Pub baron snaps up Royce Hotel for $55 million
Melbourne hotel investor Mazen Tabet has acquired the five-star Royce Hotel on St Kilda Road for $55 million.
The Royce Hotel, just a 15 minute walk from the Royal Botanic Gardens and about two kilometres from the CBD, is regarded as a boutique property.
The venue was offered with vacant possession so the selling price was a bit under the $60 million it was expected to fetch.
The 100-room Royce Hotel fronting 387 St Kilda Road has the distinctive feature of a 1920s art deco façade. It also has high-profile food and beverage offerings. These include a dish restaurant and the Amberoom lounge bar. It also offers conferencing and event facilities.
It’s also known as the site of the city’s first Rolls-Royce car dealership.
Agents McVay Real Estate offered the hotel for sale through international expressions-of-interest campaign so the site attracted a lot of interest from investors and owner operators keen to get a foothold in the Victorian capital, where hotels are performing strongly.
Hong Kong-based Ovolo Hotels was also in the running to acquire the Royce.
Tabet, who has been trying to sell the Tankerville Arms Hotel in Fitzroy with market expectations of $20 million, has been working to get the hotel.
Public records show he recently set up a holding company, Royce Hotel Business Pty Limited, registered to the hotel’s address on the leafy St Kilda Road.
The Royce Hotel has been in the hands of Melbourne-based private owners and hotel operators the Bursztyn family.
They have been developing the hotel since 2000 from the old showroom site.
The deal also includes an office building on the 2164 square metre site. That site has a net lettable area of 1125 square metres.
For the long term investor, both the hotel and office building sites have development approval which could add a further 67 hotel rooms, a larger ballroom, a rooftop gym and ground-floor retail.
by Leon Gettler, November 21st 2017
