Auction roundup – Luxury hotels and iconic partnerships

2 October 2020 | Investment

This week, we provide a rundown of the latest auction news, from a one-of-a-kind hotel business site up for sale in South Africa’s Cape Town, to Foxtons and BidX1’s strategic alliance.

Luxury hotel business site in Cape Town up for auction

A business zoned site with potential to develop into a boutique hotel in the exclusive Atlantic Seaboard neighbourhood of Cape Town – dubbed the ‘French Riviera’ of the southern hemisphere – is to go under the hammer at High Street Auctions’ upcoming sale.

Set to be a steal for developers, plans for an 18-suite hotel spread over seven floors above ground and a further three basement levels have already been drawn up for the 543 square metre site opposite Clifton’s first beach on the Table Mountain side of Victoria Road.

Other design features of the plan include a fully automated parking garage for 21 vehicles, a further 235 m sq for entertainment, dining and reception spaces, back-of-house facilities and a retail element on the ground floor.

Auction roundup – Luxury hotels and iconic partnerships

Rodney Beck, director of High Street Auctions, says years have been invested in planning and application processes to bring this unique hotel project to the point of fruition. “The land has been rezoned to General Business 1, a demolition certificate has been obtained for the old cottage that remains at the rear of Erf 337 and excavation of the front portion has already begun.”

“Cape Town’s City Council has also granted approval for a portion of Erf 145, measuring 76 m sq, to be sold to the owners of the adjacent Erf 337 for a price of approximately $195,000, escalating at 8% per annum from 1 September 2018. Although this acquisition is not compulsory, it allows the developer to build a bigger scheme with more parking and a larger footprint.”

Beck also reveals that the lucky developer will for the first time have the option of purchasing a smaller vacant Erf on the apostle stairs, adjacent to the right rear portion of the proposed hotel site.

According to New World Health’s April 2020 South African Wealth Report, the stretch of Victoria Road where the planned hotel site is located is ranked as the most expensive street in the country, with pre-Covid real estate prices there averaging out to around $5,700 m sq.

The report also notes that Clifton as a whole takes top ranking as the most expensive suburb in South Africa.

Joff van Reenen, director and lead auctioneer at High Street Auctions, says this exclusivity is attracting the attention of international investors. “Clifton is the French Riviera of the southern hemisphere. It’s a global hotspot to see and be seen, which doesn’t render it impervious to overall downward trends in the real estate sector but does increase its desirability as a safe harbour investment in very turbulent times.”

“It’s indisputable that our world has been changed by this pandemic. International borders are reopening, though, and people will travel again soon – perhaps slightly more selectively than before – but travel they will, and Cape Town will reap the benefit.”

The next virtual auction will be streamed live from 12pm Central African Time on October 8. For more information, visit www.highstreetauctions.com.

Foxtons and BidX1 announce ‘strategic’ collabaration

Digital property investment platform BidX1 and London estate agency Foxtons have announced a strategic alliance which will see BidX1 become Foxtons’ exclusive auction partner.

The move follows the success of their early collaboration, when Foxtons began listing selected properties in London and the South East via BidX1’s digital platform, achieving more than 40 joint sales and approximately €20 million in total sales value.

BidX1 currently operates across five markets – the UK, Ireland, South Africa, Spain and Cyprus – and has taken an innovative approach to property transactions, combining established real estate expertise with proprietary technology.

With over 50 interconnected offices across London and the Home Counties, Foxtons says it is passionate about using technology to streamline the sales and lettings process in order to provide the best possible service for its customers.

Stephen McCarthy, founder and chief executive officer at BidX1, comments: “We are very pleased to have partnered with Foxtons, who have always been early adopters of technology, to offer properties in London and the Home Counties via our digital platform.”

He says the growing demand for a more modern, digital approach to property sales is a trend which has been augmented by the Covid-19 pandemic.

“Our model has mitigated against risk for both vendors and investors because the full transactional process can take place digitally. The platform provides certainty in terms of deal execution, transparency throughout the entire process, and powerful real-time data to inform decision-making across the full sale cycle.”

“Combine this with our platform’s global investor audience, who are actively seeking cross-border investment opportunities, and it’s clear that we are uniquely placed to complement the expertise and experience of market-leading firms like Foxtons.”

John Ennis, managing director – new homes & Central London at Foxtons, adds: “Providing an exceptional level of service for all our customers is at the core of what we do at Foxtons. We’re passionate about helping buyers, sellers, tenants and landlords navigate the UK’s toughest property market, so we are keen to support anything that makes that process easier.”

“We wanted to partner with a company who shared our value of using technology to serve customers better, and who would be able to offer our buyers and sellers a viable alternative to private treaty sales. We’re pleased to have seen many successful sales through our partnership with BidX1 to date, and we look forward to working with them going forward.”

103-bed hotel & spa opportunity set for auction

An iconic Victorian estate located in Kelham, Nottinghamshire, is set to go to auction in October through Allsop.

The site, Kelham Hall & Country Park, has been on the market with specialist business property adviser Christie & Co since June 2020 and the current owner has partnered with Allsop to auction the property.

The estate presents a ‘fantastic’ development opportunity, with full planning and listed building consent for conversion to a 103-bedroom hotel, complete with a spa, food and beverage, and recreational facilities as well as a wedding and events venue.

Dating back to 1893 and designed by Sir George Gilbert Scott, the property is ideally located outside the market town of Newark-on-Trent, just a few minutes away from the A1, and is well-connected to the East Coast main line stations of Newark North Gate, Newark Castle and further afield to Grantham. It is also within close proximity of the A46 and the M1.

The Grade I, II and II* property is set on circa 44 acres of formally designed landscaped gardens and parkland, regarded as one of the country’s largest prime wedding, conference and events venues, with capacity for multiple events in excess of 1,000 people. It also benefits from fishing rights, allowing guests to make use of the riverside location.

The current owner has secured full planning and listed building consent from English Heritage as well as discharging all the prestart planning conditions associated with the hotel and spa development scheme. The redevelopment requires almost no major structural change, with works using the current room layout from its original design as a stately home.

Ryan Lynn, director of corporate hotels at Christie & Co, says: “We have had a very strong level of interest in the opportunity to date, which hasn’t surprised us due to how fantastic the building and the potential is.”

“However, we also wanted to see what effect an auction process would have on the final price for our client, and are therefore working with the very well-known Allsop auction house to drive interest and achieve the very best possible price with set and focused deadlines.”

Kelham Hall & Country Park is scheduled for sale by auction online on Thursday 29th October, with a guide price of £6,500,000.

This post has originally been featured in Property Investor Today.