Analyze This: Condo Hotel

[Jeff N.]

I understand Condo Hotels in most cases are not looked at as an investment, but rather an income stream to offset your vacation pad expenses. But recently I have been presented the following:

Condo Hotel located in Myrtle Beach South Carolina.

Age: 2006
Type: Efficiency Unit with Ocean View

Asking: 55K

2009 Revenue pre split: 13K
2010 Revenue pre split: 14K

Split: 60/40
POA: $4,164 year
Content/Liability INS: $360 year
Taxes: $750 year

Assuming a sale price of $55K cash it leaves a $3,126 return based on 2009/10 numbers.