Colliers International appointed to sell Mercure Hotel Warragul
The Mercure Hotel Warragul has come to market at a time very few investment-grade accommodation assets are up for grabs.
Colliers International has been appointed to sell the award-winning hotel, in conjunction with Wilson Property Residential Commercial Industrial, via expressions of interest closing Thursday, October 12 at 4pm.
The Mercure Hotel Warragul was constructed in 2015 and is occupied on a 20-year lease with five further options of five years to renew, providing a secure investment for an incoming purchaser.
Operating as a Mercure Hotel franchise, the property benefits from the expertise offered by the world-renowned AccorHotels, Australia’s largest hotel company. This provides the tenant with one of the largest direct booking platforms and loyalty program, which in turn allows the Mercure Hotel Warragul to be the destination of choice by corporate and leisure travellers alike.
Having recently been named the winner of the Regional Accommodation of the Year award in the 2017 Tourism Accommodation Australia (Vic) Awards for Excellence, the property is highly regarded in the marketplace as a state-of-the-art regional hotel. It forms part of a mixed-use development on the corner of Mason and Williams streets within the main commercial precinct of Warragul.
The hotel comprises 47 accommodation rooms, two conference/function rooms and a two-bedroom manager’s residence. The wider development, completed by BFN Developments – which was named the South East winner of the 2016 Regional Building Awards for the project – encompasses a large family restaurant, gymnasium, medical centre and secure basement car parking.
Warragul is the main population and service centre of the West Gippsland region and the Shire of Baw Baw. Located 100 kilometres from Melbourne, the town is undergoing rapid residential growth and several new housing estates are currently under development. The Mercure is perfectly positioned to benefit from the growth of the wider township and region, which is currently home to a population of about 45,000 people and anticipated to grow to 71,000 by 2031.
“Warragul is without doubt one of regional Victoria’s fastest-growing towns on the back of a housing and population boom,” Wilson Property’s Ben Wilson said.
“This rapid progress and growth has triggered strong interest from many national retailers, which have recently committed to the region, and more specifically, BFN Developments’ bulky goods project site, where five of the six showrooms that have been leased are new national businesses to the town.”
Colliers International’s associate director of Hotels, Guy Wells, said that the modern accommodation benefitted from being located within a mixed-use development, allowing for the tenant to focus on its core business of accommodation offering, while minimising overhead operating costs.
“Having a separately tenanted restaurant and gym within the complex allows for the hotel to focus on its accommodation offering, while a guest can access the amenities directly and utilise chargebacks within the gym or restaurant,” he said.
The property is expected to be well received in the marketplace, with limited investment-grade accommodation assets offered to the market in recent years.
“The near-new accommodation means that an investor can be secure in their understanding that the hotel has been built by an award-winning builder and will require little to no CAPEX in the medium term,” Mr Wilson said.