Real Estate
20 May, 2024
City’s largest hotel on market
THE Pullman Cairns International hotel is being sold by Prime Value’s Shakespeare Property Group after nine years of ownership.
The five-star city centre hotel occupies an 8139sqm site and comprises 324 guest rooms, 11 conference and meeting rooms, a lobby bar, a day spa and gymnasium facilities, and basement parking for 184 cars. It last sold for $75.08 million in 2015.
CBRE Hotels’ Michael Simpson, Wayne Bunz and Hayley Manvell are managing the sale via an expression of interest campaign set to be launched later this month.
Accor Hotels manages the property under the Pullman brand, but vacant possession of the hotel, which underwent a $17m refurbishment in 2021, is available upon sale.
Mr Simpson said the offering included a two-level, 2644sqm retail and commercial arcade, ‘Village Lane’, featuring 23 tenancies.
“This is arguably Cairns’ best hotel and has immense potential due to its central location, extensive size, and various value-add opportunities. These factors are expected to generate significant interest from both domestic and international investors,” he said.
“As the largest luxury hotel in Cairns in room size, scale and amenities, as well as possessing the largest conference facilities outside the Cairns Convention Centre, the hotel attracts a broad range of guests.
“This opportunity offers purchasers historically consistent financial performance, through diversified income streams including accommodation, food and beverage, conferencing, day spa and passive revenue from the retail and commercial arcade and basement car park.”
Mr Bunz said the vacant possession available upon sale “opens up the opportunity to rebrand and reposition for owner operators or alternate brands”.
“In addition, the increased cost of construction post-pandemic has materially impacted the viability of new hotel projects, with significant barriers to entry to replicate this type of product in the market, enhancing the attractiveness of this offering,” he said.
Average hotel room rates in Cairns have risen by 41 per cent since pre-pandemic levels and the market is still in the process of recovering when it comes to occupancy rates and international visitors.
As at the end of December 2023, international visitation was 21 per cent – a decrease from the pre-pandemic level of 45 per cent – however, with the gradual recovery of the international inbound market, particularly from China, there is optimism around future hotel performance.
