Commercial & Industrial Property News Update

Australia - Lennons Plaza Hotel Sold For AUD 57 million

September 19, 2012

The property, valued at AUD 55 million, was acquired by Singapore-based hotel group SilverNeedle Hospitality.

Chifley at Lennons Hotel (aka Lennons Plaza Hotel) in the Brisbane CBD has a new owner. Singapore-based hotel group SilverNeedle Hospitality reportedly picked up the property for AUD 57 million, at slightly above valuation.

The four-star property was last traded for AUD 29.75 million in 2004 to Abacus Property Group, which in June valued the asset at AUD 55 million.

SilverNeedle's acquisition was meant to be a joint-venture together with Fijian-based hotel and construction company Reddy Group. However, the latter decided to exit the deal, which was brokered by CBRE and Jones Lang LaSalle.

Located at 66 Queen Street Mall, Chifley at Lennons Hotel is prized for having the best location in Brisbane. It is already managed by SilverNeedle under its Chifley brand.

The hotel is formerly known as the Country Comfort Lennons Hotel, and occupies the site of the World War II Pacific headquarters of General MacArthur.

The historic locale hosts 154 guest rooms as well as 3,959 sq m of commercial office space and 750 sq m of prime ground floor retail which fronts the Queen Street Mall. SilverNeedle plans to refurbish the hotel property and double the room count to 300 by converting the existing office space.

Chifley at Lennons will be re-branded under SilverNeedle's upcoming new brand, NEXT, upon the completion of its refurbishment, which is scheduled to coincide with the G20 summit in 2014.

Formerly known as Constellation Hotels, SilverNeedle owns and manages about 67 hotels in Asia Pacific. The privately owned company is majority-owned by IT entrepreneur Nadathur S Raghavan, and operates about 4,400 rooms in Australia under the Grand Chifley, Chifley, Australis, Country Comfort and Sundowner brands.

SilverNeedle's acquisition highlights a growing trend of prominent hotel purchases by Asian investors. Noteworthy transactions in recent months include the AUD 61 million purchase of the 100-year-old Rendezvous Hotel on Flinders Street by Singapore's Straits Trading Company in July, as well as the sale of the Sydney Harbour Marriott, the Brisbane Marriott and the Melbourne Marriott to Malaysia's Starhill REIT for AUD 415 million.

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