The sale of a luxury boutique hotel in Byron Bay is said to be the first negotiated since Covid-19 took hold in Australia, snapped up by the Gold Coast-based Guok family.
CBRE Hotels’ Wayne Bunz and Hayley Manvell, who negotiated the sale of The Bower, declined to comment on price but said the deal “establishes a new record price per key for the region”.
Industry sources say the Guoks—who have other interests in real estate and hospitality—paid around $18 million for the near-new hotel at 28 Bangalow Road, which offers 28 guest rooms on a large 4,495sqm landholding and features a distinctive circular swimming pool.
Taking its name from the historic Bowery neighbourhood of Manhattan, the hotel was listed for sale in January by local hotelier Sein Lowry and Byron doctor Blake Eddington with price expectations of $20 million.
It’s the latest in a series of Byron Bay hotel transactions, with more than $170 million in properties changing hands in the past 12 months, including the $104 million sale of the Beach Hotel and the $42 million sale of the Byron at Byron.
CBRE Hotels’ Bunz said The Bower campaign had attracted global interest, specifically from investors in the United States, the Arab Emirates and the Asia Pacific region.
“While Australia has long been viewed as a politically and economically safe investment destination, there has been an added focus in recent months on the country’s response to Covid-19,” Bunz said.
“This is the first Australian hotel sale to have been negotiated and exchanged during the pandemic period, highlighting continued confidence in leisure and boutique hotel investment opportunities.”
Investor demand in this sector of the hotel market has been buoyed by the potential transfer of the 10 million Australian outbound visitors last year to the domestic visitor market, according to Manvell.
“Australia’s regional and leisure hotels are leading the recovery, particularly those hotels in popular ‘drive markets’ such as the Gold Coast and Byron Bay.”
Manvell said this trend was expected to continue in the short to medium term, which was underpinning interest in available opportunities.
News of the sale comes as hotels in Queensland, around 100km north of Byron Bay, brace for an influx of quarantine bookings by residents returning home from southern states, as the sunshine state prepares to close its borders once more due to a second wave of coronavirus in New South Wales and Victoria—further slowing prospects for market recovery further south.
With a six-week stage-4 lockdown once again under way in Victoria, Michael Johnson, the chief executive of advocacy group Tourism Accommodation Australia, reinforced the importance of Victoria’s success in suppressing the virus to the nation’s tourism economy.
“Victoria is second only to NSW in terms of domestic visitor numbers and international visitor arrivals and spend,” Johnson said.
“It’s therefore critical the state is able to beat this challenge and re-invigorate the state’s tourism and accommodation sectors as quickly as possible.