Hotel Investors Hit the Marque Portfolio Sold for 72 million
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Hotel Investors Hit the Marque Portfolio Sold for 72 million
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Category: Asia Pacific -
This is a press release selected by our editorial committee and published online for free on 2007-10-15
Grand Hotel Group’s (GHG) four star Marque Hotel portfolio has sold for a combined value of $72 million. Mr Mark Durran, Executive Vice President, Jones Lang LaSalle Hotels negotiated the sale of the three freehold investment hotels to two separate buyers on behalf of GHGs new owners Morgan Stanley and Tuan Sing.
Primespace Property Investment purchased The Marque Hotel Canberra, whilst a private investor purchased both The Marque Hotel Brisbane and The Marque Hotel Sydney properties. Strategically located along Australia’s eastern seaboard under lease agreements to Rendezvous Hotels Group, the three properties are currently undergoing a major $7.5 million refurbishment. “All three hotels will enjoy a contemporary new look and rating of four stars,” said Mr Durran.
“Australia’s hotel investment market remains buoyant and as such, investor interest for the 290 room portfolio was exceptionally strong,” said Mr Durran. He added, “Investors were attracted to the investment properties due to their prime locations and long term leases offered with both fixed rent and turnover rent.”
“This was a very rare opportunity for astute hotel investors to acquire a portfolio of quality hotels in three major Australian capital cities all showing clear signs of continued improvement,” said Mr Durran. The sale of the Sydney and Brisbane Marques reflected a yield in the order of 6.5%.
“With high barriers to entry in the Sydney CBD and positive forecast growth potential in hotel trading for the city, enquiries for the 113 room Marque Hotel Sydney were very strong,” said Mr Durran. The 965sqm site is situated opposite Sydney’s Central Railway Station and enjoys three street frontages.
The Marque Hotel Brisbane is a 16 level 99 room hotel located in the heart of the CBD. “Brisbane is one of Australia’s best performing hotel investment markets with occupancies currently at around 78-80% and with a strong ADR growth outlook,” said Mr Durran.
The Marque Hotel Canberra (78 rooms) is situated on a 6,270sqm Crown leasehold site on the prominent Northbourne Avenue, hence interest from developers was always expected to be strong. “Primespace Property Investment were amongst several competitive bids and are expected to redevelop the property at the end of the current lease term whilst having a holding income,” said Mr Durran. Despite the property’s excellent potential for alternate use, Canberra’s hotel market is presently the second best performing market in Australia with room yield growth of 19.7% during the March quarter 2007.
Alan Walker, CFO for GHG stated, “We offered the three Marque properties for sale after the new board deemed the hotels were no longer a strategic fit with the Group’s five star hotel business model and we are pleased with the sale prices achieved.” GHG is an Australian based hotel owner with approximately $650 million of assets, including four hotels under management agreements with Hyatt International.
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