Informer Issue 99 by Resort Brokers

INFORMER I S S U E N O. 9 9

AU S T RAL I A ’ S BES T ACCO M MODAT I ON IN V E S T M E N T SH OWCAS E

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CONTENTS

22 24 44 50

A rare and unrivalled opportunity for an established short-stay operator to secure the management and letting rights to Melbourne’s most exciting new high-rise development. With its elegant curvature and immense scale, Aspire Melbourne is a distinct and sculptural tower soon to make a striking and everlasting statement to Melbourne’s world-famous skyline.

Combined with the sheer quality and scale of Aspire, this is an opportunity not to be missed and unlikely to be repeated.

Ideally positioned in the heart of Melbourne’s most vibrant and visited city, Aspire boasts the stately and historic Flagstaff Gardens as its picturesque front garden. A vast array of world-class shopping, dining, arts and entertainment is within minutes’ walk.

Landmark tower designed by Elenberg Fraser

Rising 64 levels above the bustling retail offerings at its base, Aspire will offer magnificent panoramic views from every one of its 565 beautifully appointed apartments. Situated across multiple levels, the amenity for both exercise and entertainment is unsurpassed.

77% of apartments (434) are one bedroom

The essential cornerstones for a viable and successful MLR operation are well planned for and locked in place – long-tenure agreements, security over key operational space, investorfocussed apartments/owners. CO N TACT US

Highlights include:

64 levels, comprising 565 apartments 3 levels of unsurpassable amenity Unbeatable location in heart of Melbourne CBD

Current sales (381) indicate significant investor profile Most selling agents under restraint of trade (letting) Reception desk, back office, luggage room on licence Freehold options for further back-of-house/F&B 25-year FM and Letting agreements 1st stage delivery February ’22, completion May ’23

Alex Cooks 0467 600 610 alex@resortbrokers.com.au

ASPIRE MELBOURNE RARE AND UNRIVALLED

Tim Crooks 0422 208 450 tim@resortbrokers.com.au

The city’s most elegant and exciting new high rise MR development

WE GOTTA GET OUT OF THIS PLACE

Find out why Australians are heading to the regions in record numbers

Regional Spotlight: NORTH QUEENSLAND

Our Guide to some of the Best Roadtrip Properties

How the deep north is making a comeback from COVID with new market drivers

LET'S GET SOCIAL: RECENT EVENTS We’ve been out and about hosting and attending events across Australia

Start your engines and check out these great travel ideas which will inspire you to hit the road

62 74

Q&A - COPING WITH THE COVID CRISIS

SETTING THE BAR HIGH in Regional Australia

Faces of the Industry

We ask some of the industry’s leading figures how they’re moving forward during the pandemic

We check out the fabulous Powerhouse Tamworth after its multi-million dollar transformation

Renowned regional hotelier Greg Maguire on meeting some of the world’s biggest stars

Post-COVID valuation AND HOW TO avoid generating RED FLAGS

Explaining insurance terminology for accommodation operators

Valuers Acumentis give us the Peter Spranklin talks us through rundown on why it’s important ‘insurance-speak’ & what to look out for when taking out a policy to get organised early

REGULAR FEATURES

SALES ACTIVITY

on the market

BROKER PROFILE

RELIEF MANAGERS

MEET OUR TEAM

A snapshot of our top 10 sales and listings across Australia

Managing Director Trudy Crooks on why accommodation demand is rising

Meet Jessie Shi, a management rights operator who’s now a broker in our Brisbane team

Taking a holiday? Need a manager? Find one here.

ResortBrokers' national directory

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PREFACE

ON THE MOVE Ian Crooks CHAIRMAN

The seachange and treechange movement has been given serious momentum in recent times

ustralians are a mobile bunch of people. Did you know Aussies move home more often than 80 percent of other OECD countries? Or putting it another way, more than 39 percent of Australians change their address every five years, compared to an international average of 21 percent. When I moved across the ditch from New Zealand in the 1980s to set up ResortBrokers, one of the major things I realised was that this was a country where people are not afraid to up sticks and make a move, and this is what fuelled our fledgling accommodation agency in those early days. With the onset of the pandemic and the lockdowns, this has caused a rapid escalation of people moving in even larger numbers from the city to the regions and this is covered in depth in our main feature article. The numbers are quite staggering. The capital cities had a net loss of 11,200 people from internal migration, the largest quarterly net loss on record. But even before COVID-19, Australians were moving to the regions.

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According to the Regional Australia Institute, between 2011 and 2016, 501,643 people moved from capital cities into regional Australia while 436,439 people moved from regions to the capital cities. Therefore, Australia’s regions attracted a net inflow of 65,204 people from Australia and state capital cities. This means that in the five years to 2016, Australia’s regions attracted more people than they lost to capital cities. This report shows that people were already ‘voting with their feet’, and many were already choosing to live in regional Australia, even before COVID-19. The availability of the internet in the regions has now removed the feeling of remoteness for many non-city dwellers. Previously, city dwellers had an advantage over regional households with access to information, television channels and communication in general. Nowadays you can get decent internet and access streaming services like Netflix, hold Zoom meetings with colleagues and FaceTime with your friends.

A lot of businesses have been actively decentralising people and embracing rural and remote work and this means the future of work has been fast-tracked. As part of that main feature, we also speak with two separate couples who ditched the city life to buy an accommodation business through us to be in a more laid back environment. Their stories are typical of the thousands of people we’ve helped make a seachange or treechange lifestyle/ investment. It's not just workers who are moving to the regional destinations, domestic tourists are also driving a surge in regional tourism and the savvy operators are aware of that and looking at assets in non-capital city locations.

STATISTICS Australian Bureau of Statistics 2020

223,100 Australians moving from cities to regional

We catch up with renowned regional hotelier Greg Maguire, who runs the Powerhouse brand, and he gives us the rundown on what it’s like to own the best hotel in Australia’s country music capital, Tamworth. From Keith Urban to Bob Dylan, Kenny Rogers, Willie Nelson and Reba McEntire, Greg has met them all and even counts George Harrison as a friend and neighbour. Speaking of regional destinations, North Queensland was hit hard in the early months of the pandemic but has bounced back this calendar year and we get the lowdown from our broker in the area, Des Fagg, on how and why there’s been a resurgence in the deep north. We’ve also lined up some of the most well-known accommodation brands in Australia to find out how they

dealt with the pandemic and how they see the future and what they plan to do. These are some of the biggest names in the industry but I think nearly every operator will gain some valuable insight into how to deal with the post-pandemic world we now live in. We’ve also set up our own WeChat channel and we’re really looking forward to connecting with our valued Chinese clients. For those of you who are not familiar with WeChat, it is an amazing platform and we have a QR code in this issue for those who want to connect with us. The economic outlook, overall, is positive and let’s hope we all make good inroads for the remainder of 2021. END

190,200 Australians moving from regional to cities

32,900 Net inflow to regional areas

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Sales Activity in

QTR 4 OUR TOP RECENT SALES & LISTINGS We’ve been experiencing incredibly high demand across all accommodation asset classes and here’s a selection of some our biggest and best sales and listings.

JUST SOLD

BIG4 STUART OUTBACK RANGE RESORT, COOBER PEDY With 22 apartments, 120 powered sites & 40 unpowered sites, the new owners intend to turn this great park into a ‘flagship property’. Contact: Kelli Crouch M: 0410 441 750

JUST SOLD

ATRIUM, BUDERIM One of the largest permanent management rights complexes on the Sunshine Coast with 305 units sold for what’s believed to be a record multiplier. Contact: Tim Crooks M: 0422 208 450

JUST SOLD

HUNTER GATEWAY HOTEL, RUTHERFORD

DEVILS MARBLES HOTEL, NORTHERN TERRITORY

One of the Hunter Valley’s premier motels was snapped up by specialist regional accommodation investment fund Mandala Asset Solutions.

One of the Northern Territory’s most popular resorts, at Wauchope near Tennant Creek, was keenly sought by experienced operators.

Contact: Trudy Crooks M: 0477 882 210

Contact: Kelli Crouch M. 0410 441 750

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JUST SOLD

BATHURST HERITAGE MOTOR INN This hit the market for the first time and attracted strong interest as one of the biggest and most well-presented motels in the area. Contact: Chris Kelly M: 0431 055 221

JUST SOLD

A rare and unrivalled opportunity for an established short-stay operator to secure the management and letting rights to Melbourne’s most exciting new high-rise development.

THE MIRAGE ALEXANDRA HEADLAND With its elegant curvature and

FOR SALE One of the Sunshine Coast’s most ASPIRE MELBOURNE, Highlights include: popular resort complexes changed KING ST Landmark tower designed Ideally hands and this four star resort ispositioned in a in the heart of by Elenberg Fraser Melbourne’s most vibrant and visited city, Aspire boasts the stately This is a landmark apartment 64 levels, comprising 565 prime Sunshine Coast location. and historic Flagstaff Gardens as apartments its picturesque front garden. A project - a large-scale, vast array of world-class shopping, 3 levels of unsurpassable amenity Contact: Glenn Millar/Chenoa Daniel dining, arts and entertainment is high-end development in Unbeatable location in heart within minutes’ walk. of Melbourne CBD M. 0412 277 804; M. 0403 143 151 a prime inner-city location Rising 64 levels above the bustling 77% of apartments (434) are retail offerings at its base, Aspire one bedroom will offer magnificent panoramic with 594 apartments. Current sales (381) indicate views from every one of its 565 immense scale, Aspire Melbourne is a distinct and sculptural tower soon to make a striking and everlasting statement to Melbourne’s world-famous skyline.

beautifully appointed apartments. Situated across multiple levels, the amenity for both exercise and entertainment is unsurpassed. The essential cornerstones for a viable and successful MLR operation are well planned for and locked in place – long-tenure agreements, security over key operational space, investorfocussed apartments/owners. C O N TA C T U S

Combined with the sheer quality and scale of Aspire, this is an opportunity not to be missed and unlikely to be repeated.

significant investor profile

Contact: Alex Cook M: 0467 600 610

Most selling agents under restraint of trade (letting)

Reception desk, back office, luggage room on licence Freehold options for further back-of-house/F&B 25-year FM and Letting agreements

1st stage delivery February ’22, completion May ’23

Alex Cooks 0467 600 610 alex@resortbrokers.com.au Tim Crooks 0422 208 450 tim@resortbrokers.com.au

FOR SALE

COLONIAL TWEED HOLIDAY & HOME PARK, TWEED HEADS A high quality riverside park set on 2.3ha on the southern bank of Terranora Creek Inlet, with outstanding management in place. Contact: Greg James M: 0416 247 068

FOR SALE

UNDER OFFER

HIDDEN VALLEY HOLIDAY PARK, DARWIN

PENINSULA, AIRLIE BEACH

This great park will appeal to a wide range of investors because of its location within the Darwin metropolitan area and its overall presentation.

This is Airlie Beach’s most luxurious and the only 5 star beachfront accommodation situated alongside the newly extended Abell Point Marina.

Contact: Kelli Crouch M. 0410 441 750

Contact: Des Fagg M: 0427 849 119

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FREEHOLD GOING CONCERN 6 COTTAGES 1 VILLA + 1 SUITE MANAGER’S RESIDENCE 3 BED 2 BATH

Maleny Terrace Cottages MALENY, QLD

REF // F H 0 0 6 7 1 1

Beautiful Sunshine coast Hinterland luxury cottage accommodation opportunity ResortBrokers presents to market the opportunity to acquire the Freehold Going Concern to this boutique business situated in the highly-sought after Sunshine Coast Hinterland. Moments away from scenic Maleny and set within rainforest gardens, Maleny Terrace Cottages comprises six cottages, a villa and a penthouse suite. Each offering scenic views of both mountains and coastline. The business is ideally located within walking distance to shops, cafes and one of the Sunshine Coast's best restaurants. With its prime hinterland location, this business is a popular spot for weddings, conferences and group retreats and as such the owners have collaborated with local providers to offer affordable packages to guests. This provides a great additional income that the incoming owner can also enjoy. Also offering sweeping views, the three bedroom, two bathroom owner's residence is a fully renovated house situated away from the business and separated by lush gardens and trees. The property is currently run by one owner with the help of cleaning/ gardening staff, however with a total of 8 guest accommodation suites, this business could easily be managed by a husband and wife team and 1 or 2 casual cleaners providing another opportunity to increase revenue. Very profitable business located in Sunshine coast Hinterland 8 Luxury cottages and villas beautifully presented with not a cent to spend beautiful fully refurbished separate 3 bedroom 2 bathroom residence with majestic coastal views Easily run by a husband and wife team with 1 cleaner Only a 30 minute drive to beautiful Sunshine coast beaches High nightly tarrif achieved from luxury accommodation, a 2 night minimum reduces workload

Net Profit $256,512 Turnover $423,256 Price $2,500,000

GRANT SULZBERGER

BROKER

+61 455 053 832 grant@resortbrokers.com.au

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MANAGEMENT RIGHTS 51 UNITS 14 LETTING 10 YEARS 17 STOREY TOWER

Cashelmara Beachfront Apartments BURLEIGH HEADS, QLD

MANAGER’S RESIDENCE 3 BED 2 BATH

REF // M R 0 0 6 6 9 9

Luxury Burleigh Heads Beachfront Living & Lifestyle Business Located in the heart of beautiful Burleigh Heads. If you were thinking about purchasing management rights, this is the area to do it! Highly sought after location with incredible ocean views from every room. Only a short stroll to the James Street cafe's and boutique shopping, not to mention the world class surfing of Burleigh Point. A proven performer and consistent net profit of $216k, topped up agreements, easy to manage resort facilities, extra large renovated 3-bedroom, 2-bathroom manager's residence with ocean views, 50 units in the complex with 14 in the letting pool. There are no set office hours and the BC remuneration is a healthy $95k. All 2 or 3 bedroom apartments with incredible ocean views, driving repeat guests year upon year. Perfectly set up for first time operators or those looking for a lifestyle business to run from your beach front home. With a manager's residence like few others, a location that is hard to beat and a lifestyle that only Burleigh Heads can offer, this is a little gem that must be inspected to appreciate it's value. Time to invest in Burleigh Heads is now! Absolute beachfront Burleigh esplanade location Upgraded complex with wonderful resort facilities Incredible 3 bed 2 bath large manager's residence with ocean views Topped up agreements No set office hours Consistent performer with growth opportunities post covid Work from your own beachfront home Opportunity to buy into the booming Burleigh Heads market

Net Profit $216,000 Price $2,200,000

TODD WARNER

BROKER

+61 438 170 763 todd@resortbrokers.com.au I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

MANAGEMENT RIGHTS 39 TOWNHOUSES, 24 LETTING 18 APARTMENTS, 12 LETTING 22 YEARS & 23 YEARS MANAGER’S RESIDENCE 3 BED 2.5 BATH

Enoggera Manors & JQ1 ENOGGERA, QLD

REF // M R 0 0 6 7 0 9

Brisbane Permanent Management Rights close to the city Perfect opportunity for a first time buyer or experienced operator to purchase the management rights to a quality permanent town house complex in the quiet leafy suburb of Enoggera. Built in 2008 and consisting of a total of 39 town houses, 24 of which are currently managed in the onsite letting pool. Included in the sale is a large freestanding manager's unit, consisting of 3 bedrooms and 2.5 bathrooms with an office on title, double lock up garage and includes a designated car space for the manager. Additionally, in this offering is a second building comprising of a total of 18 apartments (Business only) situated a short 10 minute drive in Kelvin Grove, located directly opposite from Kelvin Grove College and QUT campus. This building consists of 1 & 2 bedroom (All fully furnished) and 12 units in the manager's letting pool. A small common area with synthetic grass (no facilities) make this an easily managed add-on. Long 25 year agreements - 22 & 23 years tenure remaining Family friendly location close to parks and bike paths Both complexes easily managed by one person Combined net profit of $153,508 Supportive committee - Just topped-up agreements P&L prepared by specialist industry accountant Formal valuation on managers unit available on request

Net Profit $153,508 Business Price $790,566 Managers Unit $600,000 Total Price $1,390,566

JEFF KEAST

BROKER

+61 414 669 007 jeff@resortbrokers.com.au

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LEASEHOLD MOTEL 21 ROOMS

MANAGER’S RESIDENCE 2 BED 1 BATH

Dawson Motor Inn LISMORE, NSW

REF // L H 0 0 6 6 7 0

High Performing Fully Refurbished Motel In Desirable Location On offer is the opportunity to purchase the leasehold to this fully refurbished property offering all 21 rooms on the ground floor. During COVID-19, the business has had consistent trading and enjoys a strong corporate clientele for the last three years and did not require rent relief during the COVID-19 period. With favourable rent and increasing net profit, this pristine motel is ready to go! Simply walk in and enjoy a favourable income already set up. This is a proven performer with further upside forecasted. Located on the edge of Lismore’s central business district, it is the closest motel to the Lismore Base Hospital. The Dawson Motor Inn has a 4 Star AAA rating and also has excellent guest reviews, ranked number two on TripAdvisor. Fully refurbished in the last three years Consistent trading figures 4 Star Rating AAA Favourable rent ratio Strong forward bookings and repeat corporate clients Parking for vehicles and trucks 80% occupancy (average over 3 years) Low-maintenance, landscaped outdoor areas, with salt water pool. Property inspections are by appointment only

Net Profit $411,420 Turnover $840,454 (projected) Price $1,300,000

GREG JAMES

BROKER

+61 416 247 068 greg@resortbrokers.com.au I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

FREEHOLD MOTEL 22 ROOMS MANAGER’S RESIDENCE 3 BED 1 BATH

Country Roads Motor Inn NARACOORTE, SA

REF // F H 0 0 6 6 9 1

Outstanding opportunity to purchase this high netting Freehold and Business Motel on the Limestone Coast. This immaculate 22 room motel situated in the Limestone Coast region of SA, is perfectly positioned for the new owners to make the most of the surge in domestic tourism with the purchase of this freehold and business showing a 16.3% return. The business has a mix of both corporate/workers and leisure clients and enjoys good repeat clientele. Positioned walking distance from the town centre, with 22 generous sized ground floor rooms and a range of accommodation options including superior and standard, double, twin and family rooms to meet the needs of all travellers. The rooms are complete with TV, AC, fridge, mircrowave, tea and coffee making & Ironing facilities. Other features include ample off street parking, free WiFi and a spacious grassed BBQ area. With a net profit in excess of $400,000, the business is perfectly placed for an owner operator couple but also equally suited for investors to run under management. It is rare that a Freehold and Business opportunity comes along, with no stamp duty payable in South Australia, and strong return to trading post covid, this is the perfect time buy. Well established Freehold and Business motel showing 16.3% return Strong post covid trading performance for the first 9 months of FY21 No stamp duty payable in South Australia Simple operation, no restaurant Well maintained and a number of recent refurbishments/replacements Walking distance to the main street 3 bedroom spacious manager's residence with private rear garden

Net Profit $431,038 Turnover $648,172 Price $2,600,000

KELLI CROUCH

BROKER

+61 410 441 750 kelli@resortbrokers.com.au

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FREEHOLD MOTEL 37 ROOMS 37 LETTING

MANAGER’S RESIDENCE 3 BED

Kingsley Motel & Cabernet Restaurant M A N J I M U P , WA

1 BATH

REF // F H 0 0 6 7 0 4

Finally!! A Freehold Motel netting over $500K PA The Kingsley Motel and Cabernet restaurant represents an excellent opportunity to secure a high-quality regional Motel and restaurant operating with limited competition, within the booming south-west of Western Australia. Built on three acres of land, the newly renovated Kingsley Motel boasts 37 ground-level rooms, plenty of parking; large areas of lawn and a delectable onsite restaurant offering farm to table, locally sourced ingredients and a seasonally changing menu with Room Service available on request. This predominantly renovated freehold motel and restaurant has bounced back strongly from the effects of Covid shutdowns, with an excellent Average Net Profit of $517,000 pa over the last 5 years. Revenues are driven primarily by corporate and government clients with the bonus of seasonal tourist accommodation, allowing the Motel to operate at occupancy rates of between 55% and 60%. The owners have invested over $750,000 of renovations and improvements into the Motel over the last 5 years, investments that will pay dividends for a new owner. The business generates 88% of all revenues through Motel accommodation sales with the remaining 12% being related to the restaurant. All the hard work’s done – Predominantly renovated 37 room Motel and restaurant Ample space for additional accommodation units to facilitate future growth Predominantly corporate clients, with long-term and repeat bookings Limited local competition to both motel and restaurant 4.0 score on TripAdvisor "Tree change" opportunity - situated in the beautiful southern forests of Western Australia

Net Profit $517k Average Turnover $1,462,000 Price $3,300,000

BLAIR MACDONALD

BROKER

+61 433 149 144 blair@resortbrokers.com.au I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

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AUSTRALIA’S GREAT REGIONAL MIGRATION. Lockdowns and border closures have changed the way Australians want to live, and now they’re ‘going bush’ for a lifestyle change. There was a time when living in regional Australia meant a choice of two terrestrial TV stations, often with patchy reception, expensive STD phone calls and overpriced flights to the capital cities. As for shopping options, for say a new piece of clothing, on a Saturday afternoon or a Sunday – forget it. It wasn’t that long ago that living in a country or regional town meant missing out on the many advantages of life in the big city. Now, the great divide between “the big smoke” and “the bush” has been closed and it’s easier than ever to live outside the city, thanks mainly to the improvements in technology which means that the internet can deliver communications platforms such as Skype, Zoom, WhatsApp and FaceTime. As for entertainment, think Netflix and Stan as a replacement for VHS tapes rented from Blockbuster. With the onset of the pandemic, and the resulting border closures and lockdowns, analysts and economists are calling a new

rush to the regions a “stampede”, following the release of figures which show Australian capital cities have witnessed the biggest loss of people into the regions on record. The Australian Bureau of Statistics has confirmed the pandemicinspired trend with the release of a report that showed capital cities had a net loss of 11,200 people from internal migration, the largest quarterly net loss on record for September 2020 (with statistics going back to 2001). Brisbane bucked the big city trend and gained the most people through net internal migration (+3,200) while Sydney lost the most (-7,800) in the September quarter of 2020. Melbourne had a net loss of 7,400 people in the September quarter but that was less than the 8,000 recorded in the previous quarter. The most popular regional destinations were Gold Coast, Sunshine Coast and Geelong. Most of the states welcomed enough new arrivals to fill a decent-sized town. In NSW, enough people moved

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from the cities to create a second Cobar, in Victoria they would have created a second Daylesford. For Queensland, the movers would have packed out Oakey or in South Australia enough people moved bush to populate a second Clare. “The pandemic has ushered in a new way of thinking about how and where we work, what we want from life and how we might reshape our lifestyles,” says Regional Australia Institute CEO Liz Ritchie. “We are seeing a shift in our traditionally metro-centric thinking toward a new appreciation for the lifestyle and opportunities that living in regional Australia can bring,” she says. “Our research confirms that one in five city dwellers want to make the move and almost half wish to move in the next 12 months. So what are the drivers? “The research found that people want to genuinely reduce their stress and anxiety, they’re sick of the hustle and bustle of traffic and they want to reduce their cost of living.” This has been confirmed by overwhelmed residential real estate agents who are calling the demand for regional properties a “boom”. CoreLogic data shows regional home prices surged by 7.9 per cent over the year to January 2021 which is the biggest annual jump in 16 years.

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Despite this, the cost of buying a home in regional Australia remains less expensive, and often better quality, than what is available in the major cities. The fact that very few coronavirus cases were recorded in Australia’s regional destinations, coupled with the reality that you can do your Saturday or Sunday shopping online with home delivery and maybe even start your own business, means that “going bush” is a no-brainer for many people. “What our research also highlighted is that the appeal of regional Australia is a stronger motivation to move than any dissatisfaction with city life. Regional Australia offers city dwellers a desirable alternative to improve their lifestyle, their wellbeing and to shape their best life,” Liz Ritchie says. “This creates an historic opportunity to rebalance our nation.” Despite the advances in technology, smaller towns are unlikely to be able to offer exactly the same services as those in the city. You might not be able to order Uber Eats or you might have to travel to see a medical specialist. But pick the right town or smaller city and you might find yourself loving a lack of traffic lights, more affordable housing and a close-knit community of friendly locals.

NATIONAL MIGRATION KEY STATISTICS (ABS September quarter, 2020)

INTERSTATE 76,200

76,200 people moved interstate in the three months to the end of September 2020.

CITIES -11,200

Capital cities had a net loss of 11,200 people from internal migration, the largest quarterly net loss on record.

INTERSTATE MIGRATION KEY STATISTICS (ABS September quarter, 2020)

QLD +7,200

Queensland gained the most people from net interstate migration (+7,200).

NSW -4,100

New South Wales lost the most (-4,100).

CAPITAL CITY MIGRATION KEY STATISTICS (ABS September quarter, 2020)

BNE +3,200

SYD -7,800

Brisbane gained the most people through net internal migration (+3,200), unchanged from the previous quarter.

Sydney lost the most (-7,800). Sydney had the largest change in net migration, from -6,400 in the previous quarter to -7,800 in the September quarter.

MEL -7,400

PER +1,400

Melbourne lost 7,400 people, compared with 8,000 in the previous quarter.

Perth had a net gain of 1,400 people, compared with 410 in the previous quarter.

ADL -330

HBA -160

Adelaide lost 330 people, compared with 180 in the previous quarter.

DRW +10

Darwin had a small net gain of 10 people, compared with a net loss of 200 in the previous quarter.

Hobart’s net loss of 160, compared to 40 in the previous quarter.

ACT -140

The ACT had a net loss of 140 people, compared with a gain of 240 in the previous quarter. I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

The desire to trade life in the big city for a ‘seachange’ or ‘treechange’ in a regional or country destination is often a major motivating factor for people in the accommodation industry. We spoke with two operator-couples, who sold out of the major cities for an alternative business and lifestyle, to find out their motivation and how they’re getting on in their new lives.

TIM AND MAUREEN MORETTI Moved from: Sydney to Culburra Beach Business: Culburra Beach Motel Distance from Sydney: 180km

efore buying the Culburra Beach Motel on the NSW south coast through ResortBrokers’ Russell Rogers, Tim and Maureen had a 20 year leasehold at what was then called the Gardenia Motor Inn in Bass Hill in Sydney. Everything was fine but after 15 years with the same landlords, the building was sold to overseas investors. That’s when things became “difficult” for the Morettis and they gave up the last five years of the lease just to get out. So, how and why did they pick the Culburra Beach Motel? “I came upon the listing for Culburra Beach by accident and, even though we were not really looking to buy another business, we were attracted to the property,” Tim says. “I always thought that one day I would like to retire near the beach somewhere and, as a bonus, it would be nice to have a few rooms to rent out as an additional income. This motel seemed to tick all those boxes. It was freehold, a short walk to the beach and 10 rooms to rent out. “We figured once our mortgage was paid it didn't matter if we sold rooms or not. We had our house by the beach and if we sold a few rooms, that would be a bonus.”

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“Since leaving Sydney, we don’t really miss living there. We miss our friends and family that we do not get to see as often, but we would not move back there.” For Maureen Moretti, the location on the south coast was also a major advantage in their decision to shift their lives out of Sydney. “The south coast is great because of the beautiful green countryside and pristine beaches. Also, Culburra Beach is only a two hour drive to Sydney. Since leaving Sydney, we don't really miss living there. We miss our friends and family that we do not get to see as often, but we would not move back there,” Maureen says. “The business in Sydney consisted of 42 rooms, a restaurant and a function centre, it was also a 24 hour reception. Whereas, Culburra Beach has only 10 rooms and no restaurant and we don't even offer breakfast. Plus, the clientele is completely different.” The Morettis, like many accommodation operators, have endured their fair share of hardships in recent times. They bought into the Culburra Beach Motel just three months before the bushfires of 2019/20. “After the bushfires came the floods and then followed by the

coronavirus,” Tim says. “Financially it was difficult, we still needed to keep paying the mortgage, council rates, water rates, electricity and other things with very little income coming in. Once the coronavirus eased, we have been inundated with bookings and has been going strong with many forward bookings as well.” As with any major life changing moves, there are pluses and minuses and the Morettis have embraced the challenges and are relishing their decision to go regional with their seachange and the adjustments that come with that. “My advice to anyone making a move like this is, first decide if leaving what you have with nearby friends and family is something you are prepared to do. “Do you want short term or long term; do you want to own the property or happy to lease. “We are happy with our decision, the business is going great, we are paying off our loan. I am more involved with local activities. It can be hard work, but that all depends on how much you want to save in labour costs.”

“Take your time in finding the right fit for you. Build a relationship with your broker and use industry experts for all your legal, accounting and insurance needs.”

fter spending most of their working lives in the building industry in Melbourne, Trish and Peter Ridout decided it was time to “do the double” and change both careers and home locations and they began looking around for options on both. “It was early 2018 and we decided to quit the building industry and try something new,” Trish says. “With the children all grown up and settled in their work and personal life, a change in direction was due. We originally considered the Gold Coast as anything further north for me was too far away from family in Melbourne “It was all about taking on a lifestyle change and what we wanted was that change with a better work-life balance.” The Ridouts bought the management rights to Whale Watch Ocean Beach Resort through ResortBrokers’ southern Gold Coast specialist Todd Warner. The 40 unit complex sits right on top of Point Lookout with sweeping views along Main Beach and, thanks to its outstanding location, it has a highly consistent occupancy rate, even during the pandemic. Whale Watch Ocean Beach Resort has also recently hosted Hollywood heavyweights Chris “Thor” Hemsworth and his close mate Matt Damon, along with their families on an extended family vacation. “Straddie is unique in its offering of its flora and fauna and for the most part untouched beauty,” Peter says. “It has some of the most spectacular scenery found anywhere in Australia and it’s an ideal holiday destination for families, groups of friends and day trippers thanks to its scenic headlands, freshwater lakes, rolling surf and endless white sandy beaches.” One of the big challenges in relocating work and home can be the wrench of leaving close

relatives and friends behind in the hope that the new lifestyle benefits will outweigh the feelings of being disconnected from your loved ones. “We visited Melbourne recently for the first time in almost two years and, yes, I do miss my family and close friends and restaurants,” Trish says. As first-timers in the accommodation industry, the Ridouts have naturally been finding their feet in a completely new business but have adopted a positive attitude and thrived on the total change of direction. “Yes, it is our first accommodation business. It has its challenges but overall, it is very rewarding when guests let us know they have enjoyed their time here with us at Whale Watch Resort,” Trish says.

“COVID was, and has been, a huge challenge. We were extremely grateful for the government assistance which allowed us to keep our staff busy during the three month island closure. “We were able to do many things around the resort during this time which would otherwise have been logistically challenging.” And their advice for anyone else thinking of making a similar big change? “Take your time in finding the right fit for you,” Trish says. “Build a relationship with your broker and use industry experts for all your legal, accounting and insurance needs. Doing this makes the world of difference before, during and after the purchasing process.”

TRISH AND PETER RIDOUT Moved from: Melbourne to North Stradbroke Island Business: Whale Watch Ocean Beach Resort Distance from Melbourne: 1,800km

I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

1 . 4 5 3 H E C TA R E S I T E

Reef Accountants has been providing specialist services and advice to clients in the Management Rights industry for almost 10 years. Services include: - Finanial Verification/Due Diligence - Financial Statements & Tax Returns - Structuring advice

Form 6 letting agreement advice POA Trust Account Audit Exit planning, including Adjusted Profit & Loss for sale purposes

With combined experience in the Management Rights industry in excess of 25 years, get in touch with Hayden or Carol to discuss your requirements. Hayden Rooney CA Carol Woolfenden CA

07 5406 0382 07 5406 0388

hayden@reefaccountants.com.au carol@reefaccountants.com.au

4/146 - 148 Alexandra Parade, Alexandra Headland, QLD, 4572

“One of the most highly regarded and respected accountants in the industry, Hayden has established himself as a true management rights specialist. He's guided experienced operators through their business growth and helped newcomers navigate their way into the industry, while maintaining an exceptional level of enthusiasm and professionalism. Hayden's key trait is that he's with you every step of the way.” - Chenoa Daniel, ResortBrokers

IAN CROOKS

CHAIRMAN

RESORTBROKERS.COM.AU_I S S U E N O . 9 9

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gigafy.com.au gigafy.com.au 1300 1300 444 444 239 239 IIS SS SU UE E N NO. O. 9 99 8 _RESORTBROKERS.COM.AU

21 61

Combined with the sheer quality and scale of Aspire, this is an opportunity not to be missed and unlikely to be repeated.

Landmark tower designed by Elenberg Fraser

77% of apartments (434) are one bedroom

RESORTBROKERS.COM.AU_I S S U E N O . 9 9

4 levels, comprising 565 6 apartments 3 levels of unsurpassable amenity Unbeatable location in heart of Melbourne CBD

Current sales (381) indicate significant investor profile Most selling agents under restraint of trade (letting) Reception desk, back office, luggage room on licence reehold options for further F back-of-house/F&B 25-year FM and Letting agreements 1st stage delivery February ’22, completion May ’23

I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

WORDS_BEN HALL

SECOND IN A SERIES CHECK OUT ISSUE 98 FOR PART 1

Our guide to some of the best roadtrip properties PACK THE CAR BOOT, FILL THE TANK AND GET READY TO HIT THE ROAD WITH OUR PICK OF SOME OF THE BEST PLACES TO STAY IN AUSTRALIA.

If you’ve ever dreamed of hitting the open highway on an epic road trip adventure, then Australia is the type of place which can provide a range of unforgettable experiences. The outstanding landscapes, wide open spaces, orangered sunsets and wildlife all combine to create the perfect backdrop to exploring the country by road. In part 2 of our special guide, we’ve put together a guide to some of the best properties that ResortBrokers has sold or listed, in locations that are tailor-made for road tripping, from the deep north to the Sunshine Coast and the Gold Coast, to the NSW south coast and out into western Queensland.

RESORTBROKERS.COM.AU_I S S U E N O . 9 9

Southern QLD, Darling Downs, Northern NSW

Ivory Palms Noosa A classic 4 star resort with a full range of quality accommodations along with three swimming pools, jumping pillow, games room, wood fired pizza café, set amongst 7 acres of tropical grounds.

The Roma Mid Town Motor Inn Roma

The Retreat Beach Houses Peregian Beach

This 19 Room CBD motel is at the gateway to the Queensland outback and is a short walk to shops, pubs and restaurants - just minutes to everything Roma has to offer.

Exceptional, freestanding 1, 2 and 3 bedroom beachfront houses in a stunning tropical landscape right on the sand dunes of Peregian Beach.

The Riverland Motor Inn St George With 26 comfortable rooms, this motel receives rave reviews for its award winning restaurant close to the mighty Balonne River. Check out the Tripadvisor reviews!

Rumba Resort Caloundra Absolute beachfront luxury with a range of cafes and restaurants in this complex. Stunning views over the Pumicestone Passage with the famous Glass House Mountains as a backdrop.

The Jolly Swagman Motor Inn Goondiwindi This family-owned 55 room resort-style motel prides itself on providing guests with a ‘home away from home’ experience with personalised and friendly service.

The Vines Motel & Cottages Stanthorpe Located right in the heart of the scenic town of Stanthorpe, just 3 hours from Brisbane and the Gold Coast, this is an ideal holiday destination.

The Buckaroo Motor Inn Warwick The Buckaroo Motor Inn is a top-quality motel complex in a beautiful location, with friendly staff in a clean and comfortable tech savvy accommodation.

Gosamara Boutique Apartments Byron Bay 4-star modern, self-catering, one two and three bedroom apartments featuring split levels, multiple bathrooms, expansive living areas and private balconies provide space and privacy for all guests.

Breakers North Surfers Paradise Breakers North Absolute Beachfront Apartments has a private boardwalk that leads to the white, sandy beaches of Surfers Paradise. Located within a 20-minute walk to Surfers Paradise & Broadbeach.

I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

WHERE EVER AND WHENEVER YOU CHOOSE TO GO, ROAD TRIPPING IN AUSTRALIA OFFERS A WIDE VARIETY OF EXPERIENCES.

Central & North Queensland Tropixx Motel Ingham Ingham's only four-star accommodation with a great central location which is an ideal base to explore this laid-back area which is just one hour and 20 minutes by car from Townsville.

Oshen Holiday Apartments Yeppoon

Gunna Go Caravan Park Myrtlevale via Prosperpine A jewel in the middle of the cane fields, this park is set on 6.5 acres of paradise on the banks of Myrtle Creek. It has an abundance of wildlife with many different species of birds throughout the park.

RESORTBROKERS.COM.AU_I S S U E N O . 9 9

Oshen Holiday Apartments Yeppoon is one of the Capricorn Coast’s most stunning accommodation complexes which is located on ‘The Bluff’, offering unrivalled ocean views of the Keppel Islands and Southern Great Barrier Reef.

The Ten Dollar Town Motel Gulgong The charming heritage town of Gulgong was made famous as it appeared on the paper $10 note until 1993 alongside the Australian poet, Henry Lawson. The motel is located in the heart of the historic Gulgong township.

Bathurst Heritage Motor Inn Bathurst The only 4.5 star independently rated Bathurst accommodation with an easy two block stroll to the CBD. Offering fully selfcontained cottages, luxurious king spa suites, deluxe studios and standard motel rooms.

Bangalay Luxury Villas Shoalhaven Heads Set amongst the pristine backdrop of coastal national park and Shoalhaven Heads golf course, this is the place to experience architecturally designed luxury just two hours south of Sydney.

Batemans Bay Hotel Batemans Bay Located a short walk to the beach, this is a classic hotel in one of the most popular towns on the NSW south coast offering good old fashioned hospitality in a highly rated property.

Hillcrest Motel Merimbula

South Coast & Central West NSW

With uninterrupted views overlooking the beautiful town of Merimbula, the Hillcrest is reimagining the 50 year old property, currently offering newly furnished deluxe, superior and family style rooms.

I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

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RESORTBROKERS.COM.AU_I S S U E N O . 9 9

nuvho.com | info@nuvho.com | +61 7 3040 7114

LEASEHOLD CARAVAN PARK 177 POWERED SITES 54 CABINS

MANAGER’S RESIDENCE 2 BED

Hidden Valley Holiday Park

1 BATH

BERRIMAH, NT

COMING SOON - PREVIEW LISTING ResortBrokers is proud to be releasing to market this outstanding leasehold tourist park only 10mins from Darwin CBD. Nestled on approx. 6.13 hectares of well maintained tropical gardens and with 177 powered sites and 54 cabins this opportunity provides potential operators with the scale to capitalise on the forecast surge in domestic tourism. This privately owned park is currently run under management and there is significant upside for experienced park operators looking to acquire a footprint in this region. Park facilities include swimming pool, playground, BBQ & picnic areas, amenities blocks x 3, dump point, cafe currently leased out for the season. With a number of accommodation options to meet the needs of all travelers including 137 powered sites, 40 en-suite powered sites, 10 villas, 17 cabins, 5 holidays units and 22 roomed lodge. 74 of those powered sites only opened in June 2019 as part of a stage 2 development and have not yet been realised due to the covid pandemic. The high quality facilities and with a location so close to the CBD will drive both long term and short term demand, strong revenue and upside for experienced operators. Brand new 20 year lease (10 years 2 x 5 year options) Ramp up rent over 3 years allowing new owners to get settled Located 10mins south of Darwin CBD Currently run under management, upside for owner operators 6.13 hectares, zoned tourist commercial Range of accommodation options to meet the needs of all tourist

Price $2,800,000 + SAV

KELLI CROUCH

TRUDY CROOKS

BROKER

M A N AG I N G D I R E C TO R

+61 410 441 750

+61 477 882 210

kelli@resortbrokers.com.au

trudy@resortbrokers.com.au I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

REF // M R 0 0 6 4 3 3

MANAGEMENT RIGHTS 23 UNITS 14 LETTING 23 YEARS 12 STOREY TOWER MANAGER’S RESIDENCE 2 BED 1 BATH

Hibiscus On The Beach MAIN BEACH, QLD

Manager Wants All Offer Submitted, They Need To Move South. The current manager needs to move to the ACT and wants this sold now. We are excited to present this absolute beachfront short term complex to the market with a net of over $234,000 Only 23 units total in the complex all with two bedrooms and one bathroom the perfect investor building. Current letting pool has always remained stable during the current manager's tenure, and they have done a magnificent job taking the satisfaction rating from 42% to 92% on Booking.com There are a total of 14 two-bedroom one-bathroom units and one converted two bedrooms, one bathroom to a one bedroom one bathroom unit. Majority of the units have had a modern styling upgrade, with only a few more units left for the incoming manager to coordinate with the investors. Due to the location on Hibiscus On The Beach, there is an excellent opportunity to bring some lockups into the rental pool. With the renovated manager's unit, you can turn the one bathroom into a twobathroom two-bedroom unit with one an ensuite to the master and the other a guest bathroom. One of the few remaining absolute beachfront complexes, make sure you secure it now. Short Term Complex Absolute Beach Front 23 Years remaining Net over $212,000 Great family friendly locations Holmans prepared P/L Perfect complex for that management rights journey So much more growth remains

Net Profit $212,727 Price $1,630,000

PAUL MUELLER

BROKER

+61 439 255 507 paulmueller@resortbrokers.com.au

RESORTBROKERS.COM.AU_I S S U E N O . 9 9

MANAGEMENT RIGHTS 64 UNITS 31 LETTING 24 YEARS MANAGER’S RESIDENCE 1 BED 1 BATH

Bayview Tower YEPPOON, QLD

REF // M R 0 0 6 6 9 7

Outstanding opportunity to take a high performing business to the next level Absolute beachfront location, at the epicentre of the Great Southern Barrier Reef. This business will strike the soul with spectacular ocean views, breath taking morning sun rises from every balcony. This outstanding lifestyle business that delivers healthy returns with the potential to grow revenue even further, the vendor is looking to retire and 33 of the 64 units are with outside agents, which means an incoming manager has the opportunity to bring these back into the letting pool and subsequently grow the net profit. Opportunity to grow business as 23 units with outside agents 24 out of 25 years left on the agreements Business would benefit from a full time/hands on operator Motivated vendor Recent renovations of units to 4 star standard Spectacular beachfront location

Net Profit $383,844 Price $1,650,000

IAN CROOKS

CHAIRMAN

+61 411 171 648 ian@resortbrokers.com.au

MARISSA VON STIEGLITZ

OPERATIONS MANAGER +61 437 198 164 marissa@resortbrokers.com.au I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

ON THE MARKET

The cheap lending conditions has flowed through to accommodation operators, both experienced ones and newcomers looking to ‘be their own boss’ and, at the moment, the optimism and confidence in the market is incredible.

WORDS_TRUDY CROOKS MANAGING DIRECTOR

DEMAND RISING FAST Market heats up as economic fundamentals take a turn for the better.

f you cast your mind back about a year ago, remember the uncertainty, trepidation and anxiety that everyone was feeling in the wake of the lockdowns and border closures? Very few people escaped the financial, and emotional, turmoil of that chaotic period and at the time it seemed inconceivable that we would emerge from it at any time in the near future. Fast forward 12 months, and right now there is incredible heat in the market and demand for accommodation businesses has hit unprecedented levels as this upheaval causes a major shift in the way people are thinking and acting. None of us really knows what the future holds, but the Reserve Bank of Australia (RBA) held official interest rates at a record low of 0.10 percent in early May and outlined a rosier-than-expected economic outlook, along with an unusually bold forecast that interest rates won’t be hiked “until 2024 at the earliest”. What this has done is shore up consumer confidence to borrow and spend and the impact of that has been obvious, as lending records continue to be broken month-on-month fuelling a massive residential home price rally right around the country.

RESORTBROKERS.COM.AU_I S S U E N O . 9 9

While these ingredients are heating the accommodation market, not all operators are benefiting from this. Those who rely on international guests will be disappointed at the forecast from the Federal Budget that Australia will remain closed off from the rest of the world, even after a full vaccination program is in place. The international border is expected to remain closed until at least mid2022, however, there is some positive news with the opening of the trans-Tasman bubble allowing quarantinefree travel between Australia and New Zealand. Airlines have been reportedly travelling at near-capacity and this bodes well for other travel bubbles to be opened up. With the international border closures and the subsequent drop off in corporate business in capital cities, one of the major developments driving the industry is a major shift in investment into regional accommodation assets, backed by a surge in domestic tourism. As Australia’s longest established and most experienced specialist agency operating in the accommodation and hospitality sector, we have 30 brokers covering every state and territory across the country and they’re all reporting the same thing – high buyer demand in the regions is driving cap rates up and there isn’t enough stock to cover that demand. With international travel not possible, many Australians have been forced into shifting their travel preferences to intrastate and interstate visitation with drive tourism becoming a major contributor to this massive shift in accommodation demand.

Experienced accommodation operators are well aware of this and they are actively looking for assets which can be income positive in the short term, while remaining solid cash flow businesses in the medium and long term.

The massive surge in domestic & drive tourism is one key factor driving demand

This demand is flowing through to most asset classes, even to management rights businesses on the Gold Coast which struggled through 2020 because of the sudden ‘disappearance’ of international travellers. There’s been a definite improvement on the “Glitter Strip” while the Sunshine Coast and Brisbane management rights businesses are now going for record multipliers and there simply isn’t enough stock to meet demand.

Caravan parks have become hot property and our South Australian Specialist Kelli Crouch recently sold the BIG4 Stuart Range Outback Resort in Coober Pedy and we have 15 parks listed for sale. Operators see them as low-risk investments which often present multiple income streams and produce strong revenue. Motels are also attracting a very high level of enquiry. One of the biggest plays recently was made by renowned regional hotelier Greg Maguire who invested $12 million in the Powerhouse Tamworth by Rydges which transformed the hotel into the only five-star property in the New England region of NSW. Regional accommodation investment fund, Mandala Asset Solutions, also recently added to its portfolio of 18 regional assets with the purchase of the Hunter Gateway Motel for $8.5 million and the Lithgow-based Inzitari family bought the freehold to the Bathurst Heritage Motor Inn to pick up its third regional asset.

CONSIDER THIS

JUNE 2020

55 % CITIES 45 % REGIONAL

- VS -

JUNE 2019

Accommodation revenue split between cities and regional Australia.

36.6 % CITIES 63.4 % REGIONAL

That’s quite a shift and investment is moving with it.

I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

LEASEHOLD MOTEL 19 ROOMS 16 YEARS MANAGER’S RESIDENCE 2 BED 1 BATH

Roma Mid Town Motor Inn ROMA, QLD

REF // L H 0 0 6 7 2 8

19 Room Leasehold Motel in Prime CBD Location Perfectly located within the vibrant Roma CBD, this 19 room Leasehold Motel, ticks all the boxes. The business commands great tariffs with consistent occupancy. No food and beverage is every motel owner's dream. The business is currently being succesfully run under management. Take advantage of the current management style and create your own passive Leasehold business returning 19%+ under full management. Or alternately, add your own style and flair and cruise along with a 30%+ ROI. First timers would be well suited for this leasehold motel business, with the ease of operation. Linen is cleaned off-site allowing you the time to work on your business performance. Chargebacks from local businesses for breakfast and dinner make this one of the easiest motel businesses to run. The motel accommodates a diverse clientele group, including the resources sector, agriculture, transport and sporting groups, to name a few, which provide regular repeat trade. Don't sit on the fence with this one. It is priced to sell now. This business presents in immaculate condition, and the first to inspect, will buy it. Prime CBD Location No Food & Beverage Presents in immaculate condition Bathrooms fully renovated in 2019 Great repeat Clientele 19 ground floor rooms Currently Run Under Management Minimal Maintenance

Net Profit $195,000 Projected Turnover $570,500 Projected Price Offers above $600,000

JASON VOGLER

BROKER

+61 427 431 213 jasonv@resortbrokers.com.au

RESORTBROKERS.COM.AU_I S S U E N O . 9 9

MANAGEMENT RIGHTS

3 COMPLEXES

MANAGER’S RESIDENCE 4 BED 2 BATH

Off-Market Management Rights Opportunity BRISBANE SOUTH SIDE AREA, QLD

Business-Only Management Rights - Will Be Sold! ResortBrokers® is excited to present to you this exclusive off-market management rights opportunity located in the highly sought after Brisbane South Side area. Three complexes with no set office hours and no requirement to live onsite. Ideal for either an experienced operator to add on and expand their business portfolio or a first time buyer to takeover these well established permanent management rights businesses.

Combined net profit $254,329 (incl. 61% contributed by Body Corporate Salary) Located in the highly sought-after Brisbane South Side area 3 x Business Only Management Rights One Manager Unit - not attached to the caretaking agreement, could be sold separately by the incoming manager 61% of net profit is contributed by Body Corporate salary No fixed office hours, no requirement to live onsite on these complexes.

JESSIE SHI BROKER

Net Profit $254,329 Price $2,170,541

+61 422 935 428 jessie@resortbrokers.com.au

REF // MRB006656

MANAGEMENT RIGHTS

5 5 A P A R T M E N T S , 42 LETTING 25 YEARS MANAGER’S RESIDENCE 3 BED, 2.5 BATH

Modern Town House Complex in a Fantastic Bayside Location Fantastic opportunity to purchase the management rights to this immaculately presented permanent complex located in the fast growing Bayside suburb of Deception Bay, close to the water of Moreton Bay. Great business for a first time buyer looking to enter the management rights industry or perfect add-on for an experienced operator in the area. With a workload easily manageable by 1 person and no requirement to live on site, the managers unit could be rented out for extra income - circa $18k per annum. Just Topped Up - Full 25 Years Remaining No Requirement To Live On Site No Set Office Hours Supportive Body Corporate Easy Caretaking Workload

Solid BC Salary with 3% increase annually - 52% of total income Large 3 Bed 2.5 Bathroom Managers Unit with Office Attached Highly Sought After Location with Strong Rental Demand

Net Profit $142,005 Price $1,095,025

Bayside Element DECEPTION BAY, QLD

JEFF KEAST

JESSIE SHI

BROKER

+61 414 669 007

+61 422 935 428

jeff@resortbrokers.com.au

jessie@resortbrokers.com.au

I S S U E N O. 9 9 _RESORTBROKERS.COM.AU REF // MR006687

MANAGEMENT RIGHTS 36 RESIDENCES 20 LETTING 19 YEARS MANAGER’S RESIDENCE 4 BED 2.5 BATH

Surfers Palms Central B E N O WA , Q L D

REF // M R 0 0 6 6 6 7

Changing of the guard! This Permanent Management Rights business has been operated by the same family for 14 years and now that the kids have moved out of home, it's time for the vendors to do the same. With 36 residences in the complex and 20 in the manager's letting pool, this business has been a consistent performer for the entire 14 years. One of the vendors has a full time job outside the complex and is not part of the operation of the business at all. The business is very comfortably operated by one person and still leaves time for fishing and golf on a weekly basis. The manager's residence is a very comfortable stand alone 4 bedroom 2.5 bathroom home with undercover patio, fenced yard for the dog, single lock up garage and double car port. There is an additional office attached to the residence which is on title to keep work and home life separate. Long term caretaking and letting agreements of 19 years are in place and the relationship with the Body Corporate Committee is excellent. The complex presents beautifully, is neat as a pin and is ready for the next operator to walk in and take over the wheel for the next voyage. An inspection will certainly impress, so don't delay, call Steve today! 19 years remaining on agreements Easily managed by 1 person Excellent and quiet location In the catchment of the best schools on the Gold Coast Experienced vendor to assist with all training required No Set Office Hours Enjoy the Gold Coast Lifestyle today!

Net Profit $113,190 Price $1,095,000

STEVE CAMPBELL

BROKER

+61 407 220 668 steve@resortbrokers.com.au

RESORTBROKERS.COM.AU_I S S U E N O . 9 9

FREEHOLD MOTEL 60 ROOMS SET ON 12 ACRES

EXPRESSIONS OF INTEREST

Rivers Apartments & Motel SALE, VIC

REF // F H 0 0 6 7 3

Pristine Motel, Ripe For Experienced Management This is your chance to secure an outstanding freehold motel which has been renovated and meticulously maintained in the major regional centre in East Gippsland. Just two hours by car from Melbourne, Sale is a popular tourist destination and also benefits from being an important farming and livestock community. The 60 room motel needs nothing spent on it and is perfectly positioned for experienced management to take over and capitalise on the immaculate property located in a high-demand destination. Sale has undergone major infrastructure investment recently, including the multimillion-dollar redevelopment of the city's Port of Sale, upgrades to the RAAF base, Gippsland Base Hospital, and the Longford Gas Plant expansion. 60 quality refurbished rooms with twin or double beds Nothing to spend Set on 12 acres of lush greenery overlooking lakes Permits for permanent, long and short term accommodation Perfect for experienced management to take it to next level Diversified income over short term and long term worker bookings Manager’s residence is 4 bedroom Fully licensed bar Wood-fired pizza shop Just 5 minutes from Sale town centre Two share kitchen facilities with fridges, stoves, microwaves and dishwashers Large common area with TVs, Netflix, pool table

Net Profit On Request Turnover On Request Price Expressions of Interest

TRUDY CROOKS

DAVID JEFFERIES

MANAGING DIRECTOR

BROKER

+61 477 882 210

+61 447 101 970

trudy@resortbrokers.com.au

david@resortbrokers.com.au I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

FREEHOLD MOTEL 17 ROOMS

PERMANENTLY TENANTED EASY MAINTENANCE

Rosedale Motel ROSEDALE, VIC

REF // F H 0 0 6 7 3 3

Permanently Tenanted, Freehold Opportunity How would you like to own a freehold motel that has the workload of a passive investment, while delivering the returns of a going concern? The Rosedale Motel in the central Gippsland region does exactly that, thanks to the fact that the 17 room property is permanently tenanted to a labour hire company which supplies vegetable workers to farms in the area. For just $1.4 million down, you can receive $136,600 in annual rent. Try getting that kind of return anywhere else, seriously. Rosedale is a pastoral and agricultural town 184 kilometres east of Melbourne on the Princes Highway, or two hours by car, and is just a 25 minute drive to the major regional town of Sale in East Gippsland. Because of the ongoing tenancy, very little maintenance is needed. All you need to do is organise the cleaners every fortnight. That’s it. 17 rooms Permanently tenanted to labour hire company Like having a passive investment with the financial benefits of a going concern Potential for solid revenue growth based on increased occupancy/tariffs Very little maintenance Full renovation 2017 with Depreciation Tax Benefits Commercial Kitchen & Recreation Room Approved Accommodation Under Government Seasonal Worker Program Highway frontage on Princes Highway

Net Profit $136,600 Turnover $183,300 Price $1,400,000

DAVID JEFFERIES

RESORTBROKERS.COM.AU_I S S U E N O . 9 9

KELLI CROUCH

BROKER

+61 447 101 970

+61 410 441 750

david@resortbrokers.com.au

kelli@resortbrokers.com.au

MANAGEMENT RIGHTS 38 UNITS TOTAL 25 YEARS & 10 YEARS

Verde Monte & Villa Rinella M O U N T G R AVAT T E A S T & S U N N Y B A N K , Q L D

REF // M R C 0 0 6 7 1 8

Two new complexes! Caretaking only Management Rights on Brisbane's South side ResortBrokers has been appointed to sell a brand new complex and a near new complex Caretaking agreements. The first complex is Verde Monte located in Mount Gravatt East is nearing completion and is an Accommodation module with 25 years remaining featuring 22 units. The other is Villa Rinella, comprising 16 units in nearby Sunnybank which is almost brand new and on a Standard Module. Both have very easy and limited duties which make this a perfect add on business for a nearby operator. These are the hottest assets on the market so will sell very quickly! Grossing $36,909 2 complexes in close proximity Very easy Caretaking duties One brand new and one near new complex No real estate to purchase No office hours Next to no facilities such as pools etc.

Gross Profit $36,909 Price $185,000

JESSIE SHI

NATHAN EADES

BROKER

+61 422 935 428

+61 448 339 920

jessie@resortbrokers.com.au

nathan@resortbrokers.com.au I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

MOTEL F R E E H O L D G O I N G CO N C E R N

24 ROOMS

MANAGER’S RESIDENCE 3 BED 1 BATH

Tropixx Motel INGHAM, QLD

REF // F H 0 0 6 5 9 6

Strong Trading Motel, in a richly diverse location If you’re looking for an already-successful Freehold Going Concern in an outstanding location with huge potential this is a must inspect. The original owners have developed this motel from new to the highest standard and all 24 rooms are well-appointed and maintained. In fact, the current vendors pride themselves on the clean and well-presented rooms which are a mix of twin, queen and family accommodation with multiple letting opportunities of disabled rooms and a pet friendly room. The business incorporates a very successful restaurant, Flames at Tropixx restaurant with seating capacity of 40 inside and 40 outside. This will provide the incoming operator an additional income stream. The motel enjoys a strong repeat corporate clientele and often hosts regular holiday makers from around North Queensland due to the tourist locations and events hosted in the town. The owner’s residence is a spacious three bedroom, fully air conditioned unit. It has recently been painted throughout and fitted with a modern kitchenette and living area, as well as a private laundry. In addition there is also a private courtyard for outside enjoyment.

Full highway frontage on the Great Green Way Great family lifestyle in a friendly country town Fully air-conditioned, spacious, self-contained 3 bedroom manager’s residence Facilities: swimming pool, wifi, BBQ facilities, Disabled facilities, guest laundry Low maintenance construction & gardens Walking distance to acclaimed Tyto Wetlands and Arts Precinct

Net Profit 6 MONTHS JULY/ DEC 2020: $246,723 FINANCIAL YEAR 19/20: $199,094 Turnover

6 MONTHS JULY/ DEC 2020: $425,796 FINANCIAL YEAR 19/20: $661,523

Price

$2,400,000

DES FAGG

BROKER

+61 427 849 119 des@resortbrokers.com.au

RESORTBROKERS.COM.AU_I S S U E N O . 9 9

siStylgnature le openi ng theiesr gidoors to a boomithengfreedom market toof lretai eisure,n theicorporate ish, unistylquees and and personal luxurious.itiOures, whiupscal e properti ve operators r own Stylish, unique andthe luxurious.freedom Ourandupscal eence-seeki propertitoens ggiretain ve operators thetheir freedomown to retain their own ve operators experi travel l e rs al i k e. signature styl e s and personal i t i e s, whi l e openi n g thei r doors to a boomi n g market of l e i s ure, corporate Elevate your hotel business. si g nature styl e s and personal i t i e s, whi l e openi n g thei r doors to a boomi n g market of l e i s ure, corporate oors to a booming market of leisure, corporate Elevate your hotel business. Elevate your hotel business. otel business. experi e nce-seeki n g travel l e rs al i k e. Join and Choice Hotels Asia-Pac Join Choice Hotels Asia-Pac To enqui r e about the regi o n’ s l a rgest franchi s e hotel group wi t h over 300 properti e s across Asi a Paci fi c Join Choice Hotels Asia-Pac els Asia-Pac and experi e nce-seeki n g travel l e rs al i k e. travellers alike. s.com.saeuhotelor contact manager To enquire aboutvistheit JoireginChoi on’s lcaeHotel rgest franchi group wiatdevel h overo300pmentproperti es across Asia Pacific To enquirover e about the300 region’sproperties largest franchise hotel group with overAsia 300 propertiPacific es across Asia Pacific up with across visit JoinChoiceHotels.com.au or contact a development manager visit JoinChoiceHotelmanager s.com.au or contact a development manager act a development ™

Scott Armstrong

™ ™ ™

Tim Mayoh

Memorable, boutique, unique. Get together here. boutique, Get service together here. TheMemorable, world’s first and largest unique. soft brand. Upscale-full accommodation. Memorable, boutique, unique. Get together here. Memorable, boutique, unique. The world’s first and largest soft brand. Upscale-full service accommodation. The world’s first and largest The world’s soft first and brand. largest soft brand. Upscale-full service accommodation.

Devel pment Manager, Devel opment Manager, ScottoArmstrong Tim Mayoh Scott TiNSW,m Mayoh Tim Mayoh VIDevel C, SA,oArmstrong WA, TAS NT pment Manager, DeveloACT,pmentQLD,Manager, Development Manager, Development Manager, Development Manager, VIC, SA, WA, TAS NSW, ACT, QLD, NT VIscott.C, SA,armstrong@choi WA, TAS cehotelNSW, QLD, NTcehotels.com s.com ACT, QLD, NT NSW, tim.mACT, ayoh@choi

Stylish, unique and luxurious. Our upscale properties give operators the freedom to retain their own signature styles and opening their give doorsoperators to a booming market to of leisure, corporate Stylish, unique and personalities, luxurious. Ourwhile upscale properties the freedom retain their own Stylish, unique andthe luxurious. Our upscale properties give operators the freedom to retain their own ve operators f reedom to retain their own and experience-seeking travellers alike. signature styles and personalities, while opening their doors to a booming market of leisure, corporate signature styles and personalities, while opening their doors to a booming market of leisure, corporate oors to a booming and market of leisure, experience-seeking travellers alike. corporate To enquire about the region’s largest franchise hotel group with over 300 properties across Asia Pacific and experience-seeking travellers alike. travellers alike. visit or contact a development manager To enquire about theJoinChoiceHotels.com.au region’s largest franchise hotel group with over 300 properties across Asia Pacific To enquire about the region’sproperties largest franchise hotel group with over Asia 300 properties across Asia Pacific up with over 300 across Pacific visit JoinChoiceHotels.com.au or contact a development manager act a development visit JoinChoiceHotels.com.au manager or contact a development manager

Scott Armstrong

Tim Mayoh

+61scott.409armstrong@choi 735 231 cehotels.com +61tim.448 505 660 cehotels.com mayoh@choi scott.armstrong@choicehoteltim.mayoh@choicehotels.com s.com tim.mayoh@choicehotels.com +61 409 735 231 +61 448 505 660 +61 409 735 231 +61 448 505 660 +61 448 505 660

Development Manager, Development Scott Armstrong Tim Mayoh Manager, Tim Mayoh Scott Armstrong Tim Mayoh VIC, SA, WA, TAS NSW, ACT, QLD, NT Development Manager, Development Manager, Development Manager, Development Manager, Development Manager, VIC, SA, WA, TAS NSW, ACT, QLD, NT VIC, SA, WA, TAS NSW, ACT, QLD, NT NSW, ACT, QLD, NT scott.armstrong@choicehotels.com tim.mayoh@choicehotels.com +61 409 735 231 +61 448 505 660 scott.armstrong@choicehotels.com tim.mayoh@choicehotels.com tim.mayoh@choicehotels.com scott.armstrong@choicehotels.com tim.mayoh@choicehotels.com +61 409 735 231 +61 448 505 660 +61 409 735 231 +61 448 505 660 +61 448 505 660

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41 29

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REGIONAL SPOTLIGHT

Des Fagg

NTH QLD With one of the most diverse economic bases in Australia, North Queensland has been able to ride through the pandemic, despite the challenges placed on the tourism and accommodation industry.

he North Queensland accommodation market was hit hard at the outset of the pandemic in March and April, like the rest of Australia, and for most of 2020 there was a slow and steady recovery of sorts. While there is very little hard data on occupancy and RevPAR, Townsville Enterprise reports that interstate travel declined by 74 percent from September 2019 to September 2020, and international travel dropped by 52 percent over the same period of time. Those numbers appear pretty grim but as we entered 2021 that ‘slow and steady’ recovery turned to ‘speedy’ and now accommodation operators are telling me that they’re either getting back to normal or even doing better than before the pandemic. The reason for this? There are many reasons, but basically a lot of it is down to the surge in domestic tourism caused by international and state border closures, backed by Tourism Australia promoting its ‘holiday here this year’ campaign to

RESORTBROKERS.COM.AU_I S S U E N O . 9 9

support regional tourism. Since June 2020 operators in Airlie Beach are saying it’s the best year they’ve had for a long time as a lot of people are heading up this way for their holidays. For the same reason, Magnetic Island off the coast of Townsville is doing very well. Both these places are ideal tourist/getaway destinations and, as such, they’re pretty much fully booked on weekends and at school holidays, much like the situation on the Sunshine Coast. Demand in Mackay is somewhat softer although I did sell a large management rights portfolio in the city to John Zeckendorf of Mandala Asset Solutions for just over a million dollars. A lot of this is down to the fact that we have had no cases of COVID-19 up here and people from the southern states have been heading up this way. One of the other interesting developments on the accommodation front is that the caravanners and RV crowd stayed around in North Queensland for the hot and humid summer, whereas they would normally head back down south to cooler places before November. Cabins in most parks are running full. Even in Charters Towers, which

Des Fagg BROKER

is an hour and a half south west of Townsville, there is strong demand and the operators of the Big4 Aussie Outback Oasis Holiday Park say they’re doing their best trade since they took over three years ago. So, this increase in domestic tourism numbers being driven by the pandemic is a major driver of the accommodation industry, however, the overall economic fundamentals will also help the sector over the next decade at least. Despite the once in a hundred-year flooding event in 2019 and the economic ramifications of the COVID-19 pandemic, business confidence in Townsville is at its highest point in 14 years.

North Queensland Fast Facts:

Des has sold and settled on eight properties in the last quarter. These include a mix of management rights, motel leaseholds and a passive investment in a caravan park. He has a further five that are unconditional.

GRP: $41 billion

Population: 413,000

Industry diversity: all 19 industry sectors represented with over 16,000 businesses

Provides direct access to Great Barrier Reef and Whitsundays

Townsville has the largest general cargo and container port in northern Australia

Largest Australian defence base located in Townsville

Two universities (JCU & CQU) and HQ for Australian Institute of Marine Science and Great Barrier Reef Marine Park Authority

Mackay is home to the biggest mining services support centre in the southern hemisphere

The Bowen Basin and Galilee Basin coalfields use Port of Mackay which employs 1,800 people

Overall, the Townsville and North Queensland region has remained resilient during the economically uncertain time. The easing of restrictions and the start of the NRL season has resulted in an increase in activity in Townsville’s inner city, with the full capacity utilisation of the Queensland Country Bank Stadium. This is likely to further increase hotel occupancy rates and subsequently business revenue within the CBD. Key infrastructure projects will support business confidence into the future by generating economic activity and job creation. Key underway projects include: The Armoured Vehicle Simulation Centre ($31 million), Australian-Singapore Military Training Initiative ($1 billion), Reef HQ Aquarium Refurbishment ($40 million) and the Townsville Port Expansion ($193 million). The accommodation sector benefits directly from this type of investment as government and corporate workers need to stay somewhere and many operators are able to provide semipermanent arrangements which provide a reliable, and significant, stream of revenue to their businesses. These workers also travel locally for holiday purposes and the coastal resort

towns like Airlie Beach and Bowen receive a direct benefit from these types of infrastructure investment. From Hinchinbrook in the north, to Townsville, Bowen, the Whitsundays and Mackay on the coast to the inland regions of Charters Towers, Mt Isa and the Bowen Basin, North Queensland is home to just under half a million people and is an economic powerhouse that is key to Queensland’s economy. The North Queensland region has one of the most diverse economic bases in Australia and enjoys a stunning natural environment of reef, rain forest and outback which all combine to provide tourism growth opportunities and an attractive lifestyle for its residents. It is also one of the most naturally beautiful and resourcerich locations in Australia, from the largest coal mining deposits in Australia - in the Bowen and Galilee basins - to the iconic Great Barrier Reef and Whitsunday Islands. This combination has helped North Queensland ride through the pandemic, despite the challenges placed on the tourism industry.

Major Infrastructure Projects: $2.25 Billion +

Singapore Australia Military Training Initiative

$2 Billion +

Adani Carmichael Mine Project

$300 Million +

Sun Metals Zinc Refinery expansion

Stage 1 & 2 +

of the Haughton Pipeline Duplication Project

$193 Million +

Port of Townsville Channel Widening

I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

DEVELOPMENT SITE F R E E H O L D C A R AVA N PA R K 33 LARGE CABINS 4,898m2 BLOCK CONSISTING OF PARK 3,277m2 BLOCKS SURROUNDING THE PARK

Paradise Park Cabins LONG JETTY, NSW

REF // F H 0 0 6 5 7 4

Developers Dream! Huge waterfront block on the Central Coast! Rarely does a TORRENS TITLE waterfront property with 5 surrounding blocks become available in the heart of the Central Coast, but now is your opportunity to secure one of the longest standing parks on the Coast. The Vendors have run the park with no marketing and only through word of mouth and it still turns over just shy of $570k so if you are looking for a business with upside this is the opportunity for you. This turnover is not including rental potential of the houses. To add to this, if you are looking for prime waterfront real estate to develop into residential and commercial this property ticks all the boxes. In the thriving area of Long Jetty, Paradise Park Cabins and surrounding blocks will be highly sought after as the area is being snapped up by Developers. To add to this Development consent may be granted to subdivide the land into small lots providing increased lots. Multi zoning creates an opportunity to construct mixed-use development with dual occupancy on 300 m2 blocks A DA has been lodged and pending approval so don't wait to secure this magnificent opportunity. Prime Waterfront Park Highly motivated Vendors 3 additional houses, 5 flats and 1 vacant block Application for DA lodged with Council Successful Park with ample room for growth Mixed use development opportunity Zoned B2 local centre & R2 Low-density residential which will accommodate retail, multistory apartments, adaptable living, daycare and other similar businesses.

Park only Turnover $569,500 Park only Price $7,000,000 Park and Surrounding Blocks $11,000,000

JACQUELINE FEATHERBY

BROKER

+61 424 497 056 jacqueline@resortbrokers.com.au

RESORTBROKERS.COM.AU_I S S U E N O . 9 9

MOTEL FREEHOLD GOING CONCERN 15 ROOMS MANAGER’S RESIDENCE 2 BED 1 BATH

Colonial Lodge Motor Inn YA S S , N S W

REF // F H 0 0 6 6 7 7

Outstanding Freehold Motel in NSW Regional Town The Colonial Lodge Motor Inn Yass offers the astute investor a great opportunity to take over this independent boutique motel with a solid record of strong returns. The motel enjoys a location close to all amenities of the main town precinct whilst also being quiet. It is AAA rated 3 1/2 star and has been consistently rated as the number 2 motel in Yass by TripAdvisor for the last seven years. Reviews on TripAdvisor comment on its comfort, space, location and good rates. The motel comprises 15 well presented rooms that have been refurbished with new bathrooms and the most recent improvements in 2020 include the 5 new superior rooms with kitchenettes. All rooms now have 50” smart TVs, reverse cycle air con/heating and microwaves. The bathroom in the manager's residence has also been refurbished. The upgraded rooms have resulted in an increased revenue for the motel. Located just off the Hume Highway the motel enjoys a solid repeat business with opportunity to build the business further with weekend and short stay break clientele from Sydney as they explore new food and wine experiences and trails in the Canberra Wine District. Solid repeat business on Melbourne - Canberra - Sydney route Well maintained colonial style building in brick and tile 15 room motel comprising of deluxe queen, superior queen & deluxe twin rooms Consistent performer with high occupancy Large 1,833.7 sqm corner block Recently renovated

Price $2,300,000

RUSSELL ROGERS

CHRIS KELLY

SENIOR EXECUTIVE

BROKER

+61 416 166 909

+61 431 055 221

russell@resortbrokers.com.au

chris@resortbrokers.com.au I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

Why Getting A Valuation On A Manager’s Unit is so Important Herron Todd White Director Chris McKillop and Valuer Stacey Sager – Sunshine Coast specialists - outline the reasons why it’s in the best interests of both buyers and sellers of management rights to add a valuation onto the due diligence process. FIRSTLY, WHY GET A VALUATION DONE WHEN BUYING A MANAGER’S UNIT IN A MANAGEMENT RIGHTS?

Valuations of a manager's unit can be an important tool for both vendors and purchasers. Pre-sale valuations aid the agent and vendor in the marketing campaign, ensuring that the unit is set at a fair and realistic price that they are confident can be achieved. Pre-purchase valuations can also be beneficial for a buyer to ensure that they are purchasing a property at market value. Both valuations are helpful within the sales process, as we have seen disagreements in unit price as a major reason why some sales have not progressed past the contract stage.

IS IT DIFFERENT TO BUYING A STANDARD RESIDENTIAL HOUSE OR UNIT?

Manager's residences are different to standard residential houses or units in a number of ways. Firstly, the caretaking agreements generally state that the manager's residence cannot be sold separately to the management rights. This requirement limits the buyer pool to those wanting to purchase management rights and those buyers have different drivers for purchase to traditional real estate purchasers - for example assessing the liveability of a unit compared to an investor seeking returns or views. Manager's units also have additional commercial areas held on title, exclusive use or occupation authority, which have an added value. However, given the strong market and the increase in prices of residential units in some areas, the addition of a management rights business could be construed as an encumbrance to the residential value.

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WHAT’S HAPPENING WITH THE MARKET ON THE SUNSHINE COAST AND WHAT IS DRIVING IT?

The real estate market on the Sunshine Coast is extremely strong at the moment. We have seen significant demand for residential property across the Sunshine Coast over the past 18 months, with the period of March 2020 to June 2020 having a slow-down. Particularly since June 2020, we have seen demand and value levels increase to various degrees across the region. Each location is different and the impacts on values have been different in these locations as a result. While the market for traditional real estate is strong, as we mentioned, the buyer pool for manager's units and rights is limited and the competition from buyers which drives property prices is not as strong to that noted above.

ARE ONLINE REAL ESTATE TOOLS WHICH PROVIDE ANALYTICS HELPFUL IN THIS MARKET?

Typically sources of information such as RP Data are up to three months behind reporting settlements of properties. With the market as strong as it is at the moment, this can often mean that the information is dated by the time it is recorded. We have the largest valuation team on the Sunshine Coast with over 15 valuers servicing both the residential and commercial markets, which ensures our information is up to date and relevant and we can rely upon information gathered by valuing units under contract in the area by our residential team.

WHAT ARE THE KEY THINGS YOU’RE LOOKING AT WHEN DOING A VALUATION?

A manager's residence comprises both residential and commercial components, which we are assessing when we complete a valuation. This includes the typical residential components of location, quality of improvements, view and amenity of the unit and complex. However, it also includes the usability of the manager's office, additional store rooms and car parking, and whether this is appropriate for the size of the complex and requirements of the management rights business.

HOW MUCH DO THEY COST?

The cost of a pre-purchase or pre-sale manager's unit valuation is usually between $770 to $1,100, depending upon the individual property.

ANY OTHER ADVICE FOR BUYERS/SELLERS?

In our experience, valuations of the manager's unit are just as important for vendors as any other pre-sale information such as accountant reports. They provide peace of mind that the manager's residence achieves the best price possible in the current market, and ensures there should be no issues when it comes time for the buyers to obtain finance approval.

Chris McKillop 0419 704 815 chris.mckillop@htw.com.au

Stacey Sager 0401 268 884 stacey.sager@htw.com.au

LEASEHOLD HOTEL

25 ROOMS 27 YEARS

2 STOREY BUILDING MANAGER’S RESIDENCE 2 BED 1 BATH

Best Western Airport 85 Motel ASCOT, QLD

One of the best medium sized motels in inner Brisbane! Best Western Airport 85 Motel is perfectly located only 10 minutes from Brisbane Airport. Situated in a quiet, highly sought after location within sub tropical gardens. The motel has modern décor, is extremely well maintained with most rooms featuring king sized beds. There is 27 years left on an extra long lease and despite the obvious impact of COVID this is one of the first motels to bounce back and is well advanced in it's recovery! Best Western Airport 85 Motel is a 25 room, two story brick motel featuring ample parking, an onsite in-ground pool and spa and a small dining room offering breakfast to all guests also has a fully renovated full sized two-bedroom manager unit.

Average pre COVID monthly turnover in excess of $75k (8 months) Long lease with 27 years remaining Great condition, no major work to be done Modern, clean and fantastic online ratings Strong and loyal customer base Genuine reason for sale

Net Profit $122,887 (unadjusted for COVID) Turnover Avg. $76k/month pre-COVID Price Offers over $650k

NATHAN EADES

BROKER

+61 448 339 920

nathan@resortbrokers.com.au

REF // LH006714

Set On 1.75 Acres Of Picturesque And Tranquil Gardens LEASEHOLD HOTEL 26 ROOMS MANAGER’S RESIDENCE 3 BED

Here is your chance to purchase this beautifully presented 26-unit leasehold motel which includes a beautiful one bedroom honeymoon suite. Located in the heart of Eden, the motel is only minutes from amenities and provides easy access to the area's attractions. The Eden Motel offers quality rooms that are comfortable, modern and well priced, along with resort facilities such as an indoor heated swimming pool (11 metre), fitness equipment, table tennis, BBQ area and licensed reception kiosk.

Eden Motel EDEN, NSW

26 rooms, including one bedroom honeymoon suite Indoor heated pool Massive gym & children’s game room open to the public Large restaurant & commercial kitchen (Not currently in use) All motel rooms have kitchenettes and are fully self-contained

Net Profit $209,425 Turnover $529,049 Price $485,000

RUSSELL ROGERS SENIOR EXECUTIVE +61 416 166 909 russell@resortbrokers.com.au

I S S U E N O. 9 9 _RESORTBROKERS.COM.AU REF // LH006348

LETS GET

SOCIAL

MANAGEMENT RIGHTS MADE EASY

BRISBANE SAT 12TH JUNE 9AM

As industry leaders, we’re always looking to host events to help educate everyone in our network and we also attend Australia’s major conferences. EVENTS

CARAVAN INDUSTRY ASSOCIATION OF AUSTRALIA NATIONAL CONFERENCE

AUSTRALASIAN HOTEL INDUSTRY CONFERENCE AND EXHIBITION

GOLD COAST

ADELAIDE

Greg James and Russell Rogers, two of our caravan parks specialists, were our brokers on the ground at Australia’s premier event for the industry which was the perfect opportunity for making new business contacts.

Our Managing Director Trudy Crooks & Kelli Crouch were among the nation’s leading figures in the hotel industry for this prestigious event as AHICE was held in Adelaide for the first time.

MANAGEMENT RIGHTS MADE EASY EVENT

MOVERS & SHAKERS LUNCH

GOLD COAST

NOOSA

This was a very successful event hosted by our Gold Coast team of Todd Warner, Paul Mueller and Steve Campbell. More than 30 people turned out to network and find out what’s happening in the industry.

After a hiatus of just over year, our Sunshine Coast duo of Glenn Millar and Chenoa Daniel hosted their Movers and Shakers lunch event at the always popular Alexandra Headland Surf Club.

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Movers & Shakers Lunch N O O S A

“It was the first real time we could have this get together with restrictions in almost a year and the feedback was outstanding from everyone who turned up. We were expecting a good turn out, but this was even better than we thought.” - Glenn Millar

MCG QUANTITY SURVEYORS

Obligation Free Quotes

YOUR HOSPITALITY EXPERTS

We specialise in preparing Tax Depreciation Schedules & Asset Registers Maximise your deductions for both Freehold & Leasehold

PH: 1300 795 170 WWW.MCGQS.COM.AU CONTACT@MCGQS.COM.AU

Australia wide service

Hotels

Motels

Resorts

Pubs

Caravan / Cabin Parks

Flat Fee for Insurance Replacement Cost Estimates* *Tax Depreciation Schedules & Asset Registers quoted on a case by case basis

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PANEL Q&A

Coping with the Covid Crisis

Q&A

We asked some of Australia’s biggest accommodation operators how they handled the onset of the crisis and what strategies they’re adopting to move forward in this unpredictable environment.

that helped us navigate the varying border closures and several tactical messages that allowed us to increase direct business for our hotel franchisees. AS THE SAYING GOES ‘EVERY CRISIS HAS AN OPPORTUNITY’. WHAT OPPORTUNITY DID YOU SEE?

Trent Fraser CEO, CHOICE HOTELS AS I A - PAC IN TERMS OF MARKETING YOUR PROPERTIES, WHAT WAS YOUR INITIAL REACTION WHEN COVID-19 HIT AND, IF YOU COULD GO BACK IN TIME, WOULD YOU DO THINGS DIFFERENTLY?

When the lockdowns first occurred, our focus was to stay calm and let our franchisees know that we were there to support them, we did this through several fee relief initiatives. And leveraging our sales team to capture essential services business. Initially we did pause a number of marketing activities to allow us time to assess the situation and prepare a series of recovery marketing strategies, tactics and campaign messaging. Although during this time we did maintain some ‘always on’ digital activities such as Google AdWords where we were able to adjust the campaign messaging quickly and by location. By the time the first lockdown ended we were quickly back in market, launching our major PR activity called “100 Untold Stories”, were on radio in every market across the country and scaling up our digital activities in line with consumer confidence. In addition we were able to communicate and activate our 450,000 strong database with relevant and timely offers. We used an agile marketing strategy

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We prioritised the focus on our franchisees’ business health and implemented fee reductions in-line with their lower accommodation revenue. We ensured we were in regular contact with franchisees and clients offering support where we could and keeping them up to date on the various support programs/services which were available. We entered the pandemic with a healthy balance sheet and, courtesy of our focus on the select-service midmarket, we performed really strongly in 2020. We exceeded our RevPAR index over our CompSet by 10 percent in Australia, onboarded more staff at a corporate level to help facilitate the uplift in demand for a lot of our regional properties, and were able to direct our focus towards strategic nonorganic growth opportunities throughout Asia-Pacific. AS FOR STAFFING, WAS IT DIFFICULT MAINTAINING MORALE AND IF SO, HOW DID YOU OVERCOME IT?

From the outset of the pandemic our goal was to protect the jobs of our associates and we managed to do that. As a result we were able to support our franchisees through the crisis, to be ready for the recovery and we knew retention of talent was going to be critical along this journey. We had already started to implement flexible work practises prior to the pandemic but we ensured everyone had access to the equipment required to work remotely for a sustained period. We held daily/weekly Zoom checkins with team members to allow the opportunity to just talk and share feelings and allowed flexible working hours

tailored to each employee depending on their situation especially when schools/ childcare centres were closed along with access to mental health support services for associates and their families. The efforts by our leadership team over the past 12 months culminated in Choice Hotels Asia-Pac being recognised as a finalist in the 2021 AFR BOSS Best Places to Work list, coming second in the retail, hospitality, entertainment and tourism category, which we’re proud of! HOW HAS YOUR GUESTS’ BOOKING HABITS CHANGED?

There are two key booking habit changes that we have noticed. Average length of stay on average has not changed and has remained reasonably consistent with prepandemic times, however we have seen a reduction in lead time as guests remain wary of the conditions around them. A positive booking habit change that Choice Hotels has seen is the significant increase in direct bookings through choicehotels.com. Despite the pandemic, Choice Hotels saw an increase in direct delivery of 11 percent in 2020 compared with 2019. And so far in 2021, we’re averaging a further increase of 48 percent. Furthermore, we’ve significantly reduced the ration of direct to OTA bookings. We believe this is a combination of guests having greater trust in brands such as Choice who, during the pandemic, could clearly communicate our cleaning protocols and refund policies in addition to our marketing strategy which was to remain visible in market. WHAT NOW FOR THE MEDIUM AND LONG TERM. HOW DO YOU KEEP YOUR ROOMS OCCUPIED?

In the medium and long term, we will focus on three pillars to drive reservations: brand, loyalty and digital. Our dynamic sales team will leverage data insights and work with our hotels to maximise corporate delivery.

AS THE SAYING GOES ‘EVERY CRISIS HAS AN OPPORTUNITY’. WHAT OPPORTUNITY DID YOU SEE?

Grant Wilckens C E O & CO - F O U N D E R , D I S CO V E R Y H O L I DAY PA R K S

IN TERMS OF MARKETING YOUR PROPERTIES, WHAT WAS YOUR INITIAL REACTION WHEN COVID-19 HIT AND, IF YOU COULD GO BACK IN TIME, WOULD YOU DO THINGS DIFFERENTLY?

Celebrating a strong first half of the FY20 financial year, little did I know that ahead of me lay the biggest challenge of my career. As a tourism business with an ambitious strategy for growth and a network of near 300 properties across Australia, a pandemic certainly wasn’t in our annual plan. With the pandemic hitting tourism businesses hard, we took action early. Our crisis management team shifted to a COVID-19 focus with safety, people, operations and communication working collaboratively to manage fast moving change. We have been fortunate that as our business has grown we have solidified the skills and experience in our leadership suite and built a culture of empowerment – meaning our team could take strong action fast without being hampered by unnecessary internal red tape.

What became clear early in the pandemic was that we needed to pivot our revenue streams Over the years we have proactively expanded to a ‘mixed’ park model, incorporating workforce parks to complement our tourism offering. Through the rise of the pandemic, we focussed our efforts on corporate clients to keep the business in motion, providing accommodation for stranded FIFO workers in northern WA, and over the last few months our workforce parks have more than performed. We also took the front foot in actively petitioning government health departments to promote our cabin accommodation as an option for selfisolation as opposed to hotels. Our efforts were noticed, and as restrictions began it ease, particularly in South Australia, we collaborated with the Marshall government to build the story of caravan and holiday parks emerging as a holiday of choice for people looking to travel locally, in open space and fresh air, while remaining socially distant. AS FOR STAFFING, WAS IT DIFFICULT MAINTAINING MORALE AND IF SO, HOW DID YOU OVERCOME IT?

As our 130-person strong head office moved to working from home and parks were closed, we reviewed how we would keep connected, engaged and collaborative

as we navigated changes and restrictions. A national business headquartered in South Australia, we are used to communicating to a geographically disperse workforce, but COVID-19 brought this into a harsher relief as we were forced to deliver difficult messages and employee stand downs remotely rather than in person. Leadership is not about you, it is about the people around you, and I don’t mind saying it was an emotional time for me. Being available, accessible and upfront through this period was high on my priorities, as was doing all we could for our people and the future of our business. We established weekly online catch ups and tried to focus on positives where possible to maintain a forward-facing culture. We recognise that the culture of our business has shifted, in particular in how our people have valued greater flexibility and connectivity, and this will factor into how we work in the ‘new normal’. WHAT NOW FOR THE MEDIUM AND LONG TERM. HOW DO YOU KEEP YOUR ROOMS OCCUPIED?

We have implemented contactless check-in and other initiatives at reopened parks to keep customers and staff safe. As restrictions and borders have eased the green shoots for our industry are beginning to show, and we are faced with a fresh opportunity. It’s been pleasing to be able to return to a voice of positivity and to showcase the resilience of our industry and, importantly, the resilience of our people.

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Graham Perry M A N AG I N G D I R E C TO R , BEST WESTERN AUSTRALASIA

IN TERMS OF MARKETING YOUR PROPERTIES, WHAT WAS YOUR INITIAL REACTION WHEN COVID-19 HIT AND, IF YOU COULD GO BACK IN TIME, WOULD YOU DO THINGS DIFFERENTLY?

I was due to head off on vacation the day after the international borders closed. I came home that night and told my wife I couldn’t go and instead spent the whole weekend with my senior team planning our response. The whole world had just changed and we realised we had to respond and adapt quickly. Our first concern was our hotels and our staff. We knew performance would be impacted. International business would stop and uncertainty and confidence would set in. We had learnt from the bushfires that contingency plans were needed and they needed to be applied on a location by location, hotel by hotel approach. We knew most of our hotels would struggle to pay their bills including fees and rents. On the Monday we offered fee relief associated with our fixed fees to our hotels and didn’t wait to be asked. The roles of many of our staff wouldn’t be needed so we identified the roles that had become redundant in the short term but would be needed in the long term and those that would be redundant in the long term. In terms of the former we converted our revenue managers, customer service and training and regional service managers into Account Managers and allocated each of them with no more than 10 hotels each to look after. We asked them to call their hotels several times a week, if not daily, to check above all on their health and wellbeing (it can be lonely running a hotel), their finances, revenue strategies, operational needs and local sales and marketing. We also decided on weekly local projects for them to deliver – be it rate reviews, local content refreshes etc. We turned everything upside down with a good example being sales. We worked locally to identify any and every source of local business – be it essential staff, locals needing to self-isolate, local corporates needing to work away from

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home etc. We introduced local sales and marketing kits and local media kits for our hotels to reposition themselves as “Your Local Home Away From Home”. Nothing was off limits. We have grown stronger as a team with all departments and team members collaborating brilliantly to drive results. If I could go back in time, I wouldn’t change a thing. We responded decisively and quickly and have grown stronger as a team and as individuals. I have an incredibly responsive team who are totally committed to the business, our hotels and each other. AS THE SAYING GOES ‘EVERY CRISIS HAS AN OPPORTUNITY’. WHAT OPPORTUNITY DID YOU SEE?

The opportunity to support and grow even closer to our hotels by adding value at every turn. The pandemic has really demonstrated the vital importance of effective communication. At the outset there was information coming and flowing from everywhere, be it the Federal Government, all state governments, local governments, travel tourism and hospitality associations, hotel companies, industry in general and let alone the media. It was overwhelming. So, we set about locating and tracking all information from everywhere, made sense of it and then sent out concise information to our hotels on a daily basis. In this way they could make sense of the information and be informed about the things they needed to know and how it affected them. We became the one source of COVID-19 information for all our hotels. It made me realise the importance and value of belonging to a brand during what were very uncertain times. AS FOR STAFFING, WAS IT DIFFICULT MAINTAINING MORALE AND IF SO, HOW DID YOU OVERCOME IT?

We quickly learnt to use virtual communication tools effectively which was particularly important as everyone was working from home. I met virtually with my senior team daily (to discuss and resolve the issues of the day and to assess the evolving situation) and with our staff several times a week. I made myself available to everyone (as did my senior team to their team members) to answer questions and put their minds at rest. The key was to be transparent, open, honest and approachable to all team members and to let them know the bad as well as the good news. If we knew the answers we told them, if we didn’t we told them so and endeavoured to find out and revert. We tried virtual end of week drinks to maintain relationships and a fun environment. We focused on building teams and collaborating to overcome and address challenges and to keep everyone connected. We shared our performance with our team and the trends warts and all. In a nutshell, the solution was to collaborate and make everyone feel and be part of a team and it worked.

HOW HAS YOUR GUESTS’ BOOKING HABITS CHANGED?

We needed to provide assurance to our guests. We introduced our “We Care Clean” program as an extension of our “We Care” program and put in place enhanced cleanliness, health and safety protocols across all of our hotels. This was built on the strength of our already-high standards of cleanliness. We have tried to hold ADR at every turn and avoid discounting. The challenge was demand, not rate, so there was no point discounting for the sake of it. We introduced appropriate cancellation programs so that guests would feel comfortable and confident in booking with Best Western and all BWH Hotels. At the outset of the pandemic, the booking window shrank overnight with the majority of bookings being made within just 48 if not a few hours before arrival. This trend has continued, exacerbated by the disappointing reaction of most states to close their borders at the hint of new cases. This happened in Melbourne, Perth, Sydney and occurred again and again as hot spots appeared. These closures and restrictions have had a considerable impact on consumer booking confidence. Guest booking patterns changed to a large portion booking direct with the hotel to ensure certainty of operation, cleanliness protocols and flexible cancellation policies. Average length of stay increased and larger rooms or apartments with cooking facilities were favoured over traditional hotel rooms. In view of the continuing closure of international borders which are predicted to remain in place until at least mid 2022, we are now seeing a strong upsurge in domestic tourism – particularly leisure - to regional Australia and particularly those regions within three to four hours of a capital city and to destinations with experiences and things to see and do. Hotels in capital cities (where many of the visitors to regional Australia reside) continue to struggle with low occupancies. However, hotels in regional areas are benefitting significantly with many in April 2021 outperforming April 2019 in terms of RevPAR, ADR and average length of stay. WHAT NOW FOR THE MEDIUM AND LONG TERM. HOW DO YOU KEEP YOUR ROOMS OCCUPIED?

Domestic tourism is undoubtedly the saviour for many hotels across Australia particularly those in regional areas and will be for as long as the international borders remain closed. Approximately 70 percent of our hotels are based in regional areas with 30 percent in capital cities. We measure our performance against STR and, pleasingly in every month throughout the pandemic (and before), our hotels have been outperforming the market in occupancy. The hotels that we revenue manage have performed even better with all collectively and most individually outperforming their market class in

Occupancy, ADR and RevPAR. Pleasingly, none of our hotels closed during the pandemic although three have taken on quarantine business and others government contracts. I have no doubt that all of our BWH Hotels will survive, although there is a long way to go until international borders open. Going into the pandemic the brand image of Australian tourism was in damage control due to the world’s perception of how we had handled the bushfires, but this has been more than made up for by the way Australia (and New Zealand) have managed and minimised the pandemic. Once we get the vaccination component right and international borders open, we will see a strong rebound from overseas markets wanting to travel overseas again, particularly to regions considered safe and Australia and New Zealand will be top of the list. Australians have also woken up to what they have in their backyard and the domestic tourism honeymoon will continue. Regional Australia

will be the major beneficiary with both international and domestic tourism looking for new experiences beyond capital cities. For decades leading up to the pandemic, tourism has been underestimated by governments at every level and by the regional communities themselves, which in turn influenced investors to overlook regional opportunities focusing in the main on capital cities where there is now an increasing oversupply of rooms at the luxury end of the market impacting profits and RevPAR. However, because of the pandemic all stakeholders are finally waking up to the huge opportunity that is regional Australia. I anticipate that investors will snap up distressed stock that will be acquired at affordable prices and whose performance can be transformed through professional operational and revenue management in partnership with companies like BWH Hotel Group. I predict that these investments will coincide with increased government

investment in regional areas to support recovery and expansion of regional economies. This leads not only to opportunity within the midscale (economy and premium economy sectors) but within upper midscale and beyond in the major regional hubs, supported by growing populations, regional airports, hospitals, universities, mining and other industry sectors. However not all the opportunities are distressed as there are strategic acquisition opportunities plus new build development and conversion opportunities particularly in the regional centres. BWH Hotel Group is well placed to cater for this upsurge through its core Best Western mid-scale brands, its new award winning Sure Stay economy brands and through Sadie and Aiden at the upscale lifestyle end of the market.

AS FOR STAFFING, WAS IT DIFFICULT MAINTAINING MORALE AND IF SO, HOW DID YOU OVERCOME IT?

During COVID-19 our group had to make some tough decisions with stand downs and redundancies. There is no doubt this had an impact on morale but as the market recovers so does the confidence of our employees in the future of the industry and their careers

Lachlan Hoswell G E N E R A L CO U N S E L A N D CO M M E R C I A L O F F I C E R AU S T R A L I A , M I N O R H O T E L S

IN TERMS OF MARKETING YOUR PROPERTIES, WHAT WAS YOUR INITIAL REACTION WHEN COVID-19 HIT AND, IF YOU COULD GO BACK IN TIME, WOULD YOU DO THINGS DIFFERENTLY?

I believe our group navigated well through COVID-19, all things considered. If we knew what we know now, we would have transitioned more apartments from short term to permanent tenancies sooner. AS THE SAYING GOES ‘EVERY CRISIS HAS AN OPPORTUNITY’. WHAT OPPORTUNITY DID YOU SEE?

We secured a property in Sydney during COVID-19, Oaks North Ryde, and this would not have happened but for COVID-19. We think more opportunities to grow will come out of the situation.

within such industry. The strong regional leisure results we are experiencing paint a positive picture for the accommodation industry beyond the pandemic.

HOW HAS YOUR GUESTS’ BOOKING HABITS CHANGED?

The leisure segment has materially increased in both our regional and corporate destinations whereas our corporate guests are coming back at a much slower rate. WHAT NOW FOR THE MEDIUM AND LONG TERM. HOW DO YOU KEEP YOUR ROOMS OCCUPIED?

We are well on the way to recovery and are seeing strong revenue growth month on month. We have had to vary our marketing campaigns to target the increased volume of leisure travellers with good success. We are hopeful that the vaccine roll outs will take place swiftly as they will lead to a much quicker recovery. Our experience is that COVID-19 lockdowns are slowing the recovery as it impacts on the confidence of people to travel. Once the lockdowns cease, we do expect a speedy recovery and when the international borders re open we do expect Australia to be a destination of choice for international travellers due to the safe way we managed through the pandemic.

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Update on COVID-19 Rent Relief & other Lease Protections for Tenants – Transition to Business as Usual With the reopening of the Australian society following lockdowns and border closures of the last year and a return to more normalized trading for many businesses including accommodation businesses, it is timely to check on the status of the rent relief and another protections for Tenants which were legislated by the States in response to the COVID-19 pandemic. In Queensland, the State’s response to the National Cabinet Mandatory Code of Conduct was the Retail Shop Leases and Other Commercial Leases (COVID-19 Emergency Response) Regulation 2020 (the Qld Reg). The Qld Regs provided protections to Tenant by prohibiting Landlords from taking a Prescribed Action which involved all of the usual ways a Landlord would enforce the terms of a Lease (i.e. recovery of possession, termination, eviction of Tenant, forfeiture of the Lease, claims for damages etc.) and also prohibited increases in rent. The Qld Regs also provided obligations on the Landlord and Tenant to renegotiate rent payable and other conditions in the Lease.

A requirement on Landlords to waive at least 50% of rent relief was removed for the Extension Period. The most recent amendment to the Qld Reg (The Third Amendment) provides a transition to the ending of the protections from 5 February 2021:• Landlords can take a Prescribed Action. • Where Tenants have applied to QCAT for an order preventing a Landlord from taking Prescribed Action, that application will lapse. • Landlords can increase the Rent. • Where Landlords have made an offer to negotiate the rent payable and other conditions which has not been accepted, the offer is automatically withdrawn. • Where a dispute notice was given to the Queensland Small Business Commissioner, the notice is taken to have been withdrawn.

The Qld Reg was amended on 29 September 2020 which extended its operation from the initial Response Period of 29 March 2020 to 30 September 2020 to include an Extension Period from 30 September 2020 to 31 December 2021 (The First Amendment).

The Third Amendment provided some instances where Landlords could start to enforce Leases against Tenants prior to the end of the overall protections for Affected Leases on 28 March 2021.

The protections in the Qld Reg was effectively extended by a second amendment which provided that the prohibitions on Prescribed Actions,increasing rent and the requirements to negotiate the rent and other conditions applied to ‘affected’ leases being those under which the Tenant was eligible for JobKeeper 2.0 until 28 March 2021 (Second Amendment).

In New South Wales, amendments to the Retail and Other Commercial Leases (COVID-19) Regulation 2020 extended the Prescribed Period from 24 October 2020 to 31 December 2020 (Second Prescribed Period) and then from 31 December 2020 to 28 March 2021 (Third Prescribed Period).

Landlords were not able to increase rents under the First Amendment and Second Amendment unless the parties agreed in writing and then the increase could not be applied until the end of the Extension Period (i.e. from 1 January 2021).

Rent deferred under the Response Period or the Extension Period could not be required to be repaid until the end of that respective period.

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Other States

Landlords and Tenants in New South Wales can obtain support from the Small Business Commission’s Mediation Service to resolve rent relief disputes, however Landlords will have more ability to pursue claims against Tenants following the expiry of the Third Prescribed Period.

McBride Legal is a specialist commercial and litigation practice, acting for small to large size commercial enterprises. McBride Legal provides a full suite of commercial legal services to its clients and looks for a practical commercial solution to any situation. The firm strives to provide quality legal services in an efficient manner with a focus on client service that sets it apart from other professional service providers.

Acc. Spec. (Bus.) - Qld Special Counsel, McBride Legal M. 0410 644 246 E. davidadolphe@mcbridelegal.com.au

David Adolphe is a Queensland Law Society Accredited Business Law Specialist and has been in practice for 20 years. He has advised clients in all manner of business transactions and takes a specific interest in Tourism and Hospitality matters. David takes a practical approach to delivering the best possible strategic legal advice to clients on all aspects of business and commercial law matters.

In Victoria, the Commercial Tenancy Relief Scheme ended on 28 March 2021. Tenants can still seek guidance from the Victorian Small Business Commission for good faith rent relief negotiations. Where negotiations fail, parties can apply for mediation to help resolve their dispute. VCAT has upheld claims by Landlords for outstanding rent finding that Tenants should not be afforded protections in the regulations where Tenants have failed to apply for rent relief.

Looking foward With the legislative protections for Tenants ending across Queensland, New South Wales and Victoria on 28 March 2021, Landlords should consider their positions and whether they are satisfied

with the arrangements they have with their Tenants. All parties should ensure that any arrangements have been formalized in writing and preferrable in an amendment or variation to the Lease by way of Deed or registered document where appropriate. Tenants who are still experiencing financial difficultly should seek advice, engage in or continue negotiations in good faith where possible and formalize any agreements as noted above. Tenants should also be seek advice from their accountants to ensure that they are accessing all other forms of small business relief from the State and Federal governments.

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SETTING THE

BAR HIGH in Regional Australia HOTEL PROFILE

Powerhouse Tamworth by Rydges is part of the Powerhouse Hotels Group, an Australian-owned and operated family business who have been operating in regional NSW for the past 40 years with their two hotels in both Tamworth and Armidale. Over this time they have developed a solid reputation for exceptional service, quality restaurants, bars and upmarket facilities. With a $12 million dollar redevelopment, completed over three years, Powerhouse Tamworth by Rydges has been transformed into the only five-star hotel property in the New England region of NSW. The major makeover has resulted in the public areas, restaurant, bar, guest rooms and conference and event spaces completely reimagined and the finished product has set a new benchmark in the regional accommodation space. The completion of the Tamworth redevelopment also marks the launch of 20 brand-new luxe serviced apartments, a mix of one and two bedroom options and a three bedroom villa, perfect for longer stays and

families or groups travelling together. The apartments complement the property’s 61 newly refurbished rooms and suites, all with highspeed free Wi-Fi, 60 inch 4K smart TVs on an acoustic wave wall, wireless mobile chargers, multiple USB ports and catering for every modern traveller’s needs. Renowned regional hotelier and owner of the property, Greg Maguire, drove the hotel revamp with the aim of offering a “a timeless design that could be found in London, San Francisco or Cape Town”. And he says the feedback, and bookings, has justified the investment. “It’s been wonderful. We’ve taken our hotel to a five star rating in a regional city. It was a pretty big gamble and a bit out there, but we are attracting a lot of people, especially since COVID-19 when people haven’t been able to travel to their usual destinations,” Mr Maguire says. “With the ongoing travel restrictions in place, we’re getting a lot of people from the cities, including Sydney, coming to Tamworth for a weekend and staying with us. “In the past, we didn’t get a lot of weekend trade because Tamworth is basically an industrial city and we were a corporate hotel, with 80 percent of our business in the corporate market.

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“With COVID-19 that corporate market dissipated. So, for us the silver lining out of COVID-19 has been that people in the cities couldn’t travel interstate so they are now putting regional New South Wales on their travel shortlist. “That has been a huge positive for us and our restaurant, The Workshop Kitchen is a big drawcard. We’re getting people coming from Sydney for a weekend to eat in our restaurant and stay at the hotel before continuing their road trip.”

Powerhouse Tamworth restaurant & facilities Along with its accommodation, Powerhouse Hotel Tamworth by Rydges incorporates the iconic regional dining establishment, The Workshop Kitchen, renowned for its wood-fired grill and premium local meats, Two Glass rated wine list, an 800 wine bottle entrance wall, elaborate open kitchen and subtle classic design detailing with leather banquette joinery, marble and bespoke cabinetry. The restaurant sits alongside the classy-cool Coal Bunker Bar with brass and timber elements and deep aqua hued velvet soft furnishings. It’s a chic, intimate setting to enjoy an aperitif, evening martini or nightcap until late. The bar showcases an array of top shelf spirits, an entire whiskey cabinet from around the globe, alongside a hand-picked selection of local craft brews. Facilities include 24-hour reception and room service, six contemporary venue spaces for corporate and social events as well as a gym, outdoor pool, spa, BBQ area, sauna and guest laundry. The hotel also offers two Tesla Destination Charging stations and limousine transfer services.

The hotel’s on-site restaurant is lauded for its wood-fired grill and stand out steaks (local Jack’s Creek Beef, consecutive winner of World’s Best Steak Award) with a Two Class rated wine list in Australia’s 2020 Wine List of the Year Awards. Powerhouse Hotel Tamworth by Rydges has an enviable location in the heart of the city and at the front of the property, lies an obelisk, erected to recognise Tamworth as the first town in Australia and the southern hemisphere to provide its residents with electric street lighting in 1888. The refurbishment was designed and implemented by Australian award-winning design team, Paul Kelly Design, which specialises in the hospitality industry. The company has designed over 600 bars and restaurants and won several national awards and international listings for its projects. Powerhouse Hotel Tamworth was the firm’s first hotel project, bringing a new level of sophistication in curating beautiful, bespoke spaces for guests to retreat as a ‘home away from home’. “We knew that Powerhouse Tamworth had an incredible reputation, though it was time to amplify its aesthetic and take the concept of a regional hotel to a whole new level,” Paul Kelly said. “The hotel’s location on the original electrical powerhouse site for Tamworth was a huge inspiration – so the design of the hotel and its spaces is inspired by this; a celebration of Tamworth’s history as the first Australian city of light, and a sophisticated new look to cement the direction of where Tamworth is going

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as an impressive business and tourism hub in country NSW.” Greg Maguire said working with Paul Kelly was a ‘no-brainer’ as his specific goal for the Powerhouse Tamworth aligned with his vision. “The brief was to create a contemporary hotel where our guests could sit in their hotel rooms, surrounded by a timeless design that could be found in any global city. Our aim was to take a country roadside motel to an international hotel standard,” Mr Maguire says. “The design aesthetic is ‘natural and authentic’. All of the leathers are cowhide, all of the timbers are American Oak, all of the carpets are wool, which comes at a huge cost. “If you look closely at it, this was not a ‘refurb’, this was a design project. All of the bespoke furniture and all of the lighting was actually designed for this project. So there’s nothing, not even a chair, that is in this hotel, that you can buy.” Greg Maguire says he wanted to create an accommodation asset that would actually attract visitors up to the New England/North West region and become a destination in its own right.

Tamworth Fast Facts

Tamworth is the largest and most populated city in the north-western region of NSW, and the second-largest inland city in the state.

It is known as the ‘first town of lights’ being the first place in Australia to use electric streetlights in 1888, with the hotel’s name a historical reference as the physical location of the former electrical power-house.

“The hotel is a destination. It’s really attracted a lot of people out of Sydney, especially, who previously would have travelled up the Pacific Highway and stayed at Port Macquarie, Coffs Harbor and Byron Bay.” And he says he’s seeing other accommodation operators in regional areas investing to improve their product. “I honestly believe we have raised the bar dramatically and our local hoteliers also lifting their game. So, our investment into regional New South Wales has an ongoing effect, because as you know, we all have to stay in front of our opposition, and for us to spend $12 million dollars on a country motel redesign is probably unheard of. “It’s time to show off what we have to offer in regional New South Wales and for guests to enjoy a slice of upmarket, genuine, country hospitality.”

Tamworth is widely known as the Country Music Capital of Australia, annually hosting one of the top 10 music festivals in the world with the Country Music Festival - a fun, 10-day event held every January that includes over 700 artists, a 50,000 plus crowd of music lovers and over 2,800 events. Don’t miss the 2022 Festival celebrating its 50th anniversary!

In 2008, the Australian Equine and Livestock Events Centre opened. The city is recognised as the “National Equine Capital of Australia” and holds numerous equine events throughout the year drawing large crowds to the city’s centre. I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

Greg Maguire OWNER, POWERHOUSE GROUP

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Hotelier, Greg Maguire first started in the industry over 40 years ago since building the Cattleman’s Hotel in Armidale in 1980 (now the Powerhouse Hotel Armidale), and the Powerhouse Tamworth which officially opened its doors to guests in 1986. Employing over 125 staff over the two properties, he has created a business with a reputation for world class service and facilities in regional New South Wales. When you own and operate the best hotel in Australia’s country music capital, it’s a given that you’re going to be able to name-drop some of the world’s biggest performers and Greg Maguire, when pushed, is able to rattle off a ‘who’s who’ of country and western stars that he’s met. Bob Dylan, Kenny Rogers, Willie Nelson and Reba McEntire have all stayed at the Powerhouse Tamworth during the Country Music Festival but there’s one Australian

music legend, now married to Nicole Kidman, who stands out from the rest. Keith Urban was introduced to Greg Maguire by his manager Greg Shaw in the late 1980s with a request that he allow the young and inexperienced performer to play in the foyer of the Powerhouse Tamworth near the bar. “In those days, the Powerhouse Hotel Tamworth was the central point of all of the record companies, because the record companies were the drivers of country music,” Greg Maguire says. “All the big record labels like BMI, ABC Records, Sony Records, had people staying and you might get 60 or 70 people from the music industry all in the hotel at once. “It was a very clever move for Greg Shaw to put Keith Urban in there because all of the record industry types always ended up back at the bar.

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“So, the year we put Keith in the foyer, I said to Greg, ‘mate, I’m not going to pay you, or this bloke’. He said, ‘no, I know you won’t pay him’.” Greg Maguire described Urban as a looking like an “ordinary knockabout country bloke”. “We’ve got a photo of him sitting in the foyer and certainly doesn’t look like country superstar he is today, but with his talent he got the break he was looking for.”

“These old superstars, they’re just absolutely wonderful, down to earth he people who just want to be treated as the other guests. No trashed hotel rooms or diva behaviour to report.”

Owning and running the best hotel in one of the world’s most famous country music towns has its advantages in terms of meeting famous people, and Greg Maguire says the most impressive of the celebrities have been the “old school” ones. “Bob Dylan, Kenny Rogers, Willie Nelson and Reba McEntire have all stayed at the hotel many times. “It’s quite interesting, being a country property, that we’ve had some of the biggest music entertainers in the world stay with us. “And it’s been a wonderful experience because, as the owner, I’ve gotten to know these people. And you know what? The more famous and successful they are, the nicer they are. Some of the younger acts are full of it. “But these old superstars, they’re just absolutely wonderful, down to earth people who just want to be treated as other guests. No trashed hotel rooms or diva behaviour to report.” New to the hotel, this month the Powerhouse King Suite 131 will be re-named the ‘Slim Dusty Suite’ with a plaque erected in the country music legend’s honour, in ode to his annual visits staying in this same room for over three decades for the Tamworth Country Music Festival. Along with Powerhouse Hotels, Maguire runs Powerhouse Pastoral with nine rural properties in the region covering 23,000 acres and 10,000 head of cattle for the premium domestic beef market and export market. His journey to become a renowned accommodation and agricultural identity pretty much began when, at the age of just 16, he start his first business

in Armidale – a menswear store. That business spawned a small chain of jeans stores in Tamworth and Armidale.

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He says a move into the accommodation industry was inevitable. “Anyway, I just couldn’t understand retail. You open at nine and you shut at five, and your hours dictated the amount of money you could take. In other words, for some reason my, my dumb head said, ‘this is crazy’. “If you have a loan, does the bank charge interest from 9am to 5pm? No, the bank charges interest 24 hours a day. “I looked around and I thought about the basic principles of any good business: number one is capital growth, and number two is cashflow. Number three is, if you’re a good operator, then you create profitability. So, for me the answer was a very small motel. “In 1978, when I first built my first motel, I came up with the idea that if I build a motel, I have a hard asset. Secondly, I create cashflow and thirdly, if I can be a good operator, I am creating profitability. “So that’s where it started. It’s a long journey. It’s over 43 years. The situation has been that we have been blessed with being in an industry that has shown high capital growth, and the other issue you have is replacement of assets today. Our construction costs in Australia are absolutely out of whack with the rest of the world. “These prime assets can’t be replaced unless you’re prepared to build, and to build new, of course.” His first foray into building hotels was The Cattleman’s Hotel in Armidale (now the Powerhouse Hotel Armidale by Rydges), followed by The Powerhouse Tamworth & The Powerhouse Brisbane (the first boutique, 5-star hotel in Brisbane at the time).

Greg Maguire’s celebrity encounters have not been confined to Australia’s country music capital. In the 1980s, he purchased land blocks on the undeveloped Hamilton Island (from entrepreneur Keith Williams) and built his first holiday home there which he still has, called ‘Villa Illalangi’.

George Harrison of the Beatles was also an early investor, and neighbour. “I got to know George very well. I had flown up with the architect and when the building was just about finished, one of the tradies came in and said, ‘Oh, Greg, there’s a guy outside who wants to see you’. I walked outside, and there’s this guy in sandals and shorts and a fisherman’s hat. “He said, ‘My name’s George. Keith Williams said to come and have a talk to you’. It took me about 90 seconds for me to realise it was George Harrison. And anyway, cut a long story short, we had dinner that night and he ended up renting my house for six months while he built his own house next door. “We become good mates and neighbours. He was a gentleman, and you wouldn’t even know who he was. He used to walk around and look like any tourist.” Summing up his journey so far, Greg said “It is a true privilege to be a part of the hospitality business – we all know what we put in and what we take out in return. I agree with the person who said, ‘service is a skill and hospitality is a spirit’. I certainly live and breathe this industry with spirit and passion.”

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Tips for Buying Management Rights IN THE COVID ERA As I contemplate an attempt to make some sense in this article there’s an old English expression that springs to mind. "May you live in interesting times" is claimed to be a translation of a traditional Chinese curse. While seemingly a blessing, the expression is normally used ironically; life is better in "uninteresting times" than in "interesting" ones, which are usually times of trouble. Talk about ironic alright. Anyway, I digress. Rather than write my usual meandering stream of consciousness I’ve decided to cut to the chase and outline some specific thoughts that might hopefully assist buyers to navigate a management rights purchase in a world of apparent uncertainty.

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THE FUNDAMENTALS HAVE NOT CHANGED While the world has most certainly changed the basics of purchasing a management rights have not. The process of accounting verification, legal due diligence, finance and settlement remains the cornerstone of a successful acquisition. Sure, there are some extra hoops to jump through and some days more hoops than others. However, it’s important for buyers to appreciate that a proven process that has held the industry in very good stead with lenders continues to deliver positive outcomes. There is simply no reason to reinvent the wheel. Maybe put a couple of extra spokes in it and some performance tyres but it’s still a wheel. GET PRE-QUALIFIED The first, and perhaps the most important step. Talk to us about your situation and gain some level of certainty. No point having a grand plan if you fall at the first hurdle. Our brokers will assess your personal and financial situation and offer guidance. They will be a sounding board and help you review opportunities, pointing out the potentially good and not so good aspects of the business you are looking at. While we encourage anyone who is interested to research the industry there’s simply no point in making listing enquiries or inspecting properties until you are pre-qualified. The Covid era has delivered an incredibly volatile lending policy environment. It’s imperative that buyers speak with a finance specialist who’s talking to the banks on a daily basis. KNOW WHAT YOU WANT AND WHY If you don’t know where you’re going any road will get you there. It’s an old cliché but also pretty accurate. We encourage buyers to think long and hard about what’s important and what boxes a listing needs to tick. Lenders are keenly interested in why you are buying a particular asset. We love talking to clients about the opportunities they see in a particular

listing and how best to make the deal happen. Part of that process is making the deal look as compelling as possible for lenders. INSIST ON THE VENDOR PLAYING FAIR While the fundamentals haven’t changed there’s no denying that Covid has had an impact on how we assess a lending opportunity. Regrettably, there are vendors out there who would prefer to pretend that Covid didn’t happen. The vendor mindset of “I bought it this way, I’m selling the same way” needs to be avoided if possible. On the flip side of that coin there are management rights businesses that have actually benefitted from Covid driven demand. We think that vendors need to be realistic in respect of additional information and buyers have every right to ask. The bank simply doesn’t care how the vendor bought or financed the asset, the game has changed. You’ll know you’re in good hands when your agent has already asked the tough questions and has the answers ready. COVID IMPACT – WHAT HAPPENED AND WHAT’S NEXT? Lenders will focus on this question above all others. Regardless of what happened we need to explain why. If it’s a holiday building enjoying record occupancy due to international travel restrictions that’s great. But, what happens when borders reopen? A permanent property may be enjoying strong rental demand based on inter and intra state migration. How much of this is Covid life change driven? Is it sustainable? Will government first home owner incentives and other economic policies impact letting pool numbers? The trick in presenting a compelling case to a lender is to summarise how the business was travelling pre-Covid, what’s happened since and what the likely future holds. The better we can demonstrate that our client understands these three Covid impact phases the more likely a finance approval.

FINANCIAL DUE DILIGENCE – A MIXED BAG I think it's fair to say that the banks are treating every deal on its merits when it comes to trading history, current performance and future prospects. Remember, in the absence of compelling data, bank credit managers will default to their imagined worst possible scenario. We don’t want that! The historical benchmark in the industry has been the review of the past 12 months financial performance of the business. In this regard management rights are unique. No other going concern business is bought and sold on the strength of a single accounting period. I would argue that the Covid era has pushed the tide out and found our industry sans bathers. So, what to do? At the risk of dodging the question...it depends. For a permanent management rights in the ‘burbs I’d be happy to go to the bank with a one year P and L review. The reality is that these businesses are easy to analyse with likely profitability being an outcome of a basic set of data. The industry has developed a Covid impact info summary for permanent management rights which I think does the trick. My observation would be that the impact sheet has, to some degree, been rendered obsolete by the demonstrated resilience of permanent MLRs, many of which are showing improved trade, zero Covid arrears and rising rents. For leisure based short stay properties the process is a little more “horses for courses”. If we come from the old adage that certainty = value then the more info the better is a good place to start. There won’t be many leisure based MLRs that did not see some sort of negative Covid impact in 2020. The trick is to normalise the 2020 calendar year and achieve some sense of what sustainable net profit looks like. Setting a trend line or benchmark based on a couple of prior years makes sense so I think, if possible, a look at 2018 and 2019 calendar years is the place to start. Provided those years show trading stability or growth it’s reasonable to review 2020 through the prism of year in, year out trade. I also I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

think it’s reasonable to reconstruct the 2020 P and L to identify Covid impacted months and compare those with the same trading months of the prior years. At the end of the day we are trying to assess sustainable net profit over time so a once in a lifetime event certainly needs commentary and adjustment. In my mind it’s no different to having a unique event that drives occupancy and tariff up, it has to be netted out to get to the likely sustainable $NP. If, by some miracle, Covid had zero impact on a leisure property we still need to explain why so best to be ready. There is merit in preparing a projection based on the best market intel at this point. The report should be supported by commentary explaining what happened and why and justifying the projections. I don’t think projections should be a “must have” as I’ve never seen one in any industry that didn’t predict a positive result. However, as an indication of expectations driven by the business plan and broader economy a projected

reconstruction of the 2020 calendar year P and L is a handy report to have and will be well regarded by the lenders. Valuers appointed by the banks will certainly be looking for insight into the sustainability of the net profit so the more compelling and complete the data the better. THE PLAN The last piece of the jigsaw puzzle. We encourage all buyers to write a business plan. Not some enormous document filled with waffle and motherhood statements. The plan should cut to the chase and demonstrate that you know what you’re buying, why you’re buying it and what you plan to do in order to be successful. We know what banks are looking for and we can help but…it’s important that you are able to articulate the why, what and how of your decision to buy a particular management rights. If you’re stuck remove the title Business Plan and replace with Here’s Why I Won’t Go Broke.

In closing I think it’s important to appreciate that we are dealing with an incredibly fluid situation and the banks are in this boat with the rest of us. Today’s business plan can be rendered obsolete by a snap border closure or new strain of the dreaded virus. But, I believe Australia has managed the situation better than most. We have a very stable and well capitalised banking sector, a mostly competent government (at Federal level anyway) and a reasonable economic outlook. Add record low interest rates, a population in transition and all the big spenders trapped in Oz and I’ve gotta ask... What are you waiting for? PS : We have had 6 different lenders approve finance for short stay leisure based management rights in the past week. Our advice, don’t believe any stories you hear about banks not lending.

No. No. #2 #2

Golden Golden Rule Rule

• •

enable one party (but not enable one party (but not another) to breach or terminate another) to breach or terminate the contract the contract Must show the Gross Income Must show the Gross Income • penalise one party (but not and not the Net Income • penalise one party (but not and not the Net Income another) for breaching or another) for breaching or Agents must account to their clients for terminating the contract. Agents must account to their clients for terminating the contract. everything they receive and disburse. When the terms and conditions everything they receive and disburse. When the terms and conditions Agents cannot report their rental allow for it, a booking cancellation Agents cannot report their rental allow for it, a booking cancellation income as the net amount. They must fee can be kept from deposit money income as the net amount. They must fee can be kept from deposit money show the gross payment received and a guest has paid for accommodation. show the gross payment received and a guest has paid for accommodation. any deductions, then the net amount. In some cases, usually depending on any deductions, then the net amount. In some cases, usually depending on the way the booking was made, such the way the booking was made, such as via a third party, guests also pay a No. Golden as via a third party, guests also pay a No. Golden booking administration fee on top of #3 Rule booking administration fee on top of #3 Rule the accommodation costs. the accommodation costs. Accommodation Cancellation Fees Accommodation Cancellation Fees If a guest cancels their booking – Who is Entitled? If a guest cancels their booking – Who is Entitled? and is penalised with a cancellation and is penalised with a cancellation fee in accordance with the agent's Booking cancellation fees for fee in accordance with the agent's Booking cancellation fees for booking terms, the fee is generally accommodation may be applicable in booking terms, the fee is generally accommodation may be applicable in considered rental income and should certain circumstances whenthinkers, a guest We’re looking for quick enthusiastic negotiators, considered rental income and should certain circumstances when a guest be ambitious paid to the owner. cancels their booking. However, all sellers, proactive performers, proven career climbers. be paid to the owner. cancels their booking. However, all cancellation terms and conditions must Where an appointment to act cancellation terms and conditions must Where an appointment to act be clear andyour transparent at the time of letter Please send resume with cover detailing experience refers to an agent’syour commission be clear and transparent at the time of refers to an agent’s commission booking (as partOperations of the bookingManager, form to the National Marissainvon Stieglitz. expressed the form of a percentage, booking (as part of the booking form expressed in the form of a percentage, or a term and condition on the booking this rate of commission must be marissa@resortbrokers.com.au or a term and condition on the booking this rate of commission must be web site), and they must not: calculated on the actual amount of 0437 198 164 web site), and they must not: calculated on the actual amount of rent collected, which in the event of • enable one party (but not the rent collected, which in the event of • enable one party (but not the a cancellation, may only be part of a other) to avoid or limit their a cancellation, may only be part of a other) to avoid or limit their retained deposit. obligations under the contract retained deposit. obligations under the contract

Agents may also claim any Agents may also claim any expenses relating to cancellations that expenses relating to cancellations that are stipulated in the appointment to are stipulated in the appointment to act. If cancellation expenses are not act. If cancellation expenses are not stipulated in the appointment, the agent stipulated in the appointment, the agent cannot claim them, and, if a cancellation cannot claim them, and, if a cancellation fee is retained from a guest’s deposit, this fee is retained from a guest’s deposit, this must be paid to the owner. must be paid to the owner. An exception to this rule would be An exception to this rule would be where a booking administration fee has where a booking administration fee has been charged to the guest in excess of the been charged to the guest in excess of the accommodation costs and is not payable accommodation costs and is not payable to the owner. to the owner. At the end of each month, the agent At the end of each month, the agent is required to provide an account to their is required to provide an account to their clients that clearly shows each amount clients that clearly shows each amount the agent has received and exactly how the agent has received and exactly how it was paid out. A client should be able to it was paid out. A client should be able to ascertain from this monthly account if a ascertain from this monthly account if a deposit was received from a guest for a deposit was received from a guest for a booking that was cancelled and how the booking that was cancelled and how the deposit was distributed (i.e. the amounts deposit was distributed (i.e. the amounts returned to the guest, claimed by the returned to the guest, claimed by the agent, and paid to the owner). agent, and paid to the owner).

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Australia Wide

Liability limited by a scheme approved under Liability limited by a scheme approved under Professional Standards Legislation Professional Standards Legislation Disclaimer – This article is provided for Disclaimer This article isand provided information–purposes only shouldfor not be information purposes only and should not be regarded as legal advice. regarded as legal advice.

Our trManagement usted team of legal experts, ledRights by Col Myers,Law draws on Specialists over 30 years experience to Management Rights Law Specialists Australia Australia Wide Wide get you the best possible outcome. Our trusted team of legal experts, led by Col Myers, draws on over 30 years experience to Our Our trusted trusted team team of of legal legal experts, experts, led led by by Col Col Myers, Myers, draws draws on on over over 30 30 years years experience experience to to get you the best possible outcome. get you the best possible outcome. get you the best possible outcome. Although Although our our full full suite suite of of services services is is more more Although our full suite of services is more comprehensive, particular expertise comprehensive, particular expertise covers: covers: comprehensive, particular expertise covers: -- Buying & Selling Buying & Selling Buying & Selling --- Structuring Structuring Structuring --- Variations Variations Variations --- Renewals Renewals -- Renewals - Establishments Establishments -- Establishments - Licences Licences & & Letting Letting Appointments Appointments -- Advice Licences & Letting Appointments on all Body - Advice on all Body Corporate Corporate Issues Issues -- GST, AdviceStamp on all Duty Bodyand Corporate Issues Tax - GST, Stamp Duty and Tax GST, Stamp Duty and Tax --- Exit Exit strategies strategies Exit strategies --- Dispute Dispute resolution resolution -- Legal Dispute resolution reports due - Legal due diligence diligence reports - Legal due diligence reports

Although our ful suite of services is more comprehensive, particular expertise covers: - Buying & Selling - Structuring - Variations

Contact us us today today Contact Contact us today to find find out out how how we we can can assist assist you; you; to to find out how we can assist you; P: +61 +61 (0)7 (0)7 5552 5552 6666 6666 P: P: +61 (0)7 5552 6666 M: +61 +61 (0)417 (0)417 620 620 516 516 M: M: +61 (0)417 620 516 E: cmyers@smh.net.au cmyers@smh.net.au E: E: cmyers@smh.net.au W: smhmanagementrightslawyers.net.au smhmanagementrightslawyers.net.au W: W: smhmanagementrightslawyers.net.au

FROM OPERATOR TO BROKER

Jessie Shi BROKER_BRISBANE

For three years up until she joined ResortBrokers, Jessie Shi owned and operated her own management rights business, an apartment complex in the Brisbane CBD. Could there be a more perfect fit to become a Brisbane management rights specialist broker? That handson experience, combined with a successful corporate background as a business development and key account manager for a global food and beverage company, means Jessie Shi will bolster our high-performing Brisbane management rights team. HOW, AND WHEN, DID YOU COME TO WORK AT RESORTBROKERS? I’d been running my management rights business for several years, then one day I was approached by one of the other management rights agencies and this piqued my interest in becoming a broker. I then did my research and found ResortBrokers is one of the most reputable businesses

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in the market in Australia. So, basically I thought, ‘if I’m going to go into this industry, then this is the company I want to work for’. Once I made up my mind, I made a move immediately. It took a while to firm up the meeting with Managing Director, Trudy Crooks, and had my first interview in April 2019, followed by the second and third interview with the entire management team. Fortunately, I was warmly welcomed and we agreed to work together and I officially started with ResortBrokers from October 2019. YOU OWNED AND OPERATED YOUR OWN MANAGEMENT RIGHTS BUSINESS - HOW HAS THIS HELPED YOU NOW THAT YOU'RE ON THE SALES SIDE OF THE BUSINESS? It definitely helps by having an indepth understanding of the ‘ins and outs’ of running a management rights and dealing with people from all sides of the business. When I meet with a vendor, it is easier and much quicker for me to understand the daily operation of their business and all associated finance figures. At the same time, I’m able to provide recommendations and advice to prepare the vendor in getting the business in its best possible shape before launching it onto the market. When promoting and discussing the sale of a management rights business to potential buyers, I can answer more specific questions that the buyer may have from the actual day-to-day running of the business, to ways of practically solving potential issues rather than just focusing on the sale. Most of our clients are small to medium business operators, so I understand how important it is for them achieve a positive result

by selling or buying a good, secure business to support their families. I feel confident that I can provide a thorough view about all aspects of running a management right business, and I can stand in both the seller’s and the buyer’s shoes which means I am able to establish long term trusting relationship with my clients. WHAT DO YOU SPECIALISE IN AND HOW IS YOUR MARKET LOOKING RIGHT NOW? I like to think that I provide a more personalised sales experience to my clients. I am thorough and like to preempt any problems, take necessary action to resolve and prevent any deals falling over at any cost. As a management right business owner myself, I understand what factors in any particular business transaction are important to both the vendor and the buyer. I share my practical experience in running a management right business with the buyer as I want them to end up purchasing a good business which they can successfully run year after year. I will always be the ‘glue’ to assist all parties to resolve any issues arise throughout the business transaction process. During COVID-19, management rights businesses have proved themselves again of being stable and ‘bullet proof’, therefore many new buyers have rushed into the market wanting to get into this industry while existing business operators started actively seeking quality stock to expand their business portfolio. High demand inevitably leads to a shortage of stock, and the multipliers have increased significantly over the past couple of months on high net properties. The market is hot! WHAT IS THE TOUGHEST PART OF YOUR JOB? I’d say time management is one of the toughest parts of this job. Some days there is just not enough time in a day to complete everything. Time management is very important and might be difficult to deal with from time to time, especially when managing a number of deals simultaneously. I have one bottom line when servicing my clients: regardless how busy I am, if I promise to get

something done for them, I will make sure I deliver on time as promised. This requires self-discipline and a well organised plan/workload. WHAT MAKES YOU TICK? WHAT DO YOU DO ON A TYPICAL WEEKEND? My most relaxed time is when I’m out and about, when I wine and dine with my family and friends. Believe it or not, there are 16 foods that are scientifically proven to make you happier! A delicious meal makes me feel energetic and makes a good mood more likely to happen. On a typical weekend, I often go to an aerial yoga class in the morning. You’d think a woman’s body would be more flexible but certainly not in my case. That’s why I’ve been doing hot yoga for a couple of years and started aerial yoga from the beginning of this year – persistence leads to positive results! After the class, my husband and I always go somewhere for brunch, sometimes with friends as well. That’s what I call the official start of my weekend. Sunday is generally the day to do the good old house chores and grocery shopping, and some jazz music puts me in a light mood to ‘dance’ with the laundry. We like to finish the day with a simple home cooked dinner since there is more time available to prepare a meal and it’s also a good time to try out new recipes.

We’re on WeChat. Let’s connect!

IF YOU COULDN'T WORK HERE AT RESORTBROKERS, WHAT WOULD BE YOUR IDEAL JOB? If wasn’t with ResortBrokers, then I would probably continue my career path as a business development manager and climbing the corporate ladder. I’m passionate about marketing and I worked as a business development manager for a public listed company for seven years looking after several major product lines servicing key accounts across Asia Pacific region. This is also one of the reasons I enjoy my current role as a broker, meeting vendors and buyers, understanding their needs and fulfilling that. There will always be obstacles along the way, climb over it and keep going!

We’ll keep you updated on all the latest news and events in the industry.

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Business Support

ey Rigby 2 158 136 uild.com

How to win back your Outside Investors

Top Tips Communicate

Educate

Be consistent

Above all, be kind & approachable

Kelley Rigby is the founder and owner of LettsRebuild, which was established to assist onsite managers win back and retain outside rentals. A passionate management rights advocate, Kelley is building her own business to bridge the gap between onsite managers and their investors and she outlines the key fundamentals in winning back your letting pool.

ince starting this business recently, I’ve been busily attending industry functions – as you do – as part of the networking process and one of the common topics of conversation among operators is how to deal with outside investors. This also includes the fact that many managers feel they are unable to secure the investor business for themselves. A few times, an obvious question was directed at me: “So, how do you do it?” The assumption was that I would not reveal the secrets to this, but on all occasions I was happy to oblige with a straightforward and simple response: “I communicate!” Communicating is as obvious as it sounds but it also seems to slip people’s minds. Some operators think that because they are the resort manager, investors are obliged to entrust them with their property. I wish it were that simple. Unfortunately, that is not how the system works. You are not entitled to their business just because of your title, and you must always sell yourself and I mean do that in a

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modest and respectful way. Clients talk to me about how much they do for investors that are not even in their rental pool and I commend them for being so kind. Then I follow up with this question: “But did you communicate this to them?” Because, if you do not tell them how much you do, they will not know. As an onsite manager you have many advantages over any other agent. As the owner-operator of the business, it isn’t just a job for you, you are completely invested. You are the specialist in the complex, you live onsite, you are accessible for tenants, you are there to rectify issues immediately, and did I mention you live onsite? The list of your attributes really does go on and on. Therefore, educating investors about why you are the best person for the job is crucial to winning them back. Remember, that some of your clients live in states where management rights are not as prominent as it is in Queensland and you may need to explain your role and enlighten and remind them about the ways of the industry. If you remain consistent with your marketing efforts, it will ensure you

are at the forefront of the investors’ minds when their current property manager drops the ball. Within my business I create a schedule to track how often and, via which platform, I am communicating with investors as this helps keep me accountable and organised. When communicating with clients it is so important to emphasise how valuable their business is to you and show them how much you would go above and beyond for them. My goodness, if an investor asked me to communicate with them via pigeon my next move would be to start a pigeon farm! It is human nature to prefer to do business with people we connect with or like, so pick up the phone and start showing these investors how ‘likeable’ you are. Apart from investor relations, my aim is also to help managers with sales in their buildings, through a new component of my business called ‘Letts Sell’. With this, I am contactable via phone throughout the first sale assisting them every step of the way from the Comparative Market Assessment through to settlement. I assist with all paperwork and communications with buyer and seller. The ultimate goal is to train the managers so they can do it again on their own, with less or no help from me.

Would Would you you like like to to win win back back and and retain retain outside rentals in your business? outside rentals in your business?

We’re We’re here here to to help help onsite onsite managers managers with with every every facet facet of their business. We can help you with: of their business. We can help you with:

Building and retaining Building and retaining beneficial/profitable beneficial/profitable relationships relationships

Creating a unique Creatingstrategy a uniquefor marketing marketing strategy for your building / clientele your building / clientele

Brand Brand Development Development

Letts Rebuild prides itself on the Letts Rebuild prides itself on the work ethic we provide, the knowledge work ethic we provide, the knowledge we have and the passion we bring. we have and the passion we bring.

Adding value to your Adding value to your building / business in building / business in preparation for sale preparation for sale

Ongoing Ongoing Business Support Business Support

Kelley Rigby Kelley Rigby 0402 158 136 0402 158 136 kelley@lettsrebuild.com kelley@lettsrebuild.com I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

Post-COVID Post-COVID valuation trends valuation trends & how to avoid & how to avoid generating generating “red flags.” W O R D S _ ANDREW KEMP – DIRECTOR, VALUATIONS AT ACUMENTIS

D D

espite the uncertainty created worldwide by the COVID-19 espite the uncertainty created worldwide by the COVID-19 pandemic, the Australian experience is one of relative pandemic, the Australian experience is one of relative positivity, even with the odd state border closure and snap positivity, even with the odd state border closure and snap “reset” lockdown. lockdown.Despite Despitethis, this,the theeconomy economyremains remainsresilient resilient and andthis, “reset” this, coupled with historically low interest and strengthening coupled with historically low interest ratesrates and strengthening business business and consumer confidence, has resulted in a stronger than and consumer confidence, has resulted in a stronger than expected expected and recovery andwithin appetite the accommodation sector. recovery appetite thewithin accommodation sector. This includes This includes motels, hotels, caravan parks and management rights. motels, hotels, caravan parks and management rights.

With internationalarrivals arrivalsdown downto to almost almost zero, zero, domestic With international domestic and and regional regional travel travel has has surged surged and andthis thishas hasprovided providedsome some positive positive news news in in the the wake wakeof ofthe thefinancial financialdevastation devastationcaused by the initial in Marchin2020. Those areas reliant caused by thelockdowns initial lockdowns March 2020. upon international however, remain burdened Those areas visitors, reliant upon international visitors, by an uncertain short toburdened medium term if they are to unable to however, remain by anfuture uncertain short medium future if they are unable to adapt and adapt andterm market to the domestic traveller. market to the domestic traveller.

In times of uncertainty, and either swift market movements in positive or negative direction, requirement In atimes of uncertainty, and eitherthe swift market for valuations the accommodation sector remains movementswithin in a positive or negative direction, the critical. Primarily thisfor may be triggered by clients and mortgage requirement valuations within the accommodation sector remains critical. providers looking to refinance existing going concern or Primarilyoperations, this may be triggered by clients and partial interest or via the sale/purchase of a mortgage providers looking to refinance existing going particular asset. Similarly, any valuation for the purpose concern or partial interest operations, or via the sale/

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of a rentalofreview/determination, development purchase a particular asset. Similarly, any valuation valuation/feasibility, familyreview/determination, law etc., sees the same for the purpose of a rental valuation approach. development valuation/feasibility, family law etc., sees the same It is during thisvaluation valuationapproach. process that all participants in the process - owners/operators, It is during this valuation process that all participants landlords/tenants, accountants, legal advisers, in the process - owners/operators, landlords/tenants, brokers, finance brokers and bankers remainbrokers aware accountants, legal advisers, brokers, finance of the requirements of the valuation process, timing and bankers - remain aware of the requirements of the and documentation needed. valuation process, timing and documentation needed. Unfortunately, we continue to find that the timing Unfortunately, we continue to find that the timing of our instructions is often left to the last minute of our instructions is often left to the last minute which can result in unnecessary stresses in terms of which can result in unnecessary stresses in terms transactions, financial settlements, negotiations and of transactions, financial settlements, negotiations a lack of documentation. and a lack of documentation.

be illustrated and suitably explained. Accounts can be internal, although preferably by a third-party accountant, with enough clarity as to the relevant inclusions, such as if there are other businesses included in the statements? Operating expenses should be itemised and not consolidated, which limits a valuer’s ability to analyse on a line by line basis and subsequently compare In order to avoid “red flags”ifduring “like for to like”. Redpotential flags may appear ongoing In avoid “red flags” during theorder process, it is potential essential to provide timely and operating expenses cannot be verified. the process, it is essential provide timely detailed documentation attothe start of any valuation and detailed documentation at the start of any instruction. valuation instruction. A summary ofdata the minimum A the minimum required In summary addition toof Profit and Loss accounts, for a required valuationfor inamost casesin inmost the accommodation data valuation cases in the accommodation providers, vianot their sector include, although may be onsite limited accommodation sector include, although mayto, notthe be following: reservations should provide details of limited to, thesystems, following:

categorised by accommodation type (e.g. - Profit and Ideally most -revenues, Profit andLoss Lossstatements: statements: Ideallythe the most recent five years, where trends and movements can recent five years, where trends and movements for a caravan park - revenue per cabin type, sitecan type, illustrated and suitably suitably explained. explained.Accounts Accountscan can be illustrated or ainternal, motel –although revenue preferably per room type, food, beverage). internal, although preferably byaathird-party third-party be by enough claritydata asto toshould therelevant relevant accountant, with enough clarity as the This internal reservation then inclusions, such such as as ifif there there are arethere otherother businesses inclusions, businesses provide comfort and Operating analysis ability when includedfurther in the thestatements? statements? included in expenses Operating expenses should be itemised and not compared to the annual P&L accounts noted above. should be itemised and not consolidated, which consolidated, which limits a valuer’s ability to analyse limits aSignificant valuer’s ability to analyse on ainternal line by line variance between on a line line basis and subsequently basis and by subsequently compare “like for compare like”. Red reservation revenue datamay and appear recorded P&L accounts “like for like”. Red flags if ongoing flags may appear if ongoing operating expenses operating expenses cannot be verified. will alsoberaise red flags. cannot verified. addition Profitand and Loss accounts, - InInaddition toto Profit Loss accounts, accommodation providers, via their onsite Detailed occupancy data for the same periods -accommodation providers, via their onsite reservations systems, should provide details of reservations systems, should provide details of as above, normally maintained on a monthly basis, revenues, categorised by accommodation type (e.g.is revenues, categorised by accommodation type (e.g. for arequired caravan to park - revenue cabin site type, also again provideper clarity of type, operational for a caravan park - revenue per cabin type, site type, or a motel – revenue per room type, food, beverage). revenues, also beverage). used as an or a motel including – revenueRevPOR, per roomand type,isfood, This internal reservation data should then This internal reservation data should then provide further comfort and analysis abilityprovide when further comfort analysis when compared compared to theand annual P&Lability accounts noted above. to the annual P&L variance accountsbetween noted above. Significant Significant internal variance between internal reservation data reservation revenue data and recordedrevenue P&L accounts and recorded P&L accounts will also raise red flags. will also raise red flags.

- Detailed occupancy data forfor thethe same periods Detailed occupancy data same periods as above, normally maintained on a monthly as above, normally maintained on a monthlybasis, basis,isis also also required required to to again again provide provide clarity clarity of of operational operational revenues, including RevPOR, and is also used as an

provide suitable analysis on a room night or unit/ site basis. Discussion of wages “off the books” can generate another red flag. In assessing a maintainable operating profit (EBITDA), the above detailed documentation is vital. A deficiency in data provided, or available, does place limitations upon analysis and potentially impacts analysis assessing of suitable value duetool to when the perception risk, tooperational which the revenues, including andwage is also usedper as occupied an expenses such as RevPOR, laundry and costs market will suitably price. analysis room.tool when assessing suitable operational expenses such as laundry and wageoperations, costs per occupied In of park occupancy In terms terms of caravan partial interests, including lessor’s room. caravan park operations, occupancy dataInisterms not asofuseful, with revenues per site type a and lessee’s interests, the above dataoperation. remains and data is notanalysis as useful, with revenues per site type a better tool of the property’s forms a significant partproperty’s of our analysis of suitable better analysis tool of the operation. Noting the labour-intensive nature of some market rental levels. - accommodation Noting the labour-intensive nature ofthe some businesses, normally largest accommodation businesses, normally the largest operating expense, it is further required that detailed operating expense, is required thatcases, detailed rosters In and wageitsummaries are in provided to again addition tofurther the above, such rosters andsuitable wage summaries areaprovided to again provide analysis on room night or unit/ full disclosure of leaseofon documentation, variations, provide suitable analysis a room“off night unit/site site basis. Discussion wages theorbooks” can basis. Discussion of wages “off the books” can generate renewals is required, among other documents. generate another red flag. another red flag. we acknowledge that the While In assessing a maintainable operating profit In assessing athe maintainable operating profit (EBITDA), above detailed documentation is vital. accommodation sector remains impacted by vital. the (EBITDA), the above detailed documentation A deficiency in data provided, or available,isdoes place COVID-19 pandemic, it currently appears prudent A deficiency data analysis provided, or available, does place limitationsinupon and potentially impacts limitations analysis and potentially value dueupon to the perception oflevels risk, to which the to adopt pre-COVID revenue in impacts our analyses value due to thesuitably perception of risk, to which the market market will price. on domestic travel restrictions not willpredicated suitably price. In terms of partial interests, including lessor’s continuing too much further intodata 2021. and lessee’s interests, the including above remains In terms of partial interests, lessor’s andand forms a significant part of our analysis of suitable lessee’s interests, the above data remains and forms marketThis rental levels. is currently supported by themarket lifting of a significant part of our analysis of suitable rental levels. Infrom addition to above, in such cases, In addition to the above, such cases, restrictions state tothe state andin the positive impacts fullfull disclosure of lease documentation, variations, disclosure of lease documentation, variations, on many accommodation providers’ operations. renewals is required, among other documents. renewals is required, among other documents. we acknowledge that the While we While acknowledge that the accommodation accommodation sector remains impacted by the sector remains impacted by the COVID-19 pandemic, COVID-19 pandemic, it currently appears prudent it currently appears prudent to adopt pre-COVID to adopt pre-COVID revenue levels in our analyses revenue levels in our analyses predicated on domestic predicated on domestic travel restrictions not travel restrictions not continuing too much further continuing too much further into 2021. into 2021. This is currently supported by the lifting of restrictions from state to state and thebypositive impacts This is currently supported the lifting of on restrictions many accommodation providers’ operations. from state to state and the positive impacts on many accommodation providers’ operations.

Andrew Kemp has worked with Acumentis since 2005 (then Cosgraves Property Advisers and subsequently Taylor Byrne) and Andrew Kempofhas worked with 2005 (then is a Director Valuations in theAcumentis Acumentissince Albury office.

Cosgraves Property Advisers and subsequently Taylor Byrne) and is a Director of Valuations in the Acumentis Albury office.

He has experience in all facets of valuation with a main specialty He has experience in all facets of valuation with a main specialty

in valuation and consulting assignments within the tourism in valuation and consulting assignments within the tourism

sector including including hotels, hotels, motels motels and and caravan caravan parks. parks. sector

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Explaining insurance terminology for accommodation operators WORDS_PETER SPRANKLIN, SPRANKLIN LEGAL & MORGAN GALLAGHER, SOLICITOR

If you are in business then the chances are you hold a policy of insurance either because your financier insists upon coverage or alternatively, you as an operator decide, prudently or following advice, that cover is worthwhile and necessary. Sounds logical enough, but there are occasions where we find the need for insurance is questioned. Often this thought is aligned with the size of business being acquired but nonetheless, given a recent enquiry along the ‘questioning’ line of thought we considered this subject timely and hence, this piece. We shall isolate certain terminology that you would have or will encounter within the Motel and Management Rights (MR) sectors.

MOTELS A typical motel lease contains a tenant obligation to cover the below risks: a) public risk insurance; b) plate glass insurance; c) building insurance; d) landlord’s loss of profits insurance; e) workers’ compensation; and f ) all other insurances reasonably required in connection with the motel. If you compare a landlord to a Body Corporate in the management rights setting, where legislation dictates that a Body Corporate must hold certain insurance, a motel lease is not regulated to the same extent and therefore tenant compliance with the motel lease is vital for both the tenant (and landlord). For example, we have

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never experienced a landlord that retains building insurance in addition to their tenant. Certainly, some landlords hold building insurance instead of the tenant but not viceversa. The above comments are just a few reasons for insurance cover in a motel lease being expressly written and not assumed. Another key requirement that you regularly find in a motel lease is the obligation to retain a ‘joint name’ policy which as the term suggests, names both the landlord and tenant as the ‘named insured’. Distinguish this requirement from other commercial leases that permit ‘interested party’ or ‘noted party’ particulars on the policy. In short, a ‘named insured’ can make a claim and enforce the policy directly against the insurer however, the conduct of the insured may affect

whether a claim is paid. When a party is nominated as ‘interested’ (eg a mortgagee) then they are not a party to the insurance contract but can however make a claim on the policy provided they are listed as a beneficiary of the policy. A ‘noted party’ is rarely referenced on a motel lease because that particular does not permit the subject party to make a claim at all. When entering a motel lease relationship be mindful of the above terminology and the insurance covenants in your lease as drafted. In the due diligence phase, understand your insurance and have the requirements costed by your insurance broker. Do not assume the landlord will check your insurance cover, be a responsible tenant and ensure you comply.

Trust. Honesty. MANAGEMENT RIGHTS A MR operator is less likely to encounter a building management contract that contains an insurance clause to the same level of specificity that a motel lease provides, simply because you are operating within a community living environment. However, you may experience an express obligation for professional indemnity and public liability cover contained in the terms of a building manager’s contract so that will be the focus of our comments. Professional indemnity cover we would anticipate is well understood as a concept, so we shall use this opportunity to stress that property

Dedicated to property

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managers should undertake their role with the potential for a claim in mind, and that mindset starts with the tenant assessment process. A tenant that has a history of claims on a landlord is probably not ideal. Thereafter, ensure that property inspections occur regularly, are documented, and a delay of internal rectification work should be avoided. Furthermore, consider the level of cover in line with whether you intend or are licensed to conduct sales as compared to letting only. In the last few years we encountered a client involved in sales that experienced an inspecting party who suffered

With experience dealing in a diverse range of transaction and non-transaction based commercial advisory and property work, we want to guide you through the activities that you undertake in the marketplace to achieve that optimal outcome.

from a personal injury whilst at the inspection. This category of insurance may assist with your defence of a claim and a higher amount of cover is desirable when performing sales.

For public liability cover you are best guided by your insurance broker as to the level of cover having regard to the size of complex. Needless to say, the best protection is to perform the common property repair and maintenance duties diligently, in accordance with the terms of your building management contract and report to the Committee any identified risks followed by corrective action.

Integrity. Integrity. Trust. Trust. Honesty. Honesty.

We listen We respond We deliver

That’s That’swhat whatwe’re we’reabout. about.

Dedicated Dedicatedtotoproperty property With With experience experience dealing dealing in in a diverse a diverse range range of of transaction transaction and and non-transaction non-transaction based based commercial commercial advisory advisory and and property property work, work, wewe want want to to guide guide youyou through through thethe activities activities that that youyou undertake undertake in in thethe marketplace marketplace to to achieve achieve that that optimal optimal outcome. outcome.

We Welisten listen We Werespond respond We Wedeliver deliver

Contact Contactusustoday todayonon07073221 32219149 9149 spranklinlegal.com.au spranklinlegal.com.au I S S U E N O. 9 9 _RESORTBROKERS.COM.AU

Management Rights, Leasebacks & Covid-19 WORDS_JOHN MAHONEY, MAHONEYS

As readers of previous articles I have written will be aware, I have never been a great fan of leasebacks. For those readers unfamiliar with the term "leaseback", it is the name given to the leases or tenancy agreements between an owner as landlord and the manager (or sometimes a company related to the manager) as tenant under which the tenant can sublet the apartment for short term letting. As it is a lease, the owner receives an agreed rent as set out in the lease irrespective of the return achieved from the short term letting of the apartment by the manager. It is often used by managers as a way of attracting to the short term letting pool owners who are concerned about inconsistent or potentially lower returns (from which the manager can make significantly greater income). The reservations I hold about such arrangements include potential breach of a manager's duty to a client where there is not full disclosure, a similar breach of duty (and code of conduct) if disclosure of such an arrangement is not made to other owners in the letting pool, the need for the tariffs paid by guests to be deposited to the manager's general account and not the trust account,

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the potential for the tariff to attract GST as the accommodation for the guest is being supplied by the manager in the manager's own right not as agent for an owner, how the income from the arrangement is treated for income verification purposes and the manager being locked into a significant financial liability should there be a downturn in the market. The COVID-19 crisis highlighted this last point with many managers finding themselves locked into significant lease commitments at a time when occupancies fell dramatically. In Victoria particularly, the fall in occupancy levels lasted for many months. Whilst the Government's COVID-19 initiatives around both commercial and residential tenancies presented opportunities for the manager to seek a rent reduction, waiver or deferral, there was always some uncertainty how that would play out. For example was a leaseback where the parties have used a residential tenancy agreement in reality a commercial lease arrangement where the manager as tenant can seek relief under the commercial lease relief provisions? Or was it what it states – a residential tenancy agreement

in which case the manager had to seek relief under the residential tenancy relief provisions? Fortunately most if not all managers were able to come to sensible commercial arrangements with their owners to pay a reduced rent for the duration of the period during extremely low occupancies. We saw very few disputes around this. Despite that it seems clear that in the future managers will be less keen to enter into such leaseback arrangements. I expect that managers will opt for some form of guaranteed return in letting appointments but with the ability to avoid or suspend the guarantee in circumstances like the pandemic. Well drafted provisions suspend the guarantee for any period in which the occupancy levels for the property are adversely affected due to events or circumstances beyond the control of the manager – such as COVID-19. Apart from the adverse impacts many managers faced and some continue to face during COVID-19, there are for the reasons expressed above, many other reasons why managers should be looking at a different model in the future.

Experts in Management Rights and Motel Law For over 30 years Mahoneys has been one of Australia’s leading management right and motels law firms. We are a preferred supplier to the Accommodation Managers Industry and have been awarded “Service provider of the Year” by the peak industry body (ARAMA) for the past 2 years. Our team of industry leading lawyers regularly assist clients with: Buying and selling accommodation businesses Preparing and reviewing leases, licences and service agreements Renewing and varying existing management arrangements Assisting with remuneration reviews, disputes and other disagreements Feel free to contact us if you want to discuss how we can help. Alternatively visit our dedicated industry web page or subscribe to our industry focused newsletter.

www.mahoneys.com.au

Brisbane office L 18, 167 Eagle Street Brisbane Qld 4000

Gold Coast office L 2, 235 Varsity Parade Varsity Lakes Qld 4230

p 07 3007 3777

p 07 5562 2959

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Relief Managers Please note: this is simply a directory service that we provide to assist you. Should you choose to go on holiday or take a break, we recommend you interview and qualify relief managers yourself, before hiring. Nb. You’ll find more managers listed on our website: resortbrokers.com.au/buy/reliefmanagers

CHARLES & COLLEEN LUBANS

DAVID & BELINDA GUSTAFSON

KARLA HARDING

Management Rights QLD

All property types Nationwide

Holiday Apartments, Resorts, Boutique Hotels & Air Bnb’s, Nationwide

0432 586 099 colleenlubans@hotmail.com

0403219 562 gustafsondavid@hotmail.com

0414 767 499 bnbangels@gmail.com

DILYS & NEIL HARVEY

DONNA & WALTER SIMMEN

DAVID AND SANDRA CAIRNS

Motels Nationwide

All property types QLD

Management Rights QLD

0420 948 996 neil.dilys@xtra.co.nz

0497 675 105 info@simmenanderson.com

0411 335 539 moretonbeachhouse@bigpond.com

CARMEL MOLONEY

ROGER ANDREWS & JILLIAN CAIN

FRED BISHOP

Motels QLD Coast

Hotels & Motels, VIC & SA

Motels Nationwide

0400 483 291 c.m.j64@hotmail.com

VICTORIA MCDONOUGH & BRENDAN HUGHES

0488 780 071 0403 021 504 jilliancain@optusnet.com.au

0429 444 010 flashb2261@yahoo.com.au

KEVIN & MELISSA SPEER

DYLAN STICKLE

Motels, East Coast

All property types QLD

All property types Nationwide

0412 138 642 vickymcdonough@bigpond.com.au

0422 006 497 speer1@bigpond.com

0457 586 225 dylan.stickle@hotmail.com

PETER & MICHELLE JACOBI

CRAIG & ANDREA JOHANSON

GRANT SKINNER

Motels & Caravan Parks Nationwide

All property types, Nationwide

Management Rights Nationwide

0427 183 416 casabargara@gmail.com

0436 358 877 0498 213 204 managers@vacationminders.com.au

THE GOOD KNIGHTS

SUE BARTON

CHRISTINE WILMOTT

All property types Nationwide

Motels Nationwide

All property types QLD

0432 336 703 info@thegoodknights.com.au

0432 411 900 bartonsue@rocketmail.com

0413 452 263 christine.09@bigpond.com

PAUL & TANYA GREEN

JOHN & VAL SAUNDERS

CHRIS BAKER & SHARON CHARLES

All property types NSW

Motel QLD & NSW

All property types Nationwide

0411 874 392 tanyacooper1@msn.com

0466 325 461 valandjohnsaunders@gmail.com

0418 748 903 sharon.charles@live.com.au

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0408 996 188 grantandjuliet@bigpond.com

SCOTT & LIN MCKENZIE

JOHN & SUSAN DONE

KAREN & ROBERT NISBET

Management Rights Brisbane Only

All property types Nationwide

Motel & Caravan Parks, Nationwide

0451 010 117 scott@mcwu.com.au

0447 077 420 suedone@mac.com

0427 933 414 0488 934 899 karen.nisbet70@gmail.com.au

KLARA ALLE & JOAO TOLINO

SHARON & STEPHEN DEWSBURY

LASZLO FAZEKAS

Motels, Nationwide

All property types Nationwide

Management Rights Gold Coast

0402 142 075 sharon@airliebeach.net.au

0474 555 525 fazalaca@yahoo.com

PETER CAMPBELL

CAROL PREECE & ALLAN VERDICH

BAY6 MOTEL MANAGEMENT

Management Rights & Resorts Brisbane & Gold Coast

Motel & Caravan Parks Nationwide

Motels Nationwide

0468 688 008 petcam100@hotmail.com

0438 822 295 carolpreece11@gmail.com

0416 016 614 info@businessbay6.com.au

LINLEY & ALISON MADDICK

LEONI & LAURIE BENNETT

GEORGIANNA DYSON

Motels QLD & NSW

Motels Nationwide

0432 008 988 alisonandlinley@icloud.com

0408 743 817

0438 527 894 georgi1440@icloud.com

NEROLI GLENYS REID

THOMAS GRAF

CHAZZ & ADELE PEARCE

Management Rights, Motels, Caravan Parks & Resorts, Nationwide

Caravan Parks, Nationwide

0488 060 755 neroli.reid@gmail.com

0438 014 035 07 4032 1573 tomas49@me.com

0437 718 526 0429 087 090 chazzpearce1@gmail.com

KEITH & JULIE JOHNSON

CHRIS CAMPBELL

KRISTY & LANCE BUTT

Caravan Parks Nationwide

Motel & Management Rights Nationwide

All property types QLD & NSW

0404 004 427 wckpt@internode.on.net

0449 957 414 cj.jwcampbell@gmail.com

0428 902 878 kristymay22@outlook.com

BRUCE DRURY

ROMAN SPIDLA

STEVE REYNOLDS

Motel & Caravan Parks Nationwide

Motel, Resort, Caravan Parks Nationwide

Management Rights QLD

0428 631 573 bruceandsandra34@gmail.com

0402 255 078 rayann3010@hotmail.com

0413 614 936 steve.managemenrightsrelieft@gmail.com

CHARLIE MILLINGTON & JACKY RYAN

PAUL KIRKPATRICK

SHANE & MADONNA ASHMAN

Caravan Parks & Motels Nationwide

All property types Nationwide

Management Rights, Nationwide

07 4622 3221 jacquelineryan1@bigpond.com

0419 675 671 paul.kirkpatrick@gmail.com

0414 181 310 03 5918 2535 joaotolino@hotmail.com

All Property Types Nationwide

0437 478 401 0438 146 091 shaneashman@outlook.com

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Meet our team Introducing ResortBrokers' national team of accommodation business and property brokers. We are the industry experts at your service in every state and territory.

IAN CROOKS

TRUDY CROOKS

TIM CROOKS

ALEX COOK

Chairman Nationwide

Managing Director Nationwide

Director of New Developments and Hotels, Nationwide

Director Nationwide

0411 171 648 ian@resortbrokers.com.au

0477 882 210 trudy@resortbrokers.com.au

0422 208 450 tim@resortbrokers.com.au

0467 600 610 alex@resortbrokers.com.au

CARLA COOK

MARISSA VON STIEGLITZ

NICHOLA LANE

BEN HALL

Director of Marketing and Strategy, Nationwide

Operations Manager Nationwide

EA to Trudy Crooks

Marketing & Communications Manager, Nationwide

0467 600 611 carla@resortbrokers.com.au

0437 198 164 marissa@resortbrokers.com.au

07 3878 3999 nichola@resortbrokers.com.au

0416 295 877 ben@resortbrokers.com.au

NATHAN EADES

JESSIE SHI

JEFF KEAST

KELLI CROUCH

Broker Brisbane

Broker South Australia

0448 339 920 nathan@resortbrokers.com.au

0422 935 428 jessie@resortbrokers.com.au

0414 669 007 jeff@resortbrokers.com.au

0410 441 750 kelli@resortbrokers.com.au

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GLENN MILLAR

CHENOA DANIEL

STEVE CAMPBELL

GREG JAMES

Senior Broker Sunshine Coast

Broker Sunshine Coast

Broker Central Gold Coast

Broker Gold Coast & Northern NSW

0412 277 804 glenn@resortbrokers.com.au

0403 143 151 chenoa@resortbrokers.com.au

0407 220 668 steve@resortbrokers.com.au

0416 247 068 greg@resortbrokers.com.au

PAUL MUELLER

TODD WARNER

DES FAGG

GRANT SULZBERGER

Broker Gold Coast North

Broker Gold Coast South & Northern NSW

Broker North QLD

Broker Central QLD

0439 255 507 paul@resortbrokers.com.au

0438 170 763 todd@resortbrokers.com.au

0427 849 119 des@resortbrokers.com.au

0455 053 832 grant@resortbrokers.com.au

SHANE CROGHAN

RUSSELL ROGERS

JASON VOGLER

JACQUELINE FEATHERBY

Broker Far North QLD

Broker NSW South Coast

Broker SE & SW QLD, NW NSW & New England Region

Broker NSW Central Coast, Hunter & Blue Mountains

0418 451 006 shanec@resortbrokers.com.au

0416 166 909 russell@resortbrokers.com.au

0427 431 213 jasonv@resortbrokers.com.au

0424 497 056 jacqueline@resortbrokers.com.au

CHRIS KELLY

DAMIEN LOORHAM

DAVID JEFFERIES

BLAIR MACDONALD

Broker NSW Central West

Broker Victoria & Tasmania

Broker Victoria

Broker Western Australia

0431 055 221 chris@resortbrokers.com.au

0409 399 932 damien@resortbrokers.com.au

0447 101 970 david@resortbrokers.com.au

0433 149 144 blair@resortbrokers.com.au

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