Rental Rates & Anticipated Occupancy Rates: 

If you base the rental income projections on the Gorbandh Palace Hotel, a 3 star hotel in Jaisalmer then we will see the following returns:- 

Average Hotel Room (Studio) rate of $150 per night.

$150* per night multiplied by 365 day and again by 80%, the occupancy rate in Rajasthan in 2012, statistics by the Rajasthan tourism, this will total an annual rental income of $43,800. The owners will receive 100% rental return from their apartment. Based on a  purchase price of $120,000 with a 20% reservation payment of $24,000. This is a 150% plus per year return on investment.

* These are not guarantees, but are based on actual hotel rates quoted in Jaisalmer. It does not matter if your particular unit is rented or not. As the revenue from all the similar units is pooled together and the revenue divided in equal proportion among the owners.  On completion of the building, and on receipt of the final payment, and on closing of the sale documents, the OWNER gets the Possession of the unit. Rental income starts after the the possession of the unit by the Owner.

Do you have a management program in place for rentals? If so what are the Charges:    

There is a Rental Management Program that the purchaser has the option to participate in.  The purchaser can use his purchase and stay in the hotel for Free and when not using it is rented and making money for him.

39% Guaranteed Rental or 100% Rental Revenue: Most typical splits are 60-40. This developer is offering 100% Rental revenues in favor of the buyer. In addition for the first 3 years, the buyer will receive from the developer minimum  39% per year guaranteed rental revenues on the initial invested price for their unit, Or 100% of the rental revenue, whichever is higher.

After 3 year the revenue will be 100% in favor of the unit holder, with no guarantees. This guarantee will be reviewed annually there after to reflect changes in economy, wages and operating costs, and determined whether it should be kept or discontinued.  From these revenues the buyer as a owner is responsible for their property and has to meet all the expenses and third party expenses on it as detailed below.

The owner is and always will be responsible to all his/her property and related independent third party expenses for maintaining it: The expenses are as follows:

• Franchise fees to the 5 star hotel chain for providing the brand name, quality control, advertising, and the world wide reservation system to keep the occupancy high. According to industry standards this works out to be 10-11% of the revenues.
• Management fees, staff salaries, including front office, maids & maintenance staff, & other desk clerks, telephone and internet operators, security staff, security staff, service personnel etc. Legal counsel, and attorney firm fees, charter accountant and accountancy firm fees, auditor fees etc. According to industry standards this works out to be 8-10% of the revenues.
• Daily consumables and pilferages provided in the rooms, like soap, shampoo, lotions, creams, toilet rolls, mineral water, ice, newspaper, towels, bed sheets etc, etc. According to industry standards this works out to be 2-3% of the revenues.
• Daily and annual cleaning, service, repair, maintenance inside the building like boiler room, air-conditioning units, generators, lifts, laundry machines etc and outside the building like parking lot, swimming pools, tennis courts, jogging trails etc.. Daily and annual repair, maintenance and replacement of properties and interiors of the rooms, lobby, front office and corridors. The apartment carpets, draperies, sofa, bed, mattresses, furniture, tv, appliances, lamps, wall hangings, decorations etc need to be replaced every 2-3 years to maintain the units at 5 star luxury hotel standards. According to industry standards this works out to be 5-6% of the revenues. Minimum 4% is held on an annual basis in a reserve account for this purpose.  
• Management fees to the developer for the Administration of the project, repair and maintenance of the structure and the buildings. The developer has the sole authority and discretion as to the Management, to select the rental agent, decide room rates, parking rates for the project and change it if required.  According to industry standards this works out to be 15-18% of the revenues.   The developer is giving a good deal to the buyers in charging property management fees of only 15%, although the work and expenses involved in condo hotel management are much more complex than the simple apartment rental management who also charge 15%.
• The owner is responsible for obtaining insurance for their apartments and contents, against any loss, damage or theft. Plus miscellaneous unforeseen small costs and charges. According to industry standards this works out to be 2-3% of the revenues.
• 6. All utilities, electricity, gas, heat, water, postage etc. According to industry standards this works out to be 3-4% of the revenues.
• Property and hotel license and taxes. According to prevailing rates this works out to be 2-3% of the revenues.
• Any other expenses.

Total expenses as above are expected to be 55%. For the first 3 years the developer has agreed to cap these expenses, and guarantees the above expenses to be maximum 55%. Net profits to the owner is estimated at 45% of the revenues from the units. This guarantee thereafter will be reviewed annually to reflect changes in economy, wages and operating costs.

The range of profits from all Businesses is usually 15 -25% of the sales. However this business being a real estate business. The net net profits of 45% of the room sales revenues and parking revenues is a very high and an excellent return to the buyers. In addition the buyers can look forwards to property value appreciations of 20 - 30% every year. If the buyer reserves a unit today, then by the time of completion  the buyers can expect an appreciation of over 200% on their units. We expect the buyers to make a very good return.