A boutique hotel in the evolving Sydney suburb of Ultimo is for sale through Savills Australia.

The Ultimo Hotel comprises 95 guest rooms together with 10 retail tenancies, which include a single large basement level tenancy, plus nine high exposure ground level retail tenancies.

The property sits on a 1,584-square-metre site and offers further upside through redevelopment or repositioning under the existing development controls applicable to the site.

At a glance: 

• The Ultimo Hotel at 37 Ultimo Road, Haymarket is for sale via an expressions of interest campaign closing at 2pm on Thursday, September 24.
• The property is being operated by the Rydges Hotel Limited under a Hotel Management Agreement, which commenced on October, 2018 for a term of five years, but a termination without cause provision is able to be invoked 18 months from the commencement date.
• Savills Australia's Andy Hu, Jordan Lee, Stuart Cox and Nick Lower have been appointed to market the property.

The building was converted to the current hotel and retail/commercial uses in 1988 and subsequently renovated, with circa $10 million in refurbished costs undertaken in 2016. 

Savills Australia Joint State Head for Asia Markets at Savills Australia, Andy Hu, who has been enlisted to market the property with Jordan Lee, Stuart Cox and Nick Lower, said The Ultimo Hotel was operated by the Rydges Hotel Limited under a Hotel Management Agreement, which commenced on October, 2018 for a term of five years, but that a termination without cause provision was able to be invoked 18 months from the commencement date.

“Candidates have the option of continuing management with Rydges Hotels Limited or vacant possession," he said.

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An artist's impression of The Ultimo Hotel. Source: Savills Australia

The site offers 1,781 square metres of retail space with tenants including NAB, 7 -Eleven, the popular Karaoke bar, D1 Karaoke Sydney (650 square metres* basement tenancy), Bancho Bar, No.1 Malatown and Dodee Paidang.

With a 50 metre maximum height limit, a 10 per cent additional increase in either height or FSR may be achieved subject to council approval (STCA) allowing for circa 10,362sq m of GFA in total (STCA).

Mr Lee said local investors and developers were being just as aggressive as their offshore counterparts for these types of assets, due to the Sydney market being "supply stricken" for quality assets.

“Over the years, The Ultimo Hotel has garnered a lot of interest in the mid-tier market with domestic and international investors and we are confident even during the pandemic that there will be further local and offshore interest, as the opportunity to acquire prestigious sites such as this are not readily available," he said.

"Acquiring a pure island development site of this scale is seldom seen in Sydney, let alone Australia."

Situated directly opposite Market City, The Ultimo Hotel is within close proximity to neighbouring landmarks, including Darling Harbour precinct, Capitol Theatre, International Convention Centre Sydney, and World Square.

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An aerial view of the site. Source: Savills Australia

The property is also flanked by an educational precinct that features institutions such as University of Technology Sydney, TAFE NSW, Notre Dame and Sydney University.

Mr Lower said the southern end of the Sydney CBD was well established with a diverse mix of surrounding developments.

"The area has heritage-style commercial buildings with ground floor retail and accommodation, intermixed with modern mixed-use residential apartment and accommodation developments," he said.

“Public transport is currently available in the form of the rail, light rail and bus services connected to Sydney’s Central Railway Station, which is located approximately 150 metres from the site”.

"The Ultimo also benefits from the new Light Rail project that provides access between the southern end of the CBD from Central Station through to Circular Quay and also to the eastern suburbs."

The property is offered for sale via an International Expressions of Interest campaign closing at 2pm on Thursday, September 24.

*Approximately

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