Sydney publican snares Accor portfolio in $180m hotel deal of the year

It is understood Elanor Investors also attempted to buy the portfolio. Picture: Getty
It is understood Elanor Investors also attempted to buy the portfolio. Picture: Getty

Sydney publican Sam Arnaout of Iris Capital has snared the biggest hotel deal of the year paying around $180m for 17 hotels including Melbourne’s ibis Hotel and Apartments, a substantial $40m less than the previous buyer.

The deal positions Mr Arnaout as one of the largest private owners of hotels in the country given he now controls nearly 1800 hotel rooms on the eastern seaboard as well as a substantial pub portfolio.

It is understood that Elanor Investors and Blackstone also attempted to acquire the portfolio across Sydney, Brisbane and Newcastle, which has been on the market for several years at the behest of its Luxembourg-based vendor Accor Invest.

The portfolio was supposed to sell last year to the failed hotel investor Michael Gu for an aggressive $220m but the deal did not complete and Mr Gu’s company iProsperity is now in the hands of administrators.

Separately, Melbourne developer Ross Pelligra’s Carlton Property Group yesterday announced it has purchased the Rydges on Swanston hotel for conversion into the Crowne Plaza Melbourne Carlton Hotel under the IHG banner.

The five-level hotel will be fully refurbished ahead of its reopening in the first half of next year.

Mr Pelligra is banking on travellers returning to Melbourne adding that they will be attracted to the Crowne Plaza Melbourne Carlton’s rooftop pool and event facilities. All public spaces as well as the hotel’s 107 guest rooms will undergo a full refurbishment ahead of the reopening, he said.

IHG also manages Mr Pelligra’s Holiday Inn Melbourne Airport, and the upcoming Holiday Inn properties in Melbourne’s Werribee and Richmond.

Mr Arnaout clearly also favours Melbourne as the key investment property within the portfolio is the ibis Hotel & Apartments Melbourne.

Further up the east coast the portfolio also includes the ibis Sydney Airport, ibis Budget Sydney Olympic Park, ibis Newcastle and ibis Budget Brisbane Airport.

Mr Arnaout said he was delighted to have secured such a large portfolio in-one-line.

“This purchase fits in well with our current hospitality pub portfolio, takes our count to 45 hotels and delivers on the group’s strategy for diversification,” Mr Arnaout said.

“The AccorInvest Portfolio is well placed for repositioning and gives Iris immediate scale in an extremely tightly held hotel market,” he said.

In Sydney, Mr Arnaout was the buyer of the popular Hotel Steyne in Manly last year for a price of around $65m purchasing it from a couple of investors including John Singleton, Arthur Laundy and Mark Carnegie.

He also controls The Colombian on Oxford Street which he purchased in 2016 for nearly $15m. The sale of the pub includes the hotel licence and gaming facilities.

The media shy Mr Arnaout started Iris Capital in 1995 and within two decades had amassed a portfolio of 13 hotels in Sydney, the NSW Central Coast and Newcastle.

AccorInvest chief executive Gilles Clavie said he was pleased to secure the transaction “which is part of our asset management plan and fully in line with our strategy to strengthen in Europe in the economic and mid range segments.”

JLL Hotels Craig Collins and Peter Harper negotiated the Accor Invest hotel deal. Mr Harper said there had been almost $600m worth of hotel transactions year to date.

“This deal, together with our recent sales of the Novotel Brisbane and Vibe Hotel Melbourne, is a clear demonstration of the capital depth in the Australian hotel investment market for everything from metropolitan motels to major CBD hotels.”

Of the portfolio four hotels are branded as ibis Hotels and the other 13 are ibis Budget Hotels including the ibis Budget at Sydney Olympic Park.

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