Build-to-lease conversion pushes hotel deals to $ 2 billion
Conversions have been the other area of ââfocus, as evidenced by the $ 70 million sale of Bayview on the Park in Melbourne to Aware Super, the $ 125 million sale of Vibe Rushcutters for a residential conversion and the sale. $ 178 million Intercontinental Hotel in Double Bay. for a combined hotel and residential project.
CBRE Hotels General Manager Michael Simpson said the data indicated that the CBD hotel markets would return to 2019 performance levels within three to five years.
As the RevPAR growth trajectory has come to a halt in Australia after a promising start in the first half of 2021, it has reassured that once the Covid chains are lifted, pent-up domestic demand will quickly translate into increased hotel occupancy, which will maintain and boost average daily room rates, âsaid Simpson.
âDevelopers are capitalizing on the continued strength of the residential market and interest in construction opportunities to acquire well-located peripheral hotels, which will likely have a slower recovery trajectory than the CBD accommodation assets and will have low usage. higher and better. as residential given their location.
According to data from CBRE, the strong performance of the hotel asset class is due to firm returns, dissatisfied capital and the scarcity of quality buying opportunities.
Deloitte’s tourism and hospitality market outlook revealed that inbound international and interstate travel fell 81% and 65% respectively.
The impact of the drop is dramatic: 7.6 million fewer international arrivals and 45 million fewer domestic trips with fewer overnight stays, resulting in a loss of around $ 85 billion in visitor spending.