The prime Northbourne Avenue site of a former government office block turned four-star hotel has hit the market.
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Real estate agents Savills Australia and JLL have called for expressions of interest from potential buyers for the site of the Mantra MacArthur Hotel, at the south-western corner of the MacArthur Avenue and Northbourne Avenue intersection.
The 10-storey hotel and its adjacent 62-space underground carpark would be sold as part of the offering.
The site's owner, Canberra developer HTI Group, was late last year preparing to lodge plans to redevelop land in front of the hotel into a 10-storey apartment and commercial complex. The two blocks are separate, and The Canberra Times understands the new development proposal is not linked to the hotel sale.
HTI Group directors Adam Howarth and Jon Tanchevski did not respond to requests for comment.
The developer bought the former Department of Defence office building in 2014, before spending $19 million to convert it into a four-star hotel.
The hotel opened its doors to guests in 2017.
JLL's Hotels & Hospitality group vice president Andrew Langsford said HTI had indicated it wanted to sell the hotel site to "capitalise on the strong level of interest in the market".
Mantra Group, a subsidiary of AccorHotels, has a 15-year lease to operate the hotel, which includes 176 rooms, a restaurant/bar, conference room and gym.
Mr Langsford said the hotel could potentially be expanded or the site redeveloped, with new height limits for the block set to be introduced later this year.
Under the proposal, which is out for public consultation, building height limits on Northbourne Avenue would be lifted from 10 to 15 storeys - or 32 to 48 metres - on land at the intersections of MacArthur Avenue and Wakefield Avenue.
Mr Langsford would not speculate on a potential sale price, but said the prospect of increased building heights and Canberra's growing visitor economy would be attractive to potential buyers.
Canberra welcomed almost 5 million visitors in the 12 months to June last year, up 12 per cent on the previous year, according to the latest Visit Canberra statistics.
A number of new hotels are due to open in Canberra's inner city in the coming years, including a five-star hotel at Geocon's Midnight complex.
The 153-room Eclipse House on London Circuit and the five-star Adina Apartment Hotel Grand on Constitution Avenue are scheduled to open in 2020.
In October, The Canberra Times reported HDI Group was preparing a development application to build a 16-storey hotel at 13 London Circuit.
