Melbourne, 8 March 2016 – Melbourne’s high profile Metropolitan Hotel has been listed for public sale for the first time in over 20 years.
The historic hotel was established in the mid 1800’s and occupies a prime corner location at 263-265 William Street on the corner of Little Lonsdale Street opposite the Mint and on the doorstep of all of the city’s major courthouses.
CBRE Agents Josh Rutman, Mark Wizel, Scott Callow and Paul Tzamalis have been appointed to steer the freehold auction sale in conjunction with David Marks from Killen Thomas.
Mr Rutman said the sale provided a rare opportunity to acquire a prime freehold hotel in the Melbourne CBD in an area set to benefit from the ongoing expansion of the city’s north western pocket.
“Pubs tend to occupy high profile corner positions, which make them particularly attractive to investors,” Mr Rutman said.
“It’s very difficult to find sub $10 million freeholds on the main streets of the Melbourne CBD, with only a handful selling in the past five years.”
The Metropolitan Hotel includes a popular café style bar and dining area at ground level with a guest seating area of approximately 120 people. It has an elevated dining area at the rear which is serviced by a commercial kitchen with pizza oven. The first floor includes a large function space with the property also benefitting from a cellar area with a keg room and office space.
With the hotel leased until 2020, Mr Rutman said the auction was expected to attract interest from both investors and owner occupiers, locally and from offshore, looking to leverage from the property’s irreplaceable corner position within the legal precinct of the CBD.
“The property has a very strategic triple street frontage which will provide ultimate flexibility to the future purchaser once the current lease expires. Many prospective purchasers have indicated that they would look to cut the property into smaller ground floor retail shops and explore the opportunity of constructing additional floors or a rooftop dining area,” Mr Rutman said.
CBRE’s Mr Tzamalis also noted that the property benefited from substantial passing trade, with over 20,000 pedestrians passing the site every day.
“This is underpinned by the hotel’s proximity to Flagstaff Railway Station, which has benefitted from a seven day a week schedule since January this year,” Mr Tzamalis said.
“The future expansion and development of nearby Queen Victoria Market is also expected to assist the long term growth of any operation at the Metropolitan site, including pedestrian traffic in the area.
The hotel also benefits from an extremely rare liquor licence, which allows the operator to trade seven days a week 24 hours a day.
“Liquor licences such as these are no longer issued to hotels making this a very valuable commodity and allowing the operator tremendous flexibility on how and when they choose to operate the business,” CBRE’s Mr Callow said.
He also noted that the number of traditional pubs in the CBD area had diminished over the past decades given demand for alternate uses on prime corner sites.
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