South Melbourne’s historic George Hotel sells for $5.2 million

The George Hotel, on a high-profile corner block opposite the South Melbourne Market, has sold to a Chinese investor for $5.2 million.

On a 406 square metre parcel zoned Commercial 1, the asset (pictured top and bottom) returns annual rent of $253,146. On that basis it is selling on a yield of 4.9 per cent.

In operation for more than 150 years, the occupant is nine months into a five year lease then has three more five year options.

Despite this, the brokers promoted the “significant future development upside” of 139 Cecil Street, on the south-east corner of York Street, and walking distance to the Melbourne CBD.

The hotel is near to a 4641 sqm site at 80-84 Cecil Street which sold for $41 million last year to the Langer family’s GLG Group and is now the subject of an eight-level complex containing 14,845 sqm of office space and 800 sqm of retail.

“The sale of The George Hotel is a clear reflection of the hot demand for blue chip investments within Melbourne’s most premium suburbs,” Savills director Nick Peden said. “The sale result is evidence that buyers are flocking to A-grade commercial property and are willing to accept tight yields due to the scarcity of opportunities and the long-term growth potential”.

Mr Peden, who marketed the hotel with colleagues Jesse Radisich, Clinton Baxter and Glenn Ye, said more than 125 prospective buyers registered an interest for the investment.

An aerial view showing the George Hotel (outlined) in relation to the Melbourne CBD.

 

 

 

Marc Pallisco

A freelance property writer and experienced analyst, Marc is the co-founder of realestatesource.com.au

error: Content is protected !!