The Black Sheep Backpackers sale is an opportunity to invest in the Queenstown tourism industry.

An award-winning hostel is for sale in Queenstown, giving investors a rare chance to buy a freehold tourism investment in New Zealand's most famous mountain resort area.

The Black Sheep Backpackers hostel at 13 Frankton Rd in Queenstown is located close to the town centre and on a main arterial road into Queenstown.

"This is one of the better opportunities we have seen in the market in the past year," says Steve McIsaac of Colliers International's Queenstown office who, with colleague Barry Robertson, is marketing the hostel for sale by deadline private treaty closing on March 20.


The hostel encompasses 1088sq m of freehold land and a well-maintained purpose built accommodation building with 23 bedrooms that accommodates up to 83 people. The accommodation ranges from dorm rooms through to doubles, twins, deluxe super kings, deluxe twins and deluxe triples.

A new central heating system was installed throughout the building 18 months ago and the hostel has secure car parking which is a rarity in Queenstown.

Non-powered campervan sites are situated in the hostel car park and offer these travellers the use of communal facilities such as kitchen, showers, toilets, laundry and spa.

The hostel's official website, at describes the facility as providing "cycle friendly accommodation" with dry, lockable bike storage year round, bike wash and repair facilities, and road bike hire.

Guests have the use of a comfortable lounge with plasma TV, videos and satellite TV; a relaxing reading area with a log burner; new computers with Skype and webcams; free internet in all rooms, the lounge and reception area; a well equipped kitchen with free coffee and tea making facilities; a laundry and free luggage storage. Other attractions include a heated ski and snowboard drying room in winter and "chill out" spaces in the dorm rooms with bean bags and couches.

The property, which has its own herb garden, is located beside the historic Queenstown Gardens and features 360-degree views of the lake and the Remarkables.

Zoned for High Density Residential use, the hostel has large outdoor recreational areas along with barbecue facilities and a spa pool which is free for guests.

"This is an ideal business opportunity for someone wanting to come in and invest in a successful tourism property in Queenstown," McIsaac says.


"The investment is secured by a new 30-year lease to the established operator who has an excellent reputation in the industry."

The lease generates current annual rental of $200,000 plus GST and has locked in rental growth through regular rent reviews.

McIsaac says the property is located in a central, quiet location, only two minutes' walk to the central business district which is a key requirement for backpackers.

Robertson says the investment opportunity is supported by growth in the tourism industry in Queenstown, which continues to attract an ever growing number of visitors.

"The region's tourism industry saw steady growth through 2013 with the number of visitors staying in Queenstown continuing to outpace the rest of the country.

"For the year ended August 2013, Queenstown commercial guest nights were up 8.9 per cent over the same period in the previous year, compared with just a 2.8 per cent increase in guest nights nationwide."


Total passenger numbers travelling through Queenstown International Airport were over 1.2 million in the year to December, up more than 5 per cent on the previous year.

Robertson says Colliers' latest hotels research report shows the Queenstown hotel sector had shown a notable recovery, with hotel occupancy levels in September up 7 per cent on the same period last year.

"Average room rates have increased 10 per cent over the past five years, while revenue per available room in Queenstown grew by 9 per cent in the year to September, compared with the previous year."