The Q+A has been devised as the most appropriate way to explain this investment.
What is this property investment?
A dual key apartments in the newly completed apartment hotel Ramada Hervey Bay. The hotel comprises 44 dual key apartments, a triple key apartment (91 rooms) and a managers apartment located at the marina in Hervey Bay. The hotel commenced operations in October 2009. The investment has been structured to take advantage of the next property upswing predicted in 2012 to 2104.
Who should invest and why ideal for self managed super funds?
Investors and the reasons why they invest into a luxury Ramada apartment will be many and varied – but generally always investment optimisation and lifestyle. Let us briefly go over some of these;
- Self Managed Super Funds – this is an ideal investment for self managed super funds.
- First Investors – what a great way to get into property for first time investors.
- Serial property investors – those seeking to expand and diversify their property portfolio – spread your investments amongst a number of properties.
- Investment and Lifestyle – those seeking to both have a great investment and a great lifestyle component.
What is a dual key room?
A dual key apartment is essentially a two bedroom apartment (a one bedroom suite and a studio room) but configured in such a way that the suite and studio can be independently occupied to enable a ‘double’ revenue opportunity. This is aimed at maximizing revenue return and flexibility.
Why is Hervey Bay a good place to invest and specifically Ramada Hervey Bay?
One of the fastest growing areas in Australia – outstanding real estate growth
Nature’s wonderland – Fraser Island, Sandy Straits, Lady Elliott Island to name a few – and of course the whale watching capital of the world
Over 2.7 million visitors a year to the Fraser Coast
Over 1.2 million visitor nights a year to Hervey Bay
New airport for jet traffic and jet services – Qantas and Virgin
Ramada is a global brand name – first international hotel brand to Hervey Bay
Ramada is owned by Wyndham Hotel Group the largest hotel group in the world
Ramada Hervey Bay is all dual key apartments to optimize revenue stream
Located beside $800 million of planned marina redevelopment including 200 new berths
New Wyndham Hervey Bay Resort to commence construction late this year early next year
Hervey Bay is a hub for tourism and agriculture – population of nearly 60,000
Have the apartments been valued prior to purchase?
Yes an independent valuation has been undertaken on all apartments.
Has research been undertaken on property cycles?
Most property investors would agree that now is the time to invest into quality property. Much evidence according to Bill Morris of Midwood points towards a sound property upswing in 2012 and 2014 – especially in Queensland where there is still 110,000 population growth and the fundamentals of the state are very strong. Midwood has investigated in detail the 7 year property cycles.
Midwood undertakes a quarterly analysis of the Queensland property market and Bill Morris indicates in his commissioned report that the purchase of the Ramada Hervey Bay fully furnished apartments at under $4,000 per square meter for a dual key apartment including furniture offers excellent value with respect to both rental return on capital and capital growth. Despite the economic crisis apartments in both Brisbane and the Gold Coast are still above $5,000 per square meter. Considering Hervey Bay is still a maturing residential and tourist market this square meter purchase price for a quality property provides growth opportunity above what would be expected as ‘normal growth’.
The Property Investors Association of Australia (PIAA) undertook a detailed and independent ‘Advantage Statement’ on Ramada Hervey Bay and rated the development 4 star – the highest possible rating. The PIAA report will be available to all prospective investors.
Steven Turnbull of Aspire Resorts and Apartments has undertaken an analysis of Ramada Hervey Bay as to marketing strategy and optimization of occupancy percentage and room rates. He concludes that Ramada Hervey Bay has a very strong marketing plan and that the dual key apartments allow occupancy and revenue optimization.
What are the main capital growth drivers?
Capital growth is not assured however historically there is fundamental recipes for capital growth and factors which drive good positive growth.
- Hervey Bay is an emerging tourism market and growth area with many sound attributes
- Ramada Hervey Bay is well located in the marina precinct adjacent to $800 million of proposed new redevelopment
- With the global financial crisis very little new stock is coming on the market which will create a demand factor
- A purchase price of only $3,000 per square meter is exceptional value
- Being dual key apartments with excellent forecast revenue returns drives capital growth
Tell me about Ramada Hervey Bay operations?
On the Ramada Hervey Bay web site www.ramadaherveybay.com.au you can view full details of the resort packages and what Ramada Hervey Bay has to offer.
