Luxury Gold Coast hotel Sheraton Grand Mirage Resort has been sold for AU$192 million in a joint purchase by the Karedis and Laundy families.
The hotel was sold by Australian Wattle Development Pty Ltd – which is 50% owned by The Star Entertainment Group with Chow Tai Fook Enterprises and Far East Consortium as consortium partners – for AU$52 million more than the AU$140 million the business paid for the property back in January 2017.
The sale, which The Star announced to the ASX on Monday evening, represents a multiple of 21 times the 2023 calendar year EBITDA and about $650,000 per key – reportedly the highest rate per key achieved for a non-boutique hotel outside Australia’s capital cities.
Sheraton Grand Mirage Resort expands the two-family consortium’s hotel portfolio which already includes the Sofitel Noosa, Manly Pacific and Crown Plaza in Terrigal.
The sale, which was negotiated by Colliers, McVay Real Estate and JLL, is subject to the buyer obtaining approval to the transfer of the liquor licence from the Queensland Office of Liquor and Gaming Regulation.
Colliers’ Head of Hotel Transactions Karen Wales said the deal shows continued investor confidence in the Australian hotel market.
“The sale of the Sheraton Grand Mirage Resort, which boasts a prime beachfront location, represents an uplift of more than 80% per key on the last high-end hotel to trade on the Gold Coast, the Hilton Surfers Paradise, which sold in 2019 for $355,000 per key,” she said.
“Global luxury resort liquidity is at an all-time high, as investors and operators are increasingly attracted to hotels such as the Sheraton Mirage, which addresses consumer preferences for more authentic travel experiences post pandemic.
“Well-known for being sought-after by celebrities, tourists and the Australian population alike, in addition to hosting events of international significance, the Gold Coast’s Sheraton Grand Mirage Resort is of the highest standard, and selective upgrades will enhance this iconic landmark for decades to come.”
With a land area of 3.45 hectares and beach frontage of approximately 215 metres, the 295-room resort boasts four food and beverage venues, extensive conferencing facilities including a Grand Ballroom that can accommodate 1000 people, and undercover parking for around 300 cars.
Sam McVay from McVay Real Estate described the hotel as “an irreplaceable asset”.
“[The hotel was] purchased by two great Australian families that will maximise its true potential and capitalise on the resurgence of the Gold Coast tourism market,” he said.
“Following the sale of the Waldorf Astoria to Fiveight, this is the second landmark hotel purchased by private Australians who can see the potential in our hospitality market.”
Settlement is due to occur in Q2 this year.
With the countdown to the 2032 Brisbane Olympic and Paralympic Games, South-East Queensland is set to benefit from increased investment and development in the coming years.
According to Colliers’ research, Gold Coast luxury hotel room rates reached an average of AU$485 over the past 12 months.
The Star Entertainment Group CEO and Managing Director Robbie Cooke said the business remains committed to this fast-growing region.
“As the tourism sector continues to recover and flourish, hotel accommodation across South-East Queensland will continue to experience elevated performance and reap the rewards driven by the sought-after nature of this prime destination,” Cooke said.
“Our $2 billion-plus masterplan for The Star Gold Coast continues to advance and deliver new, world-class resort facilities across multiple towers, together with exciting new restaurant and bar precincts, entertainment, and retail options.”
The Star’s offering in the region includes three hotels, with another planned for completion in 2024.