IL Postcard

A Parisian Hotel That Pays YOU

Date: 06/29/2008

Monday, June 30, 2008
Paris, France

Read more about the French leaseback program in International Living Postcards —your daily escape

Sounds like madness, doesn’t it? A hotel that actually pays you. But it’s true, and it’ll be opening soon in my favorite corner of Paris.

It’s a three-star hotel with décor by maverick designer Philippe Starck, and is owned and run by the former president of the successful vacation resort business Club Med, Serge Trigano. The idea is to provide good-quality hotel accommodation for a reasonable price—rooms start at $157, or $106 if you're an investor—in a hip and happening Paris district: the 20th arrondissement.

Located opposite the Flèche d’Or (Golden Arrow), a quirky dance venue in a converted station, the hotel is in the east corner of Paris, just 20 minutes from Charles de Gaulle airport. Stay here and you have instant access to a side of Paris that is usually ignored by most visitors—the real face of Paris today, a district where young Parisians live and work and play.

The 20th is where you can pay your respects to the likes of Oscar Wilde, Edith Piaf, and Jim Morrison in the vast and leafy Père Lachaise cemetery. It’s also where you’ll find more artists’ studios and designer workshops per square foot than anywhere else in Europe. Here, you’ll find the best pick of specialized food shops and music venues in the city.

But how come the hotel is paying investors? It’s called a leaseback, and the French government is backing it in order to be able to offer quality accommodation and develop the tourism sector. [Editor's note: Regular readers know all about the leaseback program. To get yourself up to speed, read the full report here .]

Basically, you buy a room in Mama Shelter and you let Trigano’s company manage it for you for a fixed period of time; in this case, a nine-year contract that's renewable. This is an investment that should bring in reliable returns for more than 20 years.

The advantage for you is that you’ll get guaranteed rental income—for Mama Shelter, it’s 4.2%, index linked—and you get back the 19.6% sales tax on the purchase price. There are no management fees, and you get a discount on the public rate if you want to stay here.

This leaseback property is a unique leaseback opportunity because it’s the only tourist hotel leaseback in Paris. Other leasebacks in and around Paris don’t offer room service and are in business complexes used, for example, by companies for conferences and AGMs. Tourism leasebacks in other popular areas of France offer apartment-style accommodation in larger vacation resorts and have a wide range of leisure facilities such as a pools, gyms, and tennis courts.

Unfortunately, I can’t give away the details on how to take action on this investment for free, but International Living magazine subscribers can read the full article here. If you're not a subscriber, find out how to become one.

Leigh Fergus
Europe Editor, International Living

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