Victoria’s booming developer market has enticed two more A-grade pub assets onto the market, each boasting “development potential”.
The magnificent ‘essence’ of Sorrento, the Continental Hotel, is the only four-storey limestone structure in the Southern Hemisphere, and boasts over 3,500 square metres, overlooking Port Phillip Bay and the Mornington Peninsula.
The 1875 National Trust building on a corner block benefits from retail frontage, a loyal customer base, and importantly, “opportunity for further development”, according to CBRE’s Mark Wizel.
Meanwhile, a syndicate of former and current AFL players including St Kilda captain Nick Riewoldt that owns hotels in Melbourne, is divesting the popular CBD watering hole, the Waterside Hotel.
The syndicate, taking its name from the hotel’s address of 508 Flinders St, has owned and operated the property for over 10 years, and also operates the nearby Brighton Hotel, which has recently undergone a large-scale renovation.
According to Wizel, the sale by 508 Flinders St P/L is driven “by the buyer focus on CBD hospitality” and the current strength of the market.
“The site’s strategic position in a proven hospitality market will be a key selling factor and, due to the size of the land holding, it lends itself to a strategic, staged development.”
Marketing both hotels with CBRE’s Scott Callow, and the Continental in conjunction with Rob Curtain from Sotheby’s International Realty, Wizel cites potential including “height maximisation”.
”A growing number of investors and developers are looking to gain a foothold in the hospitality market, with the owners of both hotels being encouraged to sell due to the numerous offers they had received off-market,” said Wizel.
Speaking to PubTIC, Callow said the freehold sale of the Waterside will include a short-term 2-3-year leaseback to the operators, which will add to the developer appeal.
“We envisage considerable developer interest. The short-term lease gives developers opportunity to assess what they want to do with the property.”
The three-storey CBD building built in 1853, with two bars, 35 accommodation rooms, is expected to fetch around $15 million.
No price range has been disclosed for the Continental, but opportunities around its prominent position in a tourism hub are expected to be “key selling factors”.
Both assets are being marketed through Expressions of Interest campaigns, closing 16 April.