• Site: 171 Macquarie Street, Hobart, with works also covering 167-169 and 173 Macquarie Street and the adjoining road reserve
• Decision: approved by the Hobart City Council Planning Authority Committee on 21 October 2026
• Developer: Fragrance Group (Singapore), owner of the neighbouring Ibis Styles Hobart
• Estimated cost: about $16 million, as reported at lodgement
• Building: 14 levels, linked to the existing hotel
• Accommodation: 36 serviced hotel rooms or apartments
• Food and beverage: a ground-floor restaurant of about 127 sqm, plus function and bar facilities
• Parking: 105 spaces, with 82 in a multi-level podium and 23 in a basement
• Demolition: the existing three-storey office building at 171 Macquarie Street and part of the adjoining Travelodge
• Other works: public art on the facade, pedestrian links to the hotel and a boundary adjustment that consolidates the land into two lots

The plans were first reported in early September, when Fragrance lodged the application and it went on public exhibition until 18 September. At that stage the scheme was described as a 13-storey building. The council's approval describes it as 14 levels, which includes the basement parking.

Almost half of the building is car park. Six levels of parking sit at the bottom of the tower, then a function room with city outlooks, then six floors holding the 36 serviced apartments. The apartments are not designed with balconies. A small restaurant fronts Macquarie Street at ground level.

The clever part is how the new building works with the old one. The apartment floors line up with the matching floors of the Ibis Styles so the two buildings operate as one. Guests check in at the existing hotel reception and use its pool and gym. In practice Fragrance is adding a wing to its hotel rather than opening a second one.

The Ibis Styles Hobart sits at 173 Macquarie Street in the CBD. Fragrance lists it at 11 floors and 296 rooms with a fitness centre and indoor pool. The group describes it as Tasmania's largest hotel.

What it has never had is enough parking. Reporting on the application put the hotel's on-site parking at just 38 spaces. That is a real problem for a CBD hotel in a city where many visitors arrive by car, hire a car at the airport or drive down from the north of the state.

Fragrance's argument was simple. The new building provides more parking than the planning scheme would normally allow, but the extra spaces would finally fix a shortfall at the hotel that has run for years. The committee has now accepted that case.

Parts of the new building sit outside the amenity building envelope in the Central Hobart planning rules. When a project goes beyond that envelope, the developer has to offer a public benefit in return.

Fragrance did not offer a public plaza or public toilets. Instead it proposed a large mural across much of the Macquarie Street facade, with local artists invited to compete for the commission. Public art now forms part of the approved works.

It is a sensible fit for a building that is mostly car park on its lower levels. A long blank podium wall on one of Hobart's main streets would have been a hard sell. A commissioned artwork turns that wall into something people notice and talk about.

The planning consultant on the project, Ireneinc, framed the 36 apartments as extra short-stay capacity for the city. Its argument was that more purpose-built visitor accommodation in the CBD would take some pressure off houses and units being converted into Airbnb-style listings in residential streets.

Planning documents also noted that average stays were unlikely to run beyond two to three weeks. That positions the apartments for a mix of tourists, longer corporate stays, contractors on projects and visitors who want a kitchen and more space than a standard hotel room offers.

That debate matters in Hobart. Short-stay letting has been a political issue in Tasmania for years because of its effect on rental supply. A developer who can show its project adds visitor beds without taking homes out of the long-term rental pool has a stronger story to tell a planning committee.

Fragrance is one of the more active foreign developers in Tasmania. Alongside the Ibis Styles, its Australian portfolio lists a site at 28-30 Davey Street near the waterfront, where it says plans are being drawn up for an upmarket hotel. It also lists 5-7 Sandy Bay Road, the former Conservatorium of Music campus, which was approved in 2020 for apartments.

Outside Tasmania the group is best known for large hotel and apartment towers. Those include Premier Tower and the Spencer Street Hotel in Melbourne, plus NV Apartments, the Murray Street Hotel and Milligan Street in Perth.

Against that background, 171 Macquarie Street is a modest project. But it is also a low-risk one. The hotel is already trading, the operating platform already exists and the new building mostly adds income from rooms, parking and food and beverage without the need for a new reception, pool or back of house.

The approval lands in a busy week for Hobart hotels. The day before, the Tasmanian Planning Commission approved Chambroad's $65 million, 155-room hotel at Kangaroo Bay in Bellerive, although that site remains tied up in a Supreme Court buyback dispute with the local council.

The pub and hotel market has also been active. The Globe Hotel at 178 Davey Street in South Hobart has been offered through Elders Commercial with expressions of interest closing on 22 October, while the Midway Point Tavern changed hands as an investment for about $5.13 million earlier in the spring.

The common thread is that capital still sees value in Hobart hospitality, but the projects that move fastest tend to be the ones with a clear operating plan. Extending a proven hotel is a far easier proposition to fund and build than a stand-alone tower on an untested site.

• Look next door first. If you already own a trading asset, adjoining land can unlock more value than a new site across town because you share reception, amenities and management.
• Solve an existing problem. Fragrance pitched its extra parking as a fix for a known shortfall. Planning committees respond better to a project that answers a problem than to one that creates new ones.
• Pick a public benefit that suits the building. A mural on a car park podium is visible, low-cost and easy for the community to support.
• Tell the story visually. A tower that links to an existing hotel floor by floor is hard to picture from plans alone. Clear renders and simple diagrams help councils, financiers, operators and future guests understand how it all works.
• Frame it around the local debate. Positioning serviced apartments as an answer to short-stay pressure on housing gave this project a narrative that matched what decision makers care about.

The next steps are the usual ones after a Hobart approval. Watch for any appeal to the Tasmanian Civil and Administrative Tribunal within the appeal period, then for building approvals, demolition of the existing office building and the selection of the artist for the Macquarie Street mural.

Also watch the Davey Street site. If Fragrance gets 171 Macquarie Street moving quickly, it will be a good sign that its other Hobart hotel plans could follow.

For now, 171 Macquarie Street shows a practical way to grow hotel capacity in a tight CBD. Build onto what already works, fix the parking, add a restaurant and give the street something worth looking at.