JLL advises on refinancing of Le Méridien Melbourne

SYDNEY / MELBOURNE, 18 September 2023 – JLL has successfully advised the private owner of the Le Méridien Melbourne on the refinancing of the existing debt facility for the striking trophy hotel, located at 20 Bourke Street, in the heart of Melbourne’s CBD.

With the debt market having gone through significant changes in the past year given the unprecedented increase in interest rates, JLL was able to create a range of solutions for the owner via a competitive tender process. 12 financing offers were submitted for the property and after a short-listing process, the preferred solution was executed within an expedited time frame to secure the best possible outcome for the borrower.

Leading the transaction for JLL was Executive Vice President Adam Bury, who commented, “Whilst the Le Méridien Melbourne did have limited trading history, having only opened in the first quarter of 2023, we were able to secure incredibly strong terms for the owner through our strategic and considered approach to potential lenders.”

Bury continued, “We see a changed debt market in the second half of 2023, particularly as existing lenders review their existing loan books. However, increasing capital allocation to commercial real estate debt from non-bank lenders ensures that we are not short on options for our clients. In this instance, the quality of asset, location and in-place management agreement proved pivotal for the outcome.”

Le Méridien Melbourne has a history dating back to the 1850’s, with the heritage façade of the building having been sympathetically and stylishly incorporated into the present day building by Melbourne-based architect Peddle Thorp. The 235-key property draws on elements of the building’s past, when it has been home to both a nightclub and cinema, themes that are drawn upon with the present-day building’s interiors.

Bury concluded, “As Melbourne’s hotel market continues to recover from COVID, we continue to see good levels of both equity and debt interest in the market for the right deals. It is however clear that we are in a new phase of the cycle, and with this imperative that owners seek thorough and well thought out advice for any capital events within their portfolio”.