All Topics / Overseas Deals / North Dakota Hotel Suites 47% return p.a.

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  • Profile photo of DezzaDezza
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    @dezza
    Join Date: 2013
    Post Count: 3

    Hi Property people,

    Has anyone out there had experience or can offer educated opinion on the 47% rental yields on offer with the the hotel style accommodation in North Dakota USA? There seems to be a few companies offering this product now to house the oil field workers who are currently camping out in cars etc. I am currently invested in USA property and would appreciate any feedback  anyone has on this particular investment area and the inherent risks associated with it. Obviously with higher return comes higher risk, I just want to ensure I understand it all.

    Cheers

    Dezza

    Profile photo of FreckleFreckle
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    @freckle
    Join Date: 2012
    Post Count: 1,680

    I'd rather burn my money to get warm. At least I'd get some utility out of it.

    Profile photo of Nigel KibelNigel Kibel
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    @nigel-kibel
    Join Date: 2005
    Post Count: 1,425

    I would be very wary about being hotel suites in a tin shed. I would not touch it.

    Nigel Kibel | Property Know How
    http://propertyknowhow.com.au
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    Profile photo of CheevesFinancialCheevesFinancial
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    @cheevesfinancial
    Join Date: 2010
    Post Count: 201

    Can't believe I'm saying this, but I agree with Freckle.. I kid, Freck!  What happens when the oil production stops or dwindles and we find other resources.  It's a game of hot potato.  I don't know if I'd necessarily burn the money though :-)

    CheevesFinancial | Cushman & Wakefield - Commercial Property SW FL
    http://www.CommercialRealEstateVoice.com
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    Profile photo of DezzaDezza
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    @dezza
    Join Date: 2013
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    Thanks for the feedback guys!

    Profile photo of jayhinrichsjayhinrichs
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    @jayhinrichs
    Join Date: 2011
    Post Count: 1,177

    I have asked many times for information from these companies about structure of the deals,, and no one will answer.  One cannot just buy and get a deed to a hotel room in the US these have to be some sort of partnership LLC  500 series offerings were they are pooling the funds  so its a rather different investment than investing in a home where you are the sole owner and have a deed to the property… I guess I will respond to one of these and see what they are sending in the way of source docuemnts and supporting docs.

    Profile photo of CheevesFinancialCheevesFinancial
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    @cheevesfinancial
    Join Date: 2010
    Post Count: 201

    Jay:  Perhaps it's a condotel?  But if so, in my condotel experience, the management company takes 40-60% of the revenues so I just can't see an ROI close to 40's. 

    CheevesFinancial | Cushman & Wakefield - Commercial Property SW FL
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    Profile photo of jayhinrichsjayhinrichs
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    @jayhinrichs
    Join Date: 2011
    Post Count: 1,177

    cheeves,, even a condotel denotes a condominium Map being recorded with subsiquent individual units that can be sold with deed and title insurance. Maybe because of the emergency type of housing the state has adopted new laws to allow this.   When I lived in the Napa Valley I lived at Silverado CC and we had Condotel untis but they were a full blown condominium plat or Strata as they call it in Canada

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