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Condo Hotel Lawyer: Not so fast! Locking Down the Condo Hotel Structure

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22 September 2006

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We have been called in after-the-fact many times by developers who have been given unworkable condo documents drafted by expert condo lawyers. The problem is that they were experts in condos, but had scant experience with hotels, and no experience with condo hotels. Unfortunately, the best way to fix bad documents at the outset is to throw them away and begin again from scratch. Condo hotel deals are far too complex to try and bandage bad documents. But once they are in place, you may have to live with them for a long time, even if they are terrible.

For better or worse, most of the elements critical to the success of the condo hotels structure get “baked in” or locked down in documents that are difficult or impossible to change once implemented. This includes crucial factors like cost and revenue allocations, mechanisms for maintaining uniform product standards and high quality of maintenance and service, obtaining and managing the necessary room inventory, and providing adequate revenues and means of enforcement to meet condo unit owners’ obligations.

Before locking down the structure, you need to be sure that all these documents are right — the CC&Rs, HOA articles and bylaws, HOA management agreement, and Shared Facilities Agreement, as well as the rental program agreement and the hotel management agreement with the hotel operator. Good documents that adequately cover all the issues particular to condo hotels will help developers minimize problems and maximize profitability.

Other condo hotel resources

You can access the full library of Condo Hotel materials on Hotel Law Blog by going to the home page, selecting the tab at the top that says “HOTEL LAW TOPICS”, and then clicking on “Condo Hotels” in the drop down menu . . . or by clicking here.

Below is a partial listing of articles by JMBM’s Condo Hotel Lawyers:

This is Jim Butler, author of and hotel lawyer, signing off. We’ve done more than $68 billion of hotel transactions and have developed innovative solutions to unlock value from hotels. Who’s your hotel lawyer?

Our Perspective. We represent hotel owners, developers and investors. We have helped our clients find business and legal solutions for more than $68 billion of hotel transactions, involving more than 1,500 properties all over the world, including more than 100 condo hotels and hotel condos. For more information, please contact Jim Butler at or +1 (310) 201-3526.

Jim Butler is a founding partner of JMBM, and Chairman of its Global Hospitality Group® and Chinese Investment Group™. Jim is one of the top hospitality attorneys in the world. GOOGLE “hotel lawyer” and you will see why. Jim and his team are more than “just” great hotel lawyers. They are also hospitality consultants and business advisors. They are deal makers. They can help find the right operator or capital provider. They know who to call and how to reach them.