Melbourne’s iconic ‘Bayview on the Park’ hotel sells for new benchmark land pricing
MELBOURNE, 22 September 2021 – One of Melbourne’s well known hotels, the Bayview on the Park opposite Albert Park, has been sold unconditionally in what is one of the city’s largest hotel and inner city land deals for 2021.
The property was sold following a highly competitive expressions of interest process handled exlusively by JLL Hotels & Hospitality Group’s Peter Harper and Nick MacFie, alongside JLL Capital Markets’ Josh Rutman and Mingxuan Li
Situated at 50-52 Queens Road, the older style five level hotel features 203 guest rooms, a restaurant & bar, several meeting rooms, outdoor swimming pool and multideck carpark. It occupies a significant 6,966 sqm triple land allotment overlooking Albert Park and Port Philip Bay and was owner-operated by Bayview International Hotels & Resorts. The property was offered to the market with vacant possession.
JLL’s Managing Director and Head of Investment Sales Australasia, Hotels & Hospitality Group Peter Harper said, “Given the existing improvements and enormous landholding we received interest from an incredibly wide range of groups including those looking to re-establish the hotel, convert it to an alternative use or pursue a complete redevelopment.”
JLL’s Executive Director and Head of Capital Markets, Josh Rutman said, “We have handled some very prominent land sales in recent years along St Kilda Road and Queens Road, but this is the third largest wholly owned landholding in the entire precint and the market reacted accordingly. Whilst its an exceptional strong result for our vendor given that the property is vacant and without planning approvals, its also not surprising given the current level of activity amongst Melbourne’s developers as they look to build their book of work and take advantage of the severe drop in projected residential supply in the coming years,” Mr Rutman said.
“Ultimately the lure of a site of such scale saw a major institutionally backed developer secure the property ahead of several other developers. These groups all bid with great confidence as Queens Road has a very sound track record of delivering high quality residential, commercial and retirement living product, and due to the scarcity of such offerings, it is therefore logical that build to rent players saw great value in delivering product within the precinct.”
“This sale of the Bayview on the Park continues a trend we are seeing across Australia where hotels in prime locations that are nearing the end of their asset lifecycle are worth more as alternative uses. As a result, we’re having hotel owners come to us to better understand their options about not only redevelopment value but also adaptive conversions to medical, build to rent or other uses. This is particularly the case in Melbourne where the impending new supply cycle will make it very difficult for some existing hotels to remain competitive and profitable.” Mr Harper said.