Condotel or Condo Hotel Property Investments in the Philippines

If you can imagine the niceties you’d find in most hotels, then you can picture a condo hotel. Among the features are often resort-style pools, spas, fitness centers, restaurants, concierge services and room service.

At Lancaster Suites Manila and Lancaster – The Atrium Manila apart from normal Hotel amenities including a resort style pool on the podium deck, numerous restaurants and guest services, there is a self contained Mini Shopping Mall integrated into the building design providing guests and residents alike to purchase everyday necessities from various grocery and convenience stores and a variety of services from dry cleaning to salons and clinics within the confines of the building. A fully self contained and integrated business center is provided and even a private, exclusive, members only Businessman’s Club.

3. What is the difference between a Hotel and a Condo Hotel?

The big difference between a hotel and a condo hotel is that a hotel typically has one owner, but a condo hotel is sold off unit by unit. Therefore, a 300-room condo hotel could have as many as 300 unit owners.

Moreover a Lancaster Condo Hotel unit is not time sharing. All Lancaster Condotel unit owners own the property in fee simple on a freehold title deed basis.

4. Is it evident to hotel guests whether they’re staying in a Condo Hotel or a Hotel?

A hotel guest will likely never know that the hotel has multiple owners because the property is operated just like a traditional hotel and often under the management of a well-known hotel companies like Marriot, Hilton, Hyatt, Trump. Also, each of the individual condo hotel units will look identical in design and décor to every other, just as they would in a traditional hotel.

5. Who typically buys Lancaster Condo Hotels in the Philippines?

They’re primarily sold to people who want a vacation home in either Metro Manila or Cebu but do not want to deal with the hassles typically associated with second home ownership such as maintaining the property or finding renters in the off season and property investors whom just want the rental income without all the hassles of being a landlord.

6. What is the demographic of the typical Philippine Condo Hotel buyer?

The spectrum of condo hotel buyers in the Philippines is pretty broad. There are both local Filipino families and Overseas Filipinos and a growing number of International clients that want a second home in a either Cebu, as a vacation destination, or the capital Metro Manila for investment purposes or both. There are a growing number of baby boomers from all parts of the world whom, are at or nearing retirement and want somewhere they can “winter” and there’s no better place than the Philippines with its English speaking population and ease of access from Europe or the United States. There are also plenty of overseas investors who purchase condo hotel units or buy to let suites with little intention of ever using it; they’re in it solely for potential appreciation of the real estate and higher rates of rental income.

7. Can you live in a Condo Hotel?

Yes. At Lancaster Suites Manila a unit owner can live in his or her condo 365 days a year as a primary residence. What could be better than living permanently in a Hotel with all the amenities and facilities at your fingertips? Lancaster Unit owners have the ‘option’ of enrolling their units into the Condo hotel rental pool at any time. Similarly, if enrolled in the Lancaster Condotel Pool the unit owner may withdraw same for personal use by giving adequate advance notice.

8. Who gets the money when your Condo Hotel is rented out?

The hotel management company splits the rental revenue with the individual condo hotel owner. While the exact percentages vary from property to property, at Lancaster Condotels the typical rental split is 60%-40% in favor of the unit owner

9. Who finds hotel guests and then cleans and maintains the condo hotel units?

The hotel management company markets the property and books hotel guests. It also maintains the unit and ensures the smooth operation of all of the hotel’s services and amenities.

10. What are the advantages / disadvantages of purchasing a Lancaster Condotel over purchasing typical rental properties in the Philippines?

Advantages include:

• Hassle-free ownership; No landlord issues
• Rental revenue to offset some or maybe all ownership expenses
• A vacation home available for use whenever you want
• A real estate investment at a time when other investments may seem less attractive
• Strong likelihood of appreciation specially when purchasing at preconstruction stage
• Pride of ownership
• Easy to resell units through the Condotel operator

Disadvantages include:

• Pets are not welcome.
• Advance reservations are required to guarantee availability in case owners unit is rented.

11. Are Lancaster Condo Hotel units difficult to finance?

Not at all, Pacific Concord Properties offers all buyers of Lancaster Suites Condotel units a very easy and affordable ‘In-House Buyer Friendly Payment Plan’ with or without any down payments and up to 6 years repayment period with no interest. Mid term 10 year financing is also available through Pacific Concord’s own no prequalification ‘In House Financing’ with or without down payments. A longer term 15 year Bank financing is available only completed units but 30% equity is typically required.

A Currently Available – Studio at Lancaster Suites Manila Tower I that has a Floor Area of 27.23 square meters [293sqft] is priced at $1,618.00/sqm [$150.37/sq.ft] Total Contract Price: USD 44,058.14 [Tax Exempt] and may be purchased with 30% Down Payment [with 10% Discount on down payment Saving USD 1,321.74] of USD 11,895.70 and balance payable over 36 equal consecutive monthly installments of USD 856.69. Interest Free. Alternatively, Pay Cash and take 10% discount on Contract Price. Save USD 4,405.81 Pay 90% now [USD 35,687.09] and remaining 10% balance [USD 3,965.23] on unit turnover from March 2007….

Studio Suites are available through Bank Financing. Minimum Equity is 30% Down Payment [with 10% Discount on down payment Saving USD 1,321.74] of USD 11,895.70 and balance payable over 15 years [180] equal consecutive monthly installments of USD 360.33 [at 11.5% per annum]

Whilst a Preconstruction Condotel Suites at Lancaster - The Atrium Manila are now available on very affordable and competitive payment plans that provide for Suites to be purchased on a No Interest No Down Payment basis with 67% of the payment payable over 60 equal consecutive monthly installments without interest and the 33% balance payable upon turnover of the unit or to be paid over an additional 5 years from turnover through our hassle free no prequalification “In-House” Finance Plans

Lancaster Atrium Executive Studio Suites have an average Floor Area 28.17 square meters [304sqft] at $1,518.00/sqm [$141.07/sq.ft] USD 42,762.06. and may be purchased with a Reservation Fee USD 500.00 and Balance Payable without interest over 72 consecutive equal monthly payments of USD 586.97. Alternatively Save USD 2,535.72 by making the Reservation, USD 500.00 then within 30 days a 30% Net Discounted Down Payment of USD 10,142.89 and Balance payable without interest over 72 consecutive equal monthly payments of USD 410.88.

The Lancaster Atrium Executive Studio Suites are also now available on very affordable and competitive New Payment Plans that provide for Executive Suites to be purchased on a No Interest No Down Payment basis with 67% of the payment payable over 60 equal consecutive monthly installments without interest and the 33% balance of the contract price payable upon turnover of the unit or to be paid over an additional 5 years from turnover through our hassle free no prequalification “In-House” Finance Plans… Pay only USD 500.00 Reservation for a 28.17 sqm [304 sqft Executive Studio [Contract Price USD 42,762.06] then 60 consecutive monthly payments of only USD 471.93 with the balance of USD 13,946.48 either payable in cash on turnover or to be financed over another 60 months payment plan…..

Another alternative, Save USD 5,663.11 by making the Reservation, USD 500.00 then within 30 days a 67% Net Down Discounted Payment of USD 22,652.46 and the remaining 33% [USD 13,946.48] on unit turnover from December 2009

Cash Payment option, take a full 20% discount [Save USD 8,552.41] on unit price… Pay 90% Now [USD 30,788.68] and remaining 10% [USD 3,420.96] on unit turnover from December 2009

12. How long have Condo Hotels been around in the Philippines?

Condo hotels have been around for several decades, but the surge of four-star condo hotels that have been making their way across the country, started around year 2000 in Metro Manila. Cebu is now another up-and-coming area for Condotels in the Philippines.

13. How much do Lancaster Condo Hotel units cost?

That’s like asking how much a car costs. There are different quality condo hotels. Some require greater amounts of money than others, obviously.

There are inexpensive Condo Hotel suites at Lancaster – The Atrium, Metro Manila, Philippines from as little as $34,000 for a Studio. From $68,000 for One Bedroom Suites and $102,400 for larger Two Bedroom Suites.

There are new and exciting luxury five-star properties or high end developments planned in Cebu Philippines next year that will be sold by invitation only and may start in the $150,000 to $200,000 range, but can go all the way up to $600,000 for 2 bedroom Penthouse suites and $800,000 for a Grand Penthouse. Of course, International gateways from Europe, South East Asian and the United States to Cebu-Mactan International Airport is within 10 minutes and, all units have sea views, beach toys and other lifestyle amenities such as spa and fine dining restaurants and will come fully furnished and finished to the highest European or US standards with fully fitted kitchens, fitted bedroom suites and every unit will be sold including all appliances, split type central unit air-conditioning, plasma TVs’ and state of the art condotel management systems. Units will be significantly larger in size than a typical hotel room yet still a much better value for money investment option than paying $800,000 for a studio suite in maybe Dubai or Panama or a cool million dollars for a condo in Chicago.

14. What are typical monthly maintenance costs?

On current average [in the Philippines] of about $0.15 cents per sq. ft per month

15. Do you buy Condo Hotel units after they have been built, or can you purchase Lancaster condo hotels in pre-construction?

Unless you are in a hurry to get started vacationing, it’s best to buy Lancaster condo hotels in pre-construction as early as possible. That’s when prices are lowest and unit selection is greatest. You will likely wait two to three years or longer before closing and taking possession of your condo hotel unit, but you will have locked in the price and will get the benefit of maximum appreciation which has shown in Lancaster Suites Manila to be 80-100% on turnover.

16. Is there anything else investors should want to know about Condotels?

There is more to buying this type of real estate than the old phrase, “location, location, location.” While most condo hotels are located in desirable resort and business area locations, what is most important is a good franchise with a strong reservation system.
Resort Club of the Pacific [RCPC] was recently appointed by Pacific Concord Properties Inc to manage the pre-opening of the Lancaster Cebu & Manila Condotel operations in the Philippines. RCPC will provide assistance in installing a computerized operating, control, financial and membership system for club and hotel operations provide the special disciplines in membership affairs, rooms’ inventory and time management, culinary, F & B service, spa and relevant support operations.

RCPC President, Amor Salud, built a hotel career with Hyatt, Westin, Sheraton and Peninsula Hotels where he developed a balanced perception of overall hotel operations, will oversee the pre-operations of the Lancaster Condotels. He held General Manager and Chief operating Officer Positions for hotels and exclusive clubs for 15 years and was a key officer in the hotel subsidiary of Ayala Land Inc. With a Master’s Degree in Business Management fro the Asian Institute of Management, Salud was one among Filipinos with professional training in international chain hotels abroad.

RCPC Director, Willhelm Bolton, whom will be responsible for the Lancaster Condotel business development comes from a family of restaurateurs in South Africa. He graduated from famous hotel institutes such as Glion, Cornell and Wits, with working experience in South Africa, Europe and Asia. Mr. Bolton occupied senior posts in prominent hotel, resort and club companies in South Africa and the Philippines. His inventory of international affiliations includes Leopard Song Game Ranch – South Africa, Southern Sun Group of Resorts & Hotels – South Africa and Sun International resorts & Hotels.

Also, do not be fooled by an aggressive rental split. One way or the other, the developer of the property will have to staff, maintain and operate the hotel and its services like the restaurants, bars, spas and pools from his share of the proceeds. If he’s giving you a very favorable share of the rental, he’s also more likely to be charging you a higher monthly maintenance fee. Of course, this goes both ways. If the maintenance split that is offered is closer to 60-40, then your maintenance should be more reasonable too.

17. Any suggestions to investors in choosing which Lancaster Condo Hotel to buy?

Get good advice. Talk with a broker who specializes in Lancaster condo hotels and who knows and understands the entire condo hotel market in the Philippines, not just the facts pertaining to a single property. He or she will listen to your wants and needs and then offer recommendations as to which properties best match your requirements. You’ll have an opportunity to comparison shop and consider the pros and cons of each available property.

For those looking for somewhere to live or for rental returns in 2007, the Lancaster Suites Manila Tower I fits the bill. Nearing completion early 2007 and set for Condotel Operations by middle of the year, a few resale units are still available. Preconstruction investments are now available at Lancaster – The Atrium Manila.

A good broker can be the difference between your buying a condo hotel that will be problematic and not live up to your expectations or one that will provide you with years of great vacations, good annual revenue and a substantial profit when you sell.

18. Does it cost more to use a real estate broker to purchase rather than buying a unit on one’s own?

No. With Lancaster condo hotel properties, the prices are always set by the developer and are exactly the same whether you buy directly onsite or using a broker.

The broker’s commission is always paid by the developer and is already built into the price regardless of whether an outside broker participates in the sale or not. Since a Lancaster Condotel broker’s representation is free to buyers, it does make sense to enlist their aid and get the benefit of their advice before making a purchase.

19. How can prospective buyers find a good Lancaster condo hotel broker?

If you are reading this then you have !

PLC International Marketing Networks together with PLC Global Filipino Agency is a Real Estate Marketing & Investment Company based in Metro Manila with Branch Offices in Cebu, Philippines, serving thousands of Filipinos and Real Estate Agents across the Globe.

The company, as Lead Marketing Partners with PCPI, specializes in International Sales and Marketing for the Lancaster Suites Manila and Lancaster Atrium Manila Condotels [Condo Hotel] or Buy to Let investment income opportunities in the Philippines consisting of Three 42 Storey Towers located in Shaw Boulevard, Metro Manila and the Lancaster Cebu Resort Residences in Matcan, Cebu, both Condotel Developments of Pacific Concord Properties Inc by direct marketing and through it’s extensive International Network of Realtors, Brokers, Agents and Accredited Marketing Partners across North America and Europe

PLC International sees the strength of its 1,500 strong Global Network of Marketing Partners and sole focus on Philippine Condotel Investments, particularly the Lancaster Brand of Condo Hotel developments in Metro Manila and Cebu, as foundation for its year on year awards as consistent Top Producers for Pacific Concord Properties Inc.

20. How can buyers learn about new and existing Lancaster Condo Hotel properties coming on the market?

Subscribe to the Lancaster condo hotel newsletter such as the one we publish called The Lancaster Suites or join our Condotel Forum on www.lancastersuites.com. Other Condotel developers and brokers around the world can also publish their developments on our website at www.plcglobalpinoy.com. We offer it for free on our websites and it will feature different condo hotel properties coming on the market each month.

The prices of condotel units are normally 15%-20% more expensive that regular residential condos due to additional amenities, facilities and the Income Potential Value placed upon the property. Pacific Concord Properties the Lancaster – The Atrium in Manila, for example, featured prices from as low as $34,000 to $275,000 for the freehold units.

The Lancaster Atrium condotel project is the latest in a series of such projects by Pacific Concord Properties in Manila. The Condotel development company, formed in 2003, is now in final stages of completing its first project, the Lancaster Suites Manila.

Beth Collingz, PLC International Marketing Director, lead marketing partners of Pacific Concord Properties for the Lancaster Brand of Condotels in the Philippines, said the company’s latest sale of condotel units drew not only overseas Filipinos but significant numbers of international buyers from Europe, Australia, Canada and the United States. Units in their latest project, Lancaster – The Atrium at Shaw Boulevard, Metro Manila, range from studio units to three-bedroom penthouse suites with full kitchens, Collingz said.

Owners of Lancaster condotel units can arrange to stay in their units and they share 60% of any rental income. The Lancaster Atrium together with the soon completed Lancaster Suites Manila, one of the hottest real estate investments in the Philippines, will be the hub for Lancaster condotels. The 42-story Lancaster Suites Manila, scheduled for operations next year, will feature studio, one-bedroom and two-bedroom condotel units, as well as penthouse suites. The units will be available for daily, weekly or monthly rental, Collingz said.

“Lancaster Atrium is going to have a property manager and will be operated as a four-star hotel.” The condotel development will include the Lancaster mini mall with grocery and convenience stores, retail center, restaurants, business center, a private exclusive members only Businessman’s Club and spa on the site, she said. Prices range around $150 per square foot on up to $250 a square foot. Construction already commenced on the Atrium project, excavations, foundations, sub basements, 5-levels of basement parking and the lower ground floors are already in place.

Construction of the superstructure will commence next year for completion from December 2009. Lancaster – The Atrium is also located in Shaw Boulevard, Metro Manila, Philippines, adjacent to the nearly complete Lancaster Suites.

Several condotel projects also are in the works on the other side of the country. Collingz said that a major condo hotel project is being considered by the Company with several investors in Cebu, Philippines next year. “We’ve got so many clients requesting for Luxury Condotel Suites in Cebu and other areas in the country,” she said. “It’s like a whole new era of Overseas Investments that are coming up — it’s not something that we’ve typically seen in the past. (These Investors) are all characteristically looking for a five star hotel resort, with all the features of a hotel that can be used for vacations and then rent out the units when not in use”.

The planned high end Lancaster Mactan Resort condotels will be near the new Cebu Convention Center and Cebu International Airport which is key, to good year-round occupancy numbers, she said. We can sell from $145,000 to $450,000 or more and the square footage can range from 700 square feet to 1,800 square feet or more than $600,000 for 3,000 square feet split level penthouse suites. “They will all be luxury life styled, fully furnished and equipped to European or US standards which makes it convenient for out-of-area owners. “Why cant we build, and sell, a - Trump Quality Condotel - in the Philippines and get the same buyers that flock to invest in his lifestyle developments” enthuses Collingz.

The term “condotel” has been around in the Philippines since the 1980s and has become a generic term, said Collingz. Condotels offer a far better investment and real property appreciation that regular residential condos in the Philippines.