Vancouver’s hospitality sector has had its ups and downs throughout 2023 amid a shortage of rooms, rising prices and now a record-setting hotel sale.
The GEC Granville Suites Hotel was sold to an unnamed “local hotelier and prominent real estate developer” for roughly $70 million, according to commercial real estate services firm Avison Young.
The company says it’s the largest hotel sale in the city since 2017.
The 143-suite, 12-storey building was previously owned by education and student housing investment company Global Education Communities Corp. (GECC), and will remain a hotel under the new ownership.
“Hotels in Vancouver rarely go on sale, so this is a truly unique offering,” said Jason Mah, principal with Avison Young, in a statement.
Located in the city’s downtown on Granville and Drake streets, the hotel was bought by GECC in 2015 for $39 million. The most recent sale increases the property’s value by 79 per cent.
A shortage of hotel rooms and rising prices is spurring some developer interest in Vancouver’s hospitality sector. This is thanks to the city boasting Canada’s highest hotel occupancy rate at 89 per cent in June 2023 and predictions that local hotel prices will rise by 8.9 per cent in 2024, according to the Amex Global Business Travel Hotel Monitor report.
In addition, hotel occupancy in October of this year reached roughly 77 per cent, according to CoStar Group.
Avison Young also ranked Vancouver as the top performer among the country’s six major urban hotel markets in 2022.
GECC chairman, president and CEO Toby Chu said in a statement the decision to sell will allow the company to “explore other investment opportunities.”
There will be minor upgrades to the suites and common areas, while the White Spot located inside will continue to operate on the street level.
“Additionally, a future development site with multiple high-density, mixed-use projects in the nearby … area could bring more visitors – yet another opportunity for increased revenue,” Avison Young said in a release.
Destination Vancouver predicts that 20,000 new hotel rooms are needed in Metro Vancouver by 2050, with half of those rooms needed in the city proper.
– With a file from Glen Korstrom
Editor's note - Dec. 7, 2023: This story has been updated to clarify that Vancouver's hotel occupancy of 89 per cent is for the month of June and to include data on occupancy rates for October of this year.