The Menzies Building in Invercargill has been purchased by the owner of Distinction Hotels, who will turn it into a 150-room hotel.
Geoff Thomson, the owner of Distinction Hotels, bought the Menzies building from Pascoe Properties.
Gaire Thompson, the owner of Pascoe Properties, said his team had put a lot of time and effort into the building, intending to rent it out as office space. However, he was quite happy Thomson had approached him.
He said he could see the potential for a hotel, with the building's central location, view of the city and many windows.
Thompson was unsure how many tenants were in the building but said he would work with each to ensure a smooth transition.
Thompson had recently purchased the Invercargill Railway Station building, which would be converted into offices, he said, and where they would relocate some of the tenants.