Melbourne is expected to see continued home price growth, as recently reported. Meanwhile, the city's commercial real estate sector could also see the same trend with new developments emerging such as the New York-style miniature hotel rooms that is being proposed for Melbourne.
According to CommercialRealEstate, there is a proposal to erect a 31-story tower, designed by Sydney firm Crone Architects, on City Road in Southbank. The plan includes 270 hotel rooms of which 240 rooms will be just 17 square meters each and that is only half the size of a standard hotel room. Besides this proposal, an apartment development opportunity was presented by the owners, Webjet director Steven Scheuer and Julie Moss, for the 910-square-meter site at 63-69 City Road. The asking price for the site was $15 million.
After Victorian planning minister Richard Wynne introduced new planning rules that specified height restrictions and density for CBD and Southbank development sites, the owners for the site decided that a hotel would be a more fitting project for that spot.
Moreover, the idea of inexpensive and smaller pod-style rooms within the mixed-use development was fueled by the fact that the area has limited hotel room supplies and rising hotel room rates as tourists enter Australia at record levels. According to the agent who handles the sale of the site, Michael Ryan of Fitzroys, "There is absolutely demand in Melbourne from people who don't want to spend $300 a night, and the pod concept will fill this massive gap in the Melbourne hotel market."
He added, "These new concept hotels offer high-tech features, convenience, and artistic and modern interior design features, unlike some economy hotel chains. The rooms are slightly more compact than your average hotel room, translating into lower prices."
According to CommercialRealEstate, planning minister Wynne permitted more than 1,600 new hotel rooms around the Melbourne CBD. In the meantime, both City of Melbourne and state government planning authorities are amenable to the application.
Read more: Rising Rents in Melbourne Suburbs
