I started writing Lazy Man and Money in 2006 because of a unique reminder: my fiance was going to retire at age 43, with a military pension for 20 years of service.
Who wants to work another 22 years after their spouse retires? At 30, I could consider retiring with her in about 12 years, or working 3 times longer and retire at age 66.
My mission: explore and create revenue streams.
I did not know you could make money with a blog, but I knew it could help you connect with like-minded people. (It was at the time when social media was defined by MySpace.)
At that time, I had read that investing in hotel rooms was a very active new market. It's not just buying shares in a publicly traded hotel company. It's buying something called a condo hotel.
What's a Condo Hotel?
A condominium hotel is exactly what you can imagine: a combination of a condo and a hotel. Basically, it works like this: you buy the hotel room as if it were a condo. You can stay in this room whenever you want (it's your room after all). Alternatively, you can return the room to the hotel for a fraction of the proceeds when it is busy (the hotel receives money to manage it). The rules seem different for each property, but that's the point.
It is legally managed as a condominium, but operated as a hotel. When I heard about it for the first time in 2006, it seemed like a crazy, but cool idea. Nowadays, it makes more sense to think of it as a condo that you buy with the intention of turning it into AirBnB.
It sounds like an exciting investment, right?
Why did I seriously consider buying a condo hotel
I find that often seduced by the best of cases.
Even if I had to pay a maintenance fee, at $ 150 a night, it's over $ 50,000 a year. It was also at the time that Paris Hilton was starring in Simple Life. It is not everyone who is able to start or buy a whole chain of hotels. However, a room? It's something an individual investor might do.
At about the same time as I was reading the article above, I had heard that the W Las Vegas was looking for investors. The main major investors were in place, but they were looking for investors. It also contributes to their construction costs, is not it?
I was definitely attracted to four things:
- It's tempting to be an owner and a hotelier without maintenance, right? (Of course, I would still pay for the maintenance, it's great not to receive these 3-o'clock calls about a broken water heater.)
- Brand and premium quality W At the time, I had a friend who traveled a lot for business and who loved the W brand.
- The premium tourist location – Las Vegas. When I think of people on vacation in Las Vegas, I guess a number of them have a lot of disposable income. I like the combination of people with a lot of money looking to spend it for a luxury experience.
- The price of pre-construction, which I suppose would be the best. Although this is not always true, it feels like the early bird should catch the worm, right?
In the end, I decided not to subscribe to the opportunity of the W condo hotel. If you read the Wikipedia writing I linked above, you know I took the right decision. It sounds like a total disaster.
Why I did not buy a condo
One of the easiest ways to not buy something is to not have money. I might have been able to make appalling financial decisions, such as selling retirement accounts (absorbing a hefty penalty) and raising a mortgage loan. This is not a good idea for almost any investment scenario.
Imagine that it is not an obstacle. When I contacted the organization that planned it, I found that it was impossible to get all the numbers. On the one hand, they did not know what vacancy rates could be. They certainly had a better idea than me because they were in the business and knew the area well. I worked without knowledge. If the vacancy rate of the place is high, the sale of my room will not bring me much. (I'm not ready to buy a white lizard salon suit so I would have needed to rent it.)
However, even if they had a good estimate of the vacation costs and the nightly costs, they could not give them to me. If they communicate this information, the condominium hotel is considered a guarantee for the SEC and is regulated much more rigorously.
Where can I find a condominium hotel?
The condominium hotels are usually located in resorts like Orlando or Miami Florida and, of course, Las Vegas.
I would like to know some reputable companies with which to work. That's why I felt a little better working with a great brand of trust. I do not think I would have entrusted Joe's Condo Hotel Sales 'R' with me. If you know a reliable last name that works in this area, I would like you to leave a comment with the name of that company.
Lessons learned from the experience of my condo
When I decided to make this criticism, I wanted to tear off all my nose hairs for even considering it in the first place. However, as I reflect, I adopt a more balanced vision. I do not know if all condominium hotels are a bad idea. Maybe it could work for some people in certain situations. I'm trying not to make any overall judgment about a poorly suited (for me) condo hotel that seemed to be having difficulties.
After all, this example of a condo hotel is precisely the reason why I launched this blog. I wanted to share ideas about which ones are good and which ones are not.
I have found an example of someone who has found a condominium hotel that works very well for them. My friend J $ did most of the work during an interview with a person who lives in a condominium hotel.
I hoped that readers could help me by saving me bad ideas. In the same spirit, I wanted to help others where I could.
It's always a pleasure to discuss a subject. That's why I am begging leave you comments at the end. If there is one subject that requires more discussion, these are the condo hotels. I rarely see anyone talking about it.