Shakespeare invests again in Sydney
Shakespeare Property Group has swooped on a historic Darling Harbour hotel for a fund now seeking wholesale backers.
The Melbourne based investment house, also the family office of Yak Yong Quek, is paying about $55 million for the 4-star Woolstore 1888 at 139 Murray Street, Pyrmont.
The freehold going concern deal is with Trio Capital, the asset manager arm of Ovolo – the operator, which acquired the asset 10 years ago for $33m.
That seller, Paul Fischmann’s 8 Hotels, had just undertaken a swank refurbishment; over five floors containing 2481 square metres it includes 90 suites of various configurations, the Mister Percy Bar & Restaurant, three conference and events rooms and a resident laundry.
Shakespeare is now seeking a replacement operator, offering another upgrade.
It will be held in the Shakespeare 1888 Trust, targeting six per cent annual distributions until 2026, rising to eight and a 16pc internal rate of return.
“The Woolstore 1888 is a stunning hotel asset which is in great condition in a great location and doesn’t require major capital expenditure for us to realise its full potential,” the buyer’s vice president, Hospitality Assets and Investments, Richard Saab, said.
“We think there is scope to improve the asset. But we also think this property speaks for itself, as one of Sydney’s finest heritage hotels,” he added.
“The location is also attractive with Darling Harbour poised to benefit from Mirvac’s $2 billion harbourside redevelopment, and from state government infrastructure including the Pyrmont Metro train station,” according to the executive.
“The Sydney hotel market is attractive and has shown strong recovery since COVID revenue per available room in Sydney reached record levels during 2023 and is approximately 13 per cent higher than 2019.
“We’re also seeing rapidly growing demand in the boutique and lifestyle accommodation market and the Woolstore 1888 is well placed to capture this growth” (story continues below).
Shakespeare is part of Prime Value Asset Management, founded by Mr Yong Quek in 1998, some $3 billion of assets under management – equities, income securities, direct properties and alternative assets.
In 2022, in Sydney, it acquired the Domain House office in the CBD for $132.95m and Surry Hills’ Reservoir on Crown ($115m).
It owns and operates four hotels – all up with 1100 rooms – including Gold Coast’s ex-Palazzo Versace which it acquired for $114m in 2022, and in Cairns, the Pullman International and Novotel Oasis.
Leaseback rejected
On 626 sqm, the Pyrmont property – the fourth oldest of Sydney’s 21 surviving woolstores – was offered with an optional leaseback to Ovolo.
The sale comes eight months since Trio sold the historic Inchcolm by Ovolo in Brisbane to Singapore’s Invictus, led by Indonesia’s Karim family, for $25m, also with vacant possession.
CBRE’s Wayne Bunz and Steve Carroll brokered that deal.
The same agents with colleague Hayley Manvell sold 139 Murray St.
Ovolo will tip proceeds into other projects.
Subscribe to our newsletter at the bottom of this page.
