The Gazebo Parramatta Hotel and Conference Centre has been sold to the Hong Kong Hotel Group, Carlton Hotels for a price believed to be around $40 million. The hotel sale settles in late August and the hotel will be renamed the Carlton Hotel, Parramatta. The acquisition will give the group a strategic presence near the Olympic precinct and the rapidly growing commercial areas in Sydney`s west.
The deal was negotiated through Jones Lang LaSalle Hotels, Mr Mark Durran and Mr Geordie Clark following an off-market, expressions of interest campaign. The sale marks the first major hotel transaction to occur in Sydney`s west after a period of limited hotel transaction activity.
“Prior to the sale of the Gazebo the last major hotel transaction in the area was the sale of the Travelodge Parramatta in 1998 which was a strategic purchase by Accor Asia Pacific,” said Mr Mark Durran, Vice President, Jones Lang LaSalle Hotels. “This deal was also negotiated by Jones Lang LaSalle Hotels.”
The 204 room, 4 star hotel is the largest hotel and conference centre in Sydney`s West and was keenly sought after by both, domestic and international investors. The hotel has been owner operated by Gazebo Hotels since it was developed by current owner, Mr Syd Fischer, in 1992.
Independent research into the Western Sydney hotel market indicates solid year-to-date performance. Room nights available have increased 6.6% yet occupancy has shown only a modest decline of 0.6 percentage points. Average daily rate (ADR) and revenue per avilable room (RevPAR) have recorded growths of 3.6% to $138 and 2.0% to $100 respectively, with a promising future performance outlook .
According to Mr Durran, “Further major hotel transaction activity is likely to occur in Sydney`s West as vendors capitalise on the increased buyer interest, in what is one of Australia`s most rapidly growing commercial regions.
“Hotels in Sydney`s west will obviously be a major beneficiary in the coming months from the Olympic Games. However, ongoing hotel demand will be generated from the regular events, exhibitions, conventions and sport meetings held at these new venues”.
The flurry of new leasing deals recently mooted for Parramatta and infrastructure developments such as the Parramatta to Epping Rail line will also stimulate commercial activity in the region further underpinning future hotel demand growth in the area. BIS Shrapnel recently predicted Parramatta will become a key centre for new office construction over the next decade.
Other major hotel groups with an established presence in Parramatta are: Marriott International, Bass Hotels & Resorts, Rydges Hotels & Resorts and Accor Asia Pacific Corporation. Pacific International recently opened an All-Suite Hotel and The Sebel is expected to open in the coming months.