The local MLS, at that time, showed 29 of 32 units available and priced at approximately $1000+ per square foot.
Another post questioned if these projects were viable - asking "Will they make it?".
A regular and respected commenter erroneously computed the condo-tel investment potential when he wrote:
"It's my guess that most of these EXCLUSIVE properties have a large exclusivity premium built in and that even if it's necessary to reduce selling prices by 20% (or throw in incentives), there's still a substantial profit in these units, most of which, after all, include a transient rental license that can help to pay the mortgage. The developers talk about these as $500 a night and more rentals. I'll do the math: $500 per night at 80% occupancy = 292 days X $500 = $1,460,000. Take away another 20% for management fees and condominium charges, that leaves a paltry $1,168,000 to cover mortgage and taxes."
The correct math, using his assumptions, would be 292 days x $500 = $146,000. Taking away another 20% for mgmt. fees and condo charges leaves $116,800.
However, Key West hotels are at $500 per night only a few weeks of the year. For the rest of the year, these condos will likely rent for much less. If you hope to hit 80% occupancy, the average rate may be closer to $300 or less. Also, the income a buyer would receive is TAXABLE income - so take another 25% off for that.
Here is the correct math: 292 (80% occupancy) x $300 (per night average) = $87,600. Take away a 20% mgmt/condo fee = $70,080. And remove the 25% taxes = $52,560 in income. That equals $4380 per month - less than half what a mortgage will cost, at 6% with 20% down, on the least expensive unit in the MLS.
And this is if everything goes "right".
Today, over 4 months later - and beyond the traditional real estate selling season - there are still 29 of 32 units available and "active" on the MLS. Amazingly, the prices listed are still stratospheric: $1,965,000 to $3,120,000. The developer, Keys Caribbean, is offering a "Special pre-construction pricing starting at $1,710,000" on their website.
The developer has built a model home that towers over Lazy Way Lane and plans to build more as buyers come forward.