Condominium hotels

Condominium hotels is one of the latest trends in luxury real estate investments.


Condominium hotels, or condo hotels in short, is one of the latest trends in luxury real estate investments. A condo hotel is typically a luxury hotel in a desirable location where the rooms are sold as condos. The most obvious benefit of owning a unit in a condo hotel is having year-around access to a luxurious, full-service vacation home, which also generates profit when the owner is not using it. Hotel management assumes responsibility for maintenance, marketing and administration of renting the condo to people visiting the area. This means that the owner can have a rental income without having to deal directly with tenants.


Ownership structures vary between companies and locations, but in most cases the owner of the unit pays property tax and insurance as for a normal condo. If the owner opts for being part of the hotels rental programme, which again is the most common case, then he or she will receive financial compensation such as reduced management fees and a share of rental revenue.

However, there are some issues related to owning a unit in a condo hotel. Since the unit is normally available to be rented by the public, the owner might be required to inform the hotel in advance (sometimes as much as 60 days) of his or her intended stay to make sure that the unit is available. Further, as the unit is part of the hotel’s business, personal alterations to the interior are rarely permitted. For the same reasons owners cannot leave any personal belongings at their vacation home. Some hotels and local governments have also decided on time restrictions on the owner’s annual private use of the unit.


Condo hotels are available all over the globe and most new luxury resort establishments include condo offerings. So far, the condo hotel phenomena has its stronghold in the United States, where the trend started. Some other locations that offer condo hotels are Indonesia, Costa Rica, the Philippines, Thailand and Mexico.


Estimating the expected income generated by a condo hotel unit can be difficult. Developers rarely provide their predictions of room rates and occupancy levels, which make the ground for a purchase decision more unstable. This behaviour is due to the fact that developers wish to remain under real estate regulations on investments. The three variables determining the income are rental rates, occupancy rates and personal use. Measuring this income against expenses such as franchise and management fees makes it possible to come up with a rough estimation of profit.


New Condo Hotel projects

- Fairmont Shock Hill, Breckenridge Colorado, USA

- TOTT Hotel, Visby, Sweden  

- Copperhill Mountain Lodge, Åre, Sweden 

- Trump SoHo,  New York, USA 

- Vdara City Center, Las Vegas, USA

- Black Mountain, Hua hin, Thailand