A Sydney-based listed property trust has bought Commodore Hotel in Hay Street for $17.5 million, providing a significant profit for its Singaporean owners who paid $6.5 million in 2004 for the 1218sqm site.
A Sydney-based listed property trust has bought Commodore Hotel in Hay Street for $17.5 million, providing a significant profit for its Singaporean owners who paid $6.5 million in 2004 for the 1218sqm site.
JF Meridian Trust, which is managed by James Fielding Funds Management Ltd, will lease the site to a group who will spend $2.5 million upgrading the building to a 126-room hotel for the Travelodge group.
The sale follows a refurbishment and major upgrade worth around $5 million by the owners through an operation run by hospitality expert Tony Pallotta whose team has also been managing the hotel.
Hotels in Perth are as busy as they have been for almost a decade, with the resources boom providing relief for the sector after a glut of new rooms in 1997 dampened the market for a long time.
The Crowne Plaza Hotel Perth is also on the market. The Terrace Road site has been put up for sale by Avant Hotels Australia Pty Ltd which bought the site in 1990 for $9 million.
Below is a release on the sale:
JF Meridian Management Limited as responsible entity of JF Meridian Trust (JFM) and Trustee of the Tuckerbox Hotel Trust which owns the Travelodge Hotel Group, today announced the purchase of the Commodore Hotel, Perth, Western Australia for $17.50 million. Settlement is scheduled for April 2006.
Toga Hospitality will enter into a 20 year lease to operate the hotel as the Travelodge Perth and a $2.1 million refurbishment will be undertaken to upgrade the hotel to Travelodge standard and increase the room count to 126.
The acquisition of the Commodore Hotel, Perth is in line with the Travelodge Hotel Group's strategy of expanding the portfolio to ensure Travelodge is represented in all capital cities plus major regional centres.
Located in the Perth CBD, the Commodore Hotel comprises 120 rooms over nine levels as well as a ground floor restaurant, first floor conference rooms, and two levels of parking for approximately 52 cars.
Following the acquisition of the Commodore Hotel, the Travelodge Hotel Group will comprise 1,874 rooms across 11 hotels with gross assets in excess of $280 million.
Stephen Burt, Director-Hotel Capital Partners and Travelodge Group fund manager said, "This is a significant acquisition for Travelodge because it is the first hotel acquired outside the eastern states and therefore an important step towards ensuring the Travelodge brand is represented nationwide. Brisbane, Canberra and Adelaide are our next priorities."
Mr Tony Stuart, CEO of NRMA Motoring & Services, who is JFM's co-investor in Travelodge said, "Acquiring a hotel in Perth will help Travelodge compete more effectively in the commercial hotel sector and increases our commitment to members in the travel and leisure sectors. NRMA members will now also be able to take advantage of special member accommodation offers and discounts when staying in Perth."
JFM has committed a further $5.88 million into the Travelodge Hotel Group, maintaining its 49 per cent interest. Following the Commodore Hotel acquisition, JFM's direct sector weightings by asset value will be 13.8 per cent to hotels, 17.6 per cent to industrial/business park, 36.6 per cent to commercial and 32.0 per cent to retail.