It’s the newest buzzword among real estate investors. Condo hotels are gaining attention as the ideal solution for people who want a hassle-free, luxury vacation home that generates revenue and has appreciation potential.
Not Your Daddy’s Timeshare
Condo hotels are not the timeshares of yesterday. Buyers have full ownership of their condo hotel unit and are not restricted to a one- or two-week stay or a particular week of the year. In most cases, they can stay 30-60 days per year in any configuration of time they choose. Plus, they can elect to place their unit into the hotel’s rental management program when they’re not using it and share in the revenue it generates.
The advantage for condo-hotel owners who choose to rent their units through the hotel program is they avoid the responsibilities that come with being a landlord. Their vacation home is available for their use with a simple reservation anytime they want to visit. They receive revenue throughout the year that helps offset the expense of owning the home. And finally, they can sell their condo hotel unit whenever they wish and keep the profit derived from appreciation.
Buyers Have Sophisticated Taste
Who’s buying? Most condo-hotel buyers are affluent, well-educated and well-traveled. They enjoy all of the luxury accommodations and services that one expects from a five-star hotel, including chic décor, personal concierge services, access to spa and fitness facilities, fine dining and premier club access.
Condo Hotel Trend Spreads
The condo-hotel trend started in destination resort cities such as Miami Beach and Las Vegas but has spread to upscale cities with vital downtown areas. Currently, condo hotels are under development throughout vacation favorites like Fort Lauderdale and Orlando and in major cities like Chicago, San Diego, Boston, and Washington, D.C. To learn more about individual condo-hotel properties, consult a professional.
Top Hotel Operators Run Condo Hotels
Most condo hotels are managed by prominent four- and five-star hotel operators such as Four Seasons, Ritz -Carlton, Trump International, Sonesta, The Regent, Starwood, and Hilton. Because of the hotel’s brand name, worldwide marketing, national affiliations, centralized reservation system, and management expertise, condo-hotel unit owners typically receive a higher level of rental income than they would from owning a traditional vacation home.
Condo Hotels Sell Out in Pre-construction
Prices for condo-hotel units range from $200,000 to upwards of one million. The majority of condo hotels sell out in pre-construction phases with the earliest buyers realizing the most significant appreciation, as developers typically raise prices three to six times throughout the selling process.