First new hotel for Geelong in 20 years

First new hotel for Geelong in 20 years

10 August 2018

Victoria’s second city, Geelong, is fast becoming a commercial property hotspot with the city green-lighting a $150 million mixed-use project, the largest mixed-use development in the region, reports the AFR.

The 44 Ryrie Street project includes a 180-room hotel—the city’s first in almost two decades—along with a 1,000 square meters of ground-floor retail, 7,400 square meters of office space, and 24 residential apartments.

Melbourne developer Paul Franzé hopes to begin construction by the start of next year or earlier.

Mr Franzé has already mitigated substantial risk on the project after signing on InterContinental Hotels Group, IHG, to operate the hotel under its Holiday Inn brand.

As part of that and in a first in this country, IHG will also run the 30-unit serviced apartment component of the project under its Holiday brand.

The Ryrie Street site had initially been earmarked under an option to Quintessential Equity, to be developed into the new headquarters for the National Disability Insurance Agency and Department of Human Services.

But when that bid was unsuccessful, Mr Franzé grabbed the opportunity, negotiating an $7 million off-market deal to acquire the 2,700 square metre site from office furniture retailer John Orchard.

“We pretty quickly realised there’s not a lot of 4.5-star quality accommodation in Geelong,” Mr Franzé said.

“Geelong welcomes around 2.2 million overnight visitors annually, but is dramatically under-represented by quality hotels. With a prime CBD location in close proximity to the station, hospital, university, offices and government entities, I am confident that Holiday Inn and Suites Geelong is going to be a story of success,” he said.

Local planning statistics indicate the city needs between 1,400 and 2,500 new guest rooms to support Geelong’s projected growth over the next 15 years.

The last hotel to open in Geelong was the nearby Four Points Sheraton Geelong in 2001, rebranded the Novotel Geelong in 2014, after Accor acquired the management rights.

In a sign of growing confidence in the Geelong hotel market, the city’s four-star Mercure hotel was purchased in 2017 for $25 million by ASX-listed Event Hospitality and Entertainment who renovated it and rebranded it as a Rydges Hotel.

The project is being designed by Architectus, with Hansen Partnership managing the project’s urban planning.

The Franzé Development project is the latest in a series of major commercial projects that have arrived in Geelong in the last few years, partly due to a deliberate state and federal government strategy to shift resources into the city.

Along with the NDIA, the Transport Accident Commission, the Australian Bureau of Statistics and Worksafe Victoria are establishing new HQs there, in a bid to stimulate a local economy hit by the Alcoa aluminium smelter closure and Ford’s exit.