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Hotel Owners to Cash in on Sydney Airport Precinct

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The newly-opened Felix by 8Hotels has been listed for sale, with price expectations around the $70 million-mark thanks to buoyant trading conditions in the Sydney airport precinct.

Developer Felix Milgrom led a group of investors to build the 12-storey, 150-room Felix hotel on the site of a former industrial building at Baxter Road, Mascot. They paid $4.5 million for the site in 2015.

Hotel occupancies in Sydney’s booming airport precinct are above 90 per cent. In 2017, the market saw a 4.8 per cent rise in occupancy, with a revenue per available room of $154 – a 7.8 per cent increase on the previous year.

JLL has been appointed to handle the sale.

There is a long-term management agreement in place with the 8Hotels Group. The hotel opened 1 February this year and has reportedly well-exceeded its first month’s budget.

Related reading: Gold Coast Airport’s Redevelopment Plan Takes Off with $50m Hotel

Felix hotel 2

“The opportunity to purchase a brand-new hotel is unprecedented in the current market,” JLL’s Andrew Langsford said.

“Given the notable growth in trading performance witnessed by the Sydney Airport hotel market and the scarcity of opportunities available, we anticipate a high level of interest from groups who are eager to gain exposure to Australia’s key gateway city.”

In October, the 271-room Mercure Sydney International Airport Hotel was acquired by Folkestone Funds Management in a deal worth $74.6 million. Folkestone plan to undertake an extensive refurbishment and repositioning of the hotel to drive revenue and occupancy.

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Article originally posted at: https://https://theurbandeveloper.com/articles/hotel-owners-to-cash-in-on-sydney-airport-precinct