Frasers Hospitality is set to enter the Brisbane market following the purchase of a building in the city’s CBD.
Currently an office building, the property at 80 Albert Street will be converted to an apartment hotel, according to Dean Humphries, National Director of Colliers International Hotels, who introduced the buyer to the project.
“80 Albert Street is well suited to a hotel conversion,” he said. “It has an excellent location in the geographical heart of the CBD, a strong visual profile together with floor plates that ideally suit conversion to an apartment hotel.”
The 80 Albert Street conversion follows a similar redevelopment of Lennon’s Plaza in Brisbane. Sold to SilverNeedle in mid 2012, the site was formerly mixed-use retail, office and hotel accommodation. The refurbishment, which is currently in its final stages, will see the property launched as the first Next hotel in Australia, converting former office space to hotel rooms and increasing capacity from 150 to 300 rooms.
Colliers International Managing Director of Hotels, Stephen Burt, predicts hotel related sale transactions throughout Australia during the current financial year will approach AUD$2.5 billion compared to the long term average of AUD$1.2 to AUD$1.5 billion per annum.
Commenting on the growing demand for hotels and the prospect of office conversions, Burt added that these assets would satisfy a large part of investor demand.
“There is no doubt the next wave of hotel development in Brisbane and Sydney CBDs will be on the back of office conversion,” he said.
“Sydney CBD leasing incentives are now over 30% and for older buildings in particular the viability of alternate use is becoming increasingly compelling.
“A good test of the office conversion market will be the NSW Government’s offering of two heritage buildings in Bridge Street Sydney.
“Both these heritage buildings have great presence and will attract interest from the luxury brands.
“I think this will be a good outcome for Sydney’s premium hotel market and will actually provide impetus for growth in average rates.”
Pictured above is a room at Fraser Place Melbourne