Queensland group doubles down on the Airlie Beach Hotel with 22m purchase
Queensland group doubles down on the Airlie Beach Hotel with $22m purchase
| 30 September 2019
A Queensland-based group has consolidated its interest in the Airlie Beach Hotel, acquiring the property freehold 10 months after securing the leasehold interest.
CBRE Hotels’ agents Wayne Bunz and Hayley Manvell negotiated the sale to ABH HOTEL PTY LTD on behalf of the O’Neill family, who have owned the waterfront property for over 30 years.
The Airlie Beach Hotel has 80 accommodation rooms, conferencing, commercial car park, restaurant, pub, retail liquor, 35 gaming machines and stable retail rental income.
The sale of the freehold and leasehold interests for a combined $22 million follows a recent $10 million refurbishment of the property, which is located within the Airlie Beach CBD and offers three major street frontages, providing a strong presence and foot traffic.
CBRE Hotels’ National Director Wayne Bunz noted; “The new owners immediately elevated returns by optimising venue operations and reducing overheads. Their subsequent purchase of the property freehold provides further evidence of a resurgence in the Airlie Beach and broader Whitsundays region, with investor sentiment on the rise.”
CBRE Hotels’ Hayley Manvell said there was strong investor demand for coastal and regional assets priced below $25 million, with investors chasing yield in markets where occupancy levels were starting to rebound.
“Driving this rebound is the recovery in the resources sector, most notably the strong growth in the price of iron ore, coupled with the decline in the Australian dollar, which is resulting in increased levels of tourism,” Ms Manvell said.
“Further fueling interest is the cost of borrowing, with investors benefitting from record low interest rates following the RBA’s delivery of two 25bps cuts since the federal election.”
Growing investor appetite for Queensland hotel assets has been evidenced by the recent sales of Coral Cay Mackay, Don Pancho Resort Bargara, Best Western Lake Kawana, Travelodge Rockhampton, Rydges Gladstone and Cairns Queenslander, with hotels also under contract in Townsville, Gold Coast and Cairns.
In the Whitsundays region, CBRE Hotels is also marketing Long Island Resort, as well Peppers Airlie Beach on behalf of receivers McGrathNicol.
“We predict that Queensland will once again be the most active investment market in Australia, for the second consecutive year,” Ms Manvell said.
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CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2018 revenue). The company has more than 90,000 employees (excluding affiliates) and serves real estate investors and occupiers through more than 480 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.