Brisbane's Hamilton Motor Inn has changed hands after more than 30 years for $6 million in cash on an unconditional contract.
KSD 422 Pty Ltd, a business registered to two directors of Eagle Farm-based Epoca Constructions, tipped out 10 other bidders to secure the deal for the riverfront property in the affluent inner north-eastern suburb of Hamilton.
JLL senior vice-president hotels and hospitality Gareth Closter said the five-week process had been hotly contested with a renewed focus on the state’s resurgent hotel and motel market.
“I think that the Queensland accommodation market is coming back,” Closter said.
“There’s definitely more optimism in terms of the Queensland market … we’re in a unique time where things are getting more competitive and we’re going to see more repurposing of older assets.
“The floods have had a really big impact on the market with people looking for longer-term accommodation and now with the rental crisis, the Olympics and the Queens Wharf development the momentum is building in Queensland.
“Brisbane is becoming a tourism destination and we’re seeing an explosion in some of the rates per metre transactions.”
The Urban Developer understands the new owner of the Hamilton Motor Inn is looking to reposition the asset in due course.
The five-storey, 22-room motel also includes a function space and restaurant, rear courtyard and rooftop terrace neighbouring the Hamilton Hotel on Kingsford Smith Drive.
JLL agent Tim Jones said the location and opportunity to reposition the property and add value were key drivers for enquiry during the expressions of interest campaign.
“The campaign generated significant interest with more than 20 different groups inspecting the property from a broad cross section of end users, including short-term accommodation, aged care, office and residential,” Jones said.
“The expressions of interest campaign closed with 11 competitive bids and the top three being on cash, unconditional terms.”
Closter said the emerging asset class was proving to be appealing for small funds as well as private investors looking to amalgamate portfolios.
He said investors were starting to see value in the alternative asset class, which could follow the lead of medical assets as an alternative with broadening appeal, with the potential for yield compression.
“Investors are buying and collecting and amalgamating multiple hotels and motels, which is an emerging trend, and they’re creating their own brands instead of putting in hotel management agreements.
“The days of the second-rate vanilla offering are all but over, there are some serious new entrants coming into the market and consumers are happy to pay for a better standard of product.”
