How does a condo hotel work?

Condo hotels are becoming an increasingly popular form of capital investment. Investors buy apartments in hotels and hotel resorts, which are then managed by professional operators. The declared returns vary in amount, but returns depend on a great many factors: the experience of the developer, the location, the operator, the management of the hotel, and the effectiveness of promotional activities.

When deciding to invest, you should analyse the offer you receive and verify the experience of the developer from whom you want to buy your property. There are many projects available on the market that do not follow their intended goals. Remember that investing in real property, just like any other form of investment, carries risks.

How does condo investing work?

When buying a condo property, the investor buys an apartment in a hotel or larger hotel complex. The next step is to sign a contract with an operator who will comprehensively take care of the rental, servicing of the guests visiting the hotel, maintenance of the entire facility, and its marketing. The investment is completely maintenance-free for the investor. The investor receives regular income in the form of a fixed rent calculated on the basis of the total value of the property, equipment, and parking space. The owner is the legal owner of the property for the entire duration of the contract and has the opportunity to sell it, profiting from the increase in value of the property.

The success of an investment – how it is achieved

Choose the right location for an investment, in a place frequented by tourists. Since the owner usually has the owner’s right to use the apartment, it is worth choosing a location that you will be happy to visit. For the security of the funds invested, it is crucial to have a proven developer and an experienced operator who knows how to manage the hotel to make it prosperous and profitable. In this regard, you should check the reliability of the companies which sent the offers.

The Polish tourism market is currently returning to its pre-pandemic high recorded in 2020. The area of business meetings and industry conferences is developing very strongly, which means that venues with a wide range of business meeting offers will attract more customers than others.

 

The most important rule is to invest in what you understand. If you have questions about an investment you are considering, feel free to ask your adviser about anything you need to know. You may wish to enlist the help of an accountant or lawyer so that you can be sure you know everything that is relevant to you in the context of the investment you are considering.

You should make an informed buying decision based on your knowledge of how the condo market works.