ART snaps up Quest apartments for $46m

ART snaps up Quest apartments for $46m

13 March 2020

In one of the first major hotel transactions of 2020, the Ascott Residence Trust (ART) has snapped up the Quest serviced apartments in Macquarie Park, 14.7kms North West of the Sydney CBD for $46 million on a yield of mid five per cent.

Located at 71 Epping Road, Macquarie Park, the property offers 111 serviced apartment style hotel rooms comprising a mix of studios, one and two bedrooms apartments, with full kitchens and laundry facilities.

Michael Simpson, Managing Director, Hotels, at Savills Australia negotiated the off market sale on behalf of vendor Tuggeranong Valley Rugby Union and Sports Club Limited (Vikings Group) and said the transaction reflects the strong appetite for Australian hotels from offshore capital.

“The Quest Macquarie Park is a high quality serviced apartment hotel located in a concentrated employment node, with a range of corporate demand drivers in immediate proximity. The sale price reflected a yield of approximately 5.5%. The interest and pricing reflects the highly attractive nature of Australian hotels, the high yield compared to other global markets, and the acknowledged safe-haven status of Australian real estate” he said.

Anthony Hill CEO of the Vikings Group said they are pleased with the result and wished Ascott and the Quest operators all the best for the ongoing operation of the property.

Ms Beh Siew Kim, Chief Executive Officer of the Managers of Ascott Residence Trust (ART), said “The acquisition of Quest Macquarie Park Sydney is in line with ART’s strategy to enhance returns for our stapled security holders while strengthening investments in developed markets and maintaining a predominantly Asia Pacific centric portfolio.

“The Quest serviced residence, which is well-located in Sydney’s second largest business district of Macquarie Park, will be under a master lease agreement and will add to our stream of stable income. The annual rent under the master lease agreement provides an EBITDA yield of mid 5% and is also indexed at a 4% increase each year, subject to periodic market review” she said.

Quest offers 24 hour on-site reception and management, breakfast options and local restaurant chargeback, pantry shopping, Valet dry cleaning, Guest laundry, outdoor BBQ area, Business administration services and conferencing and a gymnasium. There is also complimentary shuttle service to Macquarie Park and North Ryde Business Park.