A NEW Mercure hotel is set to be built above a Bunnings Warehouse in Melbourne’s eastern suburbs, after MaxCap Group committed to backing the project’s construction.
Site owner and builder, Scott McVilly and Ross Clarke’s Buildcorp Commercial, is developing 659-669 Doncaster Road in Doncaster, which will have an end value of $68.5 million.
MaxCap will provide a first mortgage construction facility for the project, which includes a mixed use building over seven levels. It will have three levels of basement carparking, a Bunnings Warehouse over levels one, two and mezzanine, and the 183-room hotel above, over levels three to six.
The Bunnings Warehouse is being constructed by Buildcorp Commercial and funded by Bunnings separately.
To be known as Mercure Melbourne Doncaster, the hotel has been designed by Clarke Hopkins Clarke and is expected to be completed by October and open in later in 2021 offering views of the Melbourne CBD, Port Phillip Bay and the Dandenong Ranges.
As well as reception and lounge area, it will include a hotel restaurant, bar area, show kitchen, production kitchen, meeting rooms, swimming pool, health and fitness centre, gymnasium, alfresco seating area, function rooms and business centre.
The hotel will also utilise the basement area and be allocated 124 car spaces.
“This will be a high-quality project for the eastern zone of Melbourne,” said Bill McWilliams, MaxCap Group’s chief investment officer said.
“The new Mercure Hotel will be very well-located on a mixed-use development site situated in a tightly-held eastern suburb with significant amenity.”
The management agreement secured with Accor makes Mercure Melbourne Doncaster one of the French hotels giant’s active pipeline. It is about to launch a Mövenpick Hotel on Spencer Street in the CBD, alongside Singapore’s Fragrance Group, and has just opened Sebel Melbourne Ringwood, further east.
The tourism and hotels sectors were among the first to be impacted by COVID-19, and according to Deloitte Access Economics will be among the last to recover. However, the firm predicts domestic trips will rebound this year to be just under 2019 levels, and 14% higher in 2023.
The Bunnings Warehouse in Doncaster is due to be handed over for fit-out by early August, and trading expected at the beginning of October.
“Ross and Scott have an outstanding track record in the building and construction sector. They have built close to 700 projects and have experience partnering with institutional grade financiers and focusing on achieving robust forecast investor returns,” McWilliams said.
MaxCap has just committed to backing the third stage of Geocon’s $156 million Republic Precinct project in Canberra, and last month appointed National Australia Bank executive Johnny Woodhouse as its new state director in Victoria.