Australia’s only wholesale motel fund buys second asset
Deltine Capital, for Australia’s only wholesale motel fund, has bought a second asset – sticking to the east coast.
The freehold going concern for West Tamworth’s Roseville Apartments, on an acre at 2 Gipps Street, on the south west corner of Ebsworth, is costing $8.4 million.
On 4087 square metres, just over an acre, it contains 25 air conditioned townhouses, each with a car park.
The asset manager is expecting a 23.5 per cent per annum return by exit about 2030.
Formed earlier last year by multi-disciplined corporate executive/manager, David Toomey, now chief executive officer, Deltine also recently launched a platform, Regional Motel Partners, which invests in motel freeholds.
Deltine fund doubles
Roseville Apartments will be slotted into the High Yield Motel Fund which launched December targeting freehold going concerns delivering high income yields.
Total annual returns exceeding 20pc over a five year term were anticipated, in documents calling for wholesale investors.
It settled on the maiden asset six weeks ago – the New Crossing Place Motel & Apartments, in Victoria’s Seymour – a 10 minute drive from the Puckapunyal Military Area.
On 9355 sqm with development upside, it contains 26 rooms over three floors.
Repeat customers include corporates, defence staff, emergency service workers, miners and nurses.
Also with traditional ‘visiting tourists, the average stay is seven days, which makes it an efficient prospect from a cleaning and administrative point of view, Mr Toomey said.
It cost $7.5m following a campaign by Manenti Quinlan Brokers’ Malcolm Mathie and Ray Larkin.
A 100-day ‘improvement program’ is underway.
Seymour is about 90 minutes drive north of Melbourne’s CBD.
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