Hotel 30-year lease for $1.2m

A 30-year lease on the Quality Inn Napier is available on an improving local tourism industry.

A 30-year lease on the 60-room Quality Inn Napier on Marine Parade is up for grabs, with the asking price $1.2 million and annual rental of between $440,000 to $460,000.

It was built in the 1970s as the Napier Travel Inn and its last refurbishment in 2013 lifted it to a four-and-a-half star Qualmark rating.

Bayleys agent Bill Brown said revenue out-performed market averages, rising 8.6 per cent and profit 11.5 per cent in the 2014/15 financial year compared with the previous year.

The increase was mainly due to increased patronage. Statistics New Zealand figures show international visitors for the 2015 calendar year were up 16.1 per cent on 2014. Domestic guest nights rose 4.6 per cent for the same period.

He said it was the preferred accommodation provider in Napier for government departments such as the police, the ACC and the Department of Conservation. Corporate clients included Air New Zealand, ANZ bank and DB Breweries.

Annual rent depended on accommodation revenue. A 56-seat restaurant and bar underneath some of the Quality Inn Napier's waterfront-facing rooms was separately tenanted.

"The hotel already has strong advance booking numbers right through until Christmas - thereby delivering an instant cash-flow to any new ownership," Mr Brown said.

"A number of competing accommodation properties in Napier have chosen to take profits out of their businesses over the past decade in periods when times were good. In contrast, Quality Inn has re-invested a considerable portion of its profits back into its operations through maintenance and marketing.

"That strategy has paid off - with the property consistently recording above-average occupancy rates compared to several other hotels which have, in effect, become run-down and are now missing out on corporate bookings which demand higher levels of accommodation."