Hotels With Condo Units Might Not Be Very Happy Places

April 8, 2008 at 1:30 PM | by juliana | 0 Comments

[Photo: Jen Leo]

The Wall Street Journal has an interesting article today on the bust of some condo hotels in America.

You know about "condo-tels"--where individuals buy condo units inside a hotel and rent them out to hotel guests for a profit, that is when they aren't using the condo themselves. It seems like a great situation. You have a vacation home and when you aren't there, you get to rent it out without the hassle of posting ads or interviewing potential renters.

Except when the economy starts to go south and people scale back their vacation budgets, you might be left in a lurch. Also, the hotels' owners might take more of cut of the room profit than you would like.

All of this is happening to owners of condo-tel units today. And some are taking action against the hotel developers by suing them for being misled about the profits that could be gained from the condo-tel investments. Others are "staging revolts.":

At the Trump International Hotel & Tower in Las Vegas a group of condo-hotel owners are clamoring to rent out their own hotel units using their own operator because they said Trump takes too much of the rental revenue. A Trump spokesman said the company's rental agreements are competitive with other condo-hotel rental-management companies in the area.

That doesn't sound like Trump Las Vegas is having a very good opening week. We say: Blame Nicky O!

[Photo: Jen Leo for The Daily Travel & Deal blog]

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