Chinese buyer snares small Geelong motel
A Belmont freehold property containing a popular motel sparked an auction frenzy, selling $500,000 over reserve last week.
The lure of a freehold motel investment with a high underlying land value attracted plenty of overseas interest in the 3839sqm property at 14-16 Settlement Rd, Belmont.
The property sold for $2.3 million at an auction at Crown Casino, achieving a yield of 4.69%.
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Burgess Rawson, Melbourne agent Shaun Venables says a Chinese national purchased the freehold property in the bidding contest between three overseas investors.
There were 90 inquiries for the property prior to the auction, he says.
“While historically motels can be difficult property to sell with investors expecting a higher yield than most assets, there was far more to this property in that the location, size and value of the landholding and proven business operators ensured a mixture of different buyer types including investors, developers, hoteliers from both Geelong, Melbourne and overseas,” he says.
The operators of the Rose Garden Motel have a lease running to 2024, with further options to 2034.
The tenants pay more than $109,000 a year in rent, plus outgoings. The 15-room motel has a playground, barbecue facilities, swimming pool and manager’s residence.
But the underlying value of the landlocked 3839sqm Residential 1 zoned property provides a potential future development use for the buyers.
This article from the Geelong Advertiser first appeared as “Belmont motel sparks auction frenzy, sells $500K over reserve”.