The Condo-Hotel: When Might the Securities Laws Apply?
By Bart E. Bartholdt
June 2, 2005
General – The Condominium/Hotel Structure
The development of condominium hotels, although not a new concept, has enjoyed increasing popularity recently in the hospitality industry. The appeal of a properly structured condo-hotel development from a developer’s perspective is easy to see – in a time of tight financing for pure hotel developments, a significant portion of construction and development costs can be “outsourced” through sales of condominiums in the development. Units in the condominium component of a condo-hotel are generally marketable at a premium over pure condominium developments, due to the value added by hotel amenities (such as room service, housekeeping, access to hotel facilities, and as discussed below, the opportunity to participate in rental programs).
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