Travelodge checkout stalled as Mirvac says time to go

A move by listed company Mirvac and its NSW motoring organisation partner NRMA to rid themselves of a $620m hotel portfolio investment is proving troublesome.

Local operators of the Travelodge brand are refusing to hand over properties.

A move by listed company Mirvac and its NSW motoring organisation partner NRMA to rid themselves of a $620m hotel portfolio investment is proving troublesome, with the local operators of the Travelodge brand refusing to hand over the properties.

TFE Hotels, a joint venture between Australia’s TOGA Hotels and Singapore’s Far East Orchard Limited, is refusing to vacate 10 Travelodge hotels that the property giant and its motoring partner sold to a consortium led by fund manager Salter Brothers in July last year.

The hotels sold to the Salter Brothers Hospitality Real Estate Joint Venture, owned by Salter Brothers, Singaporean fund GIC and global private markets investment firm Partners Group. Toga submitted an expression of interest to buy the portfolio but was unsuccessful.

Mirvac’s funds unit has brought urgent court proceedings in the NSW Supreme Court arguing for the Toga and the Singapore-controlled TFE to vacate the hotels in NSW, including Newcastle, Wynyard, North Ryde, Blacktown, Bankstown and Manly, as well as Melbourne’s Southbank, ­Brisbane’s Mount Gravatt and in Perth.

It said it had given termination ­notices at the end of March and wanted Travelodge out by June 30. But TFE has argued since April that the notices were invalid.

French hotel giant Accor in April revealed that it would become manager of the Salter portfolio of hotels and would largely brand them as Mercure hotels. Accor was slated to rebrand flagship properties near Wynyard in Sydney, as well as in Perth and Melbourne, as Mercure ­hotels.

Another property in Sydney’s CBD will be rebadged the Ibis Styles Sydney Central, and all up the Salter portfolio would add about 2000 additional keys to the Accor network.

Toga and its management vehicle, Value Lodging, are using various technicalities to argue that they should not vacate the popular hotels despite the fact that Mirvac says it has properly issued the termination ­notices.

The court case comes as domestic tourism is booming, particularly in Sydney, with the present Vivid festival attracting thousands of tourists to the city’s CBD each night.

Mirvac has sought urgent declarations from the court, claiming the purchase of the properties by Salter Brothers depends on the hotels being vacant.

“(If) vacant possession of the properties is not delivered by Mirvac by June 30, 2022, Mirvac will incur ­financing costs, time value of money costs, direct interest costs, and opportunity costs,” wrote Allens solicitor Jonathan Light, who is acting for Mirvac, in an affidavit.

The parties declined to comment.