1. What is a Condo Hotel? One or more buildings designed and operated as hotel where some or all of the rooms are sold as condominium units and the buyers are offered a rental program

2. Design Speed Bumps Size of the unit Number of bedrooms Lockouts Design elements to discourage long term occupancy

3. Operational Speed Bumps Allocation of expenses “Fair” rental rotation Individual unit accounting Owner occupancy policies Stability in rooms inventory Who is the “owner”?

4. Allocation of Expenses – The Rubik’s Cube Range of Allocation Options: Condominium common expenses – all unit owners pay pro rata share Rental Program Common Expenses – only units in Rental Program pay pro rata share Non-rooms revenue generating expenses – paid by owner of the revenue source Non-condo shared expenses for shared areas – allocated between unit owners and hotel lot owner

5. Condo Structure Speed Bumps The “air only” condominium Common elements v. shared areas Approval of budgets Condominium litigation opportunities

6. Unit Sales Speed Bumps SEC enforcement actions “Sale of securities” lawsuits by Unit owners Disconnect between unit sales prices and value as hotel rooms Local regulations that restrict owner use of units

7. Rental Program Speed Bumps Who “sells” the rental program? Securities violation for selling an “investment” Maintaining brand standards Managing unit owner expectations