Famed Royal Exchange Hotel Sold Under the Hammer 4.01% by HTL Property and Burgess Rawson

Brisbane’s famed Royal Exchange Hotel sold under the hammer at a 4.01% yield at $14.05m following a spirited on market auction campaign managed exclusively by specialist national agencies HTL Property and Burgess Rawson.

The nationwide auction was conducted on-line, with representatives from multiple states actively participating.

Anchored by listed tenant Endeavour Group (EDV), the well known Toowong based hotel enjoys a 25 year triple net lease, with 4 additional 10 year options; taking the tenancy out to 2068.

“The sale at $14.05m and at a 4.01% yield is reflective of the positive asset class sentiment we are tracking nationally” advised HTL Property Director, Glenn Price.

“In conjunction with our colleagues at Burgess Rawson, and following the very positive auction sale, we can report significant sector interest; particularly in respect of blue chip covenants such as that represented by Endeavour Group” Price added.

Bidding for the large format asset commenced just under $10m, with multiple registered bidders moving the price quickly into double digits and by $100,000 increments.

“We enjoy a veritable Rolodex of significant family office groups possessing both the firepower and intent to continue the currently unsatisfied pursuit for exposure to this enviable asset class” commented HTL Property Director, Brent McCarthy.

“The powerful amalgam of the Burgess Rawson auction platform, and our acute knowledge of the traditional hotel asset class, provided for a buyer universe deep dive commensurate with the quality of the property being marketed for sale” McCarthy added.

The sale of the Royal Exchange Hotel follows the divestment of a number of other ALH tenanted properties this year, all with the Endeavour Group as long term tenants; but none of which has until now reached the circa 4% exit yield achieved.