Developers Cash In on Advanced Funding of Condo-Hotels

Apr 1, 2005 12:00 PM

The latest trend in construction seems like a financial sure-bet for developers as well as buyers

The latest trend in construction seems like a financial sure-bet for developers as well as buyers. Condo-hotels are popping up everywhere from New York to Las Vegas, and especially in southern Florida where 30 projects have been finished, are being converted, or are in the planning stages. Developers are interested because of their up-front funding. By selling ownership of the rooms in advance, they secure more than enough money to build the hotels without the risk of making loan payments in the turbulent first years of a hotel's opening. Joel Greene, president of www.CondoHotelCenter.com, says buyers are interested in condo-hotels for their return-on-investment potential. “Buyers can own a luxury vacation home at a world-class resort and receive rent revenue when they are not using it,” Greene says. The only people who don't seem excited about the trend are tourism officials, who are worried that a move to individual hotel room ownership could leave too few beds for tourists, especially when large conventions come to town. But for now, condo-hotels remain on the rise.