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Allamanda Condo Hotel Disintegrates

Category: Hotels, Posted:10 Aug 2009 | 05:47 am

One of the long standing condo hotel projects on the island Allamanda in Laguna Phuket appears to be on the point of disintegrating as a consolidated resort. For a number of years the three individual juristic bodies of the project Allamanda 1, 2 and 3 functioned and were managed by Laguna or through one of their affiliated companies faced growing issues by the various owners groups, which have now led to a parting of the ways.
With Allamanda 1 engaging CBRE to manage the common areas; it's been reported that the owners of Phases 2 and 3 will affiliate to an international branded hotel group in the near future. What the situation highlights is the current deficiency in Thailand's condominium juristic act (CJP) to ensure a long term guarantee of seamless management; and for condo hotel operator's its nearly impossible to ensure a long term presence should owners change their minds down steam and vote out the group.
For buyers who purchase on rental yields this can create a confusing situation as the branded project you buy into today may not be the same set up in a few years time. Many of the larger mixed use projects with villas or apartments that are combined with a hotel have used leasehold structure which is regulated under the far more favorable Land Development Act and allows for long term contracts of operators.
In coming years hopefully both amendments to both the CJP and Hotel Act will address relevant legislation but for now buyers of resort managed projects need to be fully aware of the longer term implications of rental programs with both upside and downside issues.

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