I'm interested in the Atlantic Village Hotel and Marina, Ft. Lauderdale, as an investment. If I purchase a unit, how soon can I resell it?
You can assign your unit at this condo hotel anytime after you have put up your 10% deposit. Up until that time, you do not have a valid contract to flip, only a reservation. However, I don't see why it wouldn't be possible to reach an understanding with someone prior to that time to sell at a pre-negotiated price once the contract is in place.
How does the right to assign differ from resale?
Assigning your contract can be done anytime prior to closing. Resale can't happen until the sale of the unit is "sold" and closed by you first. That will not take place until mid 2007. You can assign your property in about six months time and get the benefit of all of the upside that is built into the price right now, and then get out with your sizable profits. And you can do this with a refundable $2,500 deposit now.
Is there an assignment fee?
Yes, $10,000. It is owed once you assign the contract, however, up until someone comes to the closing table (in 2007) there is nothing to say that you, the original purchaser, isn't intending to close. So despite when it is owed, it might not be due until closing. I'm just not sure at this time exactly how the procedure will work.
Who is this developer, and how much can we count on him to secure good management and a good solution here?
The developer, with his family, built up Specs records and tapes from one store in 1949 to 80 stores when they sold out their entire interest in the business five years ago. Individually, he owned and operated a very successful South Beach restaurant. It was there that he developed many relationships with "A list" people, athletes and celebrities, whom he expects will be guests at his hotel. He is a dynamic guy, bright, and very pleasant to be around. One other key item, we have asked him on a few occasions about his ability to finance the construction of the deal, hoping to refer him to one of our guys. He has repeatedly rebuffed our offer because, "I've got guys from several banks begging me to do the loan with them over the competition."
Has a management company been named?
The developer has had talks with Hilton, Starwood, InterContinental and most recently, with Fairmont. He is only seriously considering a management/franchise that will help make this project a major success. And, he is putting off the decision now for a very good reason. If he hires a Ritz Carlton now, just as a hypothetical, Ritz would say "We want x% for our management fee, AND we want y% of your sellout because if you will be marketing the project as a Ritz, you will get higher prices because of our name." Bottom line is that a decision to bring in the management company after the sell out is complete will keep costs down on the sales price of the units. The franchise can't ask for a sell-out fee, if the units are already sold out. Right? Again, the developer may be new in this particular business, but he is as bright as they come.
Does the Atlantic Village Hotel and Marina have any living restrictions?
There are none currently, but the developer expects that the city of Dania (which does not yet have a position on this because there has not been a condo hotel built in Dania before now) will probably adopt Ft. Lauderdale's most liberal ruling of "no more than six months a year." However, it's worth mentioning that the developer really does not want his buyers to use their units (much) and in fact turns away people that are looking to buy a place to live. He wants this place to be a hip, happening convention hotel where his A list friends and unit owners will want to come visit, hang out, enjoy the amenities, and then go home. He wants paying customers to be filling the rooms, not owners, as that is how he makes the greatest share of the revenue for both himself and the owners.
The above questions were submitted via e-mail by a visitor to www.condohotelcenter.com. The answers were prepared by Joel Greene, a licensed real estate broker with Condo Hotel Center which specializes in the sale of condo hotel units and fractional ownerships in private residence clubs.