Newly-opened hotel Vibe Darling Harbour sold for $108 million

Newly-opened hotel Vibe Darling Harbour sold for $108 million
Courtesy: Jack Needham | News Source: commercialrealestate.com.au

The Vibe Hotel in Sydney’s Darling Harbour, which only opened its doors for the first time in October, has been sold for $108 million to a Thailand-based buyer.  The sale – the first Australian hotel purchase for the buyer – was handled by JLL Hotels & Hospitality Group’s Craig Collins and Andrew Langsford.

Developer Icon Oceania listed the property, its first hotel development, in August 2019 in the hope of cashing in on the demand in the sector. The price is in line with their initial expectations of more than $100 million.

The hotel will operate under a management agreement with TFE Hotels, whose 73-property portfolio includes the Adina, Vibe and Travelodge brands.

The 4.5-star property features 145 guest rooms, as well as a rooftop bar and swimming pool with views to the city.

Mr Collins said that the final price, and high amount of international interest in the property, was reflective of ongoing tight supply in the sector.

“It is very difficult to buy a quality CBD hotel in Australia at present,” he said, adding that future growth prospects meant most buyers were in the market with the view to holding assets for the long term.

“When quality hotel assets do come onto the market, like the Vibe Darling Harbour Sydney, competition is very strong, as buyers do not know when the next opportunity to buy a quality asset will come up.”

The deal follows this week’s sale of a new 60-room Pyrmont hotel, currently not under management, for $28.7 million to a private Taiwanese family.

Agent Jordan Lee of Savills Australia, who sold the Pyrmont hotel, said that the combination of a Darling Harbour location and a shortage of investment-grade assets had contributed to the strong result this property.

“Darling Harbour is an integral part of Sydney and currently home to two of the largest infrastructure projects ever undertaken in the city – the international Convention Centre and Barangaroo redevelopment. Other notable surrounding-demand drivers include The Star Casino, Chinatown, numerous commercial office buildings, and many of Sydney’s key leisure destinations,” Mr Lee said.

Other recent hotel sales in the CBD include the 112-room Veriu Central Hotel near Chinatown, in August by fund manager Tyche Capital, for about $55 million.