What is a condominium-hotel?
A condo-hotel offers anyone the opportunity to own an
elegant and exquisitely furnished hotel room in some of the most
desirable locations in the world. Since this is a purchase, the buyer
not only gets a deed to a property, which allows him to sell or transfer
the room/suite whenever he chooses, but also profit from tax benefits
and real estate appreciation. Whenever the room/suite owner is using his
room/suite, he has available to rent through the hotels rental program.
What are the major benefits to an owner of a condominium-hotel room/suite?
The most important benefit is hassle-free ownership. When
the owner, his family or friends wants to use the room/suite, they
simply call the hotel and schedule their visit. While at the hotel, they
can enjoy all of the amenities and services. When the room/suite is not
being used, the owner can rent the room/suite through the hotel’s
rental program and does not have worry about maintenance and general
upkeep. This is voluntary, not mandatory. What are the tax benefits?
In most cases, just like a conventional condominium you
will receive benefits for your interest on the mortgage and real estate
taxes. In certain cases an owner can receive tax benefits from interest
and principal and real estate maintenance. In order to determine
eligibility, a tax advisor or accountant should be consulted.
Who manages the hotel and what are their responsibilities?
The hotel operator not only manages hotel rentals, but
also markets the room/suites, takes reservations, operates the front
desk, maintains the property, and provides the services hotel guests
expect, such as housekeeping, food and beverage and concierge.
What general amenities does the condominium-hotel have?
Condominium-hotels are designed as high end resort.
Rooms/suites owners will generally have access to valet, concierge, spa
treatments, room services, maid service and world class restaurants. How are the room/suite furnished?
All rooms/suites are elegantly decorated including having
luxurious bathrooms. Additionally, many room/suite are equipped with
flat-screen television, DVD and CD players and wireless internet.
Depending on the developer and the project.
Can owners furnish their own room/suite?
If the room/suite is going to be placed on the hotels rental program,
the owner must comply with the hotel’s furniture selection, to ensure
consistency throughout. However;
The owner may bring in personal items for
the duration of a stay, which must be removed or stored upon departure.
Are rooms/suites owners responsible for the furniture?
Owners are responsible for their own
room/suite and the contents within. Room/suite owners are required to
buy the hotels furniture replacement program, which enables the hotel to
change furniture as necessary.
Is an owner required to participate in the rental program?
The rental program is entirely voluntary, with no mandatory participation.
Is the furniture included?
Generally speaking, some developers will
furniture is charged separately. However; if you are elected to
participate in the rental program within 30 days after closing, we will
provide you with a credit equal to the price of the furnishings. Each
developer has its own policy visa vi's this subject.
How is the revenue from the hotel rental program paid to owners?
The cost factor for hotel management is
equal to 10% of the room/suite revenues. The balance of the operating
income is split 50/50 between the owner and the hotel.
How are hotel rooms/suites selected for rental?
The rooms/suites will be selected through a specialized computer
reservation system that assigns “rotation points” to rooms/suites as
they are occupied. The rooms/suites with the least number of rotation
points are the next to be rented in the system, provided that they meet
the guests’ requirements and a guest has not requested a specific
room/suite. Through this program, rooms/suites will be fairly reserved
throughout the hotel. Rooms/suites owned by the developer or the hotel
lot owner may receive preferential treatment with respect to rental.
Will I receive a percentage of the revenues earned from the other facilities at the hotel?
If the room/suite owner decides to participate in the
hotel’s rental program, the owner will receive a portion of the revenues
from the room/suite. However, room/suite owner does not receive any
other additional revenue from any of the hotel’s services (i.e.
restaurants, spa, shops)
How can I learn more about the condominium-hotel program?
A homeowner liaison from the specific hotel management
group will be able to answer all questions pertaining to the rental
agreements of your hotel room/suite. Call 305-662-5011 for more info.
RENTAL PROGRAM OVERVIEW Revenue-
Net revenue represents the collected revenue from the rental of the
room/suite after deducting certain hotel expenses. Thereafter, the owner
and hotel operator split the net income. This is generally distributed
on a quarterly basis.
Reserve-4%
of gross room revenues will be retained to maintain all rooms/suites at
the hotel’s standards. These reserves are generally utilized for
replacement costs of various items within the hotel including
furnishings and public amenities.
Rotation Procedure
- room/suite will be rented based accommodating specific guest
requests. Rooms/suites especially designed to meet Americans with
Disabilities Act requirements, and selected other rooms at management’s
discretion, will participate base on specific guest request.
Rental Agreement Terms
- The room/suite must at all times be maintained according
to the standards of the Hotel and the Hotel Group management.
- The initial lease term will vary from one year up to 5
or 6 years. The lease terms after the initial term are re-negotiated
with each owner’s requirements in mind.
- Owners may occupy their room/suite at any time based on availability.
Termination and Default
– The Rental Agreement may be terminated by the hotel management
company with or without cause upon 30 days written notice to owner. The
agreement terminates upon the sale or conveyance or transfer of title
unless the hotel management company approves the assignment of the
Rental Agreement to the subsequent owner. The owner can terminate at the
end of any rental management term based upon written notice. Notice
provisions vary.
Assessments and Fees
Assessments, other fees and expenses are due quarterly (in
advance). The monthly maintenance varies with the size of the
room/suite as in a regular condominium.
Insurance Requirements- The owner is responsible for obtaining insurance coverage for liability and room/suite contents.
The properties will specify coverage requirements. Each
insurance policy must have an endorsement stipulating that the policy
may not be canceled or changed with at least 30 days’ prior written
notice to the hotel management company. The policy must contain an
endorsement waiving any rights of subrogation against the property
owner.
Debt Service- The owner is responsible for paying the owner’s mortgage, if any or other types of financing.
Utilities-
The owner is responsible for paying all utilities while staying at
their room/suite, except for utilities included in owner’s maintenance
fee schedule.
Property Taxes – The owner is responsible for paying applicable property taxes.
Other charges-
If the owner declines daily maid service during any owner occupancy,
the owner will be charged a nominal re-entry and cleanup charge to
prepare the room/suite for rental following the end of each owner
occupancy period. The owner will incur charges for mini bar, long
distance telephone, business center, food and beverage, and room service
use during an owner occupancy period, and must pay for all such
services at checkout.
Room Rates-
Rates are determined by individual condominium hotel group. The rate
may vary based on the season, market conditions and special local events
or promotions
My Condo Realty
305-662-5011
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