When it comes to real estate investment, condotel properties have gained attention among investors. These properties offer a mix of luxury living and income potential.
So, what exactly is a condo hotel?
A condo hotel functions like a traditional hotel, providing amenities and services to guests. However, units are privately owned, and owners can choose to rent them out, either short- or long-term. Alternatively, owners can include their unit in the hotel’s rental program, allowing guests to rent it on a nightly basis. Investors who purchase condo hotel units can also use them as their second home, providing a convenient space for their visits without the need to book a hotel room.
One of the key advantages of condo hotels is the convenience of on-site management by the building staff. This full-service approach not only ensures the maintenance of the unit but also provides short-term rental guests with access to housekeeping and concierge services.
A Brief History of Condo Hotels.
Condo hotels, a concept originating in the 1960s, saw their first debut with the San Diego Surfside Inn in California. Initially, these properties gained popularity as vacation destinations, offering individuals the chance to own a condominium unit while enjoying hotel amenities and services.
In Florida, condo hotels emerged from conversion projects of 1950s-era Miami Beach hotels during the early 1980s. Initially, they served as weekend getaways for locals. However, changes in tax laws in 1986 limited their use as tax shelters, causing a decline in their popularity until the late 1990s.
In the early 2000s, the success story of the Mutiny apartment building in Coconut Grove, FL where the owner converted his property and sold off its units as condo hotel rooms with a high premium, inspired other developers to convert their properties into condo hotels, offering units for sale. This trend allowed condo hotels to evolve into attractive investment opportunities, offering the benefits of real estate ownership along with potential rental income.
Is Investing in a Condo-Hotel in Miami a Wise Decision?
Diversifying your real estate portfolio with a condo-hotel investment can be a strategic move, especially in Miami’s thriving property market. Such investments have been recognized for their potential to yield consistent passive income. Given Miami’s allure as an all-season tourist destination, there’s always a steady demand for short-term rentals and condo-hotel accommodations.
The Pros:
- Rental Income: Condo hotels offer a unique opportunity to earn income by renting out individual units. Building operator manages these rentals, providing owners with a share of the revenue, making it a potential source of passive income.
- Luxurious Amenities: Condo hotels are typically located in prime areas, granting visitors access to upscale amenities and a luxury lifestyle.
- Hands-Off Management: Hotel operators handle day-to-day operations, including guest check-ins, maintenance, and housekeeping, freeing owners from the typical responsibilities of traditional real estate investment properties.
- Equity Growth: Over time, your property’s equity is likely to increase, providing a hedge against inflation.
- Personal Use: Owners can reserve the unit for personal use, eliminating the need for hotel bookings during visits to Miami.
The Cons:
- Revenue Sharing: Owners have to split rental income with the building owner, with property management fees often ranging from 20-30%, reducing potential passive income.
- Maintenance and Fees: Unit owners are responsible for maintenance and additional fees like HOA, insurance, and software. Some condo units with rental programs charge higher HOA fees if the unit is not rented to guests and may also limit the number of days for personal use.
Explore Domus Brickell: a new condo hotel in Miami’s Financial District
Domus Brickell Park, a new Condo-Hotel in Miami’s financial district, offers 171 apartments, including studio, one- and two-bedroom options. It features essential amenities, co-working space, a lush garden lounge, a gym, a rooftop pool with cabanas, and more.
Domus presents a concept of FLATS (Flexible Apartments for Temporary Stays), combining the comforts of home with the service, security, and consistency of a hotel. Designed exclusively for daily short-term rentals, Domus units come fully furnished, making it the perfect opportunity for those seeking to own property in Miami and generate monthly income when they’re away.
What to Expect at Domus Brickell Park:
- Fully furnished units with private balconies.
- Keyless entry smart lock system.
- Well-equipped units with a kitchenette, washer, dryer, and oversized TV.
- Pet-friendly building.
- 24/7 customer service and hospitality team support.
- Ample co-working space.
Domus Brickell Park presents an excellent investment opportunity in a thriving Miami neighborhood. This prime location attracts a steady flow of tourists and business travelers, ensuring a high demand for short-term rentals.
Contact our sales team today to explore pricing details, floor plans, and secure the best unit in Domus Brickell. Start your journey towards owning an income-producing property in the heart of Miami’s Financial District. Don’t miss out on this exclusive opportunity!