Ever wondered how you can own a slice of a Miami Beach hotel and still enjoy personal stay time? If you have heard the term condo-hotel and are curious about how it really works here, you are not alone. Many buyers love the idea of a turnkey second home that can generate income when not in use. In this guide, you will learn what a condo-hotel is, how ownership and rentals work in Miami Beach, and the key risks and due diligence steps to take before you buy. Let’s dive in.
What a condo-hotel is
A condo-hotel is a condominium that operates as a hotel. You own your individual unit in fee-simple or condominium title, and a hotel operator manages day-to-day operations like front desk, housekeeping, marketing and nightly bookings. This hybrid model blends personal use with income potential from transient guests.
Your rights and use are shaped by two core documents: the Condominium Declaration and the Hotel Management or Operating Agreement. The Declaration is governed by Chapter 718 of the Florida Statutes and sets unit owner rights, common elements and association governance. The management agreement outlines how the operator runs rentals, which services are included, and how revenue is distributed between the operator and owners.
Owners can usually stay in their unit, but use is often limited by the rental program and house rules. Typical limits include a maximum number of owner days per year, blackout dates during peak periods, and advance notice to reserve owner stays.
How ownership and rentals work
Ownership vs. control
You own your unit and are a member of the condo association. At the same time, you delegate guest rentals and hotel services to the operator under the management agreement. You will pay association assessments and be subject to the building’s rules and budgets.
Rental programs and revenue splits
Some condo-hotels require all units to participate in a centralized rental pool. Others let you opt in or out. In a mandatory pool, the operator controls brand standards and bookings. Revenue is usually split from gross rent, with operator commissions, housekeeping, marketing or reserve contributions, taxes, and the owner’s share laid out in the rental program documents. Your net income is calculated after these fees and your HOA assessments.
Owner use rules
Expect practical restrictions that protect hotel operations. Common items include maximum owner occupancy days per year, blackout dates, minimum notice for owner stays, and check-in through the front desk. Most buildings prohibit independent short-term listings on third-party platforms. If you plan to use your unit during peak season, confirm how owner priority works.
HOA fees and assessments
Association fees are typically higher than a standard residential condo. The reason is simple: staffing, front desk, housekeeping support, and hotel-grade common area utilities cost more. Also account for the possibility of special assessments, especially for capital repairs or hurricane-related deductibles in a coastal market like Miami Beach.
Insurance and risk allocation
The building carries a master policy for structure and common elements. You will likely need an HO-6 policy for interior improvements, contents and liability. Ask how wind or hurricane deductibles are allocated to owners. In South Florida, large deductibles can lead to special assessments after a storm.
Miami Beach taxes and licensing basics
Transient occupancy and sales taxes
When your unit is rented to short-term guests, state and local transient occupancy taxes and applicable sales taxes usually apply. In a condo-hotel, the operator typically collects and remits these taxes from rental receipts. Tax rates and rules can change over time, so verify current practices and reporting in the rental program documents.
City licensing and compliance
Miami Beach has specific business licensing, lodging safety and transient rental rules. Established condo-hotels are usually regulated as hotels, not as stand-alone short-term rentals, but this distinction is critical to confirm for each property. Confirm that the building’s hotel operation and your unit’s participation are properly licensed with the City of Miami Beach and compliant with fire and safety standards.
Zoning and historic overlays
Hotel operations must align with zoning and land-use rules. Some neighborhoods and buildings have historic designations or overlay districts that affect signage, renovations and food and beverage operations. Ask for the building’s compliance history and any restrictions that could impact future improvements.
Property taxes and income reporting
Your unit will be assessed by the Miami-Dade Property Appraiser. Rental income is typically reported for federal and state income tax purposes. Most operators issue year-end statements and tax documents to owners, which helps with your filings.
Financing in Miami-Dade: what to expect
Condo-hotels are often treated differently by lenders than traditional condos. Many mainstream mortgage programs restrict or exclude condo-hotel projects, or require special project approvals. This can mean higher down payments, higher interest rates or a need to use local banks and specialty lenders that understand the asset type.
Agency-backed programs like FHA, VA, Fannie Mae and Freddie Mac often have project rules that some condo-hotels do not meet. Before you shop, ask which lenders actively finance the specific building you are considering and what typical down payment and reserve requirements look like. If you plan to leverage financing, get pre-vetted with a lender experienced in Miami-Dade condo-hotel loans.
Market drivers and risks in Miami Beach
Tourism and seasonality
Miami Beach is a major international tourism destination. Demand for condo-hotel stays tends to ebb and flow with seasons, events and travel cycles. Occupancy and average daily rate can be strong during peak months and softer in the off-season. Your income will depend on these cycles.
Brand and operator performance
The hotel brand and operator matter. A recognized brand and strong management can support occupancy and revenue. Changes in management, a rebrand or an operator bankruptcy can affect performance and resale demand. Review the management agreement term and any termination or renewal provisions.
Resale liquidity
Condo-hotel units can have a narrower resale market compared to standard condos. Buyers should review comparable sales for condo-hotels, typical time on market, and how being part of a hotel affects valuation. The pool of lenders and buyers may be smaller than for conventional condos.
Climate and insurance costs
Miami Beach faces hurricane, flooding and sea-level rise risks. Insurance costs and deductibles can be higher, and those costs flow through association budgets. Understand how the association funds reserves and handles deductible obligations after a storm.
Legal exposure and building history
Condo-hotel projects can have complex litigation histories, from construction defects to management disputes. Review association meeting minutes and legal disclosures. A clear view of past assessments and repairs will help you price risk.
Your Miami Beach condo-hotel due diligence checklist
Documents to secure and read closely
- Condominium Declaration, Bylaws and Plat: confirm permitted use, rental restrictions, voting rights, reserve requirements and special assessment history.
- Hotel Management Agreement and Rental Program: review term length, termination rights, revenue splits, operator fees, reserve and marketing charges, blackout periods and owner booking rules.
- Association minutes and financials for 3 to 5 years: budgets, reserve studies, insurance claims, pending litigation and any material building issues.
- Master insurance policies and deductibles: how wind and hurricane deductibles are allocated; whether any business interruption coverage applies to rental income.
Performance and money flow
- Historical rent roll and P&L: occupancy and average daily rate by season, plus clear expense detail.
- Owner statements and payment timing: payout schedule, reporting format and any holdbacks or reserves.
- Full fee schedule: HOA dues, special assessments, housekeeping for owner stays, amenity fees, parking or valet charges.
Owner use and transfer rules
- Owner stay allowance and blackout dates: maximum days per year, minimum notice and priority rules during peak.
- Reservation process: whether owners book through the front desk or an owner portal, and whether owner stays incur housekeeping fees.
- Resale and leasing restrictions: right of first refusal, transfer fees, and any rules that affect future buyers.
Taxes, licensing and compliance
- Transient occupancy and sales tax handling: who collects and remits, and how reporting is documented.
- City licensing status: ensure the hotel operation is properly licensed and compliant with safety rules.
- Property tax classification and history: review recent assessments and appeal history if relevant.
Physical condition and operations
- Capital plan and upcoming projects: roof, elevators, facade, decks and mechanical systems with timelines and budgets.
- Amenity access and closure policies: how long amenities can be closed during renovations and what owner credits apply, if any.
- Parking and valet rules: allocation for owners vs. guests and options during high demand periods.
Financing and valuation
- Lender options: which banks actively lend in the project and typical down payment requirements.
- Recent condo-hotel comps: sale prices and time on market for similar units.
- Scenario testing: estimate returns at different occupancy levels and include HOA dues, taxes, insurance and reserves.
Red flags to watch
- One-sided management terms with long control periods and heavy penalties to terminate.
- Lack of audited financials or poor transparency in owner statements.
- Rapidly rising HOA dues without a clear capital plan.
- Active litigation involving the developer, association or operator.
- A large share of units in foreclosure or held by a single owner or developer.
Is a condo-hotel right for you?
A condo-hotel can be a smart fit if you want a turnkey pied-a-terre and like the idea of offsetting costs with rental income. You get hotel-style services and a stress-free booking and housekeeping process. In return, you accept owner-use limits, higher operating costs and market-driven income.
If you value full-time occupancy, control over rentals and the broadest financing options, a standard residential condo may fit better. If you want lifestyle use plus potential cash flow, a well-run Miami Beach condo-hotel can be compelling.
How to move forward with confidence
Your strongest early step is to obtain and read the Condominium Declaration and the Hotel Management Agreement, plus recent financials and rent roll, before you make an offer. Then speak with a Miami Beach real estate attorney, a CPA familiar with transient rental and sales tax, and a lender who has closed condo-hotel loans in Miami-Dade. Visit during both high and low season and, if possible, talk to current owners about real experiences with owner stays and payouts.
When you are ready to explore specific buildings and unit types that align with your goals, reach out for tailored guidance. The Darin Feldman Group brings boutique, senior-level representation, market-savvy analysis and access across premier Miami Beach assets. If you want white-glove help evaluating options and negotiating a strong position, contact The Darin Feldman Group at Insignia International Properties. Request a private market consultation.
FAQs
What is a condo-hotel in Miami Beach and how does it differ from a condo?
- A condo-hotel is a condominium that operates as a hotel, with your unit rented to short-term guests through a centralized program and services managed by a hotel operator. A standard condo is primarily for residential use and does not operate as a hotel.
Can I use my Miami Beach condo-hotel unit whenever I want?
- Usually you can use it, but your stays are limited by rental program rules like maximum days per year, blackout dates and advance notice. Always confirm the exact owner-use provisions in the documents.
Are HOA fees higher in condo-hotels compared to regular condos?
- Often yes. Hotel-style staffing, front desk, housekeeping support and higher insurance costs make HOA assessments higher than typical residential condos.
Can I rent my condo-hotel unit on platforms like Airbnb or VRBO?
- Typically no. Most condo-hotels require rentals to go through the hotel operator, and independent listings are often prohibited by the declaration and local licensing rules.
How are taxes handled on short-term rentals in a condo-hotel?
- The operator generally collects and remits applicable transient occupancy and sales taxes from rental receipts, and issues year-end statements for your tax reporting. Verify current processes and rates for your building.
What should I review first before making an offer on a condo-hotel unit?
- Start with the Condominium Declaration, Hotel Management Agreement, recent financials, reserve studies and historical rent roll. These documents drive your use, costs and income potential.
Is financing harder for Miami Beach condo-hotel units?
- Frequently yes. Many mainstream mortgage programs restrict condo-hotels. Expect to work with a specialty lender and plan for higher down payments or different terms than a standard condo.
What climate and insurance risks should I consider in Miami Beach?
- Hurricane, flooding and sea-level rise risks can raise insurance costs and deductibles. Ask how deductibles are allocated, how reserves are funded and whether past storms led to special assessments.
