Colliers International insolvency specialist Simon Kersten has begun the groundwork for the mortgagee sale of Jamberoo Valley Motel in March.
Formerly known as the Jamberoo Valley Lodge, it was badly run down when the Illawarra Credit Union took possession before Christmas.
"There have been previous attempts to sell by the owners in the past but the price was always unrealistic," says Mr Kersten.
The property sits on 2.81 hectares, has 45 rooms, seven conference rooms, a large restaurant and bar, a full-sized tennis court and a 25-metre pool, the largest hotel pool in the region.
"The bank has spent money tidying it up and getting it back into trading shape to preserve its goodwill, one of its strong points," Mr Kersten says.
"We have put in professional hotel management company, 2T, who after only three weeks has got it operating at 70 per cent occupancy with solid forward bookings."
He is expecting the sale will fetch more than $2 million.
Matt Davidson, from 2T, says his company's job is to highlight the property's business potential.
"Capital works are needed to bring it up to a four-star hotel but the bones are there and it just needs updating, which is a lot cheaper than re-building," Mr Davidson says.