CBD hotel market gets crowded as Rydges North Sydney joins fray
The Rydges Hotel North Sydney is the latest asset from Event Hospitality & Entertainment (EVT) to hit the market as the ASX-listed business looks to raise $250 million from the sale of non-core property.
Between $80 million to $100 million is expected for the 167 room hotel near the North Sydney CBD, which is being pitched as an each-way bet with potential to revamp or redevelop as an apartment tower.
It is the third Rydges branded hotel currently for sale in what is becoming an increasingly crowded market.
EVT is trying to sell Rydges Bankstown while well-known Sydney businessmen Phillip Wolanski, David Baffsky and John Landerer are fielding offers for the Rydges Sydney Airport, which they developed in 2013.
Also on the market is the six-property Stamford Hotels portfolio, which owner CK Low said he wants $1 billion for. The second round of bidding closed last on Friday with strong interest from international and domestic investors.
In addition, the Action Hotels portfolio of three Melbourne properties is being shopped around and Jerry Schwartz, who sold the Four Points by Sheraton Sydney, Central Park, for $150 million in May, is keen to divest the Ibis Sydney King Street Wharf.
Another property, the Ibis Budget Melbourne CBD, is understood to have sold for more than $20 million.
It was a case of third time lucky for owner Well Smart Investment Holdings, which initially tried to sell it for $35 million in 2017 and failed again in 2019 at a $30 million asking price.
The property most recently had a price guide of $23 million to $25 million.
Agent CBRE is involved in all the campaigns apart from Rydges Bankstown and said, despite the slow rate of sales and historically low occupancies for hotels in Sydney and Melbourne, investors still believed in the long-term future of tourism.
CBRE Hotels’ managing director, Michael Simpson, said there is good interest in all the assets and that potential buyers are looking to the future, not the present.
Mr Simpson said Rydges North Sydney, which occupies a 2549-square-metre battle-axe freehold site at 54 McLaren Street, is being offered with vacant possession.
This week a nearby 4000-square-metre apartment development site on Walker Street was bought by Cbus Property and Galileo for $150 million.
EVT has already sold $79.6 million of non-core property, including the Rydges Plaza Hotel Cairns, and is planning to raise a further $150 million this year “with additional non-core properties being contemplated for potential sale in FY23”.
