Hotel mogul Jerry Schwartz has secured the Gold Coast’s Paradise Resort, a former asset of collapsed property developer Ralan Group, for $43 million.
Ralan Group, which went into administration in August, paid $75 million for the hotel in 2015, and had plans to bulldoze the resort for three towers of Ruby apartments.
Schwartz says he plans for a major refurbishment to upgrade the 360-room hotel which spans a 2.5 hectare site in Surfers Paradise.
“I am very optimistic about the Gold Coast market, despite new supply coming on stream,” Schartz said of his latest purchase which settles in February next year.
The latest buy marks Schwartz second hotel on the Gold Coast following the acquisition of the five-star Hilton Surfers Paradise for $70 million from Chinese Group Ja Feng in January.
Speaking on his refurbishment plans, Schwartz said the resort offered “upside potential”.
“I know that previous owners planned to knock down the resort and redevelop it for apartments,” Schwartz said.
“But we believe there is tremendous demand for quality family-friendly resorts, especially in such prime locations as Surfers Paradise.
“I have taken over two other resorts – the Fairmont Resort Blue Mountains and Crowne Plaza Hunter Valley – and revived them as a result of diversifying their markets.”
Schwartz is Australia’s largest private owner of hotels, with the latest buy expanding the Schwartz Family Company’s portfolio to 15 hotels.
The portfolio also includes the Four Points Sheraton at Central park in Sydney, the Sofitel Darling Harbour, and Rydges World Square.
Ralan Group, led by director William O'Dwyer, went into voluntary administration earlier this year leaving apartment buyers at risk after investigations found a shortfall of $277 million in the developer’s trust account for deposits.
Last week, Ralan’s receivers put the Sapphire site, a whole city block located on the fringes of Surfers Paradise, on the market.
Ralan had purchased the 11,470sq m city block site also in 2015 for just under $20 million.