Condo Hotels Part 1: Hotel Rates in South Florida

Condo Hotels have been quickly becoming a hot new concept in South Florida. People from all over the world desire a piece of South Florida, and the Condo Hotel is the easiest way to obtain it. Unlike buying a condo where it may sit vacant for 9 months when the 2nd home owner is using it, the Condo Hotel gets rented out on a nightly basis by the hotel management company and the revenue is split with the owner. This drastically reduces the costs of keeping a property here when not in use, and in a lot of cases, they even make a profit.

A lot of it depends on the occupancy rates, prices and the quality of the management company.

The Facts:

Average Hotel Rates in South Florida Hotels for 2006 rose again by 11% in Miami Dade County, 14% in Broward, and 11% in the Keys. Occupancy was 70% for Broward, and 71% for Dade. Dade County ranked third in the country for most expensive hotels, behind only New York and Honolulu. The Average night was $142.

My Opinion:

I am pleasantly surprised. The hurricane season in 2005 coupled with a mild winter in 2006 should have made visitors skip vacationing down here, but that wasn't the case. We have seen more "out of season" tourists in months that typically have been lower in occupancy. The summer alone this year set a record with occupancy levels around 67%.

There are several condo hotels that I recommend buying which will make great vacation homes while the hotel program will help offset the costs. Just be careful of stay restrictions: some programs allow you to stay in there only a few weeks, but give you a larger split of the revenue. Decide how long you will use it before signing up for the hotel program. In most cases you obtain a history of the rent from the previous owner. Some Condo Hotels are better than others.

I have purchased two myself: The Point Orlando in Orlando, and the Sian Crowne Plaza Resort in Hallandale. I am closing on the Sian in a few months, and Point Orlando should be ready in a year or so. Both are tremendous locations in areas with booming demand for hotels, and locations that attract both business customers, heavy convention traffic as well as high tourism.

The Sian starts as little as $255,000 for a studio, and there is a special deal in the Point Orlando right now where you can get a 2/2 for $425,000 when all the other units are $480,000 and up in the building and $570k and up in the surrounding competing buildings. Visit www.sianbeachclub.com and www.thepointorlando.com for all info on these two fine opportunities. The two deals I mentioned are only available through my Remax office and not from the developer. Contact me for more info.

What's Next:

Ever wonder, how you rate as a typical buyer who purchases real estate? I will discuss the numbers and buying habits of calls/inquiries to our office and how they eventually turn into buyers. You will be shocked at how some people purchase real estate. Also, coming soon: Condo Hotels Part 2: the Purchase Process.

Deal of the Week:

**ESTATE SALE** Condo on Country Club Drive 2/2 renovated only $250,000. Units like these closed for $325,000 last year before the Hurricane Damage. The building has been fully restored, new balconies, new windows and values should start to rise again. Right on country club drive with water view, vacant and the descendants say SELL NOW!!