Chateau Marlborough Hotel for sale with 45-year lease

The Chateau Marlborough Hotel in central Blenheim has been placed on the market after undergoing a major redevelopment involving an expansion and full renovation of the complex.

The property is being put up for sale by its current owner Marlborough hospitality investor Brent Marshall. He and his family will retain the hotel business on a new 45-year registered lease. The initial annual rental income from that lease will be $620,000.

Tony Vining, a director of Bayleys Nelson and Marlborough, and Michael Ryan, Bayleys Marlborough, have been appointed to market the property by deadline private treaty sale, closing Friday 16th December.

Mr Vining says Brent Marshall saw the potential for a luxury boutique hotel to cater for the region’s growing corporate, viticulture and leisure markets when he bought the former motor inn six years ago.

It was located on an under-developed 4,493m site on the corner of High and Henry Streets on the western fringe of the Blenheim CBD, and diagonally opposite the picturesque Seymour Square recreation reserve.

Originally a two-storey, 1,680m² 30-room motor lodge constructed in the 1980s, the complex has been expanded and upgraded to a 2,879m² 45-room Qualmark 4-star plus hotel. It now offers a diverse range of accommodation from executive studio rooms to a penthouse suite and has a new fitness centre, restaurant and bar and a purpose-built conference centre as well as an outdoor swimming pool.

Mr Vining says the sale of the Chateau Marlborough offers the ultimate passive investment opportunity. He says the hotel is now widely considered to be the best available premier accommodation provider in the region.

“It offers a long-term lease to a well-established management company with a very good track record in the Marlborough hospitality industry, and it is located in a region that is expected to continue to show strong tourism growth,” he said.

“It is one of the principal accommodation suppliers to the Marlborough Convention Centre - a new 750-seat purpose-built facility which opened in 2008, and is the preferred hotel for many Government agencies, national and local businesses and wineries. It recently hosted the Russian rugby team during their Rugby World Cup campaign.”

The hotel has secured a forward contract as the sole and exclusive accommodation provider with the Marlborough Civic Trust, including Blenheim’s new $17.1million performing arts centre which is scheduled for completion in 2013.

The theatre and conference venue will have a 700-seat auditorium and a smaller 300-seat theatre along with the 300-seat Riverview function room, and is expected to attract more visitors to the region.

The hotel is the second largest in Marlborough and the only Qualmark accredited 4-star plus graded hotel in the province. It is a finalist in the best accommodation category of Hospitality New Zealand’s 2011 awards and its restaurant, Quench recently won the ‘Best Breakfast to Wake Up To’ 2011 award in the national Hotel Club competition.

Brent Marshall says the Chateau Marlborough is trading well with an increasing annual turnover despite the continuing challenging economic environment. He says the hotel has always had a strong corporate base with substantial repeat clientele and is popular with high value tour operators because of its unique central city location along with the personalised service and the level of quality accommodation offered.

He says the Chateau’s own 60-seat conference centre has proved popular, fitting well with the hotel’s corporate appeal. It comes equipped with the most recent audio and visual technology and the conference room can be divided into three separate rooms for smaller meetings.

“We have found a real niche with this facility and both it and the restaurant have been well patronised by locals as well as visitors,” he said.

Bayleys Marlborough’s Michael Ryan says the hotel is an attractive, iconic property in Blenheim, and is well positioned to take advantage of the region’s growing leisure market.

“The upgraded Chateau Marlborough is already appealing to the top end tour market which has not had a luxury property like this in the region before.”

Recently released tourism numbers for Marlborough show the province is continuing to experience strong visitor growth. In August, visitor nights in Marlborough accommodation increased 19.1% on the same month last year, according to Statistics New Zealand’s Commercial Accommodation Monitor.

Within that, international visitor nights were up a staggering 43.6% and domestic visitor nights 7.7% up. During August, Marlborough hosted three conferences of more than 200 delegates. This is now the fourth consecutive month of increased visitor nights for Marlborough and the region’s growth rate was much higher than the national August average of 8.4%.

Tourism New Zealand figures for the 2010 year put the total visitor numbers to Marlborough at 1.396million, with tourism bringing $215 million into the region. Visitor numbers are forecast to continue to grow and the future for Marlborough tourism both internationally and domestically looks bright, says Mr Vining.