Who owns Condotels

[Bobby Paquette]

Looking for some peoples experience with Condos that were converted to hotels. Lending seems more strict, like more down, higher rates, etc. A lot have managements teams in place, which seems like hotel staff still 

[Doug Smith]

That's pretty much what it is...a condo that acts like it's a hotel. The individual units are owned just like a condo, but there are very strong deed restrictions that come along with it that might limit your personal use and require you to put it into the "rental pool". A condotel will usually have on-site management that will often have a front desk like a condo for people to check in. The management company will get a cut of the action. Many if not most borrowers will think the place is a boutique hotel. We have a lot of them here where I'm at in Florida...particularly around the beaches and theme parks. Regarding financing, they are much harder to finance. Since use is restricted, they are considered "special use" and you'll need a non-QM lender that will allow condotels. They loan-to-value will tend to be lower and the rate will tend to be higher. We do it, but programs for this type of loan are limited. Does that answer your question?