Two Chinese buyers intend to shell out $68.5 million for the Gold Coast's luxury Palazzo Versace hotel.
Late yesterday, Sunland Group entered into a conditional contract with two Chinese businesses — a construction group and a travel company — to buy the fashion-branded hotel, after emerging as bidders just two weeks ago.
In a statement to the ASX, Sunland Group company secretary Grant Harrison said the sale was conditional on approval from the Foreign Investment Review Board, the House of Versace and other parties.
"The sale price reflects the approximate book value of the hotel," Mr Harrison said.
The sale is expected to settle on November 30 and will be utilised initially to repay the hotel's debts of $27.4 million, he said.
Expressions of interest came from cashed-up suitors in the US, Europe, China, Asia and Australia.
The hotel underwent a multi-million dollar makeover last year and despite global economic woes heavily damaging the Gold Coast real estate market, McVay Real Estate partners Sam and Dan McVay, who brokered the final deal, said it was a perfect time to sell.
Palazzo Versace was the brainchild of Sunland Group founder Soheil Abedian, who approached the Italian fashion house in 1997 with the idea of a Versace-branded hotel.
The 200-room hotel opened on the Gold Coast in 2000 and has since attracted the world's wealthy and a host of celebrities, including U2, Beyonce and Jay-Z.
Dan McVay told brisbanetimes.com.au earlier this year that the sale of Palazzo Versace would allow Sunland Group to focus on other projects including the development of Carrington — a 47-storey apartment block development on the corner of Alice and Albert streets in Brisbane's CBD.
The proceeds of the Versace sale are also expected to go towards paying a $10 million legal bill Sunland now faces following the failure of a lawsuit the developer brought against two businessmen over a piece of waterfront real estate in Dubai.
Sunland has claimed it was duped into paying a $14 million fee to gain control of a space in the failed Mark II development.
Two men, Matthew Joyce and Marcus Lee, have been detained in Dubai in connection with the disputed deal since 2009, prompting an impassioned plea for their release from Senator Helen Kroger in Parliament on Wednesday.