The opportunity to place your residence in a rental arrangement with the resort operator is one of the many benefits of ownership. The questions and answers below provide an overview of the optional rental program.
Frequently asked questions
What are some of the benefits of owning a condominium-hotel?
Condominium hotels are designed for worry-free and hassle-free vacation homeownership. When not using their residence, individual owners have the option of placing it into an organized rental program to offset operating expenses. Homeowners enjoy a luxurious vacation home with extensive services and amenities while the onsite operator takes care of all property management and vacation rentals.
Who are the various entities involved in the rental program?
Andaz Costa Rica Resort at Peninsula Papagayo – a concept by Hyatt (the “Resort”) is owned by Hotelera Playa Sombrero, S.R.L (the “Resort Owner”). Residence owners who elect to participate in the rental program will enter into a rental management agreement (“RMA”) with Resort Owner. Resort Owner’s duties and obligations under the RMA will be sub-contracted to the onsite resort operator — an affiliate of Hyatt Hotels Corporation (“Hyatt” or “Resort Operator”). For over six decades, Hyatt has been caring for people so they can be their best. Long-term property management by one of the world’s top hospitality companies will ensure seamless hospitality and peace of mind.
Am I required to participate in the rental program?
No. The rental program is voluntary and independent of the sales program. If you choose to rent your home, you may elect to enter into a RMA with the Resort Owner. The optional rental program is designed to ensure that all rental guests receive the same superior quality of accommodation and access to services and resort amenities that they would expect to receive as guests of the resort.
What is the term of the Rental Management Agreement?
The initial term is two (2) years. The RMA will automatically renew biannually for additional twenty-four (24) month periods unless you or the Resort Owner provides notice of non-renewal.
What if I sell my residence before the term expires – must my buyer assume the RMA?
Your future buyer will have the option to either assume the RMA or opt-out. If the buyer elects to opts out, however, he/she must honor all reservations in place at such time.
How far in advance can my residence be rented?
The Resort Operator is entitled to accept reservations for any rental period within twelve (12) months of the reservation date, subject to prior reservations made by the homeowner.
How many nights each calendar year may I stay in my residence? Is there a nightly rental fee?
For reservations made more than one (1) year in advance, homeowners have unlimited usage and pay only housekeeping charges.
What if I give short notice – can I still use my residence if it has not been rented?
Yes. As long as your residence is available, you can use it and pay only housekeeping charges.
Will I receive daily housekeeping service?
You may request daily housekeeping service and other services during your stay, subject to payment of the Resort Operator’s prevailing rates for those services. The only housekeeping service you are required to receive and pay for is on the arrival date and departure date.
What is the rental split?
Residence owners will receive fifty percent (50%) of the net rental income (defined as the gross room rental income less a ten percent [10%] rental program system reimbursement).
What marketing services will be provided by the Resort Operator?
The Residences will be advertised for rent by the Resort Operator as part of the Resort inventory, providing proprietary access to Hyatt’s global distribution network and millions of potential guests. All associated marketing costs will be absorbed by the rental program system reimbursement fee.
How will the daily rental rates be established?
The Resort Operator will set the daily room rates based on rates charged at comparable properties in the market, size of residence, length of stay, seasonality, and forecasted available inventory. The Resort Operator reserves the right to set and change rates at any time. Future rental performance will depend on many factors, including but not limited to the occupancy and average rate of other luxury branded residences on Peninsula Papagayo (e.g. Four Seasons Two-Bedroom Pacifico Residence and Four Seasons Three-Bedroom Pacifico Residence).
Can you project how often my residence will be rented and what the average rate will be?
Unfortunately, we are not able to provide projections of occupancy rates or rental rates due to U.S Securities laws.
Will rental revenues from different residences be combined into a rental pool?
No. Rental revenues from your residence are not pooled with rental revenues from other residences. Each residence will have separate income and expense accounts, and each owner’s rental income will be directly tied to the number of days their residence is rented.
How will the Resort Operator ensure that reservations are allocated fairly amongst all of the residence owners in the program?
Residences will be segmented according to floor plan, creating discrete room-type rotation groups. Reservations within each room-type rotation group will be assigned using a sequential rotation system. The only exception to the sequential rotation rule is when guests request a specific residence. In such cases, reservations would be assigned to the requested residence (if available), and that residence would revert to the bottom of the rotation. The allocation of rental opportunities will naturally be affected by the timing and frequency of homeowner use. Accordingly, it is likely that some residences will be rented more frequently than others and will achieve different rental revenue and homeowner distributions.
Will the new Andaz Residences compete with the resort’s existing room inventory?
No. Of the current one hundred and thirty-two (132) rooms and twenty-one (21) suites at Andaz Costa Rica Resort, only the presidential suite has a kitchen. The new Andaz Residences, with three brand new room categories, will dramatically change how Hyatt markets the resort, allowing it to reach exciting new markets.
How will the new Andaz Residences change the resort’s guest segmentation?
With larger family-size accommodations, the new Andaz Costa Rica Residences will allow Hyatt to expand into the fast-growing family travel market. Architect Ronald Zürcher’s innovative two-bedroom and three-bedroom townhomes with full kitchens and plunge pools are an ideal match for families seeking more authentic experiences on inter-generational re-connection holidays.
What ongoing operating costs am I responsible for?
Homeowners are responsible for the cost of running and maintaining their private residence, including:
$6,988 per Assessment Unit per year*
Two-bedroom villa: ≈ $25,000 per year*
Two-bedroom penthouse: ≈ $35,000 per year*
Three-bedroom penthouse: ≈ $45,000 per year*
What is the FF&E and OS&E requirement?
Residences will be delivered fully furnished and all furniture, fixtures and appliances (“FF&E) will be in compliance with Andaz brand standards. One par level of operating supplies and equipment (“OS&E”) is included with your purchase. Owners wishing to place their residence in the rental program will be required to purchase one additional par level.
What is the FF&E replacement reserve fund?
For each rental period, a percentage of your gross rental revenue (3.5%) will be deposited into a separate replacement reserve account. This capital account will be used to fund all unscheduled maintenance and repairs, as well as periodic renovations deemed necessary to maintain brand standards. If your reserve fund is insufficient to pay for such costs, you will be required to make up the difference.
What happens if a hotel guest damages my residence?
The guest’s credit card will be charged for any damage.
What insurance coverage will I need?
Property damage insurance and premises liability insurance must be in place throughout the term of the RMA. The property damage coverage must be at least equal to the full replacement cost of the FF&E and OS&E. The premises liability policy must be a minimum of One Million Dollars ($1,000,000.00) for each occurrence.
How often will I receive a statement of revenues and expenses?
Monthly statements will be issued by the Resort Operator showing a breakdown of rental activity, revenues, and expenses. Your statement will be issued with an invoice, as appropriate.
How often will I receive income distributions?
Profits will be distributed quarterly via wire transfer, subject to applicable bank fees.
Can World of Hyatt members redeem points to book your residence?
Will your residence be non-smoking?
Hotelera Playa Sombrero S.R.L. (the “Developer”) is solely responsible for the development, marketing, and sale of the Residences. An affiliate of Hyatt Hotels Corporation (“Hyatt”) has licensed to the Developer the right to offer and sell the Residences using the Andaz name and trademarks. Neither Hyatt nor any of its affiliates has any ownership interest in the project and is neither responsible for, nor makes any representation or warranty concerning the development, marketing, sale, or operation of the Residences. This is neither an offer to sell nor a solicitation to buy to residents in jurisdictions in which registration requirements have not been fulfilled — void where prohibited by law. Renderings, floor plans, and other images presented herein are for illustrative purposes only, may not be to scale, and should not be relied upon as a basis for purchasing. Dimensions and square footage are approximate and may vary with actual construction. The developer reserves the right to make modifications or substitutions, should they be necessary. Prices subject to change without notice.