There will be new owners on the horizon for the Oak Bay Beach Hotel in the wake of it being placed into receivership this week.
Owners Kevin and Shawna Walker are no longer part of the operations of the hotel and Ernst and Young is in control working on a restructuring plan.
Changing ownership has become a fairly regular occurrence in Victoria, and across the country over the last two years with hotel investment seen as an attractive option for institutional investors.
Low borrowing costs and forecast increases in revenue per available room have helped fuel a robust hotel real estate market, according to Colliers International’s 2014 Hotel Investment Report.
The report noted that in 2013, 115 properties worth more than $2 billion changed hands in Canada. And there is a forecast for between $1.25 billion and $1.75 billion in hotel sales by the end of this year.
In B.C., there were 18 hotel sales worth $310 million in 2013.
In Greater Victoria and the Gulf Islands this year, there have been two major sales — the Fairmont Empress to Vancouver developer Nat Bosa, and Poet’s Cove on Pender Island to an undisclosed investor group. In both cases, no sale price was disclosed.
In 2013, Victoria’s Parkside Hotel was sold for
$23 million and the Brentwood Bay Lodge and Spa was sold to a Chinese firm, Forebase International Holdings, for $14 million.
Should the receivership process at Oak Bay Beach Hotel lead to new owners, it wouldn’t be the first time that’s happened in Victoria.
The Hotel Grand Pacific, built by Murray Gammon, was taken over by creditor Standard Life during an economic downturn in the mid-1990s and later sold to Pacific Sun in 1996.
In 2009, the companies behind the Traveller’s Inn chain of budget motels were into bankruptcy and the sites were sold to entities that have used them as hotels, supportive housing and rental housing.
Both the Parkside and the Belleville Park Resort, which includes the Huntingdon Hotel and Gatsby Mansion near the Inner Harbour, were put up for sale by court order in recent years.
In 2011, the Aerie Resort and English Inn were bought out of receivership, though the English Inn has again been listed for sale by Colliers at $8.5 million.
There is also a growing list of hotels and resorts on the Island that are for sale.
Currently listed by DTZ Victoria are the Quality Inn Waddling Dog at $6.275 million; the Choice Hotel on the Gorge at $6.275 million; the Quality Inn Resort Bayside in Parksville for $6.75 million; the Parksville Beach Resort at $4.975 million; and Pacific Sands Resort in Tofino at $29.8 million.