That’s for five assets.
According to Colliers International, the outlook for Australia’s new hotel supply continues to gain momentum, with new developments recently announced in Adelaide, Brisbane and Canberra and across a number of regional areas.
The majority of new development will occur in the motel and serviced apartment sectors, with the cost to develop a new 4 or 5-star hotel still challenging without the benefit of a mixed-use component.
Total hotel sales activity (above $7.5 million per transaction) for the year-to-date 2013 is in excess of $1.550 billion (including the recent sale of the Tourism Asset Holdings Limited (TAHL) properties), showing an increase of 20% on the total value for 2012.
Investors from Singapore continue to be active in the Australian market buying five assets for a total of $221 million.
Here’s more from Colliers:
Local investors were also acquisitive during the year picking-up 13 assets for a total of $245 million, which accounted for 16% of sale by value. Domestic purchasing activity was focused in New South Wales (both city and regional areas), Melbourne and in the Canberra market.
The average value of acquisitions made by Australian investors was $18.9 million, which is substantially lower than the average for off shore investors.
The attraction of Australia for off shore institutions is a combination of factors including the availability of scalable investments, reasonable initial yields, a stable economy, attractive REIT structures and a transparent legal system.
All of these attractions are still prevailing and we can expect to see further off shore interest in Australian hotels.Off shore investment activity was led by the Abu Dhabi Investment Authority, whose portfolio purchase accounts for 50% of sales to-date in 2013 by value.