10 August, 2019
In recent years the concept of “condotel” has dominated the real estate market in Vietnam and generated a wave of interest in this type of real estate investment. The term “condotel” is very briefly a combination of “condominium” and “hotel” which is used to indicate a building that is “owned” like a condominium and operated like a hotel.
To be more specific, a more international understanding is that the owner of a condotel can either operate their condotel by themselves or leave it under the management of the developer (or any other property management company) and receive profit. In the former option, the owner may use their condotel as their own tourist accommodation or rent it out as any hotel room. In the latter situation, the authorized manager of the condotel will lease the condotel as a hotel room, generate profit from the rental and receive a management fee.
The initial driving force behind the condotel form were developers who lacked financial funding during the construction stage of the project. These developers would pre-sell units in the project, and then use the money from buyers to complete the project construction.
These developers in turn promised buyers a substantial profit for leasing the units as hotel rooms in order to make it an attractive investment.
The full article can be found from Zicolaw's site here.
For more information, please contact:
Kevin Hawkins, Co-Executive Partner at ZICO Law Vietnam,
kevin.hawkins@zicolaw.com
