A freehold purchase within a luxury suite hotel is one of the easiest but most lucrative property investments you can make, they claim. A single management company handles all the headaches from occupancy to maintenance.
These types of investments are available in Spain, the Far East, the Caribbean, the USA and South America and come in a variety of prices, sizes and lifestyles. But it is the luxury end of the market that is attracting most interest.
'It's all the rage,' says Robert Mandelbaum, director of research at hotel consultants PKF Consulting. 'But everyone's asking if it is a flash in the pan or something that's here to stay.'
Unlike time shares, where owners have the right to visit a property for a few weeks a year, or traditional condominiums, where individuals own the units and can do what they want with them, condo hotels are a hybrid. Investors own a specific condo and pay property taxes, insurance, and maintenance fees. Hotel management companies rent out the rooms, rotating reservations among the various units and splitting the revenue fifty-fifty with the owners.
The downside is that units often come furnished and owners can't make changes to the decor or add personal items such as photos. 'You wouldn't know the room is owned by somebody else,' says Rick Davis, a Los Angeles attorney specializing in condo-hotel projects.
'You need somebody with the right mindset,' says Bruce Weiner, president of Turnberry Associates, with developments in Las Vegas and the Bahamas. 'If it's somebody looking for a retirement home and socialization this is not the right product. Your next door neighbour could change every day.'
One of the latest to come onto the market is the flagship condo-hotel Pueblo Acantilado Suites. It is described as a charming cliff top resort close to Alicante in southern Spain which provides a dreamy hideaway for its guests and a rewarding opportunity for investors. It is forecast to return more than 6% from year one, excluding capital appreciation.
Pueblo Acantilado certainly seems to have it all. It is being marketed by global luxury brand Kasamia whose head man Jean Robert Reznik has previously worked for Club Med and Accor.
It also reeks of luxury including high speed internet access, flat screen television, spas, swimming pool, a Romanesque ampitheatre, concierge, in-room massage, childcare and even the services of a personal shopper.
