Malaysia’s Aikbee Group buys Melbourne’s Hotel Francis

Prominent Malaysian apartment builder Aikbee Group is paying $13.75 million for a corner pub with development potential in the Melbourne CBD.

Hotel Francis, which is leased to Club Retro until 2021, rises three-storeys at 383-387 Lonsdale Street.

The art deco pub occupies a 444 square metre site, also with frontage to Niagara Lane.

The 444 square metre site at 383-387 Lonsdale Street (marked) is close to $3 billion worth of new development.

Colliers International’s David Sia, Daniel Wolman and Guy Wells promoted building activity around the site: valued at more than $3 billion, it includes the Brady Group’s 380 Lonsdale Street and the future National Australia Bank headquarters at 405 Bourke Street.

Cbus Property is also proposing a $1 billion project known as 435 Bourke Street which would see the demolition of a heritage-graded Yuncken Freeman designed office at 140 Queen Street.

Hotel Francis was offloaded by private investors who paid the wealthy Lechte family $5.75 million in 2011.

Last year, the owners paid the same family $600,000 for an adjoining 59 sqm laneway, which was amalgamated with the hotel, prior to it listing it for sale last month with a price guide of about $12 million.

Based on the annual rental return ($542,788), 383-387 Lonsdale Street traded on a 3.9 per cent passing yield.

A dance floor and bar at Club Retro, which rents the hotel.

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Marc Pallisco

A freelance property analyst and journalist, Marc is a co-founder of realestatesource.com.au.

Marc Pallisco
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