condo-hotel, is this a good investment vehicle?
 

I've received two proposals to invest in condo-hotels. One in Panama City, the annual rental return on this one is zero but I get 4 weeks of free annual vacation and no property taxes for the next 20 years. The other one is in Quebec City, the annual return on this one is about 5% and about one month of free stay per year.

For someone like me that don't like to travel, these condo-hotels don't seem to be a good investment, or an I missing something!

I have a question... couldn't you rent out your free time which should then produce a significant return?

You could but I don't see how it will significantly increase your rental return! Don't forget hotel rooms are not always 100% occupied 365 days a year...

Sounds like you are investing in something you will have no control of, be next to impossible to resell.

Prediction ..... Management contracts to insiders will eat any profits in this unregulated investment.

5% is a bit shit. I have no idea why you would want to go for a 0% return unless the hotel is awesome in a great place and you know you want to spend a month there every year for 20 years.

Most hotel investment schemes in the uk give you 6% at the minimum guaranteed for 5 years.

I've never been sure about these things. For the cost of a hotel room you can get a nice rental apt in various countries...

You 'r crazy dude. Who's your financial adviser so we can avoid him? :winkwink:

http://www.pictures.vaty.net/uploade...des-700552.jpg

Alex... ask around. Those kinds of investments aren't for everyone.
I know a couple of people who bought into resort properties (at Mt. Tremblant) and they aren't as happy as they thought they would be with them.

sounds pretty shitty, when you invest the point is to make $$, zero return is just stupid....

I agree too. This investment is being sold on the premises that the value will more than double in 5 years, which I doubt it will....

You only double an investment when the other guys check clears. Who will you sell this investment to? And how will you market it?

I agree with the last 2 posts. You need to think of your exit. With an apt if you research the area you can at least rent it for the forseeable future and you have control over it.

Do a little work and if you have the cash to invest in one of these schemes you will get yourself something much more solid. Look at off plan stuff in Northern Morocco for instance...

Its all about demand.

Yeah dude, you wanna have significant control over your investments. So I wouldn't look into the Panama one. What are your options in terms of renting them out?

Dont even mess with that stuff, your stuck in it and if want to sell you are lucky to get 25% of what you paid

Really think about it, just rent a hotel room and you can go anywhere in the country, and after 5-6 nights you can start to get rewards nights for free stays anywhere in the country.

I thought the Mont-Tremblant project was doing great! I'll for sure do more research into these type of properties....

5% ROI is shit, you can get that rate from GIC's and its guaranteed. I did research condo hotels for quite some bit and for the most part, it seems to be a good idea in high vacation spots like Vegas, or Miami Beach, etc. Either way, unless you can do 7% or more, I wouldn't do it.
WG

unless you're buying a new condo/hotel in a swanky place like the ritz carlton i would not bother.

DH

No it's not 5% ROI but 5% annual ROE (return on equity). The ROI is expected to be much higher, they're assuming the value of the property will more than double in 5 years...

There are both new projects. it's quite Ritz Carlton, but the one in Quebec city will be run by Choice Hotels Canada, a known company in Canada.Not sure about the one in Panama tho....

LOL. My financial planner is very good in making sure my investment is well diversified to reduce my risk:thumbsup

Remember what happens when you assume.

Anyway, Look into something in Cancun or Playa Del Carmen. You have a better place, Most likely cheaper or about the same to purchase, and a HELL of a better chance of Making better ROI and ROE.

I have been looking into this myself, and to be honest, I'm really on the fence. To rest my hopes that the property will rent out often doesn't make me feel comfortable. And if the land value doesn't increase, you'll lose when / if you sell.

Which projects were you looking at?