Quetzal Condos at Bahia Principe

Quetzal Condos at Bahia Principe

Over the past 20 years I’ve visited countless real estate projects in several countries. In terms of amenities and infrastructure, Bahia Principe Residences and Golf on Mexico’s Riviera Maya near Tulum, is probably the most impressive project that I’ve ever seen.

The project, situated along the Yucatan coast, features four hotels, eleven specialty restaurants, twenty-two bars, seven pools, three spas, five tennis courts, a basketball court, a beach club, and a shopping center. Further, residents can enjoy an 18-hole Championship Par 72 and an executive 9-hole Par 27 golf course.

The groupbehind the project is unique in that it includes a tour company, a hotel company, a separate resort company, and a development company all under one flag. Essentially, the group’s business units are vertically integrated to create a business model that supports itself from the bottom up. The tour company feeds the hotel company, the hotel company feeds and manages the resorts, and the resorts provide much of the amenities and infrastructure for the developments.

The master plan for this residential resort community at Bahia Principe calls for multiple lot sections for custom homes as well asturnkey condo units and luxury homes. In fact, several of the turnkey residential options have been already been built and sold.

I’m writing today to inform you of a limited-inventory investment opportunity in Bahia Principe that’s ideal for an investor looking for rental yields or a second home in this part of Mexico…or both.

The investment opportunity that I’m speaking of is Quetzal situated within Bahia Principe and its Riviera Maya Golf Club.

 

Quetzal Condos
The Quetzal complex includes nine buildings with a total of 72 one- and two-bedroom units. All nine buildings are fully completed andcondo units are move-in ready.In fact, at the time of this writing there are only five condo units remaining. Specifically, there are only three one-bedroom and two two-bedroom units available.

The buildings at Quetzal feature contemporary modern design and all of the infrastructure is underground. Further,to add to the overall visual appeal of the project, the developer uses state-of-the-art lighting throughout the grounds and decorative gardens that integrate with the natural landscape.

In addition to the access to the amenities of the five-star hotel resorts in Bahia Principe, residents of Quetzal will have access to the sub-community’s own amenities, as well. The complex is professionally managed with on-site concierge service and 24 hour security. Even more, there is a turnkey rental program in place that includes sourcing renters, check-in, and concierge service for your renters.

There are four one-bedroom and four two-bedroom penthouse units in each of the Quetzal buildings. The one-bedroom units have approximately 68 square meters (726 square feet) of interior space and 32 square meters (348 square feet) of terrace space with a private Jacuzzi.The two-bedroom penthouse unit, which has two levels, has 122 square meters (1318 square feet) of interior space and 22 square meters (232 square feet) of roof-top terrace space with a private tanning area and a Jacuzzi.

All of the condo units in Quetzal have a sleek modernEuropean look and feel with elegant woodwork, marble, and high end décor. They feature expansive wall to wall, floor to ceiling windows with impressive views of the surrounding golf course. Further, each unit comes with a fully equipped kitchen with stainless steel appliances, upscale modern bathrooms, and central air conditioning.

Again, there is a very limited amount of inventory available in Quetzal. Out of 72 units only five remain.

As a special offer to Global Property Advisor members, the developer is offering the remaining one-bedroom condo units for US$188,150 and the two-bedroom penthouse units for US$290,250. Plus the developer is delivering the units completely furnished. Essentially, this is pre-construction pricing for units that are ready for immediate delivery—and instant rental income.Furthermore, the developer is offering financing. The terms are 30% down with the balance paid over 4 years with 7% interest.

Why I Like Quetzal As An Investment
Quetzal makes sense from an investor perspective for a couple of reasons. First off, Quetzal is situated in a master-planned beach front resort community located in an established tourist hotspot in one of the most visited countries in the world. In fact, the region where Quetzal is located has been designated as a zone for tourism development.

Second, I like that the group behind the development has over 30 years of experience in real estate development, international hotel management, and tourism. Plus they have an integrated administrative and marketing infrastructure in place that will ensure optimum short-term rental occupancy levels.

Additionally, I like the fact that the condo units are move-in ready. That is you can start enjoying your condo unit right away. Or, even better, you can start earning immediate rental cash flow.Plus if you add in the fact that there is a professionally managed turnkey rental program in place that sources renters, checks them in, and provides concierge service for them, then this investment becomes an absolute no-brainer.

The developer has projected annual occupancy rates for the condo units of 45%. However, considering the area where Quetzal is located, I believe these projections are conservative.

This part of Mexico sees nine months of high season and two months of low season each year. The remaining month of year is considered “prime season” and is made up of two weeks over Christmas and two weeks over Easter. Bottom line, the short-term rental potential here is very strong.

If you prefer to earn rental income on autopilot, then you could simply put your unit in the rental management program, where they take care of everything from the marketing, booking, and administration of your condo unit. The rental management fee is 30% of your gross rental income. Running the numbers on rental returns in the rental program, with a 45% occupancy rate, you could achieve a 5.79% net rental yields with a one-bedroom unit and 6.73% net rental yields with a two-bedroom unit.

However, if you wanted to take on a more active role in marketing and booking your condo unit independently,then you could significantly increase your net rental yield. In this case the rental management fee drops to 10% (includes administration, check-in, and housekeeping) of your gross rental income. For example, your net yield for a one-bedroom unit would go from 5.79% to 8.71%. In a two-bedroom unit the net rental yield jumps from 6.73% to 9.58%.

You could definitely opt to find renters for your unit on your own—through websites like Airbnb and VRBO—and not to participate in the rental program altogether. Though for optimal rental yields, I would advise you to do both.

Below I have included rental scenarios for the one-bedroom and two-bedroom penthouse units. I show the return you could earn in each case given average projected rental rates and the developer’s projected occupancy rates. Plus I highlight the yields that you would earn should you choose to market and book your condo unit independently.

Quetzal Rental Scenario 1

One Bedroom Unit Priced At US$180,000 with Rental Program
Projected Occupancy	45%	50%	55%
Net Annual Rental Income	US$10,416	US$12,460	US$14,504
Net Annual Rental Yield	5.79%	6.92%	8.06%
*Rental Income is based on an average nightly rental rate of US$160. *Yields calculations include rental management fees (30% of gross rental income), HOA fees, and utilities.

Quetzal Rental Scenario 2

One Bedroom Unit Priced At US$180,000 without Rental Program
Projected Occupancy	45%	50%	55%
Net Annual Rental Income	US$15,672	US$18,300	US$20,928
Net Annual Rental Yield	8.71%	10.17%	11.63%
*Rental Income is based on an average nightly rental rate of US$160. *Yields calculations include rental management fees (10% of gross rental income), HOA fees, and utilities.

Quetzal Rental Scenario 3

Two Bedroom Penthouse Unit Priced At US$277,000 with Rental Program
Projected Occupancy	45%	50%	55%
Net Annual Rental Income	US$18,654	US$21,720	US$24,786
Net Annual Rental Yield	6.73%	7.84%	8.95%
*Rental Income is based on an average nightly rental rate of US$240. *Yields calculations include rental management fees (30% of gross rental income), HOA fees, and utilities.

Quetzal Rental Scenario 4

Two Bedroom Penthouse Unit Priced At US$277,000 without Rental Program
Projected Occupancy	45%	50%	55%
Net Annual Rental Income	US$26,538	US$30,480	US$38,364
Net Annual Rental Yield	9.58%	11%	13.85%
*Rental Income is based on an average nightly rental rate of US$240. *Yields calculations include rental management fees (10% of gross rental income), HOA fees, and utilities.

Undoubtedly, theplay that I am recommending for this investment is short-term rental cash flow. It’s located in a tourist hotspot where tourism and rental demand continue to grow. Plus short-term rental allows you and your family to enjoy your condo yourselves.

This investment makes sense for an investor, particularly golf or beach lovers (or both), looking for a turnkey property rental with strong cash flow that doubles as a vacation home. In fact, I see this as an ideal legacy investment that will generate rental income for generations.

Again, there are only five units available, so I would encourage to act now.

 

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