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The brand-new, 38-room accommodation facility was sold to an onshore hotelier who paid roughly $30 million for the property.
Spread over six floors at 202-210 Elizabeth Street in Surry Hills, the site also boasts two ground-floor retail spaces, three outdoor terrace areas and a rooftop with views of the Sydney central business district.
It was sold off market by Colliers’ national director of Asia markets Joseph Lin on behalf of Paul Fischmann’s 8Hotels and business partner Jonathan Hasson.
Mr Hasson, a property investor and developer, expressed his pleasure at the outcome of the deal.
“We are extremely proud of what we have built. We spent three years constructing the hotel and are very pleased with the sale price achieved, especially having just come out of COVID,” Mr Hasson said.
The property, which once housed a Thai restaurant, was sold in April 2015, at which point the purchaser applied for development approval to embark on a rebuild. It was sold again in 2017 with DA approval attached for a six-level, mixed-use development comprising retail and self-contained residential accommodation.
Those plans have finally come to fruition, though COVID injected some uncertainty into its market potential over the past two years.
Colliers’ head of hotels Gus Moors said the sale showed how Sydney’s commercial accommodation market was building back after the hardships imposed by the pandemic.
“The recovery in trading gets better each month, with citywide occupancies now moving toward 70 per cent and average rates approaching nearly $280 across the CBD. To put that into context, the Sydney CBD had a rate of around $250 for the full calendar year of 2019,” Mr Moors said.
“Corporate travel is building well, business is bouncing back faster than anyone expected, and the domestic leisure sector continues to underpin the strong rate positions. If we layer in the re-emergence of international demand, and sectors like the cruise ship market re-commencing, the outlook is very positive for Sydney’s trading markets.”
And according to Mr Lin, “astute investors” see the sector as a current area of opportunity.
“It’s not difficult to understand the acquisition strategy of this newly completed hotel in the heart of the Tech Central precinct, the largest technology and innovation hub and urban revitalisation project in the foreseeable future,” Mr Lin said.
“With the phasing out of the strict lockdown measures in China, we anticipate seeing more Chinese tourists returning to Australia, giving a boost to the hotel room rate as well as the occupancy rate,” he added.
ABOUT THE AUTHOR
Juliet Helmke
Based in Sydney, Juliet Helmke has a broad range of reporting and editorial experience across the areas of business, technology, entertainment and the arts. She was formerly Senior Editor at The New York Observer.
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