Whitsunday’s Long Island to be redeveloped by new owners

One of NSW’s largest hospitality groups has bought Whitsunday’s Long Island for close to $20 million.

Oscars Hotel Group, owned and operated by brothers Bill and Mario Gravanis, has plans to significantly redevelop the resort which has been closed for five years. This is the group’s first Queensland investment and while they didn’t respond to media requests, realcommercial.com.au understands they plan to create an “upscale resort”.

Long Island, originally developed as a resort by Contiki, had been owned by Sydney-based investor David Kingston for more than 20 years. Mr Kingston previously owned Club Crocodile in Airlie Beach. His current Queensland investments include the heritage-listed Hide Hotel and Sunlover Reef Cruises in Cairns.

Listed in 2016, the sales campaign for Long Island presented CBRE Hotels’ Wayne Bunz and Hayley Manvell some challenges along the way: An offer by a Middle Eastern buyer interested in launching a Sixth Sense resort on the island fell through; and then last year, the COVID-19 pandemic wiped out Queensland’s $28 billion tourism industry.

Its sale is being hailed as an indicator of a recovery driven by local investment.

The new owners of Long Island plan to redevelop the resort. Picture: Supplied by CBRE

Ms Manvell told realcommercial.com.au the sale of Long Island reflected a strong lift in domestic investment in leisure, lifestyle and regional assets, particularly from Melbourne and Sydney investors.

“We have never been so busy,” she told realcommercial.com.au

“The level of enquiry we are seeing for regional and leisure assets right now is at unprecedented levels. It is particularly encouraging to see domestic capital shifting out of their key markets, predominantly Sydney and Melbourne, and into other destinations that in the past they may not normally have had interest in.

“Astute investors are more than ever seeing the incredible opportunity that Australia’s tourism industry offers, as domestic tourism will continue to be strong and international travel will have an incredible rebound when the international orders re-opens” she said.

Recent data from Tourism Research Australia reveals the resurgence of Queensland’s tourism sector is underway. Visitors spent $1.9 billion in January 2021, up from a $1.3 billion in December 2020. And over this year’s Easter long weekend, 146,000 people flew into Queensland’s largest airports, according to Tourism and Events Queensland.

TRA’s Tourism Recovery Scenarios report released last month, showed Queensland was likely to recover faster than any other state or territory, returning to pre-pandemic 2019 domestic tourism levels around March 2022.

Ms Manvell said Long Island’s access to mainland power – a rarity for islands – existing resort infrastructure and its idyllic setting in the Whitsundays had been drawcards for domestic buyers.

“Australia’s tourism industry is going through a renaissance and the Whitsunday’s region has certainly been a key beneficiary of the rebound in domestic travel, a trend which will only become a stronger in the future,” she said.

Meanwhile, market sources are reporting that the sale of Dunk Island to a domestic buyer is close. Dunk Island was placed back on the market last November with a reduced price tag when its $31.5 million contracted sale to investment group Mayfair 101 fell through. JLL Hotels and Hospitality Group is managing the sale of the property which includes 135ha of freehold land, a mainland power connection, airstrip, and the resort infrastructure.

Pumpkin Island is on the market for only the second time since it was established in 1961.

Pat O’Driscoll from Knight Frank Australia told realcommercial.com.au that there had been considerable interest from domestic investors in the sale of Pumpkin Island, which sits in the Southern Great Barrier Reef Keppel Group of Islands.

Pumpkin Island is on the market for the second time since 1961. Picture: realestate.com.au/buy

The six-hectare island has a price guide of $20 million to $25 million. In 2019 it was named Australia’s most sustainable hotel in Australasia at the World Boutique Hotel Awards. It was also the first beyond-carbon neutral island in Australia, offsetting 150% of its annual greenhouse gas emissions.

The sale is a leasehold arrangement until 2046 and then a rolling lease.

CBRE Capital Markets, Hotels director Tom Gibson told The Australian this week that with the continued international border closures, the resort islands were being pursued by domestic investors seeking escape-style investments that were pandemic resilient.

“It’s a unique time in the market,” he said.