Renovations underway as plans revealed for Townsville City Motel

27 Sep 2023
Words Leighton Smith Townsville Bulletin

Renovations underway as plans revealed for Townsville City Motel

A new era has begun for the Townsville City Motel, sold to southern investors for $3m, with the lessor spearheading ambitious renovations of its 35 rooms.

The motel grabbed headlines in March after a mass eviction of Australian Red Cross clients receiving subsidised accommodation to stave off homelessness.

The evictions were due to a condition of the motel’s sale which stipulated that the premises be vacant to allow a new owner to carry out renovations.

Two months after signing a lease for the hotel, Sami Ullah said the renovation process was well advanced with one block of 10 rooms already upgraded, and their first guests welcomed last week.

Townsville City Motel manager Muhammad Awaiz said they took over the motel’s lease two months ago aiming to make it a “proper motel for online bookings and the public”, rather than continuing its previous role.

“We’re painting all the rooms … putting in new flooring, bedding, new interiors ... and in the bathroom we’re putting in new showers and screens,” Mr Awaiz said.

He said former guests, who were returning to the hotel after the extended break, had been impressed by the changes.

He expected the upgrades to be completed within the next couple of months.

Speaking on behalf of her parents, the Brisbane-based investors who purchased the motel, Yao Fang said they found the property after a protracted, Queensland-wide search. 

“We found all the information very interesting ... and after three months of discussion, we decided to buy,” Ms Fang said.

“We signed a contract in July and the settlement was in September.”

Ms Fang said the family liked the region so much that they also purchased a butchery business at Castle Hill.

She said Townsville’s affordability made it an appealing place to invest in commercial property compared to other capital cities.

“I can spend less money and get equal rental (amounts), so the pay back ratio will be very good,” Ms Fang said.

The property was sold with the assistance of ResortBrokers’ Glen Cummins and Des Fagg.

Mr Cumins said they were seeing a huge amount of buyer interest in regional accommodation assets right around the country, particularly high-quality stock with strong cash flow and great returns like the Townsville City Motel.

“We’re also seeing huge interest from intrastate and interstate investors as they chase higher returns than metropolitan areas,” Mr Cumins said.

“Add that to the fact that accommodation assets typically have higher yields overall compared to many other property/business types.”

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