Luxury 5-star hotel Shangri-La Melbourne has hit the market ahead of its 2023 completion target with an asking price in the region of $500 million.

The 500-room hotel at 308 Exhibition Street will occupy 57,114sqm within the tallest of two towers in a 60-storey building, connected by a 46th floor two-storey glass skybridge.

The owners, Malaysian property developers S P Setia, believe there is an opportunity to sell the property on completion, and enlisted Colliers’ Gus Moors and Karen Wales and Deloitte’s Stephen Hynes and Paul Bartlett to lead the sale.

Moors described the property as an “architectural wonder” — one that he expects will become a Melbourne landmark for years to come.

“This is a rare generational asset in one of the most culturally vibrant and desirable cities in the world, under the aegis of one of the world’s most prestigious luxury hotel brands: Shangri-La,” he said.

On completion, Shangri-La Melbourne will offer a variety of guestrooms, including family rooms, Horizon Club guestrooms, Premier and Presidential Suites, as well as a range of bars and restaurants with alfresco dining, expansive conference facilities, a spa and wellness centre and indoor heated pool.

Moors expects the hotel will attract the attention of investors in Australia and around the globe.

“The Australian market has already seen interest in “big box” hotel opportunities, such as the Travelodge Tuckerbox portfolio and the Hilton Sydney which is close to selling at and above this $500m price point,” he told HM.

“The opportunity to secure Melbourne’s best luxury hotel housed within a truly unique building that re-defines the city’s skyline will see global interest in this property.”

While the trading environment continues to grapple with headwinds, particularly in CBD locations, Moors says there is strong confidence that recovery will be quick after the impact of the Omicron surge and floods.

“Domestic leisure remains very buoyant, Meeting demand is showing uplift, and corporates are re-entering their offices, which will then flow into travel shortly thereafter,” he told HM.

“On the investment horizon, domestic and global hotel investors are looking into the medium terms and seeing the strong underlying fundamentals of the Australian hotel sector. This confidence in our market is enabling them to bid with confidence on hotel properties.”

Globally, Colliers is seeing solid interest in hotels, particularly in southern Europe, in places like Spain, and in the UK, Moors explained.

“The same thematics are playing out in these markets, with a weight of capital seeking well-located hotel properties with good long-term fundamentals,” he said.