In another Sydney hotel deal, Singapore’s Ascott Residence Trust is paying $46 million for Macquarie Park’s Quest serviced apartment complex.
The six-storey 111 room inn at 71 Epping Road, developed by Goodman five years ago, is trading on a 5.5 per cent yield.
Savills Australia managing director, Michael Simpson, brokered the off-market transaction on behalf of Canberra based vendor, Tuggeranong Valley Rugby Club and Sports Club Limited (Vikings Group).
The broker said the tight yield reflects the “strong appetite for Australian hotels from offshore capital”.
“The Quest Macquarie Park is a high-quality serviced apartment hotel located in a concentrated employment node,” Mr Simpson said
The sale price, the agent added, reflects “the highly attractive nature of Australian hotels”, high yields compared to global markets, “and the acknowledged safe-haven status of Australian real estate”.
Vikings Group chief executive officer Antony Hill said the club was pleased with the result for the facility, about 15 kilometres north west of the city.,
Purchase consistent with maintaining Asia Pacific centric portfolio: ART
ART chief executive officer Beh Siew Kim added that the acquisition is inline with the company strategy “to enhance returns for our stapled security holders while strengthening investments in developed markets and maintaining a predominantly Asia Pacific centric portfolio.
“The Quest serviced residence, which is well-located in Sydney’s second largest business district of Macquarie Park, will be under a master lease agreement and will add to our stream of stable income,” Ms Kim added.
The annual rent under the master lease agreement provides an EBITDA (earnings before interest, taxes, depreciation and amortization] yield of mid 5 per cent, the executive added.
It is also indexed at a 4 per cent annual increase with periodic market reviews.
Quest Macquarie Park includes a 24 hour reception, restaurant, pantry shop, dry cleaning service, guest laundry, BBQ area, business administration, conferencing facilities and gym.
The deal comes less than a week after a Thailand-based family paid Icon Oceania $108 million for Vibe Darling Harbour – a 16-storey, 145-key, 4.5 star complex with a rooftop bar at 319-325 Sussex Street, Sydney.