Motels an evolving asset class, as Runaway Bay Motor Inn changes hands following a fierce bidding war

The Gold Coast’s Runaway Bay Motor Inn has changed hands for the first time in three decades following a hotly contested sale campaign.

Experienced moteliers the Mangu family, led by Ramesh, Vijayasri and Arun Mangu, snared the property following an Expressions of Interest campaign through CBRE’s Hayley Manvell, Taylor Morris, and Mark Witheriff.

Over 200 enquiries and 14 offers were fielded for the 41-room property – the Gold Coast’s largest motel, featuring a resort-style swimming pool, restaurant & bar, function area, one-bedroom manager’s residence, guest laundry and expansive grounds.

The high level of interest resulted in a sharp yield of 2.75%, underpinned by the asset’s prime Gold Coast location and the flexibility to either operate the property as an accommodation business or explore alternate uses.

The Mangu family intend to focus on operational enhancements at the property, which represents their second motel investment in the region, alongside the Tweed Central Motel in Tweed Heads.

CBRE’s Ms Manvell said, “The depth of interest we saw in the Runaway Bay campaign speaks to the evolving nature of this asset class. With stock levels remaining tight, buyers are moving to secure high-quality assets with long-term upside. The increasing scarcity of motels, with limited supply and soaring demand, has underscored a shift in how these assets are being viewed, not just as accommodation businesses but as versatile investment vehicles.”

Based on current market dynamics, Ms Manvell noted that this style of investment offered flexibility and multiple avenues for upside, including operational, development and alternate use potential.

“This was highlighted by the broad range of prospective purchasers for the Runaway Bay Motor Inn, with interest from moteliers, not-for-profit organisations, government bodies, retirement groups, and buyers eyeing opportunities for strata titling or long-term redevelopment,” Ms Manvell added.

CBRE’s Ms Morris noted that population and tourism growth were driving interest in Gold Coast accommodation assets, with demand for well-located motels at an all-time high.

“The competitive campaign and sheer number of underbidders, speaks volumes about the strength of the national motel investment market and South East Queensland. With tourism booming and the Olympics on the horizon, astute sellers are taking advantage of current market conditions with considerable capital waiting on the sidelines for motel stock. Investors are acutely aware of the region's robust growth potential and the compelling returns this style of accommodation asset can deliver,” Ms Morris said.