In a new record for the Australian hotel sector, ALE Property Group has sold six landmark hotels in an auction that spanned four states.
The properties sold for a cumulative total of $37 million.
The auction created history as private investors in four separate rooms in Sydney, Melbourne, Brisbane and Adelaide competed to acquire the ALE hotels using audio visual technology.
CB Richard Ellis’ Joel Fisher said the auction attracted frenetic bidding, with the Sunnybank Hotel in Brisbane sold on a yield of just 4.41 per cent – a new record for an Australian freehold investment hotel. The blended yield across the portfolio was 5.7 per cent.
“The result highlights the key difference between these assets and other hotel assets in the marketplace, which have been selling at higher yields,” Mr Fisher said.
“The strength of the tenant and the length of the lease term provided a key point of difference, with all six hotels sold with 19 years remaining on leases to Australian Leisure & Hospitality Group with options to renew for a further four, 10-year terms.”
The two Brisbane ALE properties achieved the highest prices, with the Sunnybank sold for $11.1 million and the Albion Hotel sold for $6 million on a yield of 6.25 per cent.