Agents had hoped the Barton landmark would attract between $8 and $10 million at auction, having dealt with approximately 40 interested parties throughout the six week marketing campaign.

Successful bidders, a joint venture between Toga Hotels and NRMA, beat out seven other registered bidders for the heritage listed Art Deco style property.

Despite the final sale price facilitated by auctioneer Glen Madsen, Colliers International agent Michael Heather said it was positive that the property sold at auction.

“We thought it might have been a bit higher, but overall [we’re] happy with the price,” he said.

“Heritage sometimes affects the price, because of the limitations of what can be done. It’s always an interesting question of whether heritage will impact positively or negatively on values.”

Mr Heather said the sale would be settled by the end of the financial year, adding that the lease for the current tenants - the Blue Mountains International Hotel School – would end in May.

Michael Herman from Toga Hotels said his group was happy with price, having been interested in the property for a number of years.

“Expansion in Canberra has always been high on our agenda,” he said.

He said the group was looking to convert the hotel into a larger hotel and was considering branding it under its Travelodge portfolio while retaining the Kurrajong name.

Mr Herman said the group also had experience with heritage buildings similar to the Hotel Kurrajong, which was designed in 1924 by the Commonwealth’s chief architect and Old Parliament House designer John Smith Murdoch.

“There’s always something unique in the story and I think people come to stay in heritage hotels for more than just a bed,” he said.

“We’re going to continue operating it as is before the rebrand. Potentially, we may even operate it through the redevelopment. It just depends on the logistics.”

Mr Herman said planning and additional work on the property - which includes 26 executive rooms, 47 single budget rooms with ensuites and an additional 44 single budget rooms with shared facilities across the 16,426 square metre block - could take up to two years.

He said the group would retain the historic nature of the hotel, which was home to Labor MP and former Prime Minister Ben Chifley from 1928 to 1931, and again between 1940 and 1951.

It was at the hotel where he suffered a fatal heart attack in 1951.