Mike Tauber
Feature: Downtown Digs
March 1, 2006
Some hotel-condos have other restrictions. If you purchase a condo at the Grand
Cayman Ritz-Carlton, for instance, you are guaranteed six weeks a year of
occupancy, and only allowed to stay at other times if the room is vacant.
The real winners in the hotel-condo business are the hoteliers, who generate
income from rooms even when they are not occupied; they sell off pieces of their
hotel, but still collect hefty maintenance fees from owners. “Most hotels don’t
run more than about 80 percent occupancy,” says Scott Geraghty, general manager
of the St. Regis hotel in New York, currently in midconversion to condos. “We’re
taking some of that excess inventory and converting them to condominiums.”
The hotel hybrid will sell 60 rooms on two floors, at approximately $3,500 to
$4,000 per square foot.
“We will continue to run a hotel that has no debt service,” says Deborah Carr,
general manager of the Brazilian Court in Palm Beach, which converted to condos
in 2002. “That’s the most glorious position to be in as far as being a
hotelier.”
“It’s a model that has become very popular recently, because the operator or the
owner of the hotel has no investment at the end of the day,” agrees Coutry.
The continued popularity and success of hotel-condos and pieds-à-terre are also
dependent on the continued revitalization of downtowns. It could be that city
living is just a flirtation; it remains to be seen if the love affair continues.
“It’s fun to be a part of city life,” says Robinson. “But I don’t know
that I would want it on a full-time basis. Life is a whole lot easier in the
suburbs.”
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