- The sale comes as the Ovolo brand is set to grow, having tripled room count over the past half decade.
- The hotel occupies one of the oldest surviving sawtooth roof woolstores in Sydney.
- Listing comes as three other hotels sold and two Ritz-Carlton hotels listed for sale all in the past fortnight.
A Sydney hotel has been listed by TriO Capital, as it progresses through a capital recycling plan.
The Woolstore 1888 by Ovolo is being offered on the basis that Ovolo retains the management rights to the hotel following the sale.
“The sale forms part of our strategic plan to recycle capital to further grow the Ovolo brand throughout Australia, New Zealand, and selected Asia Pacific target markets,” said TriO Managing Director Tim Alpe.
“We have tripled our room count in the past five years, including adding two assets during the pandemic, and are looking to more than double our network via hotel management agreements, acquisitions, joint ventures and investment partnerships.”
CBRE Hotels’ Wayne Bunz and Michael Simpson have been exclusively appointed to steer the Expressions of Interest campaign.
A stone’s throw from Darling Harbour
The hotel is located on the corner of Pyrmont and Murray Streets, just behind the Novotel Sydney on Darling Harbour and the soon-to-be redeveloped Harbourside Shopping Centre.
The 90 room property also comprises a multi-award-winning neighborhood wine bar Mister Percy, a private dining room, board room and a guest laundry.
The Woolstore 1888 by Ovolo occupies one of the oldest surviving sawtooth roof woolstores in Sydney, with the Pyrmont building converted into a boutique hotel in 2013.
It has since been consistently awarded TripAdvisor’s Travelers Choice for being ranked in the top 10% of properties in Sydney in addition to HM Awards for Best Boutique Hotel, Hotel Bar and Hotel Interior Design.
Recent transactions and listings
The listing of The Woolstore 1888 by Ovolo comes a day after The Ritz-Carlton Perth and The Ritz-Carlton Melbourne were also listed for sale.
Other major hotels have also been transacted across the past fortnight, including the Salter Brothers’ acquisition of Sofitel Adelaide for $154 million, and the Worldwide Hotels Group subsidiary’, Legend Land Melbourne, acquisition of Novotel and ibis Melbourne Central for $170 million.
A Western Australian beach resort also sold recently.
Boutique is best
The boutique hotel sector was recently found to have outperformed traditional chain hotels on all three key performance indicators of occupancy, average daily rate (ADR) and revenue per available room (RevPar).
The CBRE data found that boutique occupancy was 21% better than the big players, 27% higher on ADR, and 54% on RevPar.
While the sector had been lagging behind larger competitors prior to Covid, a change in consumer trends led to the strength of boutique.
“More than ever, hotel investors are looking for bespoke and boutique hotel offerings, and this opportunity will appeal to a broad range of prospective purchasers,” said Bunz.
“Over three years on from the pandemic, many resulting trends are here to stay, with remote working, ‘bleisure’ travel, ‘staycations’ and the continued growth of social media use, having shifted guest preferences towards a highly personalised and hybrid approach to their hotel stay experience.”
The return of meeting, incentive, conferences and exhibitions (MICE) travel, post-pandemic, is expected to narrow the gap, with CBRE’s Australian Head of Hotels Research, Ally McDade, noting in a previous article:
“The continued recovery of corporate travel and international arrivals, coupled with more Australians travelling abroad, will broaden the mix of hotel business demand and ultimately moderate the exceptional outperformance we’ve seen from the boutique sector in the past two years,” McDade said.
The ongoing success of boutique lies in the ability to innovate and provide bespoke experiences for their guests.
“The continued growth of boutique hotels in Australia will rely on their ability to deliver a personalised offering, while capitalising on new and emerging travel trends such as bleisure, where a leisure component is added to a business trip; workations, where some work is tacked onto a holiday, and dog friendly travel such as Ovolo’s V.I.Pooch stays,” said McDade.
The EoI campaign closes Thursday 10 August 2023.
