Condotel - Yay? Or Nay?

[Holly Rozoff]

Rookie here looking at a possible investment to a Condotel in Southern California at a well known coastal resort for $329k. Below is from the real estate agent. There are a couple of recent comps that align with pricing. Do you think there’s any money to be made here or should we keep looking? I appreciate any feedback you might have. Thank you. 

This is a full ownership condo (commonly known as condotel or condo hotel). There is just the one owner and there is a deed restriction that limits the use to 120 days by the owner. That can be used at one time or split up over as many stays as the owner would like. When the owner is not using it they have the option to rent it through the resort, on their own, through an approved property manager, or leave it vacant. If the resort manages there is a 6.7% fee that comes off of the gross rental for credit card processing and travel agent fees and then the rent is split 50/50 between the resort and owner. If the owner self manages or employs a third party then the resort receives 20% of the rent or $100/night per rentable portion whichever is greater.