Potts Point Backpackers HQ sells for circa $10m
Bruce Drayton and Simon Marsh have sold their Potts Point backpackers to a developer for an eye-watering figure — and they’ve already got their eye on their next purchase.
The couple were out car shopping today, and when asked what they were interested in Marsh said: “I’d like a Bentley.”
They can probably afford it, having sold Backpackers HQ, which consists of two four-storey terraces with 21 bedrooms and 15 bathrooms and an old sandstone dungeon at 172-174 Victoria Street for circa $10m via Jane Schumann, director of Raine and Horne Potts Point, and son Samuel Schumann.
“We’re very happy — it was in excess of the reserve,” says Drayton.
When asked if they were taking any mementos from the historic backpackers that they’ve run for the past 10 years, Marsh said “lots of memories … and $10 million!”
Jane Schumann had a guide of $4.5m for each of the terraces, but towards the end of the campaign this was increased to $10m for both.
It had passed in at auction during the week but sold soon after the gavel fell.
“The buyer may run it as a hostel for a while, but plans to return it to residential eventually,” she says.
With no foreign tourists for more than a year, Drayton and Marsh had decided to capitalise on the high demand for big houses.
“It’s time to roll the dice and see what we can get for it,” Marsh had said when they listed the property.
It’s now paid off for them, and they plan to retire. When the international borders open, they’ll spend more time in their favourite holiday destination, Hawaii.
The couple bought the hostel — which had operated as a backpackers since 1982 but once been a brothel — a decade ago for $3.75m.
The sale follows the recent sale of another backpackers, Kanga House at 141 and 141A Victoria Street, that sold at auction on March 20 for $11m via Bernadette Summers of The Agency.
That had views of the harbour.
The purchaser, stockbroker Angus Geddes who runs the financial services firm Fat Prophets, wants to turn the heritage 1890s terraces, comprising 18 bedrooms, into a single private residence.
Other backpackers have gone in recent years, with operators blaming lockout laws, high property prices and the rise of Airbnb.
The two terraces that made up Zing backpackers was sold to property developer Theo Onisforou, in 2018 for $3.25m each.
He plans to redesign them as terraces for his children.
Demand for backpackers has disappeared since foreigners have been unable to enter Australia.