Hot of the heels of a $55 million Auckland sale, US company Host is selling two of its multi-million dollar hotels in central Wellington.

The 139-room, 4.5 star Novotel Wellington hotel, on The Terrace, and the 200-room, 3.5 star Ibis Wellington hotel, on Featherston St, will go to market next month and both are expected to be snapped up quickly. Colliers International national director of hotels Dean Humphries estimated Novotel Wellington would fetch more than $35m, while Ibis Wellington would fetch more than $30m.

Host was selling off properties in their portfolio, so they can reinvest in their home country, he said. “They are de-investing a number of their properties in Auckland and around the country and redirecting capital back into the US. The US is in quite a strong growth phase, so that’s where they want to put their focus in the short to mid-term.”

The company had owned the hotels for about five years and had “done really well with them”, Humphries said. This announcement comes after Host sold its 247-room Novotel Ibis Auckland Ellerslie to CP Group for just over $55m.

CP Group, operated by the Pandey family, is reputedly the largest owners of hotel real estate in New Zealand. The group is also building the hotel for the French Accor chain’s luxury Sofitel brand.

The Novotel Ibis Auckland Ellerslie sale set a record for the highest sale price sale for a non-CBD hotel in New Zealand, Humphries said. On top of that, it was the largest hotel transaction in New Zealand since the Hilton Auckland was sold in 2012.

“[But] just as significantly, this transaction bucks the trend of overseas buyers snapping up major hotel assets around the country. The last three major hotel sales in New Zealand this year have all been to offshore investors from Asia Pacific.”

New Zealand’s tourism boom was to thank for that, he said. “At the moment, the tourism hotel sector is going through a growth cycle and with that there is a lot of interest in assets here because they are quite attractively priced. That paired with low interest rates are making hotels very attractive.”

Colliers would soon start calling for expressions of interest for the two Wellington hotels, both nationally and offshore, he said. Humphries, who has been heavily involved in selling hotels for more than a decade, expected to see significant interest in both hotels. “As a general rule of thumb was there is about 50/50 interest from offshore and domestic investors.”

Both hotels were being sold as freehold property and had a long-term management contract with Accor.

Source: http://www.stuff.co.nz/business/industries/73143852/two-wellington-hotels-on-market-us-property-investors-sell-up-kiwi-assets