NEWS PROPERTY

Expressions of interest in the Sofitel Sydney Wentworth, which is in need of a major renovation, closed on March 14. Asian investors and developers coupled with cashed-up locals are vying to buy the two biggest commercial real estate projects in Sydney — the $200 million Nine Network head office site and one of the last dowager hotels in the city, the $400m Sofitel Sydney Wentworth Hotel. Singapore’s Frasers group, local billionaire developer Harry Triguboff’s Meriton and the listed Mirvac are said to be in the running to buy the Nine Network site on Sydney’s lower north shore from its Asian joint venture owners, who are asking about $200m. The vendors, Michael Jiang’s Lotus Capital and Hong Kong-based Euro Properties, paid $147m for the residential site in 2015.Nine remains the tenant at the 2.9ha Willoughby site, which has an approved masterplan allowing for the development of 460 residential apartments across 10 towers ranging from four to nine storeys until late 2020. The NSW government received thousands of submissions against the Willoughby project mostly relating to traffic generation and parking issues, followed by insufficient infrastructure and excessive height. But the state government does not believe the project would result in unacceptable traffic generation. Despite that, the site’s selling agents, Colliers International, yesterday said there had been strong interest driven by the low value of the Australian dollar and the possibility of further interest rate cuts, as well as an “early sign of the market turning”. As a sweetener, the site remains cash-flow positive until 2020.

A landmark Brisbane hotel with prime retail space fronting Queen Street Mall has sold with its check-in sale price believed to be around $150 million. The 304-room, 4.5-star NEXT Hotel has been snapped up by Melbourne-based funds manager Salter Brothers, formerly SB & G Group. JLL’s Tom Gibson and Simon Rooney, who brokered the deal, were remaining tight-lipped about the transaction details and declined to comment on the purchase price. But according to industry sources the unconditional deal sealed for the hotel asset — formerly known as Lennons Hotel — is understood to be worth “circa $150 million”. It includes two levels of retail space with frontage to Queen Street Mall, the CBD’s premier shopping precinct. The property previously changed hands in 2015 when Sydney-based investment management company Challenger paid $133 million for the then recently refurbished and rebranded asset.

The Original Ettamogah Pub in Table Top near Albury has hit the real estate market calling for Expressions of Interest, after an extensive redevelopment nears completion. Located off the Hume Highway, the main arterial roadway 16 kilometres north of Albury in NSW, the property sits on a 4.81ha site and features a number of ancillary buildings and potential uses. The original creator of the Ettamogah Pub was Ken Maynard, who started drawing the Ettamogah Pub in 1959. It was made famous through his regular cartoons in The Australasian Post. The Ettamogah Mob cartoons, an iconic series of weekly cartoons, were published in the national magazine for nearly 50 years.

A group of investors, headed by former Yellow Brick Road owner David Carr, has copped a rare loss in the hot pub sector, after selling the Redcliffe Tavern and First Choice Liquor Superstore in Brisbane’s north for $14.5 million. The property at 32 Anzac Avenue previously sold for $15 million to Mr Carr’s Bonheur Nominees in March 2016. In sharp contrast, the previous owner, Somerset Properties, made a 30 per cent capital gain on the same property in less than two years, after buying it from Alceon for $11.5 million in August 2014. In the latest deal, it was acquired in February by Anthony and Julian Vedelago’s Wuvulu Property Investments Pty for $14.5 million on a yield of about 7.25 per cent.

Virgin Australia’s second-in-command will depart the airline this week after his position was removed in a management restructure under new chief executive Paul Scurrah. Rob Sharp’s role as group executive will be split into two new positions: chief operations officer and chief commercial officer, Virgin staff were told on Tuesday. The restructure is the second major change Mr Scurrah has made at the financially struggling airline since he took on the top job six weeks ago, after he last week pushed back an order of Boeing’s troubled 737 MAX aircraft. Mr Sharp has been with Virgin for seven years, starting as the boss of its budget arm Tigerair under former CEO John Borghetti, and being appointed group executive in 2017. He will finish at the company on Friday. Merren McArthur, Tigerair’s current chief executive, will also take on the role of acting chief commercial officer. The airline’s director of flight operations Stuart Aggs will act as COO while Virgin recruits permanent appointments for the two positions. Virgin has run at a statutory loss in each of the past six financial years, as the business transformed from a budget airline to a full-service carrier competing head-to-head with its larger rival Qantas. Mr Scurrah has said that improving Virgin’s financial returns is a key priority.

The Rydges on Swanston hotel in Carlton on the Melbourne CBD fringe has been listed for sale with a $40 million-plus asking price by prominent Adelaide-based hotel investor David Horbelt. The 107-room hotel stands on a 1,762 square metre corner site at 701 Swanston Street, overlooking Lincoln Square – a small suburban park – and is close to Melbourne University. The hotel is operated by ASX-listed Event Hospitality & Entertainment, whose other brands include QT and Atura. The five-level building is being offered with the potential for vacant possession and is being touted by selling agents Jones Real Estate and Colliers International as a possible high-rise student housing development opportunity. Title deeds show Adelaide-based Hemer Pty Ltd is the ultimate owner of the Rydges on Swanston. Hemer’s sole director and shareholder is David Horbelt. Mr Horbelt own Prime Hotels, whose portfolio of assets include the upmarket The Reef House at Palm Cove near Cairns and the Rydges South Park Adelaide. Both properties were offered for sale in 2016 but failed to secure a buyer. The Rydges on Swanston is being offered for sale by Paul Jones and Tim Spargo of Jones Real Estate in conjunction with Colliers International’s Guy Wells and Oliver Hay. The agents said the vendor was “open to a range of offers including straight sale terms, joint-venture proposals and long-term settlements”. Mr Jones said the site presented buyers with a “genuine development blank canvas”. “Recent activity in the area has demonstrated a strong demand for quality assets, and the development potential of this site makes this a really rare opportunity,” he said. Mr Well said a new owner had the option to owner-occupy the hotel and take advantage of the locational benefits or to increase the room count and appeal to a broader market set. “With a strong occupancy rate of around 86 per cent coupled with a significant conferencing and food and beverage offering, the hotel earnings are very sound,” he said. “At the same time the development opportunities cannot be understated. “ There is significant potential for a purpose-built student accommodation product or educational offering,” he said. One of the more recent hotel sales in Carlton was the former 225-room Tune budget hotel (now and Ibis hotel) which was bought by Sydney fund manager Aligned for $52 million in 2016.

Retailer Gerry Harvey is looking to offload more of his trophy ­assets, with the luxury Byron at Byron Resort & Spa hitting the market for the first time since the billionaire opened it in 2005. “It’s one of our trophy assets like Magic Millions,” Mr Harvey said, adding that he also considered some of his New Zealand horse farms the prized pieces in his real estate empire. “We have got a lot of assets. As (businessman) Sir Charles Lloyd Jones said some years ago, assets are a burden. I don’t need a lot of the things I have got,” Mr Harvey, who turns 80 on September 18, said he believed the 92-suite Byron at Byron Resort, set amid 18ha of subtropical rainforest just outside the NSW north coast town, was worth between $40 million and $50m. The property is 50 per cent owned by a private entity of Mr Harvey’s, with the remainder held by a Harvey Norman Holdings subsidiary, with the decision to sell made jointly by both parties. Mr Harvey’s timing is spot-on, with global interest focused on Australian leisure assets since the Denver-based KSL Capital Private Equity Group took over Baillie Lodges and this year bought another resort, Silky Oaks Lodge in Queensland’s Daintree, into its portfolio. In 2017 a private equity firm backed by Melbourne’s multi-billion-dollar Liberman family bought through CBRE the world-renowned Byron Beach House Hotel for $70m. It was the single-largest Australian pub transaction — a record that still stands. Byron at Byron selling agent Wayne Bunz said there was a high level of interest in Australia’s destination leisure market. “After several of our high-profile clients approached us to find a location in Byron Bay, CBRE ­Hotels submitted off-market expressions of interest for the Byron at Byron, and subsequently convinced the vendors to take it to a public marketing campaign,” Mr Bunz said. He expected the level of interest in Byron at Byron would be substantial, not only from existing owner-operators and seasoned hoteliers, but also from high-net-worth individuals ­attracted by the prestige of owning a property in northern NSW. “It’s well noted that getting approvals to build this type of asset in Byron Bay and to acquire the land parcel is notoriously difficult, with the location characterised by its high barriers of entry for new accommodation offerings due to environmental protection laws,” Mr Bunz said. “To date, no international branded resort exists in Byron and we are confident that this property could potentially allow an investor to partner with one of the world-renowned leisure brands to enter this tightly held location.” Mr Harvey recently listed his Runaway Bay waterfront apartment project site after toying with developing it for more than a decade. The site is for sale through Gold Coast agent Mark Feltell.

Bathurst’s Edinboro Castle Hotel has changed hands and its new owners are looking to restore the historic drinking hole. There has been plenty of speculation in recent times about the future of the hotel but it was put to rest in a post on the Eddy’s official Facebook page past week. “The rumours are true … The beloved Eddy has been sold!” the post stated. The pub has been purchased by locally run MPK Hotels, adding to their growing local presence which also includes the Hotel Dudley on Stewart Street.