|By Jerry W. Jackson and Christopher Boyd,
The Orlando Sentinel, Fla.McClatchy-Tribune Business News
Dec. 27, 2006 - Despite slowing condominium sales in Florida and sagging hotel occupancy in Orlando, a Central Florida developer is planning a full-service luxury condo-hotel in the Lake Buena Vista area.
The San Marco Resort, featuring two 15-story towers, is slated for State Road 535 south of Interstate 4 between State Road 417 and Osceola Parkway.
KUD International, a subsidiary of construction and engineering giant Kajima Corp., based in Japan, has been hired as the master developer for the project for Lake Buena Vista Vacation Resort.
Plans call for 472 units selling from the upper $300,000s, with amenities ranging from designer furniture and marble foyers to a pool with a meandering river.
Groundbreaking on the $200 million project is planned for next summer with completion in late 2009. The developers have not said whether the hotel would be affiliated with a lodging brand.
A condo-hotel operates as a hotel but most of the units are individually owned.
But industry experts noted Tuesday that the condo-hotel market faces challenges.
"First of all, a condo-hotel has to make economic sense as a hotel operation," said Jan Nichols, an independent hotel industry consultant in Winter Park. "Developers really have to do their homework to make these work."
Nichols said hotel occupancy has weakened this year, "a troubling trend" that the local hospitality industry hopes to reverse with a bigger and better marketing campaign.
Stuart Blumberg, president of The Greater Miami & The Beaches Hotel Association, said the condo-hotel market in South Florida has all but vanished with so many regular condos still under construction. There are not enough investors, he said, so the condo-hotel craze has ended in the Miami market.
"It went up like a rocket and came down fast," he said. "We have such a glut" of condos. "There must be 30 or 40 construction cranes building regular condos."
But Blumberg said a condo-hotel in the Lake Buena Vista area might stand a chance of attracting investors since that is the Orlando area's best hotel market and is not as saturated with regular condos.
"Lake Buena Vista probably makes sense," he said, noting that condo-hotels continue to attract interest from investors in other areas of the country where condo construction has not been so rampant.
Last month, another Orlando developer announced plans to break ground in early 2007 on a 504-room condo-hotel near Walt Disney World that would be affiliated with Wyndham hotel group.
Buena Vista Corp. said it plans to open the hotel, with twin 30-story towers, in late 2009 on Turkey Lake Road about a mile from Disney. The company said the project would cost about $300 million.
Jerry W. Jackson can be reached at firstname.lastname@example.org or 407-420-5721. Christopher Boyd can be reached at 407-420-5723.
Copyright (c) 2006, The Orlando Sentinel, Fla.
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