Geocon has purchased the Garema Centre with plans for a luxury hotel

Geocon has purchased the Garema Centre and will transform the site into a luxury hotel.

The developers purchased the building at 70 Bunda Street on Thursday for $13.35 million and have plans for a $100 million development.

Geocon managing director Nick Georgalis said the hotel will help fill a gap in the market.

“Anyone who travels regularly to Canberra knows there are times when you can’t find a hotel room because there just isn’t enough supply, particularly for the luxury market,” Mr Georgalis said.

Chief Minister Andrew Barr recently returned from an official trip to Hong Kong, where he met with a number of international hotel chains in a bid to the firms to build more five-star international hotels in Canberra.

Fender Katsalidis Architects, the architects behind NewActon and Geocon’s upcoming Belconnen precinct, Republic, will design the hotel.

“We have commissioned world-renowned Fender Katsalidis Architects to bring to life our vision of a sculptural icon that will define the heart of the city and we will introduce a bold, new hotel brand to Canberra that will reflect the city’s status as Australia’s national capital,” Mr Georgalis said.

Geocon owns and operates the Abode group of hotels, but the Garema Place hotel will be one of its first deluxe offerings.

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The size of the hotel has not been announced yet.

The 1052-square-metre site has dual frontage to Bunda Street and Garema Place.

The building is currently home to 12 tenants including Chez Kimchi, Mussen Boutique and H&R Block and was marketed as a “significant long-term redevelopment opportunity”.

It is the third building in the Garema precinct to be sold since August 2016.

A four-storey building at 50 Bunda Street sold for $9.8 million in May and a two storey-building at 25 Garema Place sold for $1.9 million in August.

Colliers International manager Matthew Winter said the expressions of interest campaign attracted more inquiries than any other building the agency has sold this year. 

He said it was a flexible site, attracting interest from developers, investors, student accommodation providers, owner-occupiers and hoteliers.

About three-quarters of the inquires came from interstate buyers. 

“We saw significant inquiry from hoteliers, and it is not surprising considering the strength of the Canberra hotel market,” Mr Winter said. 

Other hotels slated for the CBD include a five-star Adina Apartment Hotel Grand next to the ACT Legislative Assembly and six-star villa accommodation and a five-star hotel at the casino.

Work on the Geocon hotel is expected to start in 2019, with the hotel opening in 2020.

– with Daniel Burdon