The Ibis Budget Melbourne CBD has been listed for sale at a  pivotal time for Melbourne’s hospitality and commercial real estate sectors, offering investors a prime  opportunity to not only acquire a stable asset but also reposition or redevelop the property for future  growth.

Situated at 97-103 Elizabeth Street, one of Melbourne’s most sought-after locations, the 146-room  hotel occupies a 702 sqm site* between Collins and Bourke Streets, just 100 metres north of the  historic Flinders Street Station. The property stands out not only as a budget hotel offering but also as  a strategic investment with value-add potential through future conversion to a boutique hotel or other  suitable asset classes.

With price expectations north of $35 million, the property is for sale through Daniel Wolman, Oliver  Hay, and Leon Ma of Cushman & Wakefield, who are managing the value-add and development aspects of the asset, and Wayne Bunz and Scott Callow of CBRE Hotels, focusing on the hotel investment, on behalf of Capitel Group, led by well-known commercial property investor Eduard  Litver.

Currently operating under a management agreement with Accor—Australia’s largest hotel  management company—until February 2027, the property features a 3.0-star hotel with 24-hour  reception and food and beverage outlets.

Beyond its core use as a hotel, the property also provides owners the future opportunity to tap into  Australia’s thriving living sector. It offers the versatility for conversion into alternative assets such as  purpose-built student or co-living accommodation. 

Daniel Wolman of Cushman & Wakefield said the property represents a unique repositioning  opportunity in a highly desirable market. 

“This is more than just a hotel investment. The site’s central location, coupled with its potential for  redevelopment, makes it a prime target for value-add investors. Whether through modernising or  repositioning the current structure, there’s significant scope to achieve greater returns in Melbourne’s  thriving CBD.”

The Ibis Budget hotel’s strategic location in a historically low-vacancy strip of Melbourne’s CBD enhances its attractiveness to potential buyers. The hotel is surrounded by major retailers and offers  guests access to key attractions, including public transport hubs, cultural precincts, and sporting  venues.

As Melbourne’s hotel market continues to recover, budget accommodation is increasingly in demand.  With the majority of new supply in the market focused on 4.0 to 5.0-star hotels, the Ibis Budget  Melbourne CBD is well-positioned to capture the growing market of travelers seeking affordable yet  well-located accommodation.

Wayne Bunz of CBRE Hotels highlighted the hotel’s strong appeal within the hospitality sector,  noting, “The Ibis Budget’s central positioning on Elizabeth Street, right in the heart of Melbourne’s retail  and business districts, offers investors the chance to capitalise on high foot traffic and proximity to key  transport links. 

“This asset is not just about a stable hotel operation; it’s a gateway for future growth as Melbourne’s hospitality market surges back."

The Ibis Budget Melbourne CBD is for sale by International Expressions of Interest, closing Thursday,  14 November 2024, at 12pm (AEDT), through Cushman & Wakefield and CBRE Hotels.

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