Singapore-based Invictus Developments has continued to invest in the Australian hotel property market, with the $25 million acquisition of Brisbane’s 5-star The Inchcolm by Ovolo Hotel at Spring Hill in Brisbane.

The acquisition closely follows Invictus’s $52.5 million purchase of an office building at 39 York Street in Sydney - to be refurbished into an upper upscale hotel. The two buildings mark Invictus Developments’ first acquisitions in 2023, following the purchases of the Harbour Rocks Hotel in Sydney and Quest Woolloongabba in Brisbane in 2022.

The four acquisitions represent the first stage of an expected $500 million worth of investments by Invictus Developments in hospitality assets across the East Coast of Australia.

Sydney-based property investment management group, Intergen Property Group, is advising Invictus Developments on the acquisitions.

The Inchcolm Hotel has been acquired from Trio Capital, the investment and asset management business of independent lifestyle hotel group Ovolo. The luxury hotel features 50 guest rooms and suites, with a restaurant, conference and meeting rooms and basement carparking.

Meanwhile Invictus Developments plans a $30 million re-purposing of the 15-storey office building into an upper upscale hotel, complete with rooftop bar. The hotel is expected to open towards the end of 2025.

Mr Chayadi Karim, principal of Invictus Developments, said “We are very strong believers in the Australian hotel market as international travel is returning to pre-Covid levels and Australia is seen as an exciting and vibrant destination in the Asia-Pacific region.

“The addition of the two properties, with more planned on the East Coast, adds to our current portfolio of hotels in Singapore and Japan”, he added.

The Inchcolm Hotel sales campaign was conducted by Wayne Bunz and Steve Carroll of CBRE Hotels, while Mitch Noonan, James Aroney & Sophie Tieman of JLL acted on the sale of 39 York Street office building.

Mr Carroll said “Hotels continue to be an asset class of choice given the sector’s positive market fundamentals and attractive risk adjusted returns. We are seeing a broad range of investors seeking growth via hotel assets, and with outbound tourism from China recovering, we forecast this growth to continue”.

Mr Bunz added “Revenue per available room (RevPAR) has risen by 49% in Brisbane since 2019. With the Olympics coming in 2032, Brisbane is seen as a tier 1 destination for astute hotel investors”.

Mr Noonan said “Being one of only a small handful of boutique assets located on high quality corners in Sydney CBD, 39 York presented a super rare opportunity to acquire a 100 per cent freehold opposite one of Sydney’s most prominent train stations and commuter hubs.

“The sales process had broad appeal to both hotel and office investors, and we look forward to seeing the assets transformation”, he concluded.

This sale forms part of TriO strategic plan to recycle capital to further grow the Ovolo brand and beyond throughout Australia, New Zealand, and selected Asia Pacific markets.

The Ovolo Group has tripled their 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.

TriO Managing Director Tim Alpe said, “This transaction signifies a 50%+ appreciation in value based on the 2017 acquisition, driven by strong operating fundamentals which saw a 77% enhancement of RevPAR (revenue per available room) and a 100% increase in NOI (net operating income) based on 2022 actuals, whilst moving from an RGI (revenue generating index) of 77 to 146 versus the competitive set. We are committed to our next phase of growth and look forward to delivering robust investment returns and dependable growth for our partners across Asia Pacific.”

This marks the first divestment under the groups wider strategic plan, with The Woolstore 1888 By Ovolo in Sydney also on the market.