UMTravels

So — that real estate property I listed a couple of days ago is part of a wave of hotels turned condos run by hotel groups — called Condotels. Best I can tell, I’m staying in one — though I haven’t seen any of these units on the resale market. Basically you buy your hotel room for $150,000 to a million (assuming you want 2 bedrooms and 2.5 bathes). There was a great article in the paper here about it.

http://www.honoluluadvertiser.com/apps/pbcs.dll/article?AID=/20071111/BUSINESS04/711110340/1071

But the economics are dicey — most were bought to flip. There are many now many are selling for less than they were bought for. Makes me want to think of picking up something on the cheap.

But, the economics are not really good when you consider that in round numbers, you are out $200,000 for a studio, maybe a one-bedroom — and lacking a real kitchen, and your monthly maintenance is $450 a month, and your taxes of $150 — and you only get half (or 40% if there is a travel agent involved) at $100-$120 a night, and a 75% occupancy rate… a break even deal at best. Then of course there is your mortgage payment of $1000 a month — $1600 a month, at 75% rented, so a thousand a month in income… I’ll have to put that into a spreadsheet and see if those really are the numbers.

But that’s Waikiki and CondoHotels.