Airbnb investment condos in Denver?

[James Carlson]

Well, this is interesting. There's a new high-end condo development in Denver's LoHi neighborhood called Espadid. It's partnered with an STR property management company to obtain a hotel license for the whole complex. If you work with the STR management company, then your unit falls under the hotel license and ... voila! You've got a full-on Airbnb investment property in the heart of Denver.

I've been watching the short-term rental laws in Denver for years, and I've been waiting for someone to try this end-around the primary residence rule. It will be interesting to see how they do. Some rough numbers:

• $430-$450k for a studio; $490k for a 1br (Yikes!!)
• $50,000-$60,000 gross revenue for a studio or 1br
• Guessing 20% management fee (though the owner told me they might start at 15%)

Those numbers can give you better cash flow than most properties in Denver, but that's a not insignificant outlay. And with the city seemingly so anti-Airbnb, you still have to worry about the regulatory certainty. (I.E. are they going to pass a new rule to outlaw this?)