members may reserve additional time on a nightly basis.

• Traditionally, members have use of their residence on a rotating calendar, assuring access to prime season versus owning the same week every year or an open reservation system working on a “first come, first serve” basis.

• Ritz-Carlton Destination Club members benefit from services and amenities, which are not generally offered by other interval ownership products.

• The Destination Clubs are smaller and more private than traditional timeshares. A typical property consists of 40 to 80 residences.

• The Ritz-Carlton Destination Club is for the use of members and their guests only.

• Only the highest quality materials are used in the residences–from furnishings to top of the line appliances and appointments.

The press release says you “improved profitability of ancillary business at The Ritz Carlton Club, Aspen Highlands? What were those “businesses” and how did you do it?

The food and beverage outlets and the spa associated with The Ritz-Carlton Club, Aspen Highlands are ancillary businesses owned by The Ritz-Carlton Development Company, Inc. The menu at the onsite restaurant, Willow Creek Bistro, was repositioned in 2007 when Chef de Cuisine, Jami Flatt, joined The Ritz-Carlton Club, Aspen Highlands team. Mr. Flatt’s revised menu was themed around “Decadent Comfort Food” and well received from our members. As a result, we grew our revenue considerably last year while improving our bottom line. In the past, our restaurant was used for special occasions including birthdays, celebrations and holiday events. The new menu was created in order to attract our members to the restaurant four to five times during their one-week stay. Flatt’s focus takes simple ingredients and flavors and creates something spectacular with a focus on using fresh, local ingredients.

Caffe Sienna, our coffee house, was created in partnership with Royal Cup Coffee. Our members and guests enjoy this quick service food and beverage outlet where they can have a cup of coffee or wrap before heading out for a day of skiing or for a hike. Additionally, we also started offering picnic backpacks for our members. All of these businesses proved to be hugely successful.

The spa was repositioned to complement our scenography: mountain moments and alpine adventures. We introduced the Naturapathica Brand for our spa treatments in order to complement our incredible alpine setting. We have also focused on combining luxury spa services and a healthy lifestyle for our Members by offering treatments and healthy food and beverage options.

How do you find and retain good employees? How are they trained? What are the special challenges in hiring staff for an upscale resort?

We recruit our ladies and gentlemen at many of the top universities around the country that offer degrees in hotel and restaurant management. Additionally, we are also attracting international ladies and gentlemen from a variety of locations including South Africa, India, Peru, Croatia and Argentina. (Employees) are trained to offer members and guests the legendary Ritz-Carlton service. We track each individual’s performance and review our key success factors on a daily basis. Additionally, there is a certain amount of prestige and pride in being involved with The Ritz-Carlton brand. The Ritz-Carlton Destination Club allows (employees) to take this to the next level because they get the chance to build relationships with members and guests.

What are the biggest short- and long-term challenges for the vacation club industry? How do you plan to meet those challenges?

The short-term challenge deals with the real estate market. Long term is similar to the hotel business competition. Although the market has changed considerably with the current economic situation, especially in condominium development, our real estate options are unique and we still enjoy interest in The Ritz-Carlton lifestyle. For those interested in a second or third home–without the maintenance responsibilities–The Ritz-Carlton Destination Club is unmatched.

For more information, check out www.ritzcarltondestinationclub.com.