FREMANTLE’S landmark Esplanade hotel has a new owner.
Marylyn New has sold the heritage-listed building to property developer Primewest for $88.5 million, two years after it went on the market.
The 300-room hotel joins Primewest’s $1.6 billion portfolio just three months after the Esplanade came back on to the market after the collapse of a $90 million deal sale to Singaporean group Ascendas.
The derelict Woolstores in Cantonment Street is not part of the sale.
Ms New described the Primewest sale, brokered by agents Jones Lang LaSalle, as a good outcome for WA though she reportedly had wanted as much as $120 million.
“This acquisition was gained at a price well below replacement value in keeping with our philosophy of buying well and has potential for adding value through further development of the property,” says Primewest on its website.
The company, whose directors include John Bond—son of Alan—says a series of “tasteful renovations and extensions” had resulted in a four-star iconic international hotel in the centre of Fremantle.
Primewest intends “freshening” it up to reflect 21st century tastes, says director David Schwartz. The Rydges Hotel group will manage the hotel.
Mr Bond says the short supply of new hotel accommodation in WA at the height of a continuing boom means Primewest’s investors are well positioned to enjoy strong future cash flows. Primewest promotes a 17.6 per cent “internal rate of return” per annum to Esplanade investors. Bank deposits are offering around 4–5 per cent.