Advantages / Benefits of Condominium Hotels

      The financial structure of condominium hotels is attractive to apartment owners, investors and       developers for the following reasons:

     : :  The main source of revenues is the rental of rooms. Room revenue has historically been
         the most profitable sector of operations for standard full service hotels. Thus, the          condominium hotels can be much more cost effective utilized as a commercial operation as          compared to standard hotel properties.

     : :  The target market for most condominium hotels and residence apartments is the middle          income client, who makes up the majority in both the business and leisure travel sectors.

     : :  Diversified ownership of condominium hotel properties, spreads risk over a larger number of          owners holding smaller percentages of the hotel property. The broad base of owners share          the common area expense burden. The guests of a condominium hotel receive more value          for money reflected in lower room rates and increased unit size and facilities.

     : : The condominium does not have the additional development costs of large non-revenue          earning areas such as large lobbies, banquet halls, multiple food and beverage facilities,          specialty services and public areas. All of these traditional full service hotel facilities are          extremely expensive to construct and give little or no return on investment.

     : :  Condominium owners can take advantage of normal personal tax write-offs of interest and           real estate taxes or depreciation of rental property.

     : :  The condominium hotel operator can manage the operation more efficiently for the owners
         as the staffing and costs of operations of such projects is usually far below the costs of          managing traditional full service hotels.

     : :  The condominium hotel owner, through a professional operator, can benefit by receiving           monthly income from their real estate investment, in addition to any market value           appreciation that may accumulate over time. Owners have the ability to use their own unit           when not rented out or take the unit out of the hotel rental pool when they wish to reside
          in the apartment themselves.