The prospect of net rental yields between 6-8 per cent after all expenses has driven interest in Geelong’s Ritz development, 90 per cent of which has already been sold and under contract.

The 4.5-star apartment hotel planned for the city’s neglected Ritz site has proven popular for self-funded retirees wanting to invest in residential property with potential net rental yields comparable to that of commercial property.

Melbourne developer Integrated Development Solutions are responsible for building the nine-level tower on the corner of Bellerine and Corio Street.

The company’s recent projects in Geelong include the Vue apartment hotel and the award-winning Devlin Apartments. 

Click here to gain access to the Ritz Geelong website

IDS Director Phillip Petch said the yields forecast for the Ritz “were already happening” at Vue.

“I retained a one-bedroom apartment at Vue that turned over a gross rent of $57,000 last financial year,” he said.

“It really is a set and forget investment.

“It can be very difficult to get a room in Geelong.”

An aerial view of Geelong. Source: The Ritz

In order to assist with the planning of the development, consultancy firm Macroplan Dimasi was commissioned to provide a report on Geelong’s tourism and accommodation market.

The research found that overnight tourist visitation (domestic and international) for the Geelong region has recorded solid growth since 2007, with overnight trips increasing from 967,000 to 1,501,000 in 2017, at a CAGR of 4.5 per cent.

The figures mean Geelong ranks alongside Darwin (1.5 million overnight visitors) and above Hobart (1.3 million overnight visitors) in the national tourism hierarchy.

Mr Petch said while there had been a noticeable increase in demand throughout the city, it had not been matched with supply growth.

“Nothing has been coming into the market to meet the demand,” he said.

“Between 2011 and 2016, there has only been an increase in the stock of rooms by 5.6 per cent.

“There has been coupled with a huge leap in demand.”

Geelong accountant and Ritz investor Barry Kittelty has seen the evolution of Geelong as a tourist drawcard first-hand, having worked in the city for more than three decades.

He said he had never seen the city so highly sought after by investors.

“I have clients developing residential land and also have clients who have bought in the immediate area of the Ritz, and they’ve all done very well,” he said.

“My office is actually right next to the site so I can literally see it – that’s how well I know the direct area.”

Collective Hotel Management, operators of the five-star Tingirana apartment hotel in Noosa, have been appointed managers of Ritz.

Construction on the Ritz hotel apartments is scheduled to be completed at the end of next year.

For more information, including the developer's final release of properties, visit the Ritz website.

To discuss the project in more details and expected yields phone or email Jim Chapman via the contact details below. 

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